We’ll Gain More Through Shared Interests Than Turning on Each Other

I spend a lot of time reading, both because I like to do it  – not surprising from someone who had a dream as a young boy to write a book – and because I need to do it in order to give my consulting clients and what I write and talk about to be current.

In growing up, we learned to respect and care for our elders. In contrast, I experience anger from  many younger people, sometimes directed against the boomer generation. You see this in comment sections of blogs and articles as well as sometimes experiencing verbally. Other times younger people, facing difficult life situations themselves, express their anger, living off their parents. This anger is not an accident. First, we’re experiencing a change of generations as boomers retire and Millenials are coming of age. Both groups are Generation Gapexperiencing significant problems.

This change of generations has historically produced tensions. Think of how the boomer generations dissented from the prevailing cultural norms of their parents – hippies, the demonstrations at the 1968 Demonstration Convention in Chicago.  Generations have different personalities – some generations are more activist like boomers and today’s Millenials. But both have common interests, though it’s sometimes hard to think of this when this generational change is complicated by additional forces, such as:

  •  The rapid change in technology and trade that is affecting every sector of the economy and life: interconnectedness from smart phones to all kinds of devices, changes in health care, robots replacing workers, food supply and energy. Changes in retailing are apt to result in the closing of stores that have been household names for generations.
  • Big-money backed foundations have been stoking anger at social security for years, setting for the idea that it won’t be around for the Millenials.  Millenials blame the boomers for too many wars, overusing the nation’s resources and having a Congress that 9 in 10 people do not respect. A dangerous situation for a nation based on consent of the governed.
  • Expressions of anger can be felt and seen in flash mobs, the Occupy Wall Street and Tea Party movements. the actions of individuals like Edward Snowden,

Generational anger has happened before. The noted authors of Generations and other titles, William Strauss andNeil Howe, after analyzing 500 years of American history and the histories of a number of other nations, find patterns repeating themselves. This is expressed in ideas, attitudes, dress, music, wars, and in every facet of our lives.

The fact of the matter is that the deep interests of Millenials and Boomers are not different – if we eliminate the blaming game. It’s not in anyone’s interest to allow the problems we face together are simply a matter of the young versus the old. After all the overwhelming majority boomers have had no or little role in the problems this nation now faces. While Millenials are burdened by student debt, older people are being pushed out of jobs and careers as businesses change the technology of work. According to the National Academy of Social Insurance , only  one in five seniors have incomes more than $58,000 a year.  The other 80% rely on Social Security as their primary income source.

The upshot is we’re all in this together. As Richard Eskow wrote in a recent article, “The generational war is a hoax.” Bridges need building that will foster cooperation, not competition among generations.  People of all ages have common cause in finding solutions that will enable a new era in this nation’s journey.

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Earning a living is essential for “life, liberty and pursuit of happiness.” A proposition for the 2014

For us, the holidays are a break. Our son comes from Bay Area where he designs interfaces. It’s also a time to catch up on things we want to do and some we need to do. For too many people, particularly those past 40, like us, this holiday is a time of despair. Sometimes they blame themselves, but the basic principle at stake here is that the ability to earn a living is at the heart of “life, liberty and pursuit of happiness.”  Even during this Christmas holiday, thousands of workers got pink slips from corporations such as Citibank and Walgreen.

Those being laid off are middle class people who, usually through no fault of their own, are without a job or a business whose clientele are gone or no longer have the funds to use or buy what the business offers.

 laid off employee

If you or a family member is not feeling it personally, you know from the news that federal unemployment insurance benefits are ending for 1.3 million Americans. These were not among those we think of as being poor.

Approximately 40 percent of Americans who have received long-term unemployment benefits since 2008 had previously earned between $30,000 and $75,000 and tw

o-thirds had incomes at least twice the poverty level. These include the young and the old, attorneys, financial executives, information technology experts, web designers, and hospital administrators – people from multiple occupations.  They were working for a company that was acquired, decided to downsize, replacing workers with automation or outsourced – a bad break that can happen to someone holding a job or owning a business dependent on the local or some segment of the economy, which for some reason undergoes change or becoming obsolete.

Most importantly, these people want to work, but often find they are told they are overqualified. For the most part, these are people who made earned their livelihoods through brains and personality. Some think of doing blue collar work, but find they don’t have the skills to become a mechanic or technician.

