08/22/13

Dreams of Inheritances and Lotteries

While reading the daily rags a few weeks ago, on scan and bee-lining for the crossword, a smidgeon of information passed my way and halted my progress. At first I feigned surprise, recent surveys show that nearly half of Canadians are relying on either receiving an inheritance or winning a lottery for their retirement, with similar numbers showing up in other developed countries as well. My surprise died when I realized holy shit, I am one of those people. And then, as I happen to be currently reading up on social contracts, I wondered in a most dedicated and peculiar way, are lotteries and inheritances becoming but another interpretation of unrealistic hope subsidizing the con of what has become familiarly known as the “American dream”?

The seeds of the dream could be traced back to the concept of Res Communes (common things), from the Roman Justinian Code, issued in 535 AD. Res Communes were all the things owned by no one and subject to use by all. “By law of nature these things are common to mankind – the air, running fresh water, the sea, and its shores.” It would become known as the Public Trust Doctrine, where “a state serves as a trustee for such things on behalf of the present and future generations.” Today, International law recognizes all those things that lay outside of the political reach of any one nation state, but belongs to all people, as the global commons; the high seas, the atmosphere, Antarctica and Outer Space. To ask how this particular human contract is going we’d have to stand in front of a mirror before we answer, and then lie to our own face.

A thousand years after Res Communes, the contract had an amendment attached to it. During the Renaissance in the 15th and 16th centuries when birth was given to humanism, there came a new way of thinking about humans and their place in the universe, that people’s actions were not directed by God, but instead, people are responsible for their own lives.

In Europe, in the 17th and 18th centuries, the Renaissance would evolve into the Age of Enlightenment, where philosophers, artists, and scientists discussed the theory of a social contract, made up of unwritten constitutions of nature and society. Such a social contract was theorized to be the blueprint for modern society, where individuals are suggested to surrender certain definitive freedoms and submit to the authority of a ruler, in exchange for protection of their remaining assumed rights. Consent is given to be ruled by an executive power, though consent to be a part of society is not necessarily consent to such an executive. As Thomas Hobbes wrote in 1651, a social contract should be “a mutual exchange of benefits necessary to the formation of a valid contract.”

The deal would become where the ruling state would provide a neutral authority to act to protect the lives, freedoms and property of its citizens, and that justice was to be for all. The citizens on the other hand would promise to avoid doing harm to others, to not interfere with each other, and would be recognized to possess natural unalienable rights. The problem with this concept was that there was no shaking of the hands to seal the deal because it is a theory, and the authority of the state had nothing above it to control it. And most importantly Res Communes began to become privatized. Democracy was the promised placebo to deal with such lack of accountability, but alas it has failed. And though hundreds of millions of law-abiding citizens over the centuries have sacrificed their lives, and even more than that, in fulfilling their duties and their part of the deal to their state and country, the state hasn’t had to sacrifice anything. If such a social contract was indeed co-operative, changes would then  have been different than the present, and once again, collapsing of the middle class and the ever widening problem of distribution of wealth.

As to the planet, according to the international sustainability think tank, Global Footprints, August 12, 2013 marks the day when humanity has used up all the natural resources and waste absorption that the earth can provide in a year. Our human consumption and waste for the remaining four and a half months will be borrowed from future generations. This day has arrived three days earlier each year since 2011. Global Footprints have calculated that if everyone in the world consumed the same as the United States; it would take four Earths to sustain the global population.

The social contract theorized during the Enlightenment would eventually arise in the American Constitution, and would expand out globally and became everyone’s dream. Though it wasn’t until 1931, and historian James Truslow Adams’s book “Epic of America”, that the American dream became popular with the masses in North America and Western Europe. He felt the American dream, was the “dream of a land in which life should be better and richer and fuller for every man, with opportunity for each according to his ability or achievement….. It is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position…. The American dream that has lured tens of millions of all nations to our shores in the past century has not been a dream of merely material plenty, though that has doubtlessly counted heavily. It has been much more than that. It has been a dream of being able to grow to fullest development as man and woman, unhampered by the barriers which had slowly been erected in the older civilizations, unrepressed by social orders which had developed for the benefit of classes rather than for the simple human being of any and every class.”

