How to Get Rich Quick

I am about to describe to you How to Get Rich Quick.  It’s patented.  It’s painless.  It works.  I did it.  You can, too.

But first, you need some data:

In the 1960s in one Mississippi town (I can no longer find the details, so here’s the gist), the average house was a one bedroom, dirt floor house.  When asked “are you rich and happy”, the average resident said “no”.  The above average residents, with two bedrooms and wood floors, said “yes”.

By 2000, the town had prospered.  The average house was now a two bedroom wood floored house, just like the rich residents’ houses of 40 years prior.  Now, when asked if they were rich and happy, the average resident said “no”.  Still “no”, despite the huge gains in prosperity.  The above average residents, now with THREE bedroom houses, said “yes”.

Similarly, in a Fidelity Investments survey, millionaires were asked if they felt “rich” (their average net worth was $3.5 million).  They replied “no, I don’t feel rich”.  And then respondents went further, “If only I had about $7.5 million, then I would feel rich.”

Of course, the surveys asked richer millionaires with $7.5 million if they felt rich.  Their response?  “No.  If only I had more than $7.5 million — then I would feel rich.”

Clearly, “being” rich and “feeling” rich are two different things.  Few people feel rich, and if they do, it’s relative to others.

OK, with this data we’re ready for my patented Get Rich Quick scheme.  Here’s what you do.  Ready?  You do nothing.  See, I told you it’s painless.

It’s relativity that leads to feelings of wealth.  So let’s put our own lives in relation to others:  the average person in the United States earns $33,000 per year.  The average person in the world earns $7,000 (adjusted for cost of living between countries).

Feeling rich yet?  No?  Geez, you’re a hard case.  OK, try this.  We 300 million, $33,000 earning Americans earn 50 times more than the 1 billion people that earn $730/year (about $2 per day).  If that doesn’t work on you, you wealth denying iPhone wielder, we Americans earn 100 times more than another 1 billion people in the world with incomes of $365 ($1 per day).  We earn in one day what they earn in 3 months.

And that’s all there is to my Get Rich Quick scheme.  I have made you rich, in just the length of time it took to read 400 words.  If you are reading this, you are rich.  Relatively.  Quit looking at the few people with more than you.  Look instead at the overwhelming majority with less.

You can pay me later for this great Get Rich Quick program.  Of course, the program to make you truly rich – in character, in relationship, in morals –takes quite a bit longer.  I charge a lot more for that one, too.

(My thanks to John Ortberg for these thoughts)

Osama is dead. Can I leave my shoes on at the airport now?

Walking through the airport, anticipating disrobing in the airport security line, I spied a man carrying the Wall Street Journal.  One of the headlines was for an article on crying.  I think this may have been editorially related to Donald Trump’s rise to the top of the “15 month from Presidential election polls”.  One interesting point was that women cry, on average, 5 times per month.  Men cry, on average, 1 time per month.  Men cry?  I didn’t know that.

At least I didn’t until I saw how long the airport security line was.

The main headlines of the WSJ, like many other newspapers, were filled with details of Osama bin Laden’s death.  As I put my belt back on, my suit jacket, my coat, my left shoe and my right, I was reminded of the large and small prices we pay every day for Osama bin Laden’s plotting and scheming.  We have to partially undress, for example.  And since no one has yet attempted to smuggle a bomb in brassiere, the airport security line remains quite unentertaining.

So if Osama bin Laden’s death actually has some strategic value, some improvement in our security and some reduction in terrorism, why wasn’t everyone sailing through the security line without electronic cavity searches and stripteases?  The reason is simple, bin Laden’s death makes little difference to our security situation.

Terrorists are a diffuse army.  They can’t fight straight up against the might of the US Army, so they are forced into “asymmetrical warfare”.  While it’s possible that World War II would have ended if Adolf Hitler had been assassinated, this is not the case with asymmetrical warfare.  As long as there is a reason to fight, there will be fighting.

And that’s the dark side of Margaret Mead’s quote “Never doubt that a small group of thoughtful, committed people can change the world. Indeed, it is the only thing that ever has.”  As technology improves, the ability of a small group of committed people to kill has also improved.  Sticks and stones = 1 death.  Swords = 10 deaths.  flintlocks = 20 deaths.  Machine guns = 100 deaths.  747s into buildings = 1000s of deaths.  It will keep going.

It’s this reality that keeps President Obama somber at every press event since bin Laden’s death.  Watching the TV screens at the airport, the President isn’t raising both hands above his head in triumph, fists pumping.  He is not standing in front of a banner that says “Mission Accomplished!”  The President gets it, even if the public does not.

Half of Americans Pay No Taxes

Now that tax day is behind us, can anyone tell who pays what and who gets what among our neighbors?

It’s hard to tell, because in government speak things like a “10% cut” is still an increase overall because it’s a reduction in a future increase.  Right, that cleared it up.  I had to reread that sentence three times.

But here is one thing I now know:  nearly half of Americans paid no tax in 2009 (after their tax credits and deductions)

That’s right, half of Americans got handouts that at least equaled their taxes.  Clearly this is not widely known, because it seems MORE than half of Americans complain about their taxes.

Why isn’t this something that everyone knows?  Why isn’t this a big part of the public debate?

Part of the problem is that we are confused.  The way the government describes income and expense is, if not intentionally obfuscated then at least in language that only a policy wonk could love.

• A “tax credit” is not a tax or a credit.  It is technically a reduction in income to the government, just like an expense is.  Tax credits are an expense for government.
• An “itemized deduction” is also an expense for the government, even though it’s not shown that way.  The mortgage interest deduction costs the federal government $100B per year, about as much as the EPA.
• A “stimulus” is an expense, just like “The Department of Agriculture”, but a stimulus doesn’t take up two full city blocks in Washington, DC.
• A “tax” is revenue.  OK, that one seems pretty easy.

This confusing array of tricks puts expenses in both the income side and expense side of the government balance sheet.  So why not simplify the entire thing?  I’m talking Flat Tax.

People argue against the Flat Tax, which charges everyone the same amount, because the poor are taxed the same as the rich.

I have an alternative.  Combine the Flat Tax with checks issued to those that we care about or are doing things we like.  This moves all the credits, rebates, stimulus, and fluff to what they really are:  expense.

A Flat Tax plus expense checks drastically simplifies our national debate.  If the Flat Tax rate were 20% and you were in the “get back as much as you send in” half of the population, the government would write you a check every year for 20% of your income.

It’s pretty simple, still allows us to achieve social ends (like incentives for home ownership), but drastically improves our ability to understand what’s going on.  We can yell at those people that are getting big checks if we want, or applaud their largesse.

It would simplify the government processing as well, although knowing the government they wouldn’t actually reduce headcount.

And the 1040 form would look like this:

1. What is your income from all sources?_____________
2. Put .20 on Line 2                               _____________
3. Multiply Line 1 by Line 2.                   _____________
4. Send in Line 3
5. We’ll send you a check for an amount, depending on dependents, home ownership, and income.  Half of you will get at least Line 3.  Congratulations!