Here is a question:

If the government can simply print money…….why do they need to tax us?

They don’t need our money at all.  They have the blank check of the printing press at all times.  They could simply spend new money into existence, and leave it at that.

As long as they didn’t print so much that it devalued the currency, it would work fine.  That’s the same basic issue they have now (even with taxes), so that isn’t much of a shift.

Honestly, I can’t think of an economic reason (can anyone else?).

The cynic in me says there are two good psychological reasons to tax:

1. Incentives:  If the government taxes one thing (or gives a tax credit on another) it can influence our behavior.  That’s what the government does…..governs/influences/controls.
2. Government spending and the value of money would be more obvious:  People would realize printing more money devalues the money they already have; it is like theft.  They would equate inflation with theft, knowing the government printed too much (perhaps for war) and that took part of the value of the money that they’d already saved.  On another note, tax evasion would be impossible, since there wouldn’t be any taxes.

Another good question is why we allow governments to run deficits.  The flip side of the original question is:

Why do we allow the government to run the printing press?  Why not force them to spend ONLY tax revenue?

This would produce an even more dramatic outcome than ceasing the printing press:  NO MORE FOREIGN WARS.  If we had to pay each year the full cost of our military and were forced to choose between wars and education or health care (or being taxed at 100% of our income so that we’d starve)….we would always choose domestic issues.  This would also naturally limit the size of the government (since they’d no longer have a blank check).  Government spending could only grow as the economy grew (or shrunk).

Economists argue against this as they cite that governments need to issue debt to undertake large scale activities (wars, stimulus, etc.) that would be impossible if they had to pay for it each year.  I understand this argument and agree to a certain extent….and will only point out that Economists are full of shit and can’t predict as a group whether the sun will come up tomorrow.  As the new day rose and even into the sunset they would still be arguing about whether the sun was actually there at all.

I say the government and its band of inbred, self-serving economists whose theories have no relation whatsoever to reality (and cause us to have to bail them out) should be limited in a natural way.  Perhaps tax-revenue-only spending would be the answer.

I actually know why governments don’t choose this option: it causes them to get overthrown.

In the old days of gold currencies, the governments could only spend the amount of gold they had.  They had to go find new gold to fight wars and they taxed until it impoverished their people.  The people then overthrew the government.

Then one day a nifty, smart group of revolutionaries figured out that with fiat currency they could get around the spending limit problem and just borrow continuously from people who weren’t born yet.  The first groups failed because they got greedy with the printing press, which also impoverished their people…..who then overthrew the government again (notice the theme?).

Then the governments figured out they needed a Goldilocks printing press….print enough, but not too much to impoverish their people.  It doesn’t matter though that they know; it is always easier to mortgage the future than it is to pay in the present….and so all governments will succumb to the temptation of the printing press…and get overthrown as they impoverish their people.

I guess the final question, if I were a government, would be:

Why not both tax us and print money?

Why not have the best of both worlds?  No need to limit yourself to just one of those two options.   Indeed, why not?  I guess, unfortunately, that is the answer.

There.  I said it.

And I mean it.  Not that certain stocks are a ponzi scheme….the entire concept of the stock market is a ponzi scheme.

Think of all the people that work in industries related to the stock market……are you thinking?  There are newspapers, magazines, and entire TV channels that employee only people talking about the stock market all day.

And they all have no fucking idea what they are talking about.  They are so spectacularly wrong, even weathermen are more accurate than these people….and if weathermen are wrong you simply get wet.  When all these clowns are wrong the global economy is wrecked.

Let’s examine some fundamental truths about the stock market:

Stock shares are fiat money (ie. THEY ARE WORTHLESS): A company issues stock, but what is a stock?  It is simply debt, and they raise public debt (issue stock), because it is cheaper than bank debt.  If they could raise money cheaper simply by borrowing from a bank….they would.  They issue stock debt to YOU because it is cheaper than asking a bank.

Why is stock so “cheap”?  Well….because it is FREE.  Bank debt is harder to get out of.  If the company fails, the liquidated assets of the company will go first to the banks (before the stockholders).  Since debt is concentrated with the bank, they can ask the company to do things (stock ownership is dispersed, so stockholders (unless you’re a really large one) aren’t well organized and have no power).

Do you understand? Companies give you a piece of paper (you can call it stock or you can call it currency), that gives you no charge on the company (you can’t trade it in for any product), puts you last in line for liquidated assets if the company goes bankrupt, and is worth something only because other yahoos agree to pay you for it (but it has no utility).

