Saturday, October 13, 2018

How Not to Crash and Burn (28)

One of the richer veins of wisdom that may be mined throughout Proverbs has to do with wealth: specifically, how to get it, how to keep it, and the dangers of being seen to have too much of it for other people’s tastes.

As Solomon puts it in Ecclesiastes, “Bread is made for laughter, and wine gladdens life, and money answers everything.” Wealth is not the ONLY answer to life’s difficulties, and it’s certainly not the BEST answer, but in nearly every situation (even serious illness), money offers AN answer that those without it cannot allow themselves to even consider.

Without further ado, a sampling from this week’s chapter.

Assorted Proverbs (Proverbs 13:1-25)

The Soul of the Sluggard
“The soul of the sluggard craves and gets nothing,
while the soul of the diligent is richly supplied.”
Here I think it is important to mark the use of the word “soul”. It is perfectly true that “The sluggard craves and gets nothing, while the diligent are richly supplied,” but I don’t think that’s exactly what Solomon is pointing out. He’s not talking about the relatively greater bank balance that accrues from regular hard work, but about how the diligent man and the sluggard feel at the end of the day.

There is genuine satisfaction in being productive that has become tremendously undervalued in our society. As a writer to the New York Times put it back in 1995:
“Whenever government handouts have proliferated, misery follows. This has been most conspicuously true on Indian reservations and in places like American Samoa, where generous welfare benefits have led to despondency, substance abuse and poverty, even among people who technically have enough resources not to be poor.”
Some people think they’d rather have a free ride, but even regular handouts do not fill the hole in the soul that comes from failing to contribute in some way. To put it another way, it is actually being diligent that produces satisfaction, not just the financial reward that comes with diligence.

Now, of course it is possible to be diligent purely out of selfish motives; that sort of mechanistic routine can also leave you empty. But the man or woman whose labor is directed toward a genuinely positive end comes away from even difficult tasks without the sense of futility that often accompanies a day with no shape, structure or purpose.

A similar theme is explored in Ecclesiastes: “For to the one who pleases him God has given wisdom and knowledge and joy, but to the sinner he has given the business of gathering and collecting, only to give to one who pleases God.”

It is by the sweat of man’s brow that he eats bread. That’s just how it is. Attempts to circumvent the ordinance of God continue to show poor track records.

From Cravings to Crickets
“The ransom of a man’s life is his wealth,
but a poor man hears no threat.”
My car turned ten recently. I love it because it works just fine while being entirely unobtrusive: every vehicle around it on my street is eminently more stealable than mine. In a neighborhood where cars go missing or get damaged with regularity, that’s no small thing.

Wealth is a problem if you’re inclined to hoard it. A Ferrari is a beautiful thing, but you’d never dare park it anywhere that isn’t locked and monitored 24-7. That’s not cheap. Getting rich is a challenge; staying rich even more so. It has always been that way.

In Solomon’s day, kings lived very well indeed compared to the subjects of their kingdoms, but they spent their lives looking over their shoulders in fear of the competition. The number of rebellions and attempted coups listed in the books of Samuel and Kings is quite astonishing: Absalom, Adonijah, Jeroboam, Zimri, Omri, Jehu, Pekah, Athaliah … on it goes. If you had wealth, power and influence, somebody wanted not just a piece of it but the whole nine yards. Sometimes (as in the case of Omri), it turned out to be the commander of your own army.

Being poor is not the greatest situation in the world, but it carries with it none of the insecurities and hazards of great wealth.

The Value of Incrementalism
“Wealth gained hastily will dwindle,
but whoever gathers little by little will increase it.”
As a life strategy, incrementalism has much to recommend it. Even when Jordan Peterson tells you to do something as trivial as cleaning your room, he recognizes that some people won’t be up to such a daunting task on the first attempt. (If you think this unlikely, ask my mother about my brother’s room when he was a teen.) So Peterson suggests starting small: a little cleaning today, more cleaning tomorrow, an item here and an item there, and before you know it, voila! A transformed life.

The acquisition of wealth may be approached the same way, and if incrementalism is not the most appealing strategy to those with low time preferences, it is certainly the approach most likely to succeed. The average man cannot reasonably anticipate a sudden shower of inheritance money, an oil strike in the backyard or a huge payoff from day trading.

The value of putting a little away regularly is this: it teaches you how difficult it is to accumulate large sums, and therefore the importance of not spending money wastefully. My son spent two years sweating in a local factory at near-minimum wage. He came home daily looking like he’d been ridden hard and put away wet. But in those two years, he socked away more than $20,000. Why? Because he couldn’t bear to thoughtlessly fritter away something he paid a physical price to acquire.

On the other hand, there is nothing easier than spending someone else’s money, which is why I recommend making your children work for at least a year before sending them off to university or college. Kids with no skin in the game tend to spend extravagantly and appreciate nothing, whereas many of those with work experience quickly grasp the necessity of managing their assets shrewdly.

The credit card companies operate on the same principle: they hand young people huge credit limits they haven’t earned and can’t manage. Few kids a year out of high school grasp how quickly compound interest on accumulated debt can bury them and their future, but the scam depends on the carefully fostered illusion that the mounting bill is really someone else’s problem and that any looming crisis can be addressed by just borrowing a little bit more.

In some ways, little has changed since Solomon’s day.

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