Debtor Nation by dreamtrove

REAL WORLD EVENT DISCUSSIONS

Debtor Nation

POSTED BY: DREAMTROVE
UPDATED: Monday, April 18, 2011 04:27
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Friday, April 15, 2011 5:27 AM

Taking a tax day to think this over.

Anyone stop and think about their personal economics and where their money and effort is going?

Here's some stuff I'm gnawing over on this April 15th.

ETA: Sorry, it got sort of longish, the store doesn't open until noon today, so I'm killing time.

The typical Mortgage is 30 years. You buy a house under our glorious economic model, and you will be paying for it for 30 years. It's going to sap your income, we all know that.

I know several people who said "Yes, but I want this mortgage over quickly." They had reasonably high incomes, and so they could get the short term loan, which is seven years.

Now, after 7 years of working, with every penny going to the house, you have a house.

But what if you built a house? Would it really take you seven years? How about 30?

Now, backtrack to the 17th c. If you signed a contract of indenture that would typically be for seven years, all your labor, allegedly to pay your transportation costs, but ultimately, for land.

As a lawyer friend recently put it "The only difference between a mortgage and an indenture contract is that the latter is easier to get out of."

No one in business ever makes a deal to lose money, but sometimes profit margins are absurd. If 14 men worked from spring to fall they could certainly build you a house. You could probably do it with a crew of 4.

But how did we get to 30?

Taxes. Among other things. And what are taxes but your agreement to accept paying someone else's debt, in particular, the American War Debt. That's what it is, where it comes from, we all know this. Our ruling elite serves some international banking cartel which likes to fight wars so it can expand the sphere of influence of its currency, hence, its power, and the size of its economy, and we are the hired grunt nation du jour, but if you sign up for a system where you get a salary to pay for your house, you are also signing up to pay for the war debt, which, frankly, is not your responsibility.

So as you work your indentured servitude, you are not just working for your house, but slaving to fund the war machine, or rather, to pay the unfathomable debt that it has accrued since it was unleashed unto the world like Morgoth's orcs a century ago.

So, we all sent off our homage to Saruman, giving thanks for his work in the raping and pillaging of the planet, so that the debt to his Nazgul advisors and financiers could be paid, or at least, the interest on it, all praise Sauron, moving on...

Now what of education. When I was in school, the student loan term was 10 years, now that is called the "short term" and the longer terms are 15, 20 and 25.

We accept that a debt is a payment for land, and that we are indentured servants if we take the seven year contract, but are we simply slaves if we don't?

Quote:
he interest portion of your mortgage payment is usually tax deductible

WTF? Only the interest portion. Okay, back to education.

Now, surely, there's not a kegger in the world that's worth a quarter million dollars, or $100,000 in debt on average, or 10 years or 25.

Is it even worth anything at all, this education (Okay, we all know the answer to that now, of course not, as information, probably any one of you who went to college in the information age picked up a text book, the googled the information learned 10 times as much about it, and then if you had any questions you could email people anywhere online, and you probably ended up more informed for it.) So, what you didn't get from your googling wikipedia was a degree.

So why do we need this degree? To get a job of course. Why do we need this job? To pay the debt of course, for the mortgage and the education and horseshoe nail.

I hope no one missed the circular logic here.

A working year is 40hr/wk x 50/52 weeks = 2000 manhours

Housing cost, 1-12 thousand man hours. So at $10/hour that would be 10k-120k which seems about right, but of course, your labor when you do it yourself is not taxed, and there is no interest on it.

Now how about the education? I've done this one and can tell you it takes about a year of intensive study to be able to pass with a decent score in a subject GRE for a degree that you don't have any background in to start with.

Analyze it another way. About 1/2 of all college is homework, 1 semester hour = 15 hours, a degree is typically 120 sh, so that's 1800 * 2 is 3600. Which would be almost two years, in reality, it doesn't take that long, chalk it up to inefficiencies in the system, or perhaps to some degree core coursework.

If you were doing it yourself, probably the way to go would be to study all the core stuff like composition and whatnot first, so you up your study skills, and then the second year master the subject, and then I suppose you continue to master as many as you wanted, a year at a time.

I'm thinking about this in part because I have to restructure my business this spring to make way for Obama's tax reform which goes into effect this year, and is going to take a radical toll, but if done correctly, I can stay afloat.

