Archives for March 2011

The world’s most important job, 2011

Movie director.

Teacher is near the bottom. At the bottom, for the 6000th year in a row? Mother.

And he plays a mean air accordion, too

Meet the wage-earning world’s most crucial person, James Cameron. What he does means vastly more than what any 5th-grade home room warden ever has done or ever will do. According to Variety, Cameron made $257 million last year. That dwarfs the highest salary earned by anyone on Wall Street (Hugh “Skip” McGee III*, who drew $25 million for presiding over Lehman’s destruction), the highest salary earned by an athlete (Tiger Woods, $91 million), and the highest salary earned by an athlete who doesn’t have to fork over half of it under the biggest divorce settlement in the history of the universe (Phil Mickelson, $66 million. Mickelson demonstrates the rule, as always – encase your baby’s right hand in plaster until he learns how to punch, twirl a drumstick, field a grounder, strum a guitar, throw a football, shoot a free throw, sign a death warrant, masturbate and use scissors with the left.)

Cameron produced Avatar, which your blogger would rather visit the dentist than sit through, but that’s not the point. Tens of millions of others not only have the opposite opinion, but are willing to put money behind it. Cameron has the ability to turn a substantial profit given even gigantic expenses (Avatar apparently cost $230 million to make, creating a hole that perhaps no one else had the acumen to dig out of.) Is that more important than teaching a child to spell and calculate square roots, assuming the teacher knows how to do both herself?
Yes.

It doesn’t matter that movies are mindless entertainment while literacy and numeracy are vital skills. If your profession entails doing what tens of millions of others can do – keeping juveniles occupied for 6 hours a day while their parents appreciate the break from the misery that is child-rearing – you’re never going to get rich. You’re 99.9% certain never to get rich on salary regardless of what you do for a living, but that’s neither here nor there.

If you’re a teacher, you’re welcome to complain about the injustice of the salary structure. You can even whine to your union, and buy pencils and school supplies with your own money if you like. It’s not quite the equivalent of nailing Yourself to a crucifix and dying a painful death for mankind’s sins, but it’s close.

Hopefully we don’t need to state the irrelevant, but here it is anyway: as a person, James Cameron sounds like a nightmare. His next wife will be #6. He’s not satisfied being an atheist, but has to let everyone who’s listening know that he’s evolved to the point where what’s unknowable to him is thus unknowable to the universe. He’s one of the self-righteously indignant who expressed ceremonial displeasure with the presidency of George W. Bush, which in Cameron’s case entailed rescinding his application for United States citizenship. Why he didn’t apply for naturalization under the Nixon, Ford, Carter, Reagan, Bush Sr., Clinton or Obama administrations, you’d have to ask Cameron. Despite living in Canada for his first 17 years and spending the subsequent 39 in the United States, Cameron believes that any nominal national fealty he should feel should be toward a nation that he rejected – rather than the only one in which he could earn $257 million a year.

Good luck reaching him to bring this to his attention, given that he’s too busy working. And employing dozens, many of them at extremely comfortable salaries of their own. Those dozens, by the way, need to spend that money somewhere. And do. There are far more blue-collar people engaged in the occupation of building yachts than there are white-collar yacht owners. Cameron’s latest film grossed close to $3 billion worldwide. Few investments that large offer that great a return, and few investments that offer that great a return are that large. Cameron’s talents enable 20th Century Fox to turn a profit, expand its operations and hire more people. Shareholders of the studio’s parent company, News Corporation, watch their portfolios increase in value. News Corp’s rising stock price strengthens the values of the 401(k)s and IRAs that it’s a constituent of, meaning greater wealth for the myriad non-rich people who therefore each own a modest part of the company.

This isn’t just a curious story. It applies to the real world. Your world. How? If purely psychological rewards are what motivate you professionally, then fine. But if you think your life would be easier and enable you to enjoy more freedom if you had more money, it’s your obligation to do what you can to create lasting value.

*We didn’t make that up. That’s a real name, all of it. The ridiculous “Hugh”, the comically on-the-nose “”Skip””, and the Roman numeral qualifier, which is helpful for letting the country club staff distinguish Trey from Skip Sr., Skip Jr., and Skip IV.

**This article is featured in the Carnival of Wealth #31**

How Customer Service Doesn’t Work

Walmart cares, too. About having you save as much as possible.

You know how a satisfied customer tells one person about her experience while a dissatisfied customer tells 10? Safeway, America’s 3rd largest grocery chain, is staffed and run by morons.

Safeway (and its sister company, Vons) sets a policy for the way its checkers speak with customers. Here’s how our checker policy would work if we were running a grocery chain, Control Your Cash Foods:

  1. Smile and greet the customers.
  2. Ask them how they’re going to pay if they don’t make it obvious.
  3. Take their money, give them their change, thank them and send them on their way.