Stock is simply currency that a company has issued (like the government issues US Dollars)……except you can’t buy anything with it.  You simply own it, like art or baseball cards, until someone else agrees to buy it from you.

The exception to this is companies that issue a dividend (you do actually get something in this case); however, the companies that don’t issue a dividend are still bought and sold very regularly (Microsoft didn’t for years and Google still doesn’t).

Stock price changes do not make (or lose) any money for the company:

Companies issue the public debt of stocks once, at the IPO (Initial Public Offering).  At the IPO they sell a bunch of shares to us and we give them money.  They then spend that money.  They gave us “shares” (which are worthless; they are not “sharing” anything)…..we gave them money.

The stock market is simply a second hand swap meet.

Stocks are to companies as used cars are to car makers……they make NO MONEY when their stock goes up (just like a sold used Toyota makes no money for Toyota).

People investing in stocks do not help business or the economy:

You’re not creating jobs (except in finance) or helping the company; stocks (at their best) are supposed to reflect the underlying health of a company; they do not CAUSE the underlying health of the company.

Here is a thought experiment:

If everyone bought the stock of a company, what would the outcome be?  Nothing except an inflated stock price.  No one really has anything.  Nothing has been produced (except fees for finance companies).

If everyone bought the PRODUCT of a company, what would the outcome be?  Well, they would have something (the product), and the company would get that money.  That is something you can work with.

Stock market prices do not predict anything:

Stocks may reflect some things, though what they reflect I’m not sure (human psychology about the markets themselves perhaps?).  The smartest PHDs in the world have thrown every algorithm in the world at stock data.  It is random from one day to the next.

The only proven way to predict the stock market is to have INSIDE INFORMATION.  The rest of us will never do better than the market in general except by luck.

The capital gains tax reduction on stock investments is simply a tax break for the rich:

The average person gets almost no income from stocks; functionally we don’t really care about the capital gains tax rate….because we don’t have any significant capital gains.

1 percent of all taxpayers collect over two-thirds of all capital gains; that top 1% gets a tax break on their income; we don’t.  We pay 33% or whatever, and they pay 15% on their capital gains.

It is said that a reduced capital gains tax encourages investment.  Perhaps (I won’t go into the economic arguments here)…however, in the labor vs. business struggle…..labor has really been losing out over the past twenty years.  Its hard to have sympathy for the capital gains crowd (since they just wrecked the world economy).

What is good for the stock market is not what is good for America:

Correlation is not causation.  It is true that if the underlying reality of the the economy is good then you’ll probably have a decent market return; however, you CANNOT WAG THE DOG in this case.  Propping up the stock market will not cause a fundamentally sound economy.  It will simply cause the stock holders to get rich…while the underlying fundamentals (labor, jobs, etc) continue to worsen.

Chew on that.

Basic assumptions are rarely questioned.  One has to be pretty astute to even understand what the basic assumptions behind something are.  If you don’t know; you can’t question.  Even if you do, you have to be inclined to care.

I’d like to question two basic assumptions today:

Assumption 1: Kids should go to college:

I disagree.  Some kids should go to college (by college, I mean a 4 year degree).  For most it is a gigantic waste of time/money and they should stop being misled into attempting it.

So which kids should go?  Speaking practically, the ones that should go are the ones that are currently getting something out of it, as in the ones, at a minimum, who are graduating (never mind whether the degree is useful).

If you are in the bottom half of your high school class…don’t go to college.  About two thirds of you never graduate.   70% of high school graduates now go to college.  Those numbers don’t add up.  Why go?  It leaves you in debt, and out of the workforce (a year of good work experience is worth far more than 1 year of random classes).  It is a waste of time.

With our battery of endless aptitude tests and 12 years of high school grades, we know with a high degree of accuracy which students will do well in college.  Quit misleading the others into thinking it is worth their time to go.  It is dishonest if high school kids aren’t told that college isn’t always a good idea.  It is simply avoiding reality.

That being said, people should always be able to bet on themselves.  If you want to go to college anyway, and beat the odds….please do.  Life is full of people beating the odds; however, make no mistake:   the reason we like those stories so much, and why they stick in our mind, is because they are exceptional, because they are out of the ordinary.  We all want to believe we can beat the odds; it makes us feel good.

However…..We can’t all be above average.  That is a fact.  We are not all future managers, CEOs, sports stars, rappers, singers, etc.  Those at the top of their profession are compulsively dedicated and often very talented.  Most of us are just not willing to work that hard and often don’t have the natural talent; accept it.  Also, from a statistical point of view, we just can’t all be at the top of the pyramid.  It is numerically impossible.