Health and emotional problems, particularly depress follows the loss of a job. America cannot afford these casualties of the economy. Talent is lost and when people become dependent, they become a burden on family and government institutions. Even when people take lower paying jobs, the economy loses because these people are not able to spend money that stimulate the economy and when they don’t have the money to spend, you can think of this lack of spending as draining the economy.

This problem is not expected to go away. In fact, it’s projected that a total of 5 million unemployed Americans will lose their benefits by the end of 2014.

If the Congress does nothing more in the next year than to make it possible for the millions of Americans who want to work to get the support and retraining needed, then Congress will begin to regain some of the trust needed to keep our way of life.

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Corporations Getting Tax Shelter Abroad Means Make Local Businesses The Hope of The Future

Mar Preston and Sarah EdwardsMore and more corporations are giving up their identity as American companies to avoid taxation by reincorporating in tax havens like Bermuda, the Cayman Islands, or in Ireland. as pointed out in a recent New York Times story.

Among these corporations are Fruit of the Loom, Ingersoll-Rand, Eaton Corp., and Ensco International Inc . As these companies pay less taxes in the U.S. while doing business around the world, local businesses become more important. Why?

Their importance comes about because first, they provide jobs, generally hiring people from their community, and second, they pay taxes – federal, state, and local taxes, including income and worker compensation.

When you shop or do businesses with a local businesses, it spends 45 cents of each dollar it takes in locally. This compares to only 15 cents spent locally by a corporate chain. If you have a job with a local employer, know that spending your money locally helps sustain the economy for everyone.

If you own a local business or provide a local service, you understand quite well what it means to you when someone says, “I wish I could use your service or buy your product, but right now our budget is stretched.”  So when you are doing your own shopping, think about what this means to everyone in the community, you, included.

It’s the goal of Let’s Live Local,  the non-profit we established to live by our motto, “live, work and shop locally.”

Corporate Tax Shelter  Abroad Means Local Businesses The Hope Of The Future.


More and more corporations are giving up their identity as American companies to avoid taxation by reincorporating in tax havens like Bermuda, the Cayman Islands, or in Ireland. as pointed out in a recent New York Times story.

 Comments and questions on the substance of this blogs are welcome. If you have other questions about this website, please contact me directly for a consulting appointment.

If you think we can help you, we offer webinars and consulting.

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Is it Time Take More Control of Your Time and Life by Moving Your Business or Home?

Are rising costs and an uncertain economy causing your to think this is a time in your life to free yourself of some of the hassles of maintaining a business or store front business? Perhaps you want to save time and with the increasing use of smart phones and tablets, is it important where you base your business? So why not cut your costs by moving your office into your home? While of course not all businesses have this choice, many do and the financial benefits for increasing profit on decreased revenue are great.

Businessman working outdoors

You can reduce or eliminate the cost of:

  • Office or store rental: Instead of paying rent, you can get a tax deduction for your office space.
  • Commuting: Auto expenses drop dramatically when you can walk to your office in seconds.
  • Business-related travel to and from your home becomes deductible too.
  • Food: coffee breaks and lunches are far less expensive at home.
  • Insurance: Riders or endorsements to your homeowner insurance policies cost less.
  • Child care: While you may still need some, it will certainly be less when working from home
  • Personnel: You should have no difficulty becoming a virtual company with your personnel gladly working from their homes.  A newly published study by Stanford University found 51% of employees wanting to work from home and a 2009 JobNet survey found that over 70% of employees report willing or wanting to work from home.
  • Taxes: Additional possible deductions include a portion of homeowners dues and fees and real estate taxes (which can lower your “below-the-line” taxable income), furniture converted to business use, and a portion of the cost of entertaining business associates at home.

By keeping such costs down you can increase profits without raising prices. In fact, many companies shifting to a home-base find they can even lower prices while maintaining or even increasing profits. People who have moved their home office to an office outside the home tell us it takes 2.5 to 3 times the gross income to produce the same net income they were making when working from home. 

Fortunately there is no longer a stigma attached to working from home. In fact it’s considered chic these days, especially considering it’s so very eco-friendly, a definite plus in the mind of many clients and customers.

And there’s a bonus above and beyond the bottom line:  increased personal satisfaction.  Repeated surveys over the years show that better than nine of ten of those who are home-based report they are happier working from home and would recommend it to others. Their reasons are many: more control over their time, more time with family, greater flexibility to balance home and work, a more relaxed environment, and more time to be involved with their local community or personal interests outside of work.

Comments and questions on the substance of this blogs are welcome. If you have other questions about this website, please contact me directly for a consulting appointment.

If you think we can help you, we offer webinars and consulting.

