Having last year in February told the story of my own romance, I have decided to begin telling the stories of some of my roommates. I had hoped to finish the effort in February, but it appears I will have to extend it well into March, or even April.
I begin with my dear, dear roommate and very good friend, Gary Mathews.
Great Lovers I Have Known--Gary Mathews
Gary Mathews was my roommate for about four years, although the last two were only in the summer months. He was not what I would characterize as the "great lover type" which was probably better represented by the other Gary in our apartment, Gary Jensen. Gary M. was rather short and chubby and a little rough around the edges--speaking about his manner rather than his appearance, In appearance, Gary had no edges
Gary was always very much for doing his religious duty and since, for a returned Mormon missionary almost your most important duty is to get married, Gary was all for doing it and the sooner the better. If he had had a crystal ball that had told him how long it was going to take, I suspect he would have been very discouraged indeed. But those of us who did not get married until we were 35 are in no position to talk about either crystal balls or discouragement.
But, of course, all of us in our apartment were conscientious about doing our duty and were, therefore, pretty diligent daters--all except Robert Patterson. I throw that in just to point out that Gary must have had several dates and much dating experience before the first great love of his life. But I don’t really remember much about Gary’s early dates (for that matter I don’t even remember much about my own from that period). What I do remember is how hard we worked to get Robert Patterson out on a date. We felt that it was absolutely terrible that Robert was not only not doing his religious duty, i. e. getting married--none of us were doing that--but not even moving in that direction by dating. We all would encourage him in every way we could, by, for example, telling him about what a wonderful time we had on our latest date, which, of course, was generally an exaggeration if not an outright lie, but, naturally, when you are encouraging a person to do his religious duty, you are naturally allowed a great deal of leeway, religiously speaking. I mention all this because we were finally able, using a great deal of persuasion, an even greater deal of force, a bit of fib telling and a great bit of chicanery to get Robert to go out on a date with the girl next door, who, we felt, was just his type.
I mention all this about Robert because it was almost the end of the year before we got him to go on that date--actually, I think he finally went on two or three--all with the girl next door. Anyway, we all went home to work for the summer and what should we get from Robert toward the end of the summer but a wedding invitation! Naturally, we all went to his reception and lo! And behold! Wonder of wonders, the girl he married was very cute and very charming, which we all agreed was terribly, terribly unfair especially considering how little effort he put into the whole "struggle to find just the right person" thing. But the other thing we all agreed on was that it almost certainly never would have happened had we not essentially forced him to date the girl next door. I mention all this because, if anything, Robert was even rougher around the edges than Gary M. with, physically speaking, even fewer edges. For example, when we all went to the opening social at church, the Bishop came up and asked Robert his name, he said, "Robert Patterson." To which the Bishop good naturedly asked, "Do your friends call you Bob?" To which Robert replied very gruffly, "Some people do, but they aren’t my friends."
But I digress. The point of all that was that Gary went out on several dates before he started dating A_____. I don’t really remember her name, but I do remember that it began with A and I’m pretty sure it was April, but if her parents had wanted to name her by characteristic they would have named her Anxious--as in "Eager to get married". By the time Gary started dating April, he and I had become good friends, so naturally, I wanted the best for him, and, in my view, at least, April was anything but the best. She was cute enough, but she had just graduated from high school, was not interested in going to college, and saw life (again in my opinion) after high school as a Sadie Hawkins race in which she was determined to grab the slowest runner who could take care of her for the rest of her life. When it came to running away from cute, young girls, Gary was (at that time, at least) about the slowest runner around.
Gary would be in absolute ecstasy when he described their latest date. For my part, I don’t remember the dates so much as the notes they wrote to each other. Gary was working a job at the time that allowed him unlimited access to butcher paper, which he used for his own notes and provided to April to use for hers. So all over our room were these large notes with messages that can best be described as mushy. I think Gary got his from the Western novels he was always reading--after all, those cowboys, after they finished chasing cattle rustlers and running from Indians, would have to think of something to say while they sat on the front porch with the boss’s adoring daughter. I think Gary figured that since it always worked for his western heroes, it should certainly work for him--but I would have been dubious, if I had been him. One went, Roses are red violets are blue, I love you lots and I hope you love me too." Another read, "How do I love you? Let me count the ways" (admittedly, not a bad line. He must have gotten that one from one of the better writers--Zane Grey or Max Brand, but it went down hill from there), "I love you from your head to your toes and in lots of other ways too."
But if his notes to her were bad, hers to him were even worse. The one I remember went something like, "When I am with you I shake all over and come unglued." (Which, of course, one hopes is not the same thing as coming unstitched.)
At any rate, it was pretty clear that Gary thought his duty--at least so far as getting married was concerned--was all but done. What he would have known if he had read Shakespeare instead of Zane Grey (which I know, because I had to read him in the 10th grade) was that the course of true love never runs smooth and (I’m not one hundred per cent sure this is Shakespeare--I was in the 10th grade a long time ago) you should never count your chickens before they are hitched. The fly in the wedding cake, so to speak, in Gary’s case was that he didn’t have any money--or at least, not very much. A trip to the jewelry store showed him that if he could have bought an engagement ring at all, the biggest thing about it would be the microscope required to see the diamond in it. This discouraged him a great deal and resulted in the use of a great deal less butcher paper, especially on April’s part, who, as soon as Gary mentioned that they might have to wait for awhile before they happy day, began to notice that her glue was beginning to hold. Finally, she did Gary the biggest favor (in my opinion) she could have done for him. She hopped onto the back of an old boy friend’s motorcycle and together they ran off to Las Vegas. Gary learned that for someone like April, a large piece of butcher paper--even butcher paper covered with lines from a horse lover like Zane Grey--will not hold up to a Harley Davidson.
Poor Gary was disconsolate and for months and was even worse than Robert Patterson about doing his duty. But time, about fifty Wester novels, and a little pushing to remind him about his duty, and he was--to all appearances at least--pretty much his old self.
Wednesday, February 24, 2010
Tuesday, January 26, 2010
Remembering Dad--Part 2
Some months after my 8th birthday, we were obviously more prosperous because we moved from out first home on 8th to a new home on 18th. We were moving up in the world, both economically and geographically. The home on 18th was designed not only to be a symbol of increasing prosperity, but also of Dad’s partnership with George Hargraves. That was symbolized by the fact that we lived almost next door (one house in-between, whether they were unable to get adjoining lots or whether being side by side all day and all night too was too much, I was never able to find out) in houses that had exactly the same exterior and the same floor plans. When I say exactly the same exterior, I mean the same shape, they were different colors on part of the house.
The house on 18th was a fun one because it was at the edge of town. When we first moved there, there were no other houses between us and the hills behind us. On two sides we had open fields. It was also fun to help Mom and Dad with the landscaping, mostly because after a hard evening’s work Dad would take us to the root beer stand where we could get a mug of cold root beer for a nickel. The two look-alike houses, did not look-alike long, however. As soon as the landscaping was done, Dad began tinkering on the house--a process that did not end until we finally moved. One of the first changes was the conversion of the garage into a bedroom. Of course, after that we had a wall with a window, where Dad’s partner had a garage door, so the two houses ceased to look alike except that for a couple of years Dad left the driveway in place and would, in fact park one of the cars in the driveway. The driveway was very steep and came to an abrupt demise after Mom lost control of her car when backing out of the driveway and hit Dad’s car. A few days later we came home to find that what had been driveway was now just an extension of the lawn.
Part of the reason that the driveway suffered so quick a demise was the fact that when Dad filed a claim with the insurance company, they refused to pay the claim. When Dad demanded to know the reason for the refusal, the agent simply said, "We won’t pay it because we know that you won’t sue your wife." It seems to me that Dad, being a lawyer--and by all accounts, a good one--could have made mincemeat of that argument, but Dad who was always eager to fight for other people’s rights, seemed strangely reluctant to fight for his own. He accepted the refusal with good grace and simply switched insurance companies--making him one of the few community leaders who was not insured with Farmer’s (they had a regional office in Pocatello). When ever anyone would ask him how he would dare to insure with another company, he would simply tell the story of their refusal to pay a claim based on the fact that "we know you won’t sue your wife". I suspect that in the long run, it cost the company more in lost business than paying the claim would have done.