Then again, we don’t have human resources managers and assistants on our payroll – internally damaged, self-loathing women (they’re always female) whose own limited intellects forced them against a glass ceiling, hard, on the way up and who need to justify their existences by inconveniencing and hampering others’. They’re the same idiots who can’t explain away filling up a workday with scheduling meetings and formulating mission statements, so they create policies and procedures devoid of any connection to real life.

Here’s what we’re talking about. Safeway requires its checkers to address the customers by name whenever the customers give them a cue. But the checkers make assumptions. Years ago Betty had a Safeway frequent buyer card that she never got rid of. It saves you money for doing absolutely nothing, so the only incentive to not use it or to formally close the account would be to keep Safeway from knowing our grocery-buying habits. We wouldn’t want there to be a record of us buying weekly jars of those Mexican pigs’ feet*, but we still kept the card because we Control Our Cash.

When Greg buys groceries and enters the phone number linked to Betty’s account onto the keypad at the checkout lane, the checker routinely finishes the transaction by reading the cardholder’s name off the receipt and saying “You saved $24.15, Mr. Kincaid.” I can’t even rebut that with the standard old-timey line, “No, that’s my father.” If I wanted to be accurate I could say, “No, Mr. Kincaid is the guy my girlfriend dumped 10 years ago because he cheated on her with an orangutan-faced woman,” but the checkers only pretend to have an interest in your life.

That’s not even the beef. Safeway middle management is welcome to have its checkers assume that every man who’s paying with a woman’s discount card must share a last name with that woman, just as they should assume every black customer will be paying with food stamps.

The beef is this – Safeway’s infinitely more retarded policy of asking every customer who buys at least 2 bags worth of groceries whether she (or in my case, he) needs assistance out to the parking lot.

Here’s an upper-body shot of the dainty little flower that is 6’2”, 200-lb. me:

This reached its crescendo a few weeks later when my entire purchase consisted of a quart of milk and a quart of chemical drain opener. The checker dutifully put them into separate bags – you know, because there was almost certainly a pinhole in both the milk and the Drano, which would cause them to commingle and me to die. Even so, that’s nothing that two polyethylene bags each .003” thick can’t fix.

A quart of milk weighs 2 pounds and maybe 1 ounce; the Drāno, a few ounces more. Here’s what happened:

Checker: You saved 19¢, Mr. Kincaid. Do you need help out?
Me: (making eye contact, saying nothing)
Checker: Do you need help out?
Me: Are you serious?
Checker: I have to ask.

I pointed out that I was neither a) in a wheelchair, b) blind, nor c) a nonagenarian woman with a walker. I added that each of my arms is capable of lifting 1% of my bodyweight. (That gym membership really pays off in situations like this.)

The checker continued, clearly annoyed that I was inconveniencing her by cutting into her precious small-talk time with the semi-literate male teenage bagger. For the record, there was no one behind me in the line. Not that that would have stopped me from making my point. The checker attempted to put me at ease by explaining that she asked if I needed assistance only because I might be a “secret shopper” sent from the corporate office to determine whether the checkers at this particular store are asking the appropriate stupid questions of not just some, but all, of the customers.

I asked under what set of circumstances a man who looks like me (and can clearly stand on his own power, and was strong enough to have carried the milk and the Drāno from their respective aisles to the checkout lane in the first place) would ever need a store employee to accompany him to his car. She reiterated that she’s required to ask me, and, by inference, that’s there’s no room for independent thought in her job. I half-expected that she’d show me the relevant page of the particular subsection of the Safeway employee manual.

I explained that by turning off the part of her brain that discerns differences among people, she’s not being courteous, she’s being stupid. If Nancy Reagan shows up, offer to help her out. If LeBron James comes in, he can probably handle his own business.

We have a team comprised of people from all races, religions and ethnic backgrounds. They bring to the workplace a variety of styles, abilities and skills.

That’s from the 60ish white man who serves as president and CEO of Safeway and made $11 million last year.

First off, bullcrap. “All…ethnic backgrounds”? Show me the Ainu and the Amungme people working at Safeway. Second, he continues:

We recognize, celebrate and benefit from the uniqueness of each employee and customer…We value, respect and support these differences in our workplace.

An even bigger lie. The employees make it a point of neither valuing, respecting nor supporting the uniqueness of each customer. I’m not saying I want the checker to hold me and tell me I’m worthwhile. Quite the opposite, in fact. I want her to determine that I can carry 4 goddamned pounds of groceries on my own.

The more jaded among you are thinking: “She’s an $8.89/hour checker, you can’t expect her to give you a proof of Fermat’s Last Theorem.” No, but she’s entrusted with taking money, making change, and not putting the pasta sauce on top of the eggs. Do those tasks sound more or less intellectually demanding than sizing up customers and figuring out who needs their bags carried and who doesn’t?

The worst part about this dingbat’s excuse is its bizarro logic. There’s a thousands-to-one chance that I might be a corporate plant, so she’s going to take the long odds and treat me like one. Instead of treating me like a, you know, customer.