I just had to stop and wonder how much of our effort is going into a black hole of inefficiency, and how much of my budget goes to nowhere.

However much of your budget is going into thin air, that's how many hours you work to get nowhere.

It's probably worth noting that one of the things I've noticed is that there are two models which I like much better than the 5d x 8h with two days off model:
First is the 7d x 6h with no days off model, this works very well, and it much more efficient.
Second, the 7d x 12h model, typically with breaks in the middle of the day, and then a couple weeks on, couple weeks off.

The standard 5x8 model has a serious flaw: The two days off are just long enough to wipe your intermediate term memory, and the typical worker is not back into the groove of where they were at the end of Friday until Wed. morning. (this is one of those things like 2hrs of consecutive education is the most you can take in that's been studied about 20 gazillion times.)

To deal with this, you can use the 7 day model, and then, like many IT (information technology) jobs, you can work X number of days in a row and then one day off, but I find the weeks on, and then weeks off works best, if you're going full tilt. You can actually run a higher total amount of work hours if you do this, I find that you can go 6 weeks on 2 weeks off and get up to 3,000 hours per year without breaking down. Also, it's worth bearing in mind that if you work 5x8 you're operating at 60% efficiency, so it's really 1200 effective hours, not 2000, and if you're working for pay, in one form or another 50% of your income is going to taxes, so that's 1000 hours worth of DYI, even if there are no associated expenses in time and money (such as a commute)*

* Note that if you commute such that you leave at 8 and get hour at 8 you are working really 10 hours. If you are making 10/hr for 8 hours that are really ten hours, you're really making $8/hour. If that's taxed, it might be $5 or $4. Another thing to bear in mind is the "cool down" time that the end of a stressful job often requires. A lot of people sit down at the end and watch shows they might not otherwise watch with a cup of frozen yogurt for as much as 2 hours. When I was working I used to sit down with a spanish guitar for two hours at the end of the work day, and I had to do that before my mind was ready to do anything else. I think this should be figured into the working hours.

Now, next thing that you need to bear in mind is that if you hire a contractor, 1/2 of what you are paying them is tax in one form or another, so it might cost you $20/hour to hire him, which if you're working for $10/hour and that means basically taking home $5/hour, it's really a 4:1 exchange of time.

This fits in with in with the compound tax inherent in the price of every product we buy, which I've hammered out here earlier so I'm not going to do it again, just to summarize, I did a lot of analysis of the taxes corporations, workers, shippers, fuel, retailers, etc are paying before you pay sales tax, and came up with a lot of estimates between 50-90% of everything being tax. I then took a simpler approach and went on to a bunch of indian reservations and priced indian made products compared with their US counterparts, and they were consistently 1/4 the price, so that gave me a much more accurate reading:

75% of the price of everything you buy is tax.

This may look like the same as the cost of hiring a contractor, but it's not, because one 50% loss was the taxes and expenses you pay to get your $10, so really if you work at a job to buy stuff you're at an 8:1 disadvantage economically.

Okay, I know some of you are looking at this and saying "But DT, I work for $10/hr, and I take home $8" Yes, maybe, but how much do you actually get to put in the bank. I would agree that % return on being poor is better than being middle class, but there are little direct taxes like property tax that you can't avoid, and gas tax you're paying to get there, and hidden taxes you don't see, when the dust settles, you'd be lucky to be putting $5 of that in the bank.

If you earn $50k, figure how this works. He has to buy insurance of various forms before dealing with your benefits package, which means that he's paying down around $20k to get to that $50k. Also, he's paying in 10% FICA if you're a contractor, as most new hires are now, so figure that it's costing him $75k, and you're taking home $45k, but still paying tax on $50k, 25%, say, with deductions, $10k, and then state around 5k, and local taxes, property, school, city, car fees, gas tax, etc. you're going to throw in at least another 5k in tax. This means that the employer may pay $75k to hire you, you get "salaried" 50k and then you're taking home a net of $25k, so there's a 3:2:1, plus the potential expenses not related directly to hiring you, but to your job, any office space, equipment, etc. that might be needed for your job, might cost an extra few thousand, a fourth $25k might seem high, but I'll be it reaches that at times.

So, that was a long meander into personal economics. I'm curious if anyone has any thoughts on any of this.