As Dad’s business picked up, I think he got tired of tinkering with a house that was essentially George Hargrave’s (his partner) dream house and wanted to build one of his own. That finally happened when he built the house south of town--and it really was a dream house. But even more than the house, was the property on which it was built. We had 2½ acres of beautiful forest land--in fact, a national forest actually began just a block or so behind the property. We had a warm-water creek running through the property beginning with the source spring, which was also on our land.
We lived on the hill next to "Snob Hill" where many of the wealthiest people in Pocatello lived, and I suspect, that Dad wondered why more people were not eager to live on our hill. After all, to get to Snob Hill you turned up from the golf course and turned left at the top of the hill. If you turned right, you went down a dirt road and arrived at our new home. The most probable reason that we didn’t have any new neighbors (there were two families living there long before we moved in) was that right at the turn-off there was a chicken farm. Dad, who had very bad hay-fever, and consequently, could hardly smell anything, did not notice when he bought our property that whenever the wind blew west (which, in Pocatello, it almost always did), we got the smell of the chicken farm. Fortunately for us, occasionally the wind would blow east, so that the rich, and influential, folks on snob hill used that influence to force the chicken farm people to buy some sort of anti-smell device. But every now and then--usually about once a month--the device would break down. Mom would call out and Loni and I would frantically run around the house, closing all the windows and doors, while Dad sat blissfully out on the front veranda looking out over the golf course across the street and the Portneuff valley beyond, no doubt wondering why no one else had bought property on our hill to get this magnificent view for themselves. Had he thought about it, he may have realized that the reason was somewhat connected to the fact that his own family was carefully closeted inside the house burning scented candles.
We moved South of town when I had just started at Poky High. A few years later I was elected Student Body President and early in the year, I was expected to attend the Homecoming Dance. Since many of my friends had told me that they were getting a new suit for the occasion, I somehow felt that, being the important person that I had become, I ought to be wearing a new suit myself.
I can still remember everything about the conversation in which I asked Dad if he could buy me a new suit. I expected that to ask was a mere formality and that he would simply say, "You bet, we’re so proud of you being student body president and all. Anything else you need?"
I chose the time when we were sitting in the car together. Dad had driven me in for seminary and he was then going to work. Just before I got out of the car, I made my request.
To my surprise, Dad did not respond immediately, Instead, to my amazement I saw tears forming in his eyes. This amazed me because Dad was not emotionally expressive--not at all. In fact the only times I could remember Dad getting emotional at all was the two times he got angry enough to spank me. The first time occured when we were living in Germany and I was about 5. Dad had asked me to do something which I didn’t want to do so I got mad at him and hit him in the face and busted his glasses. The thing I remember most about the spanking that followed was that, considering the provocation, it was remarkably mild, and that Dad was remarkably controlled. The other time occured when we were living on 18th and I was about 11. This time Mom had asked me to do something which made me mad and I had given her a mild swipe. Dad, who saw me hit Mom, was standing at the other end of our living room. The room was divided into two sections by a couch that stretched 3/4 of the space across the room. Dad came straight for me, jumped over the couch, laid me across his knee and spanked me. I don’t remember anything of that spanking because I was in such a state of shock at seeing my dad, who was not an athletic type at all--quite the contrary, jump over the couch.
But now he was silently weeping. "I’m sorry son," he finally said. "But I can’t get you a suit. Since I signed the right-to-work petition, I’ve barely made enough to pay my office help and rent. Our family has been living on savings for a year."
"Oh, that’s alright," I quickly responded. "I really don’t need a new suit." Which, of course, was true, I really didn’t. Looking back on it, I’m surprised I even asked. I have never been much of a "clothes horse". But even more surprising, and more troubling, was that Dad could have been struggling for so long and that I was completely oblivious to it.
Although I didn’t get my new suit right then, I certainly got it--with interest. I left for college the next year and all through my college and military career, everytime Dad would come to town and see me, or when I would go home, I knew that times were better for Dad, because almost invariably he would say, "Son, you look like you could do with a new suit." And unless I could prevent it by pointing out that he had just gotten me a new suit a couple of months previously, I would get a new suit.
The suit I remember best came at the end of my college career. "Son," he had said at graduation, or shortly after, "since you’ll be looking for work now, what you need is a new suit." By this time Dad was working as a Federal Judge so, I suspect, that since he was covered up by black robes all day, the suits he wore tended to be a bit on the flashy side, but nothing he ever wore or bought for himself could ever match, in flashiness at least, the suit he bought me. It was creme-colored with rust-colored stripes (or vice-versa) and must have been made of material that included iron filings. I remember going to the interview that eventually landed me a job. The company was about half a mile from closest bus stop and the roads to the plant had only dirt sidewalks. While walking there a car drove by splashing me with mud that covered my pants from the bottom to well above the knee. Since it was winter, I simply used snow to rub off the mud. After undergoing a process like that a normal suit would have looked like you had pulled it out of a trash pile--that suit looked almost as good as when I wore it out of the store. I have always felt that the suit had a good deal to do with my being hired. The man who hired me was not LDS and did not like BYU, but I suspect, that he took one look at my suit and thought, "This kid only went to BYU because his parents forced him to."
It took me several months to find work after graduation. It was the midst of a recession in which engineering was particularly hard hit. I got dozens of interviews, and many companies said that they were interested in me, but they had a hiring freeze (or were laying off) but that they expected to be hiring again in a few months. But, of course, in the meantime I had to get by. I was living in an attic of a house in Salt Lake, and, although, the rent was low, so were my finances. Finally, I realized that I could not hold on any longer. I had exactly enough (or so I thought--mistakenly, it turned out) to pay my rent, but no money for food or transportation. I cried almost every night wondering what to do. Should I bite the bullet and confess my poverty to my parents hoping they would offer to take me back in until I could find work? Should I simply start living in the street (rather unpleasant in Salt Lake in December)? It was while I was thus at my wits end that I got a call from Dad. He was flying from Virginia--where he was living at the time--to California but had a short layover in Salt Lake. Could I meet him at the airport for a couple of minutes? I agreed. I was wondering if I should lay out my problems to him. But when he came it was obvious there was no time. "I’m sorry son," he explained as he came off the plane. "I only have a minute to catch my next plane." I walked hurredly with him to the a near-by gate where he checked in. We had less than a minute or two before he had to board. As he boarded he handed me an envelope. "Your mother wanted you to have this," he said as he walked through the boarding gate. I waved good-bye and then opened the envelope. In it was a check for $300. I had never really understood his problems, but he always understood mine.
The house on 18th was a fun one because it was at the edge of town. When we first moved there, there were no other houses between us and the hills behind us. On two sides we had open fields. It was also fun to help Mom and Dad with the landscaping, mostly because after a hard evening’s work Dad would take us to the root beer stand where we could get a mug of cold root beer for a nickel. The two look-alike houses, did not look-alike long, however. As soon as the landscaping was done, Dad began tinkering on the house--a process that did not end until we finally moved. One of the first changes was the conversion of the garage into a bedroom. Of course, after that we had a wall with a window, where Dad’s partner had a garage door, so the two houses ceased to look alike except that for a couple of years Dad left the driveway in place and would, in fact park one of the cars in the driveway. The driveway was very steep and came to an abrupt demise after Mom lost control of her car when backing out of the driveway and hit Dad’s car. A few days later we came home to find that what had been driveway was now just an extension of the lawn.
Part of the reason that the driveway suffered so quick a demise was the fact that when Dad filed a claim with the insurance company, they refused to pay the claim. When Dad demanded to know the reason for the refusal, the agent simply said, "We won’t pay it because we know that you won’t sue your wife." It seems to me that Dad, being a lawyer--and by all accounts, a good one--could have made mincemeat of that argument, but Dad who was always eager to fight for other people’s rights, seemed strangely reluctant to fight for his own. He accepted the refusal with good grace and simply switched insurance companies--making him one of the few community leaders who was not insured with Farmer’s (they had a regional office in Pocatello). When ever anyone would ask him how he would dare to insure with another company, he would simply tell the story of their refusal to pay a claim based on the fact that "we know you won’t sue your wife". I suspect that in the long run, it cost the company more in lost business than paying the claim would have done.