Adapted from our Costco Connection column from July, 2009

Where You Live Makes Localization All the More Important

A recent article in Forbes entitled The New Geography Of Jobs: Where You Live Matters More Than Ever – Forbes provides startling comparisons, which can mean the difference in finding a sustainable livelihood. Forbes cites a new book by Berkeley Economics Professor  Enrico Moretti, entitled The New Geography of  Jobs.

Within the same state, local economies vary significantly, determining this discretionary income and spending. This is evident from the differences in the share of workers who have college degrees and their average salaries. For example, in Stamford, Connecticut only 15% of the workforce are college graduates with average salaries of $54,651 while in Stamford, 56% of workers have college degrees with average salaries of $133,479. In Modesto, California, 16% of workers graduated college and earn an average of $60,563 and in San Jose, it is 47% and $87,033. Similar contrasts can be found in many states.

The higher salaries results in the demand for more service and support jobs and how much those with service and support jobs earn. The kind of jobs and businesses range from business services to dog walking, fitness coaches and financial planners. Another consequence of lower incomes is mobility – the ability to move to another job.

We believe the net consequence of this is to make localization imperative because it enables the creation of local businesses and institutions through which people can buy cooperatively, barter, share or engage in exchanges of such resources as tools and clothing, and barter for things they need.

Communities have a choice when faced with unfavorable economic statistics – either let their areas deteriorate or work together to find local solutions. For more reasons for why localization is vital, see our earlier blog.

you think we can help, we offer counseling.

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Does Being Middle Class Require a New Definition of Success?

“Who is the middle-class?” This is the most common question we have been asked while doing dozens of interviews.  When economists  are asked about who is middle class, they answer the question by citing specific income ranges. But the ranges vary widely, anywhere from $25,000 to $250,000. So income doesn’t seem to be the key to why 60% of Americans define themselves as middle class.

Middle class is more of a state of mind than a bank balance. We define ourselves as middle class as long as we feel we’re on track to success and thereby to a happy, secure life. But just what is success?

That is the question John Izzo, Ph.D., asked 250 people from all walks of life in writing is book Five Secrets You Must Discover before You Die. You might be surprised at the answers he got.

First, he found that 84% of people he interviewed reported thShopping is a mainstain of a consumer cultureat “having money beyond a basic level of comfort did not increase their personal happiness.”  Second, he found that 81% said the most important factor in career happiness was “being true to yourself.”

Psychologist and associate professor at Knox College, Tim Kasser goes a step further in disconnecting happiness from material success. In his books, The High Price of Materialism and Psychology and Consumer Culture: The Struggle for a Good Life in a Materialistic World, Kasser summarizes extensive research to show that after reaching a basic level of comfort, continually striving for more money and more things actually works against our sense of happiness.

In writing Middle-Class Lifeboat, we found that in choosing to pursue new lifestyles and sometimes new careers, the people we interviewed had re-defined success . It no longer meant making more money or owning more things. They were stepping out of our materialistic consumer culture and found they were HAPPIER!!

So instead of aspiring to some externally-measured, material definition of success, perhaps it’s time for us to re-evaluate what makes us happy and define that as success. What would that be for you? How would it be different from what society’s definition of “success?”

If you think we can help, we offer counseling.

Comments and questions on the substance of this blogs are welcome. If you have other questions about this website, please contact me directly for a consulting appointment

Health Care for All

Do you remember the Harry and Louise ads used by the health insurance industry to help defeat the Clinton health care initiative in the 1990’s? Chances are today a couple like Harry and Louise, who were so happy with their employer-provided health insurance plan then,  are worrying now  about whether they can afford the premiums, co-pays, and deductibles, or they may not have any health insurance at all. In the past few years, the number of employers offering any health coverage has slipped from 7 in 10 to 6 in 10.

In fact, when medical bills now prompt more than 60 percent of U.S. bankruptcies. This is a dramatic shift from when in the late 1960’s I did a study for the Bankruptcy Court of Western Missouri to determine why people were taking bankruptcy.  Only one in fifty – just 2% – cited medical bills as the reason.

Who doesn’t know someone who has delayed or gone without treatment because they can’t afford it and don’t have health insurance to cover what they need? How ironic considering Americans spend more per capita on health care than any other advanced country.