I’m not going to post here (lack of time) on what we do about it…the fact that inequality of all kinds simply exists, and it must exist, whether it is politically correct to say so.  I’ll simply say that if you want to be above average, you need to be aware enough of your position to realize that you can only be so because others are below average (you depend on them).  Be thankful they exist, and treat them well; tomorrow you may be one of them.

UPDATE 6/10/2010:  Someone else (NY Times) had the same idea I did.

Assumption 2:  Economic growth is good:

On average the US economy grows about 3% a year.  That seems good, right?

Yeah, its good in many ways.  Would 6% growth be better?  Sure.

No one really questions whether growth is good.  “A rising tide lifts all boats” right?  Uh…maybe.  Or a rising tide sinks those without boats.

Anyway, I’m not even going to broach that subject here.  Let’s take a step back…even further…way further…to the concept of 3% growth itself.  Is it even possible to grow at 3% forever?

No.

People are quite poor at understanding exponential growth.  We tend to conceptualize growth as linear; its a good rule of thumb that applies in most situations.

Does 3% growth look like this?

No.  That’s linear.

Here is 3% growth in a series of 150.  Think of it as a series of 150 years (but it is simply units, could be days, or miles, or whatever).

That’s a neat upward curve. Perhaps we think it would be good to grow like that?  The fact is that we do grow like that for the most part.

Here is 3% growth in a series of 350.

Here is where we start to see the issue.  It plods along at almost nothing for majority of the series and then towards the very end, it shoots off the chart (no pun intended).

That’s not sustainable.  All systems like this eventually collapse. A good analogy is bacterial growth.  It looks like this as well, and then, when it is about to shoot off the chart and grow out of the petri dish…it exhausts its food in a fit of growth, and the colony dies….quite quickly.

Growth requires input….we are growing something (the economy), and we need raw materials to make that happen.  Those raw materials MUST eventually deplete, as does the food in the petri dish.

Even if you give the bacteria more food or a bigger petri dish, it doesn’t matter.  The growth curve will eventually catch you.  You won’t be able to shovel in inputs faster than the growth.

I’m not being all environmental. I’m saying it is simply impossible, under any set of circumstances, to maintain 3% growth indefinitely.  We need to accept that reality and plan for it.

Speaking of reality:  The concept isn’t “Save the Planet”.  Trust me; the planet isn’t going anywhere.  We’re not even trying to save life on this planet.  Life is pretty resilient; it survives.  “Save the Planet for Humans” is a more accurate.  I guess that doesn’t fit as well on a bumper sticker?

If we are to believe science, we are an accident of the cosmos, which is itself an accident.  That’s a pretty big happenstance.

If we are to believe religion, the entire cosmos exists so that we can pass a few years on a lonely planet in a common galaxy in an unimaginably large universe….trying to prove that we believe that some guy who lived only 2,000 years ago was at the same time human and the son of a supreme being.

Neither is particularly plausible; though one improves our life, while the other causes as many problems as it solves.

“Why did you do all this for me?” he asked. “I don’t deserve it. I’ve never done anything for you.”  “You have been my friend,” replied Charlotte. “That in itself is a tremendous thing. I wove my webs for you because I liked you. After all, what’s a life, anyway? We’re born, we live a little while, we die… By helping you, perhaps I was trying to lift up my life a trifle. Heavens knows anyone’s life can stand a little of that.”  — Charlotte’s Web

We’re born, we live a little while, we die.

If you never read anything else, but understood that…I think it would be enough.  Children’s books are funny like that.

As we get older, we always think we understand things better than we did before, and we do….for what it is worth.  And I think it is worth not much.

When I was younger I enjoyed my lack of understanding, and I never could’ve born the weight of my life now (not that it is that bad).  Youth is good.

I am older and though youth leaves me, my ability to deal with my current life is a great skill.  Age is good.

So there.

“I returned, and saw under the sun, that the race is not to the swift, nor the battle to the strong, neither yet bread to the wise, nor yet riches to men of understanding, nor yet favor to men of skill; but time and chance happens to them all.”  — Ecclesiastes 9:11

I have come to an agreement with life that allows me to bear it:

Life promises me nothing. My very best efforts may well lead to failure.  I could betray my family, my friends could hate me, my marriage could fail, I could beat small, cute animals….there is always some set of circumstance that will make you do what you didn’t think you would.  Judge if you’d like; today it is someone else, tomorrow it is you.  “….time and chance happens to them all”

Should I complain that my parents don’t like each other, that I don’t get along with my dad, that I work most weekends, that I have a freak injury that keeps me from playing a sport that is one of my sole stress releases, that my best friends all live relatively far away, that my mother complains to me about her crappy life, my sister (bless her heart) borders on histrionic, the family I’m marrying into has its own set of problems (which I now inherit), that my dog is dead (long live the Wizard!), my grandparents don’t even know who I am anymore, and I spend most of my free time attempting to learn about home repair so I can avoid paying some high school drop out more money per hour than I make with an MBA?