As Dad’s business picked up, I think he got tired of tinkering with a house that was essentially George Hargrave’s (his partner) dream house and wanted to build one of his own. That finally happened when he built the house south of town--and it really was a dream house. But even more than the house, was the property on which it was built. We had 2½ acres of beautiful forest land--in fact, a national forest actually began just a block or so behind the property. We had a warm-water creek running through the property beginning with the source spring, which was also on our land.
We lived on the hill next to "Snob Hill" where many of the wealthiest people in Pocatello lived, and I suspect, that Dad wondered why more people were not eager to live on our hill. After all, to get to Snob Hill you turned up from the golf course and turned left at the top of the hill. If you turned right, you went down a dirt road and arrived at our new home. The most probable reason that we didn’t have any new neighbors (there were two families living there long before we moved in) was that right at the turn-off there was a chicken farm. Dad, who had very bad hay-fever, and consequently, could hardly smell anything, did not notice when he bought our property that whenever the wind blew west (which, in Pocatello, it almost always did), we got the smell of the chicken farm. Fortunately for us, occasionally the wind would blow east, so that the rich, and influential, folks on snob hill used that influence to force the chicken farm people to buy some sort of anti-smell device. But every now and then--usually about once a month--the device would break down. Mom would call out and Loni and I would frantically run around the house, closing all the windows and doors, while Dad sat blissfully out on the front veranda looking out over the golf course across the street and the Portneuff valley beyond, no doubt wondering why no one else had bought property on our hill to get this magnificent view for themselves. Had he thought about it, he may have realized that the reason was somewhat connected to the fact that his own family was carefully closeted inside the house burning scented candles.
We moved South of town when I had just started at Poky High. A few years later I was elected Student Body President and early in the year, I was expected to attend the Homecoming Dance. Since many of my friends had told me that they were getting a new suit for the occasion, I somehow felt that, being the important person that I had become, I ought to be wearing a new suit myself.
I can still remember everything about the conversation in which I asked Dad if he could buy me a new suit. I expected that to ask was a mere formality and that he would simply say, "You bet, we’re so proud of you being student body president and all. Anything else you need?"
I chose the time when we were sitting in the car together. Dad had driven me in for seminary and he was then going to work. Just before I got out of the car, I made my request.
To my surprise, Dad did not respond immediately, Instead, to my amazement I saw tears forming in his eyes. This amazed me because Dad was not emotionally expressive--not at all. In fact the only times I could remember Dad getting emotional at all was the two times he got angry enough to spank me. The first time occured when we were living in Germany and I was about 5. Dad had asked me to do something which I didn’t want to do so I got mad at him and hit him in the face and busted his glasses. The thing I remember most about the spanking that followed was that, considering the provocation, it was remarkably mild, and that Dad was remarkably controlled. The other time occured when we were living on 18th and I was about 11. This time Mom had asked me to do something which made me mad and I had given her a mild swipe. Dad, who saw me hit Mom, was standing at the other end of our living room. The room was divided into two sections by a couch that stretched 3/4 of the space across the room. Dad came straight for me, jumped over the couch, laid me across his knee and spanked me. I don’t remember anything of that spanking because I was in such a state of shock at seeing my dad, who was not an athletic type at all--quite the contrary, jump over the couch.
But now he was silently weeping. "I’m sorry son," he finally said. "But I can’t get you a suit. Since I signed the right-to-work petition, I’ve barely made enough to pay my office help and rent. Our family has been living on savings for a year."
"Oh, that’s alright," I quickly responded. "I really don’t need a new suit." Which, of course, was true, I really didn’t. Looking back on it, I’m surprised I even asked. I have never been much of a "clothes horse". But even more surprising, and more troubling, was that Dad could have been struggling for so long and that I was completely oblivious to it.
Although I didn’t get my new suit right then, I certainly got it--with interest. I left for college the next year and all through my college and military career, everytime Dad would come to town and see me, or when I would go home, I knew that times were better for Dad, because almost invariably he would say, "Son, you look like you could do with a new suit." And unless I could prevent it by pointing out that he had just gotten me a new suit a couple of months previously, I would get a new suit.
The suit I remember best came at the end of my college career. "Son," he had said at graduation, or shortly after, "since you’ll be looking for work now, what you need is a new suit." By this time Dad was working as a Federal Judge so, I suspect, that since he was covered up by black robes all day, the suits he wore tended to be a bit on the flashy side, but nothing he ever wore or bought for himself could ever match, in flashiness at least, the suit he bought me. It was creme-colored with rust-colored stripes (or vice-versa) and must have been made of material that included iron filings. I remember going to the interview that eventually landed me a job. The company was about half a mile from closest bus stop and the roads to the plant had only dirt sidewalks. While walking there a car drove by splashing me with mud that covered my pants from the bottom to well above the knee. Since it was winter, I simply used snow to rub off the mud. After undergoing a process like that a normal suit would have looked like you had pulled it out of a trash pile--that suit looked almost as good as when I wore it out of the store. I have always felt that the suit had a good deal to do with my being hired. The man who hired me was not LDS and did not like BYU, but I suspect, that he took one look at my suit and thought, "This kid only went to BYU because his parents forced him to."
It took me several months to find work after graduation. It was the midst of a recession in which engineering was particularly hard hit. I got dozens of interviews, and many companies said that they were interested in me, but they had a hiring freeze (or were laying off) but that they expected to be hiring again in a few months. But, of course, in the meantime I had to get by. I was living in an attic of a house in Salt Lake, and, although, the rent was low, so were my finances. Finally, I realized that I could not hold on any longer. I had exactly enough (or so I thought--mistakenly, it turned out) to pay my rent, but no money for food or transportation. I cried almost every night wondering what to do. Should I bite the bullet and confess my poverty to my parents hoping they would offer to take me back in until I could find work? Should I simply start living in the street (rather unpleasant in Salt Lake in December)? It was while I was thus at my wits end that I got a call from Dad. He was flying from Virginia--where he was living at the time--to California but had a short layover in Salt Lake. Could I meet him at the airport for a couple of minutes? I agreed. I was wondering if I should lay out my problems to him. But when he came it was obvious there was no time. "I’m sorry son," he explained as he came off the plane. "I only have a minute to catch my next plane." I walked hurredly with him to the a near-by gate where he checked in. We had less than a minute or two before he had to board. As he boarded he handed me an envelope. "Your mother wanted you to have this," he said as he walked through the boarding gate. I waved good-bye and then opened the envelope. In it was a check for $300. I had never really understood his problems, but he always understood mine.
Tuesday, November 10, 2009
Remembering Dad--1
I guess I always took it for granted that Dad always had plenty of money and could give me anything I wanted but didn’t because he felt that it would not be good for me, so he was inclined to be chintzy, supposedly for my own good. Mom, on the other hand, would always give me anything I wanted--if she could, but most of the time she couldn’t because she was as dependent upon Dad as I was and it seemed to me that he was rather chintzy with her as well. I assumed it was probably because Dad recognized Mom’s weakness toward me and had to hold back on both of us "for my own good". As I say, I felt that way until the Christmas just before I turned eight.
The first Christmases I remember were as a very young boy when we were living in Germany. I don’t remember much about them, but I do remember that I thought they were absolutely wonderful. We always got a few little toys and our wooden shoes were filled with candy--mostly hard tack, but because we didn’t get very much candy in Germany, it was a real treat. Later, after we had returned to the US I came to resent the amount of hard tack candy in my Christmas stocking, feeling that it took up room that would be much better served with jelly and chocolate candies--a feeling that I shared--rather pointedly--in a letter to Santa--a feeling he must not have sympathized with because the amount of hard tack was not diminished. Nor did he dispense with the orange--a suggestion I also made pointing out that we had plenty of oranges in the kitchen.
I always felt that if our situation could be described, it would be described as one of "plenty". I suspect that part of the reason for that feeling was that although, in a sense, we were part of the occupying US forces, we were not military, and, therefore, lived among the German people. Our situation, compared with theirs, was one of great fortune.
