It’s time to sit back, relax and enjoy a little joe…
Welcome to another rousing edition of Black Coffee, your off-beat weekly round-up of what’s been going on in the world of money and personal finance. Here’s what caught my attention over the past week…
With October right around the corner, things are starting to get tinder dry here in Southern California, which brings up the age-old question I recently asked on my Facebook page: Why does it usually take just one careless match to start a forest fire when it takes a whole box of them to light a campfire?
Blogs I’ve Been Following This Week
Monevator – Financial Goals: Sticking to the Plan when the Funk Comes to Visit. I love Monevator. It’s my favorite blog from the other side of the pond. Monevator is a real pleasure to read, even when I find myself getting lost in those confounded British colloquialisms. For example, in this article the Accumulator talks about “taking in a lodger.” I’m not talking bollocks, mate; although I was all sixes and sevens for a few seconds, I felt like a stupid sod after I figured it out. I probably should have known better, but to be honest, I was completely knackered at the time. Brilliant.
Fiscal Fizzle – Is the World Designed for 4 People? Says Wojo: “In a busy airport, bus, or plane, multiple cranky kids can be a recipe for disaster.” Of course! So that explains why the TSA is now so intent on patting them down along with the rest of us.
Wealth Pilgrim – Here’s How I Went to the Dentist and Saved $4750 on a Tooth Extraction. Speaking of cavity searches, Neal’s post is a must read for those of you who have never been very diligent when it comes to brushing and flossing. And here’s a bonus tip: When looking to cut costs, you know the drill; always keep your tone civil during the negotiation process. After all, dentists have fillings too. I know. Let’s move on before somebody tries to hurt me.
Money Crashers – What to Do if You Win the Lottery. This will be a great companion piece to my upcoming article entitled “What to Do If You Get Hit By Lightning Twice in One Lifetime.”
And Here’s Some Other Posts You Might Enjoy…
Millionaire Nurse Blog – Couple Financial Role Reversal!
Hope to Prosper – Money Fail: Broke on Thursday
Balance Junkie - Moving Stinks! And I Never Want to Do it Again!
Barbara Friedberg Personal Finance - 5 Lessons Learned from Moving
Couple Money – Are Kids Really That Expensive?
Lazy Man and Money – Is Social Security a Ponzi Scheme?
Beating Broke - Taking Financial Ownership
Money Crush – What do You Really Want to Achieve?
Frugal Dad – Can You Save too Much for Emergencies?
The Penny Hoarder - 5 Weird Ways to Make Money Recycling
Ironclad Finances – “Make it Automatic”
The Way-Back Machine: Past Posts Of Mine You May Have Missed
From February 2009:
What Girl Scout Cookies Can Teach Us About Mortgages – Why is it that so many folks spend less time reading and signing their loan documents than I do buying Girl Scout cookies?
Credits and Debits
Debit: Here’s something you folks with asthma will be interested in: In a bid to protect the Earth’s atmosphere, the federal government is imposing a ban on over-the-counter inhalers. The government-approved “green” inhalers are available only by prescription and are between 1.5 and 3 times more expensive.
Credit: Sheesh; how many chlorofluorocarbons are in one of those shot-glass sized bottles anyway? Trust me on this, folks: it’s fly poop in the pepper — unless you’re a government bureaucrat.
Debit: Despite claims to the contrary, if they’re like most green products, they’re probably nowhere near as effective as the products they’re replacing either.
Debit: In other news, the Dow plunged almost 400 points on Thursday, and closed Friday with its worst week since October 2008. Why all the gloom and doom?
Debit: Are investors finally growing weary of the never-ending onslaught of bad economic news, especially after yet another dismal government report citing rising unemployment claims, higher inflation, and further weakness in the manufacturing sector?
Debit: Perhaps the stock market is rattled because consumer sentiment is now at its lowest point since 1980. Why are consumers so depressed?
Debit: Maybe American consumers — folks who account for 70% of the nation’s GDP — are justifiably worried about the potential impacts of $1.5 trillion in additional taxes on their wallets. Or their employer’s ability to keep them on the company payroll.
Credit: Perhaps consumer confidence would be buoyed if our politicians came up with ways to simply shrink the federal government instead of conjuring new ways to fund it — an idea that European lenders are now urging Greece to consider before they default.