No.  I shouldn’t.  I am fucking thankful.

Why?

We’re born, we live a little while, we die.

Time and chance happens to them all.

We, my friends, are the winners (believe it or not).  The loser are all dead.  Be thankful.

So I was talking to Brian Allex at dinner the other night and he told me he almost got into a McDonalds commercial.  I mentioned (as I always do) that I wanted to be in a commercial too…as a voice talent.  He said he gets demos all the time from folks.  I said I need a demo too….thus I made one.

The Background: I thought I would re-do another movie trailer, maybe a Don Lafontaine classic.  Unfortunately, there is no website that catalogs movie trailer scripts.  There are also none that give away the music behind the trailer (although there are some that charge).  So I decided to make my own trailer, with my own music.

The Interview: As I was getting into the mindset, I started thinking about myself as voice actor.  I watched some interviews with Don L, and then decided my demo should also contain background info….my story as a voice actor.  So I wrote a self-interview too.  This was the funniest part to me.  It was actually much longer than made it onto the demo, but in the interest of time I cut my own interview short.

The Music:  Fortunately there is a lot of good info out there on suitable classical music for movie trailers.  The one that came up over and over was Carmina Burana by Carl Orff.

The Trailer: Surprisingly easy to write.  I did a little research, but they are pretty formulaic and easy to poke fun of.  “In a world..”, “On man…”, “Renegade…”….anything dire, immediate, short, and punchy.

I laughed my ass of watching this:

The Mix:  I use Adobe Audition (formerly Cool Edit Pro) to mix audio.  I know something about that from my limited experience recording music, and I have a pretty decent microphone that picks up what little depth and richness I have in my voice.  I didn’t use alot of effects on the tracks (echo, or enhancing the bass of the vocals); its pretty much how I sound.

Here is a pic of clips:

You see I recorded the lines one at a time. The trailer definitely wasn’t all one take. The interview was though.

The Environment: I did drink a bottle of red wine in preparation.  Alcohol dries your throat out and deepens your voice.  I didn’t smoke any cigarettes.  I don’t like to smoke.  I assure you the wine was not enjoyed, but only drunk in pursuit of the art.

The Result: Here you go.

With the recession looming, I figure its time to diversify my interests.  You never know when you might be forced to consider a career change.

I have grown tired of asking questions to which I know there are no answers. Perhaps that is adulthood?

I ask more immediate questions these days: What will I do today after work? What will I do today at work? Where will I eat dinner? What kind of beer do I want to buy at the liquor store? Does anyone want to play tennis tonight?

Without the tennis, I think those are the questions Homer Simpson might ask himself each day.

I can’t recall definitively answering too many important type questions…ever. Actually, I guess there are a few:

Does God exist? Don’t know whether s/he exists. Firmly Agnostic. Its hard to prove the non-existence of something. I strongly suspect the Western anthropomorphized God is not real. I am even more certain that religions are invented by people…to ease insecurities, to gather people around common causes. The Bible was written by people. What makes one religion more true than the other? War. Whoever kills people of the other religion…those people are the only ones left to ask the question.

We cannot escape our biology: I believe in the Savanna Principle, and Evolutionary Psychology. Non-politically correct evidence will continue to pile up in the coming decade that our brain’s tendencies are a product of evolution just like our body’s. Women and men’s brains are different. There are reasons for gender stereotypes. Some subgroups are smarter than others. Some are taller. Some run faster. Many very interesting facts about beauty, war, mating, power, and the limitations of human nature will come to light.

Why are we here? To survive and reproduce. You don’t have to believe it…it simply is. If you don’t think that’s true, then you will not be long around to have the argument…the survivors win.

War is inevitable: Peace is not the norm. We go back and forth…tending towards war. Why? Those who are not good at war are not around long enough to worry about peace.

People will figure out a way: There are so many of us alive, it doesn’t even need to have anything to do with intelligence…if people have all possible ideas, then some of them will end up being correct or useful. We just need lots of people and lots of questions.