Many years later, Dad told me what happened when we came back to the US. Dad had always been a civil servant, and, I suspect, planned on always being one. After he graduated from George Washington U. with a law degree, he was hired as the head of Social Security for the state of Arizona. But at the meeting with the senior senator from Arizona in which his appointment was announced, the Senator looked over his resume. "How can anyone from Idaho be over Social Security in Arizona?" he bellowed. "He is far and away the best qualified candidate," the Federal Social Security administrator assured him. "I don’t care about that", the Senator roared. "I don’t care if the guy over Social Security is blind, can’t read, can’t write, and has to use an X for his signature, all I care about is that he be from Arizona!"
So Dad’s appointment was rescinded and he was made the director of Social Security for Southern Idaho with offices in Pocatello instead. It turns out, that was probably a good thing, because Loni and I were born there and it seems that the only place Mom could ever have any children was in Pocatello. But Dad was ambitious and eager to get ahead. The chance came when the position for assistant Federal Attorney (or whatever they call the District Attorney for a State) became vacant. He applied and got the job, so we moved to Boise. We hadn’t lived in Boise very long when Dad got the chance to work with the war crime trials in Germany and he jumped at the chance.
I think the two years we spent in Germany were among the happiest of parent’s married life. They got to travel. Mom got to buy some really nice figurines and other beautiful things that were always so important to her and Dad really enjoyed his work. Of course, there were concerns as well, especially during the Berlin Airlift, when it looked like we might go to war with Russia and out family was in the place most likely to be first attacked. It was, in fact, the tension created by the Berlin Airlift that created the problem for Dad that resulted in his not being a permanent civil servant. If we were involved in a war with Russia, obviously, we wanted the wholehearted support of the German people. Amongst those people, Dad’s activity--the war crime trials--was very unpopular. They were halted and Dad came home.
When he went back to Washington to apply for a field position, he was told that because of his involvement with the war crimes trials--now a politically incorrect activity to have gotten oneself tied up with--they didn’t feel that they could send him "out into the field". Dad told me that his old boss at Social Security told him, "We certainly owe you something, but it will have to be here in Washington."
Dad told me many years later that after he heard that he went out and traveled around Washington. He said he looked at the people and the businesses and other things that were going on and said to himself, "I can’t do this. I can’t raise a family in this kind of environment." So he cut ties with the government and "hung out his shingle" in his hometown, Pocatello.
But it was pretty tough sledding in the first few years. Most of the time Dad was working. We hardly ever saw him. When he did come home for dinner, it was in, out, and back to the office. I can remember several occasions when Mom would hand me a little paper bag and say, "Take this to your Dad. It is his dinner. He is studying in the law library at the courthouse." (The courthouse was only a couple of blocks from our house.) Every year in those first years back from Germany Dad would call together shortly before Christmas and say something like, "I don’t want you to expect much from Christmas because we simply don’t have much money this year." Of course, that never bothered Loni or me (or, at least, it never bothered me) because all we ever got from Mom and Dad for Christmas was clothes. All the good stuff came from Santa Claus. I didn’t care that much what I wore, so even if Dad couldn’t afford to buy us anything, it was fine with me. I knew for one thing that if we ever ran out of clothes (which didn’t seem likely) that our Grandparents would come to the rescue before we had to go school naked.
All that changed shortly before the Christmas of my eighth year. Dad, as usual, called us together and said that we should not expect much for Christmas that year. I was a little uneasy because I had asked for a bicycle--something I knew to be quite expensive. So the next day I said to Mom, "Tell Dad not to worry about Christmas. Santa will take care of it for us."
Mom paused for a minute or two and then said rather deliberately (and I wish I could remember her exact words) something like, "I’m afraid that when people are poor, Santa doesn’t give them very much because he doesn’t want poor children to be spoiled and become dissatisfied with their parents." This was rather a shock to me, to say the least, but I more or less gave up on the whole idea of a bike.
Christmas came and I got my bicycle and several other things, smaller toys candy, and, of course, clothes. There was a hitch--a very bad hitch. The bicycle was an "American Flyer". I had seen it in a catalogue, so I knew that Santa Claus had not given it to me--it was Dad.
The next day I asked Mom, "What happens if someone can’t afford something and they tell the man at the store that they will pay for it later, but they really don’t have the money to pay for it?"
"Why they send the police to take the thing back and sometimes they put the person in jail." Mom sounded to me that she was as worried as I was about Christmas.
For the next few days, indeed, until I had to go back to school, I would sit by the front window. Every time a police car went by, I was sure he was coming to take back my bike and would demand to know where Dad was, so he could arrest him. After a while, of course, I ceased to worry and when spring came, I simply enjoyed the bike. Indeed, I think it was one of two Christmas presents I received that I remember with real fondness.
Years later I asked Dad why he always called us in and gave us the "don’t-expect-much-for-Christmas" lecture and then always bought so much to insure that we had a wonderful
Christmas. "You know," he replied with obvious pleasure as he reflected back. "That was the most amazing thing. When I called you in and told your mother and you kids not to expect much, I was in real earnest. I was almost desperate. But every year in those first few years when we were struggling, clients would come in just before Christmas--in a few cases, clients I had sent so many bills to that I never really expected them to pay me at all, and they would pay their entire bill. Generally, they would say something like,’I’m sorry this has taken so long, but I want to clear this out before the end of the year’. So we always had a nice Christmas. It’s a miracle really, or at least, I always thought it was."
Some people deserve miracles--Dad was one.
The first Christmases I remember were as a very young boy when we were living in Germany. I don’t remember much about them, but I do remember that I thought they were absolutely wonderful. We always got a few little toys and our wooden shoes were filled with candy--mostly hard tack, but because we didn’t get very much candy in Germany, it was a real treat. Later, after we had returned to the US I came to resent the amount of hard tack candy in my Christmas stocking, feeling that it took up room that would be much better served with jelly and chocolate candies--a feeling that I shared--rather pointedly--in a letter to Santa--a feeling he must not have sympathized with because the amount of hard tack was not diminished. Nor did he dispense with the orange--a suggestion I also made pointing out that we had plenty of oranges in the kitchen.
I always felt that if our situation could be described, it would be described as one of "plenty". I suspect that part of the reason for that feeling was that although, in a sense, we were part of the occupying US forces, we were not military, and, therefore, lived among the German people. Our situation, compared with theirs, was one of great fortune.
Many years later, Dad told me what happened when we came back to the US. Dad had always been a civil servant, and, I suspect, planned on always being one. After he graduated from George Washington U. with a law degree, he was hired as the head of Social Security for the state of Arizona. But at the meeting with the senior senator from Arizona in which his appointment was announced, the Senator looked over his resume. "How can anyone from Idaho be over Social Security in Arizona?" he bellowed. "He is far and away the best qualified candidate," the Federal Social Security administrator assured him. "I don’t care about that", the Senator roared. "I don’t care if the guy over Social Security is blind, can’t read, can’t write, and has to use an X for his signature, all I care about is that he be from Arizona!"
So Dad’s appointment was rescinded and he was made the director of Social Security for Southern Idaho with offices in Pocatello instead. It turns out, that was probably a good thing, because Loni and I were born there and it seems that the only place Mom could ever have any children was in Pocatello. But Dad was ambitious and eager to get ahead. The chance came when the position for assistant Federal Attorney (or whatever they call the District Attorney for a State) became vacant. He applied and got the job, so we moved to Boise. We hadn’t lived in Boise very long when Dad got the chance to work with the war crime trials in Germany and he jumped at the chance.
I think the two years we spent in Germany were among the happiest of parent’s married life. They got to travel. Mom got to buy some really nice figurines and other beautiful things that were always so important to her and Dad really enjoyed his work. Of course, there were concerns as well, especially during the Berlin Airlift, when it looked like we might go to war with Russia and out family was in the place most likely to be first attacked. It was, in fact, the tension created by the Berlin Airlift that created the problem for Dad that resulted in his not being a permanent civil servant. If we were involved in a war with Russia, obviously, we wanted the wholehearted support of the German people. Amongst those people, Dad’s activity--the war crime trials--was very unpopular. They were halted and Dad came home.