When your employees go out of their way to please some faceless higher-up in the human resources department before pleasing the customer who’s staring them in the face and handing them his money, you’ve clearly decided, consciously or otherwise, to compete on price and quality. Because you’re clearly given up on competing on service.

*We don’t.

**This article is featured in the Carnival of Wealth #30-Value Investing Premium Edition**

Social convention is keeping you poor

It’s Recycle Friday, in which we take an old guest post and spruce it up for today if it needs sprucing. A lot of the time, it doesn’t. This is one of those cases. The following post ran on the wonderful MoneyFunk last year and got us more venom than was warranted, but less than we expected. The post concerns a subject so sensitive that most people will make excuses and shout accusations rather than assess whether the post makes sense or not. We just changed the pronouns from singular to plural, but none of the rest of it requires any revision. Just revisitation. Enjoy.

Cool!

We’re talking about The Activity (actually, The Lack Of An Activity) That Dare Not Speak Its Name. One so extraordinary, so unusual, that everyone under its spell is treated as some sort of human aberration in need of reassurance and approval. And even then, people will still be certain that you must be either a medical curiosity, a desperately penitent deviant with an unfathomable past, a sheltered religious zealot, or at any rate, a less-than-full member of society. Because no one with this horrible affliction could possibly be enjoying all life has to offer.

Teetotalism.

Never even crossed your mind before, did it?

Look, this is not a moral issue. We’re not your finger-wagging aunt and uncle. It doesn’t matter to us if you shoot black tar heroin into both eyeballs simultaneously. We don’t care if Ron Wood throws his hands up in defeat after a night on the town with you because he can’t keep up. Or if Lindsay Lohan says, “I’m, like, having fun with you and all, but still, here’s the name of my addiction counselor. Call him. He’s really good.”

But if you are going to inject that smack, at least don’t throw away money on it.

A rum & Coke at the Foundation Room in Las Vegas costs $12, but the view of the Strip is complimentary. However, the same drink is essentially the same price 40 floors downstairs at the (indoor) House of Blues.

That’s one ounce of rum, maybe an ounce-and-a-half if you and the bartender share sufficient sexual chemistry. Premium rum costs a bar maybe $14 for a 59-ounce bottle, so you’re buying 24¢ worth of rum, a penny or two of cola syrup, and ice and water, whose prices are measured in trillionths of cents.

Which means you’re paying about 4500% markup for the drink itself. And of course, you’d better be leaving a tip, you cheap bastard.

It doesn’t matter what your preferred intoxicating beverage is. The margin between what the distributor pays for beer and what you pay is in the same neighborhood. And let’s not forget the wonderful 21st century indulgence of bottle service, in which an upscale venue charges you even more for the privilege of not having to go to the bar or flag down a waitress to order drinks. (Which reduces the workload on their bartenders and waitresses, freeing up time for them to serve other patrons absurdly marked-up drinks.)

Nothing comes with a higher markup than alcohol does, except maybe Cuban exit visas. And why not? The people who sell alcohol have the perfect clientele – motivated, repeat buyers who don’t accept substitutes.

Look at it this way. Among doing other things, we sell books (available now at Amazon and BN.com!) But imagine if every person who bought our book either:

-just wanted to be left alone with it, gazing into the book while contemplating their sins;
-bought one every week as far back as he could remember, and would continue to because that’s just the way he’s always done it and always will do it;
-read it, wanted another one, wanted another one after that, and was going to BUY EVERTHING ON THISH WHOLE DAMN SHELF IF I WANTS, BOOKTENDER;
-was legally too young to buy it, and risked expulsion or a citation or parental punishment because our book was either such a great read or a necessary stepping stone en route to full adulthood, or;
-was commemorating something, and wanted to prove to the guest of honor that money was no object.

If you’re drinking, you’re probably either depressed, a creature of habit, addicted, trying to be cool, or celebratory. Okay, fine, you aren’t. Whatever you feel comfortable believing.

Now let’s assume that we sold our book at the same markup bars do. That means you’d be paying $268 for a regular glossy trade publication. Yet we sell the Kindle version for 10 stinking bucks, trusting the electrons will arrange themselves in a way you find engaging.

Just try it, once. Purely as an economic exercise, go out with your regular co-conspirators and substitute club soda for beer. You’ll be embarrassed to do this, peer pressure being far stronger among adults than it is among kids. So tell everyone you’re having surgery the next morning if that’ll make you feel better. Surgery on your instep. (Pick an innocuous and hard-to-reach body part. No one will ask you to take off your shoes.)

If you usually kick back 5 drinks a night, every couple of weeks, you’ll save well over $1000 over the course of a year. How many days’ worth of take-home pay is that for you?

The uncompromised brain cells will just be a bonus, as will the feeling of nonchalance at the police roadblock.

**This article is featured in the Totally Money Carnival #11-March Madness Edition**