The dream was then interrupted by the Great Depression, which brought a deep understanding of deprivation. Soon after, World War II and its untold hardships and death on a massive scale erupted. After the horror and madness, those who survived returned and reunited, after sometimes years of separation, with their loves and families, all the while held intact through simple monthly letters. With many of the men, and no doubt much of the populations in many countries, suffering post traumatic shock. Never being able to tell their stories of what they had seen and done. They dreamed of a calmer life, where they felt safe, could toil in meaningful work, and aspire to educate themselves, get married, buy a house and raise kids in it. For decades on end working long full days, putting each of their children through school, and who after graduating, would themselves take on the responsibilities and accountability of being an adult, and stand on their own two feet. One’s dream in life was to be achieved based on individual talent, energy, perseverance, audacity, and a little bit of good luck once in awhile. But the reality of life dictated such a dream could not be for everyone, though generations have tried.

The dream would supposedly continue until the day came to retire and then life would become days of gardening, reading, playing crib, and knitting, baking, and puttering around aimlessly. Maybe obsessing over a lawn, or practising a craft, and if blessed, seeing the grandkids from time to time. Golfing, playing bingo, meeting with friends once a week, and every year going on a little vacation, by plane, train or automobile, to visit family, with the rest of the time spent watching a lot of television. This was not so much how people thought and hoped for; it was what was taught to us, rather advertised to us. Today, the end game of retirement isn’t something people necessarily look forward to at all; instead, for far too many individuals it has become a very, very scary thing. In Canada, 32% of 45 to 64 year olds are expecting lotteries to support them in their retirement, while only 34% of those who do retire have either relied on their savings and investments, or had a pension to achieve it. So for about six out of ten Canadians, retirement is not becoming an option.

Over the past forty years the one dream has morphed into four dreams and has laid waste through our societies at an ever accelerating rate. Writer and Professor of history, Ted Ownby, identifies the four dreams as, Abundance; of material goods, The Democracy of Goods; access to the same products for everybody, regardless of race, gender, ethnicity, or class, Freedom of Choice; where everyone can fashion their own lifestyle, and Novelty; of ever changing models and products and “expanding the consumer experience and fine tuning people’s purchasing skills and awareness of the market.”

Our societies have become top down structures of capitalistic enterprises, with no one above them to curtail their greed and ego. They have skillfully revised the social contract into being all about maximizing corporate profit at the expense of the citizenry. For all intents and purposes the social contract is now null and void, and we’ve allowed it to happen, for we have been sufficiently distracted enough from reality that we continue to buy into the con, that we can have anything we want, be anybody we want to be, and be able to fulfill all our desires, whether self-indulgent, degenerate or with the best of intentions. Any changes to the contract have not been co-operative in any way, shape or form, and instead have been dictated to us.

Thus, inheritances and lotteries have become a part of the dream, subtly replacing jobs and opportunities. Where all we’ve got to do is buy a ticket and dream, while cruising through the nicer areas of town, doing the slow looki-loo drive by, ogling all the homes and finely kept lawns. Dreaming of what it would be like sitting inside that house, with an even bigger screen TV, an even more expensive couch, and a big truck, Sea-doo, Ski-doo and a ride-a-mower parked in the garage. Dreaming of the opportunity to live in a luxurious way, by not dedicating oneself to education and working hard and having the discipline to do so, but instead simply by winning the lottery, or with about the same odds, becoming a sports hero or celebrity. So wrapped up in technology and upgrading it every few months that we’ve become Star Trek’s, the Borg.

Many think that when they win, which they actually believe will happen, eventually, they will be able to expand their material wealth and instantly retire and do nothing in particular. Bigger house, a few vehicles, and month long travel vacations, with the destinations prone to be places one can shop. Some also believe they will, perhaps, maybe, probably win, but are thinking of the freedom it would bring. To finally go buy a guitar, get that easel you’ve always wanted and spend a couple of hours in an art supply store picking out tubes of oil paints, writing a book, or perhaps even going back to school or finally getting your teeth fixed, making a difference in one’s community, or finally being able to help out a friend or family member. Paying it forward in meaningful ways to people who truly deserve it, all the while not even carrying a phone, but for most of us this is all but a dream.

