Thursday, September 24, 2009

Now There’s a Thought!

The Canadian Broadcasting Corporation carried a story this morning about a groundswell idea. While I can’t recall the name of the group advancing this latest bit of popular legislation (I think it has something with the word "patriotic" in it), and in spite of its nationalist overtones (which I have always found about as inviting as the Fascists - though in this case its personal yet superficial appeal gives it more the flavour of something comfy like the Green Party), the idea struck me as not only novel, but more to the point, illuminating. The proposal is to give everybody in Canada who is over the age of 50 years the sum of one million dollars, on the condition that the recipient retires, buys a new car, pays off his debts and sends his kids to university. One hardly need dilate further upon the subject to disgorge the theory behind the plan, namely to create employment, revitalize the retail sector (after all everything is somehow connected to the automobile industry), put a stop to the preposterous debt/equity problem, and do what every developing nation knows - educate our youth.

You might imagine that my interest in the proposition concerns an analysis of its terms, as unlikely as they might at first appear. In fact, what piqued my interest was not so much the proposal as the alternative to it - namely, ignoring it altogether and continuing as we are already doing. Now, to clarify, I don’t suggest that we should just keep galloping along on the same horse and in the same direction as before (for surely every catastrophe such as we’ve recently experienced in the global economy will precipitate some alteration of course); but I am not sure I am quite ready to embrace the conditional offer, even assuming enough people agree to accept it.

What interested me about this morning’s news story was that it heightened - by contrast - my appreciation of the significance of remaining in the work force, being satisfied with my car, continuing to chip away at my debt, and not having any children to consider. The gutsy demotic plan all smacks of little more than down-sizing (TS Eliot may have been right). Dropping out of business will always entail not only a more retiring life-style, but significantly a more modest life-style. Without the income stream (and assuming you can’t find a bank to pay you more than 2% on your money, or what’s left of it), you’re going to have to learn to do with less. Buying a new car is going to happen sooner than later, especially as the North American manufacturers accept the edge they already have by being here, without becoming greedy about it. The business about reducing debt is nothing more than a metaphor for selling the stuff which you leveraged your house to purchase - you know, those toys like sail boats, Harley Davidsons, platinum jewellery, fine art, the Steinway you never play, that sort of thing. If you liquidate those diversionary chattels you might find the reality of living is more than you bargained for (and there’s no turning back once the stuff is gone and the debt eliminated - at least without getting back on the tread mill). Giving all this up for one’s children is just a return to the 50's when post-war parents felt obliged to sacrifice all they had so that their darling children would never suffer as those who had lived through the Great Depression.

Count me out of that plan! As miserable as I may be at times, given the choice, I’m convinced I’ll continue to haul myself out of bed every morning and head for the office. If nothing else, it seems reasonably likely that the latter years of one’s career (like any other amortized account) carry the promise of increased capitalization. Why quit now! Now is the time to make small but surgical amendments to one’s life and career, not to throw the entire thing to the wind for the sake of one million dollars and no debt. Anyway, everyone keeps telling us that the baby-boomers are retiring at an alarming rate, so that should cure the employment problem; and as people sell their large homes for smaller ones, the associated debt will be reduced if not eliminated. The car thing is a red herring, though it may encourage people to spend more on local products than foreign ones. And the children will get educated one way or the other, if they’re motivated to do so. There might just be a resurgence of interest in the trades, an honourable but much neglected undertaking in the past twenty-five years. Have you tried getting a good stone mason lately!

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