When he went back to Washington to apply for a field position, he was told that because of his involvement with the war crimes trials--now a politically incorrect activity to have gotten oneself tied up with--they didn’t feel that they could send him "out into the field". Dad told me that his old boss at Social Security told him, "We certainly owe you something, but it will have to be here in Washington."
Dad told me many years later that after he heard that he went out and traveled around Washington. He said he looked at the people and the businesses and other things that were going on and said to himself, "I can’t do this. I can’t raise a family in this kind of environment." So he cut ties with the government and "hung out his shingle" in his hometown, Pocatello.
But it was pretty tough sledding in the first few years. Most of the time Dad was working. We hardly ever saw him. When he did come home for dinner, it was in, out, and back to the office. I can remember several occasions when Mom would hand me a little paper bag and say, "Take this to your Dad. It is his dinner. He is studying in the law library at the courthouse." (The courthouse was only a couple of blocks from our house.) Every year in those first years back from Germany Dad would call together shortly before Christmas and say something like, "I don’t want you to expect much from Christmas because we simply don’t have much money this year." Of course, that never bothered Loni or me (or, at least, it never bothered me) because all we ever got from Mom and Dad for Christmas was clothes. All the good stuff came from Santa Claus. I didn’t care that much what I wore, so even if Dad couldn’t afford to buy us anything, it was fine with me. I knew for one thing that if we ever ran out of clothes (which didn’t seem likely) that our Grandparents would come to the rescue before we had to go school naked.
All that changed shortly before the Christmas of my eighth year. Dad, as usual, called us together and said that we should not expect much for Christmas that year. I was a little uneasy because I had asked for a bicycle--something I knew to be quite expensive. So the next day I said to Mom, "Tell Dad not to worry about Christmas. Santa will take care of it for us."
Mom paused for a minute or two and then said rather deliberately (and I wish I could remember her exact words) something like, "I’m afraid that when people are poor, Santa doesn’t give them very much because he doesn’t want poor children to be spoiled and become dissatisfied with their parents." This was rather a shock to me, to say the least, but I more or less gave up on the whole idea of a bike.
Christmas came and I got my bicycle and several other things, smaller toys candy, and, of course, clothes. There was a hitch--a very bad hitch. The bicycle was an "American Flyer". I had seen it in a catalogue, so I knew that Santa Claus had not given it to me--it was Dad.
The next day I asked Mom, "What happens if someone can’t afford something and they tell the man at the store that they will pay for it later, but they really don’t have the money to pay for it?"
"Why they send the police to take the thing back and sometimes they put the person in jail." Mom sounded to me that she was as worried as I was about Christmas.
For the next few days, indeed, until I had to go back to school, I would sit by the front window. Every time a police car went by, I was sure he was coming to take back my bike and would demand to know where Dad was, so he could arrest him. After a while, of course, I ceased to worry and when spring came, I simply enjoyed the bike. Indeed, I think it was one of two Christmas presents I received that I remember with real fondness.
Years later I asked Dad why he always called us in and gave us the "don’t-expect-much-for-Christmas" lecture and then always bought so much to insure that we had a wonderful
Christmas. "You know," he replied with obvious pleasure as he reflected back. "That was the most amazing thing. When I called you in and told your mother and you kids not to expect much, I was in real earnest. I was almost desperate. But every year in those first few years when we were struggling, clients would come in just before Christmas--in a few cases, clients I had sent so many bills to that I never really expected them to pay me at all, and they would pay their entire bill. Generally, they would say something like,’I’m sorry this has taken so long, but I want to clear this out before the end of the year’. So we always had a nice Christmas. It’s a miracle really, or at least, I always thought it was."
Some people deserve miracles--Dad was one.
Wednesday, August 26, 2009
Personal Economics
With this essay I bring my series on economics to a close. This essay and the previous two require extensive work, but I decided that I need to get it over with and move on. Next month I plan to do reviews.
Personal Economics--Conclusion
Ever since Adam Smith showed that, because of the benefits we all derive from the division of labor, every real advance in economics has shown us how we can better live together in peace. Peace is the reward for correct living. When men are at peace they serve each other in ways they cannot even conceive. People on the other side of the world make it possible for me to enjoy blessings that help me meet my needs, but they do it without knowing me or without me knowing them. People all over the world help each other by helping themselves when they live by the six simple rules outlined in the previous essays.
Following those simple rules helps us to avoid the pitfalls that create disharmony, contention, and finally, conflict, which, in extreme cases results in violence and war. The first pitfall is the use of force to make others adopt our ends. The second, even more destructive, is the use of force to make others serve our ends. The subjective theory of value, Rule IV, applies not only to things but even more so to ends. I cannot judge< or place a value for you, on your ends. When I do, I almost always am tempted to use force for one of the purposes above, i.e. to get you to adopt mine or to use you to serve my ends.
What real economics attempts to do is first have people clarify their ends, i.e. decide what it is that you really want. Having clarified your ends, examine the means to achieve those ends. There is no purpose in attempting to examine and evaluate other peoples ends, but there is purpose in examining and evaluating the means they use to achieve those ends.
When we examine the means people use to achieve the ends they declare in light of the 6 rules outlined in the previous essays, we find that the means frequently lead to very different ends. In the eyes of the Austrians, this is the best way to determine if means are "good" or "bad"--"moral" or "immoral". In every action we should ask ourselves, what is the end I wish to achieve and will this action--the means--achieve that end?
Personal Economics--Conclusion
Ever since Adam Smith showed that, because of the benefits we all derive from the division of labor, every real advance in economics has shown us how we can better live together in peace. Peace is the reward for correct living. When men are at peace they serve each other in ways they cannot even conceive. People on the other side of the world make it possible for me to enjoy blessings that help me meet my needs, but they do it without knowing me or without me knowing them. People all over the world help each other by helping themselves when they live by the six simple rules outlined in the previous essays.
Following those simple rules helps us to avoid the pitfalls that create disharmony, contention, and finally, conflict, which, in extreme cases results in violence and war. The first pitfall is the use of force to make others adopt our ends. The second, even more destructive, is the use of force to make others serve our ends. The subjective theory of value, Rule IV, applies not only to things but even more so to ends. I cannot judge< or place a value for you, on your ends. When I do, I almost always am tempted to use force for one of the purposes above, i.e. to get you to adopt mine or to use you to serve my ends.
What real economics attempts to do is first have people clarify their ends, i.e. decide what it is that you really want. Having clarified your ends, examine the means to achieve those ends. There is no purpose in attempting to examine and evaluate other peoples ends, but there is purpose in examining and evaluating the means they use to achieve those ends.
When we examine the means people use to achieve the ends they declare in light of the 6 rules outlined in the previous essays, we find that the means frequently lead to very different ends. In the eyes of the Austrians, this is the best way to determine if means are "good" or "bad"--"moral" or "immoral". In every action we should ask ourselves, what is the end I wish to achieve and will this action--the means--achieve that end?
Wednesday, August 12, 2009
Personal Economics--Rule VI
Personal Economics--Rule VI
"For we wrestle not against flesh and blood, but against principalities, against powers, against the rules of darkness of this world, against spiritual wickedness in high places."
Ephesians
Rule VI says basically, "Know your enemy and keep your guard up." This rule stems from the work of Ludwig von Mises and Frederick Hayek, but Hayek shared the Nobel Prize for his work in explicating it. In economics it is simply the explanation of what is called the business cycle or boom-bust cycle. Karl Marx had explained it simply as an inherent feature of capitalism. Others had tried to explain it in a more detailed manner, but had failed. For example Stanley Jevons had attempted an explanation that correlated the boom-bust cycle with sunspots. At first glance, this sounds even more mysterious than the Marx it-is-just-an-inexplicable-part-of-capitalism theory. But Jevons theory attempted to make it more rationalistic, because it would tie the boom-bust cycle to a crop productivity cycle.