Power is its own end: Power corrupts; it is self serving. Human nature makes it extremely hard not to follow that path. The best idea is to diffuse and limit power so that not too much of it rests in any one person, since they will certainly abuse it…even if they’re smart…which isn’t always a guarantee.

The Constitution does that, and its brilliant. It limits and diffuses power…in effect, setting up a government that doesn’t have enough power to fuck anything up too badly….and then gives power to the States. The beauty of that is that it sets up a market for government and lets people vote on which rules are the best. Don’t like what’s going on in your state? Move to another one. What sucks is that the central government has taken so much power that the rules aren’t significantly different between states…so you can’t do that. Power corrupts.

Travel the world: It will change you forever and you will be better for it. Don’t read about it; don’t speculate on it; do it. It teaches you that you change someone’s life everyday and that there are so many ways to live and how dare anyone think they know what’s best.

Don’t get caught up in the hedonic treadmill: You can’t win. I don’t play games I can’t win. Human nature dictates you will do it anyway…some things you can’t avoid. Try harder.

History repeats itself: Enough said. Think it hasn’t happened before? It has. Like stereotypes, ignore history at your own peril.

You cannot derive an ought from an is: What is natural is not what is good (this is also called the naturalistic fallacy). I get tired of people trying to draw analogies from nature as a model for what should be. Guess what? Snake bites and shark attacks are natural. The bubonic plague is natural. Antibiotics are not natural. We invented them. No one ate the penicillin fungus and got better. We distilled and concentrated it. Humans…flawed as we are, decide what ought to be. I agree, “ought” is a slippery slope. As soon as you think you know what’s best, you start abusing power.

Beware of the Jedi Mind Trick: Don’t let people fool you with a) statistics, b) research, c) expertness d) The Aiken Solution, e) repetition, or f) any other poppycock that people use to try to persuade you. Stated another way: Be a Skeptic.

Reality is subjective: This has terrifically confusing side-effects, the most important of which is: two people with different opinions can be right about the same thing. That is a tough one to get through for most people.

Not to say everything comes down to opinion; some things are simply wrong. Other things aren’t though: For instance, let’s say I just got a new job. That’s great…for me. Perhaps the guy/gall I beat out was trying to feed the family…maybe not such a good thing then. The answer to the questions “Was it good thing that Elliott got the job? ” is not answerable in a traditional sense.

Many, many things on very large scales come down to this simple kind of distinction. Which is right? Same as before: Those who survive and reproduce and can write a not-so-flattering history about the other group.

Common Logical Fallacies: The study of logic, especially as it relates to human psychology is useful. Once we learn a) the tricks people use to trick us, and b) the common traps the brain falls into….the better off we’ll be. Reality catches up with you sooner or later in most instances. I could write another post on all of these.

Anything that can happen, will: This is a fun one too. People ask about genetically engineered humans, franken-foods, and self-replicating nano-robots…its all going to happen. We will do everything that becomes possible, because there is always someone willing…reality TV has proven that.

The Best of All Possible Worlds? Pangloss was wrong…and right. The world simply is. It is neither the best, nor otherwise. We decide. I have written extensively in the past about Happiness, and whether or not humanity has any use for it (although I assure you I have a use for it).

Any decision is better than no decision: There is a bit of game theory in this one. If you make no decision you will only get what other people want for you. If you make decisions, then you have a better chance of doing something that is good for you. You also stand the chance of making a wrong decision, but I think you stand less of a chance than if you leave it up to other people. Firm decisions are gold, and other people can coalesce around them.

People are neither good nor bad by nature: The brain is a mess of conflicting systems, and they don’t always agree. You can save a child from a burning building one day and rob a liquor store the next. Although people generally know what is right, they do not always do so. They more consistently act in accordance with the situation. Put a good man in a bad spot, and he’ll do what he needs to…morals be damned.

People matter: Don’t get distracted by achievements, or money, or sex, cars, houses, status, jobs, etc….people matter in the end. They witness your life and give it weight. Without them your life doesn’t exist. Without them there is no sex, job, money, status. People matter. We are a consensus of ourselves. The sole witnesses of a billion frantic lonely consciousnesses on a small rock on the edge of a normal galaxy in an unimaginably large universe. Period.

There is life on other planets: Religion? Please. We’ll be so fucking happy to find intelligent life on other planets it will change everything we do…and then we’ll go to war with them.

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Ok…that’s enough. I could go on, but I won’t. Now that all that is out of the way I can get back to the important questions: What will I do today after work? What will I do today at work? Where will I eat dinner? What kind of beer do I want to buy at the liquor store? Does anyone want to play tennis tonight?

What do you know that is true?