While there is no single reason for our health care predicament, one factor that contributes mightily to what prompts  so many personal health calamities are are big insurance companies motivated primarily by profit, are systems for denying care at any chance. Consider how they routinely deny coverage to people who consider themselves to be in good or excellent health. Here, for example, are some of the grounds insurance companies are using to prevent people from qualifying for health insurance:

allergies, breast implants, ear infections, herpes, high blood pressure, impotence, infertility, mild depression, migraines,miscarriage, pregnancy “expectant fatherhood”, planned adoption, psoriasis, recurrent tonsillitis, ringworm, swelling from a spider bite, three months of psychological counseling after a marriage breakup, and varicose veins.

The shame is that every American could have health insurance for about what is being spent on health care today if we did just one thing – wring out the administrative cost and profit out of health insurance that accounts for one dollar in four of what we pay for health insurance. Before 1990, insurance companies like Blue Cross charged only about 5% for their services.  Even today non-profit systems like Kaiser Permanente and Medicare can offer care for less than 5% for such costs, not 25%; Canadian Health Insurance runs below 3.2%.

In other words, we know about one dollar in every five  could be saved from what’s now going into processing paper, corporate marketing, executive bonuses, and shareholder profits.

How could this happen? Many people advocate Medicare for All. How might this be funded? Congressman Dennis Kucinich calculates a 7.7% payroll tax will enable universal coverage. The State of California calculates that a 4% payroll and a 2% income tax would provide health coverage for all Californians.

But there are other alternatives, too, such as:

Returning to an all cash system and allowing new community-based health insurance plans and pricing to emerge.  Right now the cash price for health care in the U.S. is a fraction of those billed insurance companies, exceeding the co-pays. They could enable U.S. health care costs more in line with those in countries that are now attracting medical tourism when people who needing hip replacements, for example, spend $10,000 on  travel in order to get a new hip for $5,400 instead of the $45,000 it would cost in the U.S.

One example of the kind of insurance companies that could emerge is the Freelancers Insurance Company in New York State. The for-profit company is wholly owned by the nonprofit Freelancers Union. It insures 25,000 independent workers and family members charging premiums more than a third below what they would otherwise pay for health insurance. Another example is Grand Junction, Colorado. Such a plan would be possible in an Elm Street Economy.

Regardless of the alternative we settle upon, no one should profit from insuring the illness of others. We need to wring the administrative costs out of the system, provide professionals with a decent income, and quality health care for all without raising the overall cost of health spending.

Let’s use our voices and voting power to make this happen. It can start by creating  local Elm Street Economies.

Comments on the substance of the blogs are welcome. If you have other questions, please contact me directly for a consulting appointment.


RX for the 99%

As the Occupy Wall Street movement is spreading across the globe while gathering
public support, a persistent question is “What are you asking for?”

Given that underlying this movement is a sense of fairness that what people value
most should be better distributed, I modestly offer this simple idea:

Education for All, including Tutors for All
Health Care for All
Housing for All
Jobs for All

In future blogs, I will offer ideas about how to provide Health Care for All, Housing for All, and Jobs for All.

Speaking of 9’s – instead of Herman Cain’s 9 Zero 9, I suggest adding another zero to his first “9”
to  make it 90% for earnings above five million dollars. This would not be an all-time high as it
was 94 % on taxable income over $200,000 ($2.5 million in today’s dollars during
World War II), which was  another time of crisis. This would help pay for Health Care
for All, Housing for All, and Jobs for All.

For more information about the need for a progressive tax, take a look at Robert Reich’s
recent  blog entitled The Flat-Tax Fraud, and the Necessity of a Truly Progressive Tax.

Comments on the substance of the blogs are welcome. If you have other questions, please contact me directly for a consulting appointment.

Tutors for All

Only one in five adult Americans have the work skills or education to be competitive in the global economy, says MIT  economist Lester Thurow. To be equipped for the global economy today’s children  today need to learn more than ever before sooner than ever before. Vic Lee illustrated how true this is in his comic strip Pardon My Planet when he pictured a young boy saying to his father,  “Dad, you really should help me with my homework while you still can. Next year I enter the 4th grade.”

But American children are falling behind. They are leaving school unprepared to meet the demands of fast-changing industries, while children in other countries are springing ahead.  More than one in every four college freshmen is taking a remedial math or English course. National Science Foundation data  over the past seven years shows a 14% decline of enrollment in science and  engineering graduate programs with current numbers showing further declines. As  a result, not only are many skilled jobs being off-shored to other countries, but skilled workers from other countries are being recruited to fill many of our top jobs here.

