Thursday, August 15, 2013

More Priceless Advice

Per last week’s entry, my eldest son and I had been having a breezy discussion about his impending college attendance and what might happen if he graduated. Thus, I wanted to lay out in a calm and understated manner a few things about the obvious future. “Our nation and the world, my boy, are in fiscal peril right now and headed toward irrevocable catastrophe. “ He nodded in a rehearsed, rueful manner and I continued.

"You know your old man is a numbers guy. Here are a few: Gross federal debt is 104 percent of GDP. The top five percent of Americans pay 60 percent of all federal taxes and the top 10 percent pay 77 percent. Oh, and 48 percent of all households pay no income tax.” Relentlessly, I droned on: “Twenty four million Americans – yes, that’s almost one-fifth of your countrymen 18 years or older -- are unemployed, have given up looking for work, or are offering to super-size an order at McDonalds. One hundred thirty-eight million people were working in July of 2008. That number today is one hundred thirty six million. And yet we’ve added twelve point six million new, wanna-be workers in that five years. Oh yeah, and there will be 76 million baby-boomer retirees by 2029, many of them in ill health with no retirement savings.”

 Junior didn’t flinch. Moreover, he knows by heart my secondary stats on BLS U-6 ratios, ten-year Treasury yields, workforce participation percentages, LIBOR tracking, Medicare Trust Fund outflows, SSI disability claims, and personal savings rates.

We were lunching in our old haunt, a throw-back diner that didn’t know that it was, staffed by individuals in their 20s. “Fifty two percent of college graduates since June 2007 are unemployed or underemployed in retail, clerical, or hospitality.” I glanced at the sullen restaurant staff and kept grinding on. “Thirty seven percent of Americans hold student loan debt, the average outstanding is $26,000 per person, and the total student loan debt load is at $1.1 trillion.” I pointed to our waitress. “I wonder how that Master’s in Psychology is working out for Patty.”

Then, seizing a cue from the true source of wisdom, Caddyshack, I smiled like Danny Noonan in Judge Smales’ country club office. “You’re probably wondering -- what does this all mean?” He nodded emphatically. “Let me repeat: It means this the nation is in irreversible financial decline. Outstanding current and future debt obligations, a shrinking number of wage-earners” – and here I raised my eyes to psychologically signal Patty for some more water – “and a massive growing number of claimants -- all are unprecedented in American economic history. You and your cohorts could be crushed,” I said dramatically. Then I whispered, “But there is a way out.” He was all ears.

“For seven years I’ve been riding you about getting top grades. Now, on the eve of your first class, I don’t want you to even think twice about grades. In fact, I will never look at one of your report cards again. Just choose what you think will propel you to a top station in life. If taking notes in class isn’t your bag – and it sure wasn’t mine – then don’t. Personally, I found it was a ton of work.”

“With all that grade stuff out of the way, here is more invaluable advice: What will propel your farthest in life are languages. Yeah, I know you have the Spanish deal down cold so now get on the Chinese bandwagon. There are a lot of them and even if their economy has slowed to 7.5 percent growth per annum right now, we’re all going to be living in Yuan City someday. Forget about Italian and French – those countries are doomed. I assure you that with languages, you will become indispensable in the business world.”

“OK.  Now, as far as lax, keep at it. Being on a college lacrosse team provides a real opportunity because most of your teammates are going to wind up as investment bankers. Yes, that’s how it works. So with your Chinese, when that Goldman Sachs VP post opens in Shanghai, it’ll be yours because your ole buddy, Cameron the goalie, is in charge of the firm’s derivatives portfolio.”

Junior nodded in agreement and then asked, “What about my Maori ancestry?” “Kia Ora!” I practically shouted. “That means ‘Right on!’ in Maori. I have another word for you, pal: Haka! The Maoris were disciplined, violent, ruthless people. They were cannibals -- you can look it up on Google. You’ve shown ferocity and drive in everything – just keep it up, thank you.”

“Now, the good thing is, you may be 416 miles away at school. But with the Interweb and all these electronic doohickeys, you and I can be in contact whenever I need to tell you something.” Junior nodded affirmatively.

“And remember, it’s all generational. When your Grandfather Don began college, he was 24 years old and had survived a year and a half in the Pacific fighting the Japanese. I left for college at age 17, surviving two years of the fever swamps of UC Berkeley before transferring away my sophomore year.” “Today, you head off with all this accumulated wisdom that neither I or your Grandfather ever had. You’ll positively thrive.”

“And heck,” I observed, waxing on, “In years to come, your sons will probably look to me for this same advice. “What will you tell them?” asked Nellie Junior sincerely. “I’ll say, “Run downstairs and ask your Dad."

Monday, August 5, 2013