While in the reality of our daily lives we, and those who are supposed to lead us, have together accumulated debt on a massive scale, which has overshadowed and distracted us from seeking and finding true abundance, which is good health, education, family, friends, a healthy natural world and meaningful work. Instead we are searching for meaning and acceptance through what we consume. It’s like people actually seem to believe if you are rich you are automatically accepted as being successful, smart, honorable, and someone who should be looked up to. Even if what you do to make a living goes against all that is moral and right. It seems we have become simply paychecks, and are defined and accepted as such. If indeed this is the case, then of course inheritances and lotteries are important dreams for many people. They have become key to any long term financial security, especially considering that getting or winning such a windfall saves us from having to work for it in a job that isn’t there anymore. People feel they will gain importance and be more than who they are, but don’t understand its nothing but window dressing for what’s really inside. We have reached the point where we have become so successful at being consumers we haven’t the wherewithal to even retire, unless of course, as mentioned, we win this week’s lottery or someone close to us dies and leaves us the money to do so.

Inheritances

Of all the Canadians who have received an inheritance, nearly half preferred not to divulge how much. Of the rest, 47% said they received an average $57,000, one in five said they received $100,000 or more, while one in four received less than $5,000. Higher up the ladder, 36% of the wealthiest families have received an average of $136,000 inheritance, with this figure predicted to swell to about $300,000 in cash, real estate and other valuables, but then assuming and knowing can be the defining difference between fantasy and reality. It’s like the reports today concerned with climate change, worried that when the earth’s ecosystems collapse it’ll cost us tens of trillions of dollars. With the question instantly coming to mind, who’ll and how many will be left to pick up the tab? And who’ll care?

In a perfect world where all goes well, the economists and soothsayers estimate that Canadian seniors and boomers will leave nearly a trillion dollars to their offspring. On the other hand this estimate is in constant flux, as much of the bulk of inheritances is tied up in homes and property. Those lucky enough to have bought their house in the seventies, and stuck it out, now find the place’s worth has risen 300%. But there’s that second, perhaps third, mortgage that was taken out a decade ago for the $60,000 update on the kitchen. Before that the roof had to be replaced, then the trip to Europe, the loan to your kid so he or she could purchase their first home, a 550 square foot “condo”, the new car loan, thankfully now able to be amortized over 84 months, so that some money is left over monthly for buying other stuff, like food, and every year Christmas is finally being paid off in April. Over the past ten years, such home equity lines of credit have risen 170%. This is why today, about 68% of home owners have, on average, only about 34% in equity in their home.

In 1980 the average home was about $100,000, with an average household debt to income ratio of 66%. Meaning for every $1000 a homeowner earned, $660 went to the bills; mortgage, household expenses, food and such, while $330 was left over for savings and frivolous spending. Today the average house in Canada is about $353,000, over 11 times the median family income, with an average household debt to income ratio of 161%. In other words, the average Canadian household debt, as of 2013, is about $1650 for every $1000 of disposable income. Even crazier, more than one in eight homeowners’ debt to income ratio was 250%, meaning two and a half times their annual income went to mortgages, credit cards and other forms of debt, creating -you guessed it- more debt. It’s a similar system to how many governments work their books.

Canadian house prices today have doubled since 2002, and over 13% since 2008, but seem to now be bogging down; you can just about hear the balloon stretching if you’re quiet and turn the TV down. The only reason the Canadian housing today has stayed fairly steady is because we are buoyed up somewhat by the continuing global economic crisis. Meanwhile the most expensive homes, condos and properties in the major cities are being gobbled up by foreign buyers. The average house value in BC today is $498,000. In Vancouver it’s $684,000. Ontario’s average is $369,000, but $479,000 in Toronto, with Alberta’s average house value at $363,000, $420,000 in Calgary.