What von Mises and Hayek did was to show that the boom-bust cycle in the economy was tied to credit expansion. Banks increase their profits by making more loans and, hence, the temptation is to cut back on their reserves and loan more of their available capital. Of course, if a single bank does this and becomes over-extended, they quickly get into trouble. The problem is self-correcting. The problem only becomes a national one when there is a government controlled central bank, such as the Federal Reserve. Most countries have these. They are able to extend the money supply, i.e. allow all the member banks to expand their credit, thus lowering the interest rate. Unfortunately, this creates an artificial boom. It sends false signals to entrepreneurs who are eager to launch new enterprises, but are restrained from doing so for all but the most promising enterprises by the shortage of available investment capital. When, however, the money supply is expanded, i.e. inflated, the illusion is created that there is plenty of capital for investment in enterprises that earlier seemed unpromising. Unfortunately, all that has been expanded is credit. In an uncorrupt society, capital is available only as people save--hence, leaving vital resources, e.g. capital goods, available entrepreneurs. Thrift is a virtue not only because it allows individuals and families to prepare against a rainy day, but because it permits investment in new tools, equipment and plants and, thereby, increases the value of the labor of the people who have better equipment and tools to work with. Hence, the virtue of thrift increases prosperity.
Credit expansion, i.e. inflating the money supply gives the illusion that society is ‘better off’, i.e. more virtuous, without actually being so. Entrepreneurs feel that there is more capital available but the amount of capital goods remains the same. This becomes clear when it is apparent that many entrepreneurs have invested in enterprises that cannot be sustained. They lay off workers, some even go bankrupt and the economy is said to be in the bust part of its cycle.
If, for example, I, and thousands of others, decide to put off buying a new car, and put the money saved in the bank, then there is not only money available to loan, but there is additional steel so if an entrepreneur decides to build a new factory, the necessary steel is available. If, however, I, and thousands of others, go ahead and buy the new car, and the so-called capital is available only because the money supply has been inflated, there is no additional steel available for the building of the factory and before it can be built, the price of steel rises to the point that the new factory enterprise is clearly not going to be profitable and is abandoned.
The bottom line is that the desire to have "something for nothing", to succeed without effort, to have all the good of virtuous living without any actual virtue, has put pressure on the government to expand the money supply and, hence, create a boom. This undermines the work of entrepreneurs who become bitter because they have been misled, and misinformed. They feel betrayed and turn to political entrepreneurship. People become convinced that only political action is effective and that the only way to succeed is to use the force of law. In economics, credit expansion is analogous to sin--enticing at first, but leaves disaster in its wake.
On a personal level it is a reminder that if life is getting easier, you better be awfully careful that you are not entering an artificial boom made possible by an enemy creating an illusion. Hence, it is always a good idea to "know your enemy and what he is up to."
"For we wrestle not against flesh and blood, but against principalities, against powers, against the rules of darkness of this world, against spiritual wickedness in high places."
Ephesians
Rule VI says basically, "Know your enemy and keep your guard up." This rule stems from the work of Ludwig von Mises and Frederick Hayek, but Hayek shared the Nobel Prize for his work in explicating it. In economics it is simply the explanation of what is called the business cycle or boom-bust cycle. Karl Marx had explained it simply as an inherent feature of capitalism. Others had tried to explain it in a more detailed manner, but had failed. For example Stanley Jevons had attempted an explanation that correlated the boom-bust cycle with sunspots. At first glance, this sounds even more mysterious than the Marx it-is-just-an-inexplicable-part-of-capitalism theory. But Jevons theory attempted to make it more rationalistic, because it would tie the boom-bust cycle to a crop productivity cycle.
What von Mises and Hayek did was to show that the boom-bust cycle in the economy was tied to credit expansion. Banks increase their profits by making more loans and, hence, the temptation is to cut back on their reserves and loan more of their available capital. Of course, if a single bank does this and becomes over-extended, they quickly get into trouble. The problem is self-correcting. The problem only becomes a national one when there is a government controlled central bank, such as the Federal Reserve. Most countries have these. They are able to extend the money supply, i.e. allow all the member banks to expand their credit, thus lowering the interest rate. Unfortunately, this creates an artificial boom. It sends false signals to entrepreneurs who are eager to launch new enterprises, but are restrained from doing so for all but the most promising enterprises by the shortage of available investment capital. When, however, the money supply is expanded, i.e. inflated, the illusion is created that there is plenty of capital for investment in enterprises that earlier seemed unpromising. Unfortunately, all that has been expanded is credit. In an uncorrupt society, capital is available only as people save--hence, leaving vital resources, e.g. capital goods, available entrepreneurs. Thrift is a virtue not only because it allows individuals and families to prepare against a rainy day, but because it permits investment in new tools, equipment and plants and, thereby, increases the value of the labor of the people who have better equipment and tools to work with. Hence, the virtue of thrift increases prosperity.
Credit expansion, i.e. inflating the money supply gives the illusion that society is ‘better off’, i.e. more virtuous, without actually being so. Entrepreneurs feel that there is more capital available but the amount of capital goods remains the same. This becomes clear when it is apparent that many entrepreneurs have invested in enterprises that cannot be sustained. They lay off workers, some even go bankrupt and the economy is said to be in the bust part of its cycle.
If, for example, I, and thousands of others, decide to put off buying a new car, and put the money saved in the bank, then there is not only money available to loan, but there is additional steel so if an entrepreneur decides to build a new factory, the necessary steel is available. If, however, I, and thousands of others, go ahead and buy the new car, and the so-called capital is available only because the money supply has been inflated, there is no additional steel available for the building of the factory and before it can be built, the price of steel rises to the point that the new factory enterprise is clearly not going to be profitable and is abandoned.
The bottom line is that the desire to have "something for nothing", to succeed without effort, to have all the good of virtuous living without any actual virtue, has put pressure on the government to expand the money supply and, hence, create a boom. This undermines the work of entrepreneurs who become bitter because they have been misled, and misinformed. They feel betrayed and turn to political entrepreneurship. People become convinced that only political action is effective and that the only way to succeed is to use the force of law. In economics, credit expansion is analogous to sin--enticing at first, but leaves disaster in its wake.
On a personal level it is a reminder that if life is getting easier, you better be awfully careful that you are not entering an artificial boom made possible by an enemy creating an illusion. Hence, it is always a good idea to "know your enemy and what he is up to."
Friday, August 7, 2009
Personal Economics--Rule V.
Personal Economics--Rule V
Whosoever will be chief among you, let him be your servant.
Matthew
Would God that all the Lord’s people were prophets.
Numbers
Rule V says simply that it is the entrepreneurial component of our exchanges that improves our lives, increases our choices, hence, our freedom, and advances civilization. Of course, in the ordinary exchanges that we make every day, it is hard to recognize an entrepreneurial component at all. An entrepreneurial component occurs when something has changed, when things are no longer as they have been and that change results in an opportunity for us to serve in a way that requires us to foresee future events and that will help people in ways they have not been previously helped--as we say, "to do something different."
The most successful entrepreneurs are envied because they reap what are called profits. Real profit is a very poorly understood concept. In a sense, if I plant a seed and reap twenty, forty, or even sixty times what I planted even after subtracting the cost of fertilizers, water and other inputs we refer to that as profit, but it becomes entrepreneurial profit only if it is serving a need that has come about as a result of a change. If, for example, I realize that people need bread so I purchase an existing farm and begin growing wheat, I am not in the strictest Austrian sense an entrepreneur. If thousands of others have done likewise and there is, consequently, a large surplus of wheat so that I and the other thousands cannot even break even on our venture, and in that extremity, I use my wheat for something entirely different, or market it in a new way, or in some other way use my wheat to bring something to consumers that they want but is new to them, then I become an entrepreneur.
It is important to recognize the difference between technical components of exchange and entrepreneurial components. George Washington Carver, for example, discovered many new products that could be made with peanuts, because so many people were growing peanuts that the situation was for them like the one outlined above for wheat farmers. What he did was provide technical input. If he, or anyone else, actually made and marketed any of those new products and consequently, gained more resources in the making and marketing than were used in the growing of the peanuts, he became an entrepreneur..