An  Obama-Biden campaign  policy paper stated “Too many Americans are not prepared to participate in a 21st century economy: A recent international study found
that U.S. students perform lower on scientific assessments than students in 16 other economically developed nations, and lower than 20 economically developed
nations in math performance. Only one-third of middle class physical science teachers are qualified to teach in that subject, and only one-half of middle
school math sciences have educational background in that subject area.”

To bridge this educational gap, I propose a Tutors for All program. Every child can benefit from the individual attention and guidance of a tutor, or even a team of tutors, to
help master the requirements for today’s highly skilled positions. Research shows that tutoring works! It produces better results among all groups than virtually any federal aid to education program, too many of which cost school districts $1500 to administer and comply with for every $1000 in aid. We need to invest our resources in people, not paperwork. We need to enable children to compete – not feel compelled to cheat.

Unfortunately, the Obama Administration is proposing to spend money on school buildings as an improvement to the nation’s infrastructure whereas a Tutors for All program would employ tens of thousands of people who are now out of work,  including teachers who have been laid off by so many school districts. Another problem with the existing school structure is they operate a on a  top-down,  hierarchical model that prescribes a one-size-fits-all education where students all learn the same thing in the same way on a schedule that many find out of pace with their individual biology. A combination of computer-based learning and tutoring will enable students who learn differently to do so and at their own pace. Berlitz, Vocabu, and Popling are producing computer-based innovative modular instruction.

New approaches can save money, too. A Jefferson County, MO, school district that was spending spends about $330 a year per student on textbooks is buying tablet computers, leaving it over half this amount to buy or rent digital textbooks.

Tutors for All can serve as a benefit not unlike the GI Bill that enabled millions of vets to go to college after WWII.  A publicly funded voucher system would allow parents to choose from among pools of capable local tutors.  Such a direct investment in the future will also provide meaningful work for millions, particularly older skilled Americans who would like to continue
working and earning even after retiring.

Higher education must become more affordable if the U.S. is going to produce the  knowledge workers necessary to our economic future.. The National Center for Public Policy and Higher Education gives 43 states an F’s for affordability. Tuition for students attending four-year public colleges and universities in-state averaged $16,140 a year in 2010-2011, almost triple the 2006-07$5,836 cost. The cost of a college education higher than it cost to own a home only 40 years ago.

Textbook costs are skyrocketing too, averaging $1137 for that same period. These costs have become  economically crippling, often leaving college graduates with a heavy debt from student loans even before they enter the workforce.

To bridge this affordability gap, we advocate a strong program of online education. George Washington University Online High School (GWUOHS), is offering such a program for  $9,995 per student, or $4,995 per semester and similar programs are available from leading universities such as Stanford, Northwestern, and Johns Hopkins.

Despite the criticism of skeptics who claim there is no valid evidence that online
education provides a good education, the Virginia Department of Education is

  • Interactive e-books increased student engagement.
  • Studentsappreciated being able to work at their own paces, whether in small groups or
  • The vast majority of students reported being enthusiastic about reading and using e-books.
  • Many teachers noted a dramatic increase in the students’ independence and willingness to be
    responsible for learning on their own
  • Teachers noted that the e-books encourage more engagement to learn the material.

What I offer here is an idea that needs and deserves research and testing.

Comments on the substance of the blogs are welcome. If you have other questions, please contact me directly for a consulting appointment.


Reduce Mortgages to Save the Economy

Consider what would happen if all of a sudden two trillion dollars of consumer spending were released into the economy. If you’re like most people, you have a “Wish list” of things you’d like to do or buy – going to the doctor or dentist, fixing your car or buying one, a household repair or improvement, a vacation, a smart phone, or moving to a new home.

Left out of President Obama’s job plan is housing – the segment of the economy that we’re told has lifted us out of prior downturns. Mortgage debt constitutes over eight and half trillion dollars and if that were slashed by a quarter, the payments servicing that would flood into the economy.

How unreasonable is this? Consider it took two trillion dollars to bail out the banks in 2008 and 2009, who in large part caused our current mess and have done little to turn around the economy.

While it would take political heroism and risk to accomplish this, it is doable. Consider that recent audit of the U.S. Federal Reserve shows 16 trillion dollars in bank bailouts over time. Citigroup alone has received over two trillion dollars in loans so far.

All we need to do is reset mortgage payments across the board to one-third existing income, what they arguably should have been in the first place, and overnight folks would begin spending their monthly savings on their wish list, supercharging the economy.

Comments on the substance of the blogs are welcome. If you have other questions, please contact me directly for a consulting appointment.