It is estimated that over the next ten years, house prices will rise perhaps 2%, barely keeping up with inflation, and while current debt and housing levels are ever more unsustainable, when the lending rates rise, and they will, they’re be hell to pay for many. Economists suggest that with only a half of one percentage point increase in the lending rate there would be an immediate drop of about 10% in house sales and over a 3% decrease in prices. A mere 1% increase in borrowing rates would drop house sales over 15% and decrease the price of the home by more than 7%. For many Canadians, they will not be able to  afford to live in the homes they own.

But over 80% of Canadians aged 18 to 29 years, still continue to expect an inheritance, especially those who attended post-secondary school, are savvy to the real estate market and the value of their parent’s home, and who are graduating with an average of $28,000 in student loans into a world where there will never be enough jobs or opportunities. While only 48% of the 45 to 64 year old baby boomers are expecting an inheritance of some sort, because they understand the fact that people are living longer and spending more in retirement, and are seeing firsthand how tough it’s going to be as we age. Boomers in particular are becoming more concerned with debt reduction than retirement and leaving an inheritance, and it’s highly likely we may well be one of the last generations to inherit anything. As to how much wealth is transferred to the next generation, it’s changing all the time, because of the high costs of living in one’s final years, especially if you want to live with a better than average standard of living. The reality will be mostly determined by the actions of the real estate market. As it is, forty-five percent of those 60 or older are going to need their savings to fund their retirement, with only one in four willing to make personal sacrifices to ensure an inheritance for their family. At the same time, only four in ten Canadians actually have a will.

Baby-boomers’ parents were unique, in that they grew up with a very deep understanding of deprivation, untold hardships and World War Two. When and if able to leave an inheritance, they feel compelled to provide financial assistance to their family. Boomers on the other hand have grown up in a relatively peaceful and affluent time, and a life of abundance. They are compelled more to treat any monies or property that they leave to certain people or charity and non-profit organizations, as a bonus, instead of a requirement. Of course that’s only if there is anything left after keeping us in diapers and well medicated in our final years.

Another generational difference is that no longer do the majority believe in a life after death, instead it’s now all about holding on to this one, even to the point of sculpting and altering one’s body to give the impression “age doesn’t mean anything”. Holding onto all we have, and getting as much of it as we can. Never going airborne to look down and see how massive our herd has become and how so alike we look.

At one time we used to inherit the best of family legacies, traditions and values. Perhaps an old watch or chiming clock, an antique dining room table with ornate chairs, perhaps a cache of recipes or a set of dishes and a tea set, or maybe some small plot of land and/or the family home, which was built to raise a family in and not just another investment. Or more importantly such things as honour, the level-headedness of one’s grandmother, the reason people respected your grandfather, having a good work ethic,  being taught etiquette, things like poise and reservation, or how to respect each other even if you don’t like each other. There are also other traditions and values that have been passed on which humanity could do without, such as out-dated social and religious values. But nothing lasts anymore, so there is less to be passed on. Even antiques will soon be no more, and more expensive, for I highly doubt an IKEA bookshelf or Wal-Mart writing desk will be around for auction in seventy years. Our legacies will be plastic effigies of ourselves.

Unfortunately, much of the best of past legacies, traditions and values have been replaced with economic inheritance. Which itself is based on the soft and shaky ground called real estate speculation, a global economic crisis, diminishing ecosystems, and a declining number of people who have planned for retirement, in non-existent or non-sufficient savings, tax, and insurance plans. As for stocks and bonds being a part of one’s inheritance, about 90% of all stock, including bonds, is owned by the top 15% wealthiest individuals. I know, made me cry too.

A few final thoughts on inheritances and why they are diminishing, debt is rising, and the ever widening gap between those with and those without continues. Between 1976 and 2010, Canada’s middle class saw their income grow only 7% when adjusted for inflation, which is about 0.2% per year. The top 20% of earners saw their incomes rise more than 40%, while those in the top 5% saw their incomes rise by that much annually.

Then there is the makeup of the average Canadian family today, where it’s not simply the married for forty years parents passing away and leaving their wealth for their two children and three grandchildren. Today if there is a pot left behind to be pissed in, it might well have to be divided between two or three unmarried and/or sometimes remarried spouses, children from the various relationships, siblings, next of kin, and of course creditors. This issue also appears when someone wins a lottery, and the relatives and friends start appearing out of the woodwork for their cut, whether entitled or not.