It is important to recognize that it is the entrepreneurial component of every exchange that enriches our lives and advances civilization. But it is also true that because entrepreneurs are envied and because so many people are eager to live without having to actually serve that entrepreneurs are almost always--and particularly in corrupt cultures--vilified. In our country where kings are looked down on, extremely successful entrepreneurs are referred to pejoratively as "kings". Hence, Andrew Carnegie was the "steel king", Hershey the "chocolate king". Our history books refer to these men as being powerful and often, devious and underhanded, and other characteristics we associate with kings. But it is important, indeed, it is critical to remember that kings, like Henry VIII and Louis XIV, were powerful because they ruled. An entrepreneurial king is powerful only to the extent that he serves. The day that consumers feel that Nestle’s chocolate it cheaper or better (or both) than Hershey’s, is the day that Hershey becomes the "former chocolate king".
All too often we confuse technical ability and expertise with entrepreneurship. Two examples, that I like to use to illustrate the difference are Thomas Edison and Gilbert and Sullivan.
Thomas Edison is often criticized as having borrowed other’s ideas, purchased their patents and then taken credit for the invention himself. For example, Joseph Swann’s English patent on the electric light bulb preceded Edison’s and numerous other inventors had patents relating to the electric light bulb, some of which Edison purchased, but the fact remains that without Edison we would not have had a working electric light bulb in people’s homes anywhere near as soon as we did, and possibly not ever. Edison and his team got all the financing and made all the auxiliary inventions and equipment necessary to make the electric light bulb available to the ordinary consumer.
My personal favorite is Gilbert and Sullivan. I very much enjoy their operettas, particularly, "Pirates", "Gondoliers", and "Patience". But the fact of the matter is that we would not have had those many operettas were it not for the entrepreneur who worked so hard to get the two to work together, Richard D’Oily Carte. Indeed, the real end of the relationship (with the "Gondoliers") came largely because Carte abandoned his role as entrepreneur and took sides with Sullivan. Recognizing his mistake, he tried to heal the breech, and the two did, in fact, collaborate on two more operettas, but so half-heartedly that they are never performed except by companies determined to claim to have done them all. Like all entrepreneurs, Carte took risks. For example, he was the first person in England to install electric lighting in a theater. Like most, he also had his failures. For example, he built a theater that was to be used exclusively for English operas. The first one (by Sullivan) ran for 160 consecutive performances--probably a world record for consecutive performances for an opera, but their was no second "English opera" so Carte had to sell his theater to a vaudeville company.
Rule V says simply that we should strive to increase the entrepreneur component of all our interactions. Real entrepreneurs are essential to the free society. The essential ingredients in entrepreneurial activity are courage and foresight--two qualitites almost totally missing in government planners, bureaucrats, politicians, and, alas, in most, corporate managers.
Whosoever will be chief among you, let him be your servant.
Matthew
Would God that all the Lord’s people were prophets.
Numbers
Rule V says simply that it is the entrepreneurial component of our exchanges that improves our lives, increases our choices, hence, our freedom, and advances civilization. Of course, in the ordinary exchanges that we make every day, it is hard to recognize an entrepreneurial component at all. An entrepreneurial component occurs when something has changed, when things are no longer as they have been and that change results in an opportunity for us to serve in a way that requires us to foresee future events and that will help people in ways they have not been previously helped--as we say, "to do something different."
The most successful entrepreneurs are envied because they reap what are called profits. Real profit is a very poorly understood concept. In a sense, if I plant a seed and reap twenty, forty, or even sixty times what I planted even after subtracting the cost of fertilizers, water and other inputs we refer to that as profit, but it becomes entrepreneurial profit only if it is serving a need that has come about as a result of a change. If, for example, I realize that people need bread so I purchase an existing farm and begin growing wheat, I am not in the strictest Austrian sense an entrepreneur. If thousands of others have done likewise and there is, consequently, a large surplus of wheat so that I and the other thousands cannot even break even on our venture, and in that extremity, I use my wheat for something entirely different, or market it in a new way, or in some other way use my wheat to bring something to consumers that they want but is new to them, then I become an entrepreneur.
It is important to recognize the difference between technical components of exchange and entrepreneurial components. George Washington Carver, for example, discovered many new products that could be made with peanuts, because so many people were growing peanuts that the situation was for them like the one outlined above for wheat farmers. What he did was provide technical input. If he, or anyone else, actually made and marketed any of those new products and consequently, gained more resources in the making and marketing than were used in the growing of the peanuts, he became an entrepreneur..
It is important to recognize that it is the entrepreneurial component of every exchange that enriches our lives and advances civilization. But it is also true that because entrepreneurs are envied and because so many people are eager to live without having to actually serve that entrepreneurs are almost always--and particularly in corrupt cultures--vilified. In our country where kings are looked down on, extremely successful entrepreneurs are referred to pejoratively as "kings". Hence, Andrew Carnegie was the "steel king", Hershey the "chocolate king". Our history books refer to these men as being powerful and often, devious and underhanded, and other characteristics we associate with kings. But it is important, indeed, it is critical to remember that kings, like Henry VIII and Louis XIV, were powerful because they ruled. An entrepreneurial king is powerful only to the extent that he serves. The day that consumers feel that Nestle’s chocolate it cheaper or better (or both) than Hershey’s, is the day that Hershey becomes the "former chocolate king".
All too often we confuse technical ability and expertise with entrepreneurship. Two examples, that I like to use to illustrate the difference are Thomas Edison and Gilbert and Sullivan.
Thomas Edison is often criticized as having borrowed other’s ideas, purchased their patents and then taken credit for the invention himself. For example, Joseph Swann’s English patent on the electric light bulb preceded Edison’s and numerous other inventors had patents relating to the electric light bulb, some of which Edison purchased, but the fact remains that without Edison we would not have had a working electric light bulb in people’s homes anywhere near as soon as we did, and possibly not ever. Edison and his team got all the financing and made all the auxiliary inventions and equipment necessary to make the electric light bulb available to the ordinary consumer.
My personal favorite is Gilbert and Sullivan. I very much enjoy their operettas, particularly, "Pirates", "Gondoliers", and "Patience". But the fact of the matter is that we would not have had those many operettas were it not for the entrepreneur who worked so hard to get the two to work together, Richard D’Oily Carte. Indeed, the real end of the relationship (with the "Gondoliers") came largely because Carte abandoned his role as entrepreneur and took sides with Sullivan. Recognizing his mistake, he tried to heal the breech, and the two did, in fact, collaborate on two more operettas, but so half-heartedly that they are never performed except by companies determined to claim to have done them all. Like all entrepreneurs, Carte took risks. For example, he was the first person in England to install electric lighting in a theater. Like most, he also had his failures. For example, he built a theater that was to be used exclusively for English operas. The first one (by Sullivan) ran for 160 consecutive performances--probably a world record for consecutive performances for an opera, but their was no second "English opera" so Carte had to sell his theater to a vaudeville company.
Rule V says simply that we should strive to increase the entrepreneur component of all our interactions. Real entrepreneurs are essential to the free society. The essential ingredients in entrepreneurial activity are courage and foresight--two qualitites almost totally missing in government planners, bureaucrats, politicians, and, alas, in most, corporate managers.
Monday, July 20, 2009
Personal Economics--Rule IV
Personal Economics--Rule IV
"We hold these truths to be self-evident, that all men are created equal....."
Declaration of Independence
"Of a truth I perceive that God is no respecter of persons."
Acts
Rule IV in personal economics was originally formulated by Carl Menger--an Austrian. It says simply that the value of anything can be determined only in exchange and the only people who make that determination are those who are parties to the exchange. There is no such thing as a value in use--a concept that grew out of the idea that value can be objectively determined. Likewise, the moment an exchange is made, the value of the exchanged items becomes a fact of history, but not of economics--a reality known to almost anyone who has ever purchased a new automobile and then soon decides he would like to sell it.
This rule, based on the subjective theory of value, is the basis for peaceful relations between people and peoples. Some people believe that the idea of the division of labor is sufficient to guarantee peace. This results in a sort of "enlightened self-interest", but unfortunately, this is seldom enough to guarantee peace for the simple reason that when we are stressed, we tend to feel that our interests are more important than others. It is only in the constant reminder, through every means possible, religious, moral, political, and economic, that every other man or woman is as important as we are, that we can hope to achieve lasting peace. The political statement of that fact is in our founding document, the Declaration of Independence. The economic statement of that fact, and the necessary adjunct to the political statement is rule IV i.e. the subjective theory of value.