That's what a ship is, you know - it's not just a keel and a hull and a deck and sails, that's what a ship needs.

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Friday, April 15, 2011 6:14 AM

ANTHONYT

Freedom is Important because People are Important

Hello,

I don't think that working 7 days a week would work for me. I need a break to unwind and get things done, and I need that break regularly.

--Anthony

Assured by friends that the signal-to-noise ratio has improved on this forum, I have disabled web filtering.

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Friday, April 15, 2011 8:19 AM

HERO

Quote:
Originally posted by AnthonyT:
I don't think that working 7 days a week would work for me. I need a break to unwind and get things done, and I need that break regularly.

When I first graduated Law School and went to work for the City I kept my part time weekend job because it was too good to give up. So I worked 7 days/week and took no vacations for the first two years...then I took a week off and continued another year at 7 days/week.

It was very tough, but I liked that extra money when I was first starting out.

H

"Hero. I have come to respect you." "I am forced to agree with Hero here."- Chrisisall, 2009.
"I would rather not ignore your contributions." Niki2, 2010.

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Friday, April 15, 2011 8:52 AM

THEHAPPYTRADER

I had a 138 hour major with many bullshit 1 or 2 hour classes that were in practice as work intensive as 3 hour classes, while practicing at least 3 hours a day and rehearsing and performing in 3 or more performing ensembles each semester. Also everything in the world was a prereq for something next year, so ya couldn't blitz the course work (assuming you could somehow function on no sleep).

And what do I have to show for this Music Education degree? Student loans and a therapy job, cause that makes sense...

Not that I'm complaining. I mean I am, but I also know I am fortunate to find any work at all in this economy. Looking for work sucked because every potential employer thought I would jump ship and leave them for the next band director job that wasn't there. Sometimes I think my degree was just a colossal waste of time and money. Still, things could always be worse.

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Friday, April 15, 2011 9:03 AM

NIKI2

Gettin' old, but still a hippie at heart...

I'll just say I disagree wholeheartedly with "The only difference between a mortgage and an indenture contract is that the latter is easier to get out of." That's simplistic and there is a whole lot more that goes into it, and I don't think taxes are the entire problem.

Hippie Operative Nikovich Nikita Nicovna Talibani,
Contracted Agent of Veritas Oilspillus, code name “Nike”,
signing off

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Friday, April 15, 2011 9:59 AM

FREMDFIRMA

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Friday, April 15, 2011 10:01 AM

HARDWARE

I've been looking into the cost of log homes for a while now. A lot of components are the same, such as foundation, heating, cooling, water, sewer, electric and communication. But the structure is dirt cheap, if you live in a rural area. Think it can't be done alone? How did the first settlers set up their homes?

A 12 inch thick log wall, depending on species, is about R30 for insulation value. Good luck getting that out of a stick built wall. It can be done, but adds to the expense and time to build.

Properly designed to protect the logs from the worst of the weather a log home is very energy efficient. You need wide overhangs to shield the logs from weather. Those wide overhangs shad your windows in the summer. In the winter, when the sun does not rise as high in the sky you can still benefit from passive solar.

And the envelope of the home is dirt cheap. About $99 for 1000 log feet in the northeast.

Or there are insulated concrete forms that can be used for the log home foundation. ICF can also be used to build the envelope of a regular home. Depending on thickness you can get a wall with R55 insulating value.

These homes are not significantly cheaper to build, because you need materials to finish the interior. But they are vastly cheaper to operate than a stick built home of comparable size.

And speaking of size, how big a house do you need? about 7 years ago I remember the hosts of This Old House were speaking unfavorably of 3,500 square foot McMansions springing up in the suburbs. I thought that if these guys are speaking against a bigger house, there's a problem. It wasn't just the size, but also the features. Cathedral ceilings, small lots, massive garages, total reliance on systems to heat and cool the home. All of which equals a home that is expensive to purchase and operate.

The more I get to know people the more I like my dogs.

...and he that has no sword, let him sell his garment, and buy one. Luke 22:36

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Friday, April 15, 2011 3:42 PM

MOCKROMANCER

"Anyone stop and think about their personal economics and where their money and effort is going?"

Most people on this board get a rebate or pay nothing. They also get the entitlements. Why change anything?