Most sadly, where grandparents were once very important within the family makeup, experience and values, especially to their grandchildren; far too often the thread of this legacy is rare or non-existent today. At the same time more and more parents and grandparents are dipping into their savings and retirement funds to financially help their struggling adult children who are finding it difficult to get jobs or meaningful work. But then, for three generations now, around the globe, television and mainstream media have far too often been the parents minding the children.

Reality is, for the majority in the present world, people need to keep for themselves what they would have left as an inheritance to finance their senior years, and/or need to keep working past the American dream’s unnatural sixty-five years old deadline. I wouldn’t be surprised to find that such a deadline is perhaps the reason for the rapid growth of people today developing Alzheimer’s disease or other types of dementia. Preventing mental decline is all about keeping physically active, socially connected and mentally challenged; while drooling over daytime television sitting in a lazy-boy rocker, in a small apartment, taking your meds, smoking your reefer, or drinking enough so that you may sleep that night, does not. People should be able to work as long as they physically and mentally can. Today most have to, before having to spend their final years, often in decrepit, unsafe, and vulnerable situations, or having to rely on Government assistance and eating cold soup out of the can over the kitchen sink. All the while the body and mind deteriorate and one becomes ever more alone and frightened. Many thank God for bringing contemplation, forgiveness and erasure of sin before going to heaven, others now thank god for lotteries, for all the same reasons.

Lotteries

Once upon a time, when we began to jam ourselves into villages, then towns and cities, we slowly stopped believing in ourselves, we also stopped using both sides of our brain at the same time. But we had to believe in something to get through our daily lives, doing those things we usually didn’t want to do, so we came up with the concept of religion. Today we have lotteries.

Any local convenience store clerk will tell you they can actually see the physical and mental reaction a person goes through when coming in to check their tickets. Some people are either cheery, feeling that positive vibes will help their chances, or glum and quiet, hoping and praying under their breath. The “sorry not a winner” from the clerk, is followed by the customer exhaling all their air, shrugging and slumping their shoulders, dropping their heads, and feeling beaten down again. But then the moment they decide to spend the last toonie to their name on a “scratch and win”, voila, hope is restored. The ticket will be taken home or to a place where the aura will make the scratching almost ritualistic and holy. Or by using “reverse psychology’, they scratch the ticket immediately, like they don’t care if it’s a winner or not, and then nonchalantly wading it up and dumping it in the trash bin. The hope, loss and recovery are quickly experienced, as they then continue to go on about their day. For most, even a free ticket win nearly brings out the choir. The dreams a major lottery creates, believing if you don’t play you’ll never win, could put a spring into one’s step for a whole week. People will spend hundreds on Keno or pull-tabs, drinking coffees or beer specials for hours, chatting within their like-minded group, and win fifty bucks and feel like a million dollars. The altar is no longer in a church, it’s in a casino.

Meanwhile, the odds of dying in a terrorist attack in North America are about 1 in 20 million, while travelling abroad these odds drop to 1 in 650,000. In Canada, we have the lowest risk of dying from terrorism out of all the Western economies in the world, about  1 in 14 million, about the same odds of winning the national Lotto 6/49, which odds can be, on average, anywhere from 1 in 14 million to 1 in 28 million. In the States, the chances of winning one of their Powerball or mega-millions state lotteries is about 1 in 175.7 million. A typical, two dollar, thousand dollar prize scratch and win, where the odds of winning a thousand dollars is about 1 in 960,000 is similar to the odds (1 in 1 million) of being killed by flesh-eating disease. So getting beheaded in a terrorist attack, and winning a major lottery have about the same chance of happening in one’s life – interesting. Yet in Canada, we’ll drive at least 16 km (10 miles) to get our lottery ticket, consuming gas worth more than the ticket, and its 3 to 20 times more likely for us to be killed in a car accident than winning a lottery or being car bombed.