Debit: Then again, I bet consumers like Chicago union boss Dennis Gannon aren’t too depressed. Gannon receives an annual city pension of $158,000 — which, as the Chicago Tribune notes, was only made possible, “Because City Hall rehired the former Streets and Sanitation Department worker for a single day in 1994, then granted him an indefinite leave of absence.” Why am I not surprised?
Credit: Those awesome pensions aren’t the only reason why I should have taken a government job out of college. They pay twice as much, on average, as similar jobs in the private sector — and there’s relatively little risk of getting laid off. I’m not sayin’. I’m just sayin’.
Debit: Another bonus is that unlike private sector pension plan managers, the government tends to be a bit, well, lackadaisical with their record keeping. The US has paid over $600 million to dead people over the past five years alone. In one case, a dead pensioner remained on the government payroll for 37 years while his son cashed the checks. (Thirty-seven years.)
Credit: Needless to say, when I die I want to be buried in Chicago. The dead people there not only get generous government pensions, they get to vote too.
Credit: Hey; who’s with me?
The Question of the Week
Loading ...
By the Numbers
It takes chutzpah for politicians to ask us to accept higher taxes in light of these egregious examples of government waste, as excerpted from this article at The Economic Collapse blog:
$175 million To the US Department of Veteran Affairs in 2010 so they could maintain hundreds of buildings they don’t use.
$3 million For researchers at the University of California Irvine to play video games.
$1 million For environmental awareness poetry.
$800,000 Stimulus money used for a genital-washing program on men in South Africa.
$700,000 To the University of New Hampshire so it could study dairy cow farts.
$615,000 For the University of California at Santa Cruz to digitize Grateful Dead photos, T-shirts and concert tickets.
$150,000 To the Conservation Commission of Monkton, Vermont for a salamander crossing.
$600,000 To the Minnesota Zoo so they could develop an online video game called “Wolfquest.” Try it now; it’s free. After all, you paid for it.
Other Useless News Here are the top — and bottom — five states whose readers, on average, visited the most pages at Len Penzo dot Com over the past 30 days:
1. Wyoming (3.84 pages per visit)
2. South Dakota (3.40)
3. Maine (2.38)
4. North Dakota (2.36)
5. New Mexico (2.31)
46. Illinois (1.78)
47. Utah (1.74)
48. Nevada (1.73)
49. Massachusetts (1.72)
50. Alaska (1.62)
Hey, if you happen to enjoy what you’re reading (like my friends in Wyoming) — or not (Alaska, ahem) — please don’t forget to:
1. Click on that “Like” button in the sidebar to your right and become a fan of Len Penzo dot Com on Facebook!
2. Make sure you follow me on Twitter!
And last, but not least…
3. Don’t forget to subscribe to my RSS feed too! Thank you. 
Plutus Awards
I just thought I’d mention (for the six-hundredth time) that Len Penzo dot Com earned two nominations for the 2nd Annual Plutus Awards:
- Most Humorous Personal Finance Blog
- Best Personal Finance Blog, Single Author (Look; if Milli Vanilli can win a Grammy Award, then anything is possible, folks.)
I won’t beg for your votes because I’m too classy for that. Besides, the polls officially closed two days ago.
Letters, I Get Letters
Every week I feature the most interesting question or comment – assuming I get one, that is. And folks who are lucky enough to have the only question in the mailbag get their letter highlighted here whether it’s interesting or not!
Ben from MoneySmartLife asked me to: “Describe a time you were bullied into a financial decision.“
It’s never happened, Ben — well, unless I go back to the first grade when a big bully named Rudy persuaded me that he needed my lunch money more than I did. I know. But I was only five.
I’m Len Penzo and I approved this message.
via Email 
Len, Thank you so much for including my article on moving over at Balance Junkie and her’s at my site!!! Now I must immediately read your bullying article!!! Bye
Bye!
I meant to say…. I must read your monopoly article- my personal favorite game
Thanks for stopping by, Barb!
Cheers Len me old mucker, I had a right laugh at that. Best of British for the Plutus Awards, you’re blog is the mutt’s nuts!
(Er, “your” blog… we British do actually use traditional grammar… it’s just very early in the morning!)
I’m glad you got a good laugh from that. And you’ll always have my vote! By the way, Investor … what’s a “mucker”? LOL!
The safe article was great, but I have to call you out on this one. That USA today article was widely debunked last year (including, if I recall, by a blog at the Economist–hardly a Pro-Big-Government publication). The USA today article overstates Government pay by about 20%, but that’s not the main problem. The average federal government employee is better educated with more specialized skills than the average private sector employee. Control for education and you find that Government employees are paid far less than their counter parts in the private sector. This is before we even get into discussions about controlling for geography and all the perks that private sector employees enjoy that federal ones don’t.
I second “m.”
http://www.nirsonline.org/storage/nirs/documents/final_out_of_balance_report_april_2010.pdf
Government employees have become the convenient scapegoats for politicians to blame for their own failings. “Hey, we’re not broke because we gave away the farm to special interests! We’re broke because of our greedy employees!”
@M and @Sheryl: Thanks for your counterpoints. The reality is, we’re broke and, forget salaries for a minute — government pension benefits, especially, are unsustainable, wholly unreasonable and economically poisonous. I know people in gov’t retiring at age 50 with $100k pensions. It’s outrageous and something has to give. Nobody is saying gov’t employees are greedy — but the system is clearly broken right now and it needs to be fixed.
The USA Today analysis, based upon data from a government analysis from the the US Bureau of Economic Analysis was not the first one to come to such conclusions.
The conservative Cato Institute did a similar analysis a year earlier, based upon eight years of data between 2001 – 2008 and came to the same conclusions. They also make excellent and very credible counterpoints, in my opinion, to the defenses that you highlight.
http://www.cato-at-liberty.org/federal-pay-continues-rapid-ascent/
Sheryl, the data from the study you provided by the liberal National Institute on Retirement Security was shown to have manipulated the data to skew the results. For example, to come up with their conclusions, they had to make some critically invalid assumptions. For example, they treated all college degrees as being financially equivalent (e.g., they treated people with engineering degrees as being equivalent to those with a liberal arts degree, which is preposterous).
For now, I guess we can just agree to disagree.
The last government job I interviewed for (Budget Analyst) required a master’s degree, four years of experience and high-level database skills and paid $32,000 a year. Oh, and from that $32,000, I would have been required to contribute 11% to the state retirement system for that “unsustainable” pension.
The Cato Institute is hardly unbiased either. And to anyone who thinks government work is a cushy way to riches, knock yourself out! https://www.governmentjobs.com/
Granted, Sheryl, there are many gov’t jobs that aren’t overpaid. It sounds like your job is one of them. I wonder what the private sector is paying for a similar position. My point is the data show that compared to similar jobs in the private sector, on the whole, they are. I clearly stated that Cato was a conservative-based organization. I’m not trying to hide anything, and I leave it up to the readers to decide whose data they want to believe. In fact, I strongly encourage them to read the conclusions from both the liberal and conservative organizations so they can draw their own conclusions as to which position makes the most sense.
The whole reason I bring these issues up is to make people think. I realize a lot of folks will disagree — and that’s okay! I appreciate the dialog!
Len, i should preface this by admitting that I’ve never worked for the federal government (they don’t pay enough). You are right that not all degrees are equal when controlling for education, but my understanding was that the big difference is that a much higher percentage of the the Federal workforce holds advanced (masters and Phds) in the sciences and engineering. This intuitively makes sense: liberal arts majors that don’t go to law school end up in sales or hr or project management–primarily private sector disciplines. The EPA needs some PMs, but their real needs are biologists, chemists, and a variety of engineers. The NSF hires top math and physics PhDs at a small fraction of what wall street pays them.
Hi, Len,
I do agree that public benefits have gone far out of control, and that it should be put upon each individual state to work out solutions. For instance, some states allow paid overtime to be added to a base salary when figuring an employee’s pension payout…which is dishonest, IMO. My state does not do this.
The USA Today article, however, is pretty controversial. If you read the comments that follow, you will hardly find one person who agrees with it. Go online to your own state’s job bank. See if a dentist in the private sector would be willing to accept a $100,000 annual salary; I think not.
Yep, there are exceptions, Holly. However, I think there are far more examples in the other direction.
And, remember, the number of comments, one way or another, should have no bearing on the validity of the overall study.
Of course, my comment was regarding public employees as a whole: local, state, federal. The article specifically mentions federal employees. There is no doubt that those numbers include the hotshots in public office and their ‘minions’!
Absolutely.
[...] Len Penzo’s Black Coffee posted both my guest post at Balance Junkie and hers at my site. If you’re not too sick of moving stories, they both have some good tips. [...]