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Friday, April 15, 2011 3:57 PM

DREAMTROVE

Mock, I've been here for years, these people work hard. I can't name a single welfare recipient here off the top of my head.

That's what a ship is, you know - it's not just a keel and a hull and a deck and sails, that's what a ship needs.

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Friday, April 15, 2011 5:00 PM

DREAMTROVE

Frem,

Roger that, loud and clear. Oh, I didn't know there was a musical animated series. Hmm...

That's what a ship is, you know - it's not just a keel and a hull and a deck and sails, that's what a ship needs.

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Friday, April 15, 2011 5:13 PM

FREMDFIRMA

Well it wasn't so hot plotwise or in regards to the animation quality, but the soundtrack is absolute classic - NightTorch on Youtube has a bunch of clips thereof, nice stuff, particularly Towers of the Teeth, and Bearer of the Ring.

-F

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Friday, April 15, 2011 5:44 PM

BYTEMITE

I work from 7:30 am to 6 pm, I get up at 5 am and get home at 7:30 pm. I spend two hours a night getting ready for the next day, I have another two hours of free time, then thirty minutes later I go to bed and start over again. I sleep five to six hours a night. So yeah, not much free time.

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Friday, April 15, 2011 5:53 PM

DREAMTROVE

It was pretty clear it was off course. Frodo is encouraging Orcs to slaughter Men.

Still, mindless entertainment.

That's what a ship is, you know - it's not just a keel and a hull and a deck and sails, that's what a ship needs.

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Friday, April 15, 2011 7:32 PM

KWICKO

"We'll know our disinformation program is complete when everything the American public believes is false." -- William Casey, Reagan's presidential campaign manager & CIA Director (from first staff meeting in 1981)

Quote:
Originally posted by Mockromancer:
"Anyone stop and think about their personal economics and where their money and effort is going?"

Most people on this board get a rebate or pay nothing. They also get the entitlements. Why change anything?

You really don't much understand the tax system, do you? When you refer to "rebates", you should probably take note that even those here who DO get an income tax refund still aren't "paying nothing". For instance, if I claim zero dependents and take no deductions and no write-offs, I might *possibly* expect a small rebate at tax time. Maybe a couple hundred bucks. But that's from income taxes paid in (not payroll or Social Security, Medicaid, and Medicare taxes, JUST from federal income taxes) of over $5,000.

This year, as most years, I'm paying in addition to what I already paid. Sorry, I don't receive any "rebate" or "entitlements". Although it should be noted that those who own homes and those who have children DO get rebates and entitlements. There's your socialism!

"Although it is not true that all conservatives are stupid people, it is true that most stupid people are conservatives." - John Stuart Mill

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Sunday, April 17, 2011 9:24 PM

RIONAEIRE

Beir bua agus beannacht

I finished college in 4 years, I think that was a good length of time, I wouldn't have had the stammina to do it quicker. I didn't figure out what exactly I wanted to do until the end of the last year so I'm glad I had that time.

"A completely coherant River means writers don't deliver" KatTaya

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Sunday, April 17, 2011 11:21 PM

ANTHONYT

Freedom is Important because People are Important

Quote:
Originally posted by dreamtrove:
It was pretty clear it was off course. Frodo is encouraging Orcs to slaughter Men.

Still, mindless entertainment.

That's what a ship is, you know - it's not just a keel and a hull and a deck and sails, that's what a ship needs.

Hello,

Given that both platoons are from the armies of Mordor, it never bothered me at all. He essentially encouraged one troop of enemy soldiers to fight another group of enemy soldiers.

--Anthony

_______________________________________________

“If you are not free to choose wrongly and irresponsibly, you are not free at all”

Jacob Hornberger

“Freedom is not worth having if it does not connote freedom to err. It passes my comprehension how human beings, be they ever so experienced and able, can delight in depriving other human beings of that precious right.”

Mahatma Gandhi

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Monday, April 18, 2011 4:27 AM

FREMDFIRMA

Quote:
Originally posted by AnthonyT:
He essentially encouraged one troop of enemy soldiers to fight another group of enemy soldiers.

I was also mocking American Business Ethics, in that they get you up to your ass in debt before you see the trap for what it is, and then using that debt as a whip...

But yes, I was also throwing hints, sure.

-F

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