The odds of being killed by a bee sting or a snake bite are about 1 in 100,000. Dying in a plane crash 1 in 360,000, becoming a pro athlete 1 in 22,000, getting a hole in one in golf, 1 in 5,000, the same odds for getting injured or dying sometime over the next year. Then raw reality lays bare the odds of getting cancer – at least once in our lives – 1 in 2.

As to the Canadian lottery, Lotto 6/49, if you spend two dollars a week on one set of numbers you’re likely to win $10 at least once every 13 months. Another study found that spending $25 per week for 20 years on lottery tickets, you could make over a third back, occasionally winning in increments of either $10 or the 4th place range of $75 The odds of winning a free ticket are 1 in 8; winning ten to twenty dollars, 1 in 77. The average Canadian spends $257 per year on lottery tickets. British Columbians spend the least at $240, while 45 to 64 year old men spend the most at $880 per year.

One of the largest lottery jackpots won in the world was in March 2012, in the States, where three tickets shared in a $640 million cash payout. After taxes each of the winners shared $474 million. In the US, the federal individual income tax rate is 35-39.6% on taxable income above $400,000 for a single and $450,000 for a couple, plus state and municipal taxes. The highest combined federal, state and city tax rate paid by someone winning the lottery is in New York State at 48.5%. In Canada there are no taxes on lottery winnings, but there are on interest earned from them.

One of the highest lottery prizes in Canada was in April 2013, where there were four winning tickets sharing $63 million. Which was $15.8 million per ticket, but one of the winners had two winning numbers, because eccentrically, for 30 years he always purchased two identical sets of the same numbers, doubling down each time, thus he was able to pocket $31.6 million.

The good thing about the lottery is it’s like the left-brain right-brain thing. It gives hope, some solace during the week perhaps, where one walks a bit straighter, and a humbled confidence could even enter their realm. And in most cases it only cost two bucks. Then there’s the view of where does the money go, won or lost. The winners more often than not are broke within five years, while the money pooled by the lottery corporations, surprisingly, is often money well spent or at least it’s what we are led to believe.

Lotteries in North America are a fairly recent addition, and unfortunately governments have become enamoured with lotteries and casinos, because instead of some of the escalating revenues going to actually help communities, as has been the case, the monies they receive now are put into general spending, most often to cover their, but really our, growing debt. One can also say that lotteries give false hope, a release valve for the population, so that there is less pressure on political leaders, to remedy the growing inequality of modern society. But then these negative aspects of a lottery have been used for thousands of years, and as mentioned, have only been recently accepted, when governments wanted a piece of the action once controlled solely by the underworld and despots.

Evidence suggests lotteries began in China over four thousand years ago, with the first recorded signs of a lottery during the Han Dynasty between 205 and 187 BC. It’s believed lotteries were created to finance government works, such as the Great Wall of China. Gambling has gone on as long with the Egyptians, who became notorious dice players three thousand years ago. The first known European lotteries were during the Roman Empire. By 1400, many communities of Europeans would hold lotteries for needed public works.

Gambling, lotteries and sweepstakes were illegal in many countries, including Canada, the US and most of Europe well into the early 20th century. Gambling Mecca’s were always elsewhere, Havana, Beirut, Monte Carlo…. It wasn’t until the sixties that casinos and lotteries began to push for amendments in both Canada and the US.

In Canada, it wasn’t until 1969, when the Criminal Code was amended, that the federal government and the Provinces were allowed to operate such “lottery schemes.” BC offered Canada’s first lottery in 1974, with everyone else soon following. There are five lottery corporations in Canada today, covering all the provinces and territories; Atlantic, Quebec, Ontario, Western Canada and BC. Combined they bring in $8.5 billion in revenue annually. In the US there are forty-four States or Territories which offer government operated lotteries.

