This article includes quotes from Benjamin Franklin's Poor Richard's Almanack (appearing in italics) alternating with commentary related to our current economic situation.
When you have bought one fine thing, you must buy ten more, that your appearance may be all of a piece; but Poor Dick says It is easier to suppress the first desire, than to satisfy all that follow it. And, it is as truly folly for the poor to ape the rich, as for the frog to swell in order to equal the ox.
Earlier in the essay, Father Abraham expressed the same sentiment. Repetition here makes it even more significant.
Vessels large may venture more,
But little boats should keep near shore.
How big is your boat? Many small boats, small businesses and small fortunes have been sunk by prideful overreaching.
And, after all, of what use is this pride of appearance, for which so much is risked, so much is suffered? It cannot promote health, nor ease pain; it makes no increase of merit in the person; it creates envy; it hastens misfortune.
America (and the entire world) needs to recognize that the current state of our personal and national economies is the direct result of two converging follies: the folly of having without owning, and the even greater folly of owning investments that someone else controls.
Perhaps the greatest and most painful example is the U.S. Congress. We invest our taxes to create a government that serves "We the people" and instead we get pork-barrel spending. While Congress points its finger at big business and CEO compensation, it ignores its own failings and mostly ignores "We the people" in an attempt to maintain its "pride of appearance."
Then there's Wall Street and its minions. How many Madoffs are there? The real question is how many foolish investors are willing to give up control of their money to the well-spoken charlatan, knowing that the only guarantee is that there is no guarantee.
You are not healthier for having a thing. A broken bone hurts the laborer the same as it does the CEO. You are not a better person for having an expensive car, a vacation condo or the largest house on the block. Do you have true friends or a covey of sycophants? Should you fall from your self-defined throne, would there be even one to help you rise up?
Wake up, America! Father Abraham knew about this problem 250 years ago, Jesus spoke of it, the Torah tells of it. Think about it.
But what madness must it be to run in debt for these superfluities.
The average car today will last for 200,000 miles or more with just preventive maintenance; oil changes, tires, anti-freeze, etc. Why then do Americans trade cars every three years? (Perhaps today we can say, "Why did...")
When you have got your bargain, you may, perhaps, think little of payment; but, as Poor Richard says, Creditors have better memories than debtors; creditors are a superstitious sect, great observers of set days and times. The day comes round before you are aware, and the demand is made before you are prepared to satisfy it; or, if you bear your debt in mind, the term, which at first seemed so long, will, as it lessens, appear extremely short. Time will seem to have added wings to his heels as well as his shoulders. Those have a short Lent, who owe money to be paid at Easter.
Remember, Father Abraham spoke these words over 250 years ago. Are they not just as true today? Will we ever learn? Collectively, we probably won't; individually you can.
At present, perhaps, you may think yourselves in thriving circumstances, and that you can bear a little extravagance without injury; but
For age and want save while you may;
No morning sun lasts a whole day.
Commonsense permeates Franklin's book, "The Way to Wealth." Yet one wonders why commonsense is so uncommon. How did we lose these simple ideas? Where did they go? Americans have allowed the behemoths of Wall Street and Washington, unions and businesses, to convince them that it makes sense to have things they don't own and invest in things they don't control.
Gain may be temporary and uncertain, but ever, while you live, expense is constant and certain; and It is easier to build two chimneys, than to keep one in fuel, as Poor Richard says; so, Rather go to bed supperless, than in debt.
So, here again is the theme of this entire discussion. The stuff you "have" but don't own because of debt continues to drain your wallet while the "gain" you expect from investments you don't control is "temporary and uncertain." Go figure.
Get what you can, and what you get hold;
'Tis the stone that will turn all your lead into gold.
And when you have got the Philosopher's stone, sure you will no longer complain of bad times, or the difficulty of paying taxes.
Save. Saving is not investing. You don't "hold" what you invest in unless it's your own business or you study individual investments carefully and attend to them regularly. Mutual funds, variable life insurance, annuity products, and other pooled investments that place all the risk on you but give you no control are gambles that you should reserve for a time when you can afford to lose.
Cash money and its equivalents that are readily available to you is the foundation of wealth. It is today, was 250 years ago, 2,500 years ago, and will be for as long as there are complex economies at work.
This doctrine, my friends, is reason and wisdom; but, after do not depend too much upon your own industry, and frugality, and prudence, though excellent things; for they may all be blasted, without the blessing of Heaven; and, therefore, ask that blessing humbly, and be not uncharitable to those that at present seem to want it, but comfort and help them. Remember, Job suffered, and was afterward prosperous.
And now, to conclude, Experience keeps a dear school, but fools will learn in no other, as Poor Richard says, and scarce in that; for, it is true, We may give advice, but we cannot give conduct. However, remember this, They that will not be counselled, cannot be helped; and further, that, If you will not hear Reason, she will surely rap your knuckles, as Poor Richard says.
It seems that the U.S. Congress today is among "They that will not be counseled." Are their knuckles hurting right now?
Thus the old gentleman ended his harangue. The people heard it and approved the doctrine; and immediately practised the contrary, just as if it had been a common sermon; for the auction opened, and they began to buy extravagantly.
It seems sermons and their effect on the congregations haven't changed that much either.