We see the violation of this rule on every hand. A common example is the price of gasoline. As soon as the price rises, there is a hue and cry for politicians to use the force of law to bring the price down. Rule IV says, however, that no one can determine what the price of gasoline should be except those who are exchanging something to obtain it. The obvious remedy if a person feels that the price is too high is not buy any. The usual response to this suggestion is, "I have no choice. I need gasoline to run my car and I need the car to go to work." This is, of course, false. A person always has alternatives in a free society. By calling for the use of force, a person is simply saying that he wishes everything to stay the same and is, therefore, willing, even eager, to use force to adjust things to suit himself.
Of course, if the price is high because the government is subsidizing it or regulating it or in some other way using the force of law to maintain it, the complaint is legitimate, but the means are not. It hardly justifies using force on your side because force is being used on the other. Rule IV still applies, however, making an attempt to get the subsidies, regulations, etc, removed is, naturally, a legitimate effort. When Ronald Reagan announced that he would remove all regulations from the price of gasoline, his critics countered that the price would quickly rise dramatically to #3 a gallon. The price at the time was just under $2 a gallon. They were right. The price quickly rose, but then steadily declined until it got down to almost $1 a gallon. Reagan was simply applying Rule IV to gasoline. Nobody knows what it "should" cost except those who are buying and/or selling it. Once the transaction, i.e. the sale, is completed, the price, while of interest, is not an economic fact, it is a historical fact, interesting, but not determining.
I well remember going into the gas station where I usually buy gas a few weeks after Reagan made his announcement. The manager told his clerk in a very discouraged tone of voice, "I’ve got to go out and lower the prices again." Before Reagan made his announcement and for a few weeks after, the price was always raised in the middle of the night just as the station was closing, but now it was being lowered in the middle of the day so everyone could see that the station owner was trying to remain competitive. The station closest to my house went out of business at this time. I guess the owner felt that at that low a price, he simply could not compete. His last act upon closing the station for the last time was list the price of gasoline on the big markee as being $5.99 per gallon. That is undoubtedly what he wished he could charge and possibly felt that it would take that price to stay in business, but he knew that he would get no takers, so he went quietly into the night--no longer a gas station owner.
Rule IV is most controversial when it is applied to labor. People selling their services tend to feel that they are better than others. When they buy services, e. g. hire someone to mow their lawn, they typically do it in the way they would buy anything else, i.e. they offer to pay a certain amount in exchange for the service. But when they are selling their services they are eager to use the force of law on their side and burden the cost of their labor with all kinds of benefits and extensions and provisions making it difficult to be laid off or fired. They then comment, "You shouldn’t be able to buy a man’s work like you would buy a sack of potatoes." What the person is saying, of course, is that in his mind he is better than others and deserves to be treated better.
Politicians, political activists, lobbyists, lawyers, have been eager to use this conceit to get laws passed and become advocates for the "working man". The result, of course, is that labor is enormously burdened and unemployment is common.
Of course, Rule IV actually extends to all values, not just exchangeable goods, because in a civilized society we are always exchanging--ideas, thoughts, information, theories as well as tangible goods. Rule IV says that we can only judge another person’s values in such exchanges. His opinion, his ideas, his lifestyle, is equal to everyone else’s until he must bring them somehow into the marketplace for exchange. Then his value, and his values, can be objectively determined, but only by those who are party to the exchange.
"We hold these truths to be self-evident, that all men are created equal....."
Declaration of Independence
"Of a truth I perceive that God is no respecter of persons."
Acts
Rule IV in personal economics was originally formulated by Carl Menger--an Austrian. It says simply that the value of anything can be determined only in exchange and the only people who make that determination are those who are parties to the exchange. There is no such thing as a value in use--a concept that grew out of the idea that value can be objectively determined. Likewise, the moment an exchange is made, the value of the exchanged items becomes a fact of history, but not of economics--a reality known to almost anyone who has ever purchased a new automobile and then soon decides he would like to sell it.
This rule, based on the subjective theory of value, is the basis for peaceful relations between people and peoples. Some people believe that the idea of the division of labor is sufficient to guarantee peace. This results in a sort of "enlightened self-interest", but unfortunately, this is seldom enough to guarantee peace for the simple reason that when we are stressed, we tend to feel that our interests are more important than others. It is only in the constant reminder, through every means possible, religious, moral, political, and economic, that every other man or woman is as important as we are, that we can hope to achieve lasting peace. The political statement of that fact is in our founding document, the Declaration of Independence. The economic statement of that fact, and the necessary adjunct to the political statement is rule IV i.e. the subjective theory of value.
We see the violation of this rule on every hand. A common example is the price of gasoline. As soon as the price rises, there is a hue and cry for politicians to use the force of law to bring the price down. Rule IV says, however, that no one can determine what the price of gasoline should be except those who are exchanging something to obtain it. The obvious remedy if a person feels that the price is too high is not buy any. The usual response to this suggestion is, "I have no choice. I need gasoline to run my car and I need the car to go to work." This is, of course, false. A person always has alternatives in a free society. By calling for the use of force, a person is simply saying that he wishes everything to stay the same and is, therefore, willing, even eager, to use force to adjust things to suit himself.
Of course, if the price is high because the government is subsidizing it or regulating it or in some other way using the force of law to maintain it, the complaint is legitimate, but the means are not. It hardly justifies using force on your side because force is being used on the other. Rule IV still applies, however, making an attempt to get the subsidies, regulations, etc, removed is, naturally, a legitimate effort. When Ronald Reagan announced that he would remove all regulations from the price of gasoline, his critics countered that the price would quickly rise dramatically to #3 a gallon. The price at the time was just under $2 a gallon. They were right. The price quickly rose, but then steadily declined until it got down to almost $1 a gallon. Reagan was simply applying Rule IV to gasoline. Nobody knows what it "should" cost except those who are buying and/or selling it. Once the transaction, i.e. the sale, is completed, the price, while of interest, is not an economic fact, it is a historical fact, interesting, but not determining.
I well remember going into the gas station where I usually buy gas a few weeks after Reagan made his announcement. The manager told his clerk in a very discouraged tone of voice, "I’ve got to go out and lower the prices again." Before Reagan made his announcement and for a few weeks after, the price was always raised in the middle of the night just as the station was closing, but now it was being lowered in the middle of the day so everyone could see that the station owner was trying to remain competitive. The station closest to my house went out of business at this time. I guess the owner felt that at that low a price, he simply could not compete. His last act upon closing the station for the last time was list the price of gasoline on the big markee as being $5.99 per gallon. That is undoubtedly what he wished he could charge and possibly felt that it would take that price to stay in business, but he knew that he would get no takers, so he went quietly into the night--no longer a gas station owner.
Rule IV is most controversial when it is applied to labor. People selling their services tend to feel that they are better than others. When they buy services, e. g. hire someone to mow their lawn, they typically do it in the way they would buy anything else, i.e. they offer to pay a certain amount in exchange for the service. But when they are selling their services they are eager to use the force of law on their side and burden the cost of their labor with all kinds of benefits and extensions and provisions making it difficult to be laid off or fired. They then comment, "You shouldn’t be able to buy a man’s work like you would buy a sack of potatoes." What the person is saying, of course, is that in his mind he is better than others and deserves to be treated better.
Politicians, political activists, lobbyists, lawyers, have been eager to use this conceit to get laws passed and become advocates for the "working man". The result, of course, is that labor is enormously burdened and unemployment is common.
Of course, Rule IV actually extends to all values, not just exchangeable goods, because in a civilized society we are always exchanging--ideas, thoughts, information, theories as well as tangible goods. Rule IV says that we can only judge another person’s values in such exchanges. His opinion, his ideas, his lifestyle, is equal to everyone else’s until he must bring them somehow into the marketplace for exchange. Then his value, and his values, can be objectively determined, but only by those who are party to the exchange.
Subscribe to:
Posts (Atom)