In 1985, selling under the umbrella of the Western Canada Lottery Foundation, BC opened its own lottery, the British Columbia Lottery Corporation (BCLC), which today is the largest net income generating commercial Crown Corporation in BC. But like the BC Transit Corporation, it is placed outside of direct government oversight. In 2011/12, over 5,000 community and charitable organizations received a combined $134 million in Community Gaming Grants for arts and culture, youth and disabled sports, public safety, environmental groups, animal welfare agencies, fairs, festivals, museums and for people in need. A further $100 million went to local governments that host casinos and community gaming centers and local economic development projects. With 900 employees, its revenues for 2012-13, by operating 2.5 lottery machines per 1000 people in BC, were $2.76 billion. While $624.5 million was paid out in winnings (39%),  total expenses were $910 million. Net income was $1.2 billion, of which $100 million in taxes goes to the BC government, hopefully going where it’s supposed to go, which is support for health care services and research, and a consolidated revenue fund to support other health care and education programs. Of the remaining monies, $128 million goes to debt; $116 million goes to Capital expenditures and finally the federal government gets its $9.1 million share. Millions also are allocated to gambling addictions. The bottom line is that, for every one dollar gambled in BC, eighty-seven cents goes back into BC. Funny enough, so do most of the prize payouts.

Twenty-five per cent of Canadians consistently play the lottery, while it’s estimated that more than 60% of Canadians will plunk down at least two dollars on any lottery which prize has grown to mega-million size. And like all big business the push is always on. Previously noted, subsidizing a government’s lack of fiscal restraint means the revenues from gambling are paying for the services the government can no longer afford to provide, and of course the push has reached mainstream radio stations, where the evolvement of never ending contests has reached a place where if you win, you will receive $100 to play Lotto, plus have an on-line account set up for you, so that “you never have to worry you don’t have a ticket ever again”, and as a special bonus you will receive an e-mail notification when you win, oh yes, when you win! So all that is needed is to sit in front of the television, mouth agape, watching regular programming, drooling in front of the computer, or playing video games until three am, and simply waiting for the phone to magically ring, and will change your life.

Nine out of ten winners of $100,000 or less spend all their winnings in five years or less. Researchers have offered a few theories as to why so many winners blow it all rather quickly. Theories abound that most lottery players have below-average incomes and education and are highly likely to be financially illiterate and that winners might also engage in something behavioral economists call “mental accounting”, where a person treats their winnings less cautiously than they would their earnings, because the winnings are something they didn’t have before. And of course some people simply develop a taste for luxury goods that outlasts their money. Just like any other addiction.

According to a study by the Statistic Brain, compiled from 34 national lottery winners (8 male, 26 female, with an average age of 46), and who averaged $175,000 in winnings, suggests that 55% were of course much happier after winning, because of improved financial security, 65% were less worried, could purchase anything they wanted, and that 23% felt their life became easier, while 43% of the winners felt no effect on their happiness. Other studies suggest that such happiness, on average, ebbs over time. Interesting effects from this study include, 58% of winners’ families claimed to be happier, 40% increased their contributions to charity, 38% have moved since winning, 48% were in a career job before and are still there, 15% started a new job, 30% started their own business, and 32% have gained weight. The average number of friends that male winners gave money to – three; the average number of friends female winners gave money to – one; while 44% would spend their winnings within five years, and the probability that any such new wealth will be gone by the third generation (grandchildren), is 90%. Of course, all these numbers are dependent on the amount of money won and who the people were.

As for multi-million dollar winners, at least those who have a head on their shoulders, who are happy with who they are, thus, are well grounded, American Brad Duke of Star, Idaho, could be used as an example. When he realized he had won the $220 million Powerball jackpot in 2005, he kept it to himself and went about his daily routine. The breakdown of what he finally did with the loot, when he finally went public; $45 million invested in safe, low-risk investments such as municipal bonds, $35 million in more aggressive investments such as oil, gas, and real estate (personally, real estate for sure, oil and gas, not even if my life depended on it, which it does. I’d go solar and wind alternatives), a $1.3 million family foundation, $63,000 spent on a trip to Tahiti with 17 friends, he paid off the $125,000 mortgage on his 1,400 square-foot house, paid off his outstanding student loan of $18,000. As a mountain bike enthusiast he spent $65,000 on new bicycles, bought a used black VW Jetta for $14,500 and now gives an annual $12,000 gift to each family member.

But it’s all relative, depending on the winner’s sense of