The Middle Way

In Transition

I met a woman last week at a networking meeting.  As usually happens, we inevitably got to the "So...what do you do?"  part of the conversation.

When her turn came she answered, "I'm in transition." 

It's not surprising that a worker in words (like me) would focus on this phrase, one I've been hearing a lot lately.  "In transition" being a euphemism for "currently unemployed" whether by choice or as another casualty of the growing recession. 

As euphemisms go, it's not a bad one.  Losing your source of income certainly results in a lot of transitions beyond finding another job, many involving a change of plans.  As someone who falls into the "in transition by choice" category, I'm certainly doing things differently than I did in the days of the regular paycheck. 

Like all euphemisms, though, this one has the feeling of holding reality at bay -- "I'm not out of work, I'm just in transition."  The risk is that by not calling things the way they really are, we run away from reality rather than towards it. 

And it seems to me, looking around at the growing mess created by wanton disregard of reality, that maybe that's not the right direction to go.

Measuring Economic Recovery

I sometimes wonder if our ways of measuring the economy are completely out of touch with a new reality.

My intuition tells me that we're going through a singular time -- one that will change our lives profoundly in ways that aren't entirely clear yet (and may not be for some time).  Will economic recovery really involve new housing starts, car purchases and retail sales at a level approaching that of the past 20 years?  An explosion of new retail building -- more stores, more malls, more restaurants?

Should we measure economic success by a continual increase in consumer demand?  And if we don't, what replaces it?  How do companies set profit targets that aren't based on continual expansion?

I'm no economist and I don't pretend to have the answers.  I do know my own discomfort with the ever expanding consumer culture has prompted me to find ways of doing more with less. 

I can think of no better illustration than my own home.  Almost 22 years ago, I bought an old house in a first-ring Midwest city suburb.  I couldn't afford the kind of house I wanted, so I looked for the best available within my limited budget -- a "starter" home.

Ten years into home ownership, I got divorced.  The starter home became a full-time divorce recovery project. 

As my income increased, I moved from simple do-it-yourself projects to full-fledged home remodeling.  Somewhere along the way, I realized my starter home could become the home of my dreams.  Rather than sell and move up, I brought my home along with me.

As I look at the growing economic crisis and wonder where it will lead, I'm profoundly grateful I chose to fix up rather than trade up.  My debts are minimal, I'm within walking distance of the library, grocery store, restaurants and bus line, and I've got a house that's increased in value, even during this downturn.

And in the process, I've turned an old house into the home I always wanted.

I Shake My Head

I dealt with executive compensation in my corporate life, usually around annual report time when the proxy got filed, revealing all the gory details.  I kept an eye on the public media's coverage of the topic, and wondered why average people didn't see red every time a new story of excess appeared.

I listened to the justification for ever higher compensation and bonuses.  I appreciated the extension of bonuses to people at my level, although guiltily wondering what I'd done to deserve more than I was already paid (which was not inconsiderable). 

So I find myself doing a slow burn every time I read another story about the egregious excess practiced by the Masters of the Universe.  These companies are the standard against which all other companies (perhaps enviously) have measured their own compensation practices, justifying ever higher compensation packages as a necessary tool for recruiting and retaining the "best of the best."

And then to read that even at a time when their companies were in melt-down, financial services companies distributed over $18 billion in bonuses -- an average bonus of $112,000 -- well.  My mind boggles.  And I bet there are a lot of people out there who feel like saying, "Bonus?  I got news for you -- your bonus is that you've got a job."

Bonuses, like standing ovations, have become obligatory.  But unlike the standing ovation, this costs all of us.  And we absolutely must start questioning why they're necessary, and whether they achieve their intended purpose or something else altogether.

"The law may not change the heart, but it can restrain the heartless."  Martin Luther King, Jr.

So begins this article from The Motley Fool.  I agree.  Unfettered markets are not self-regulating; they need wise and prudent oversight to curb our oh-so-human tendency to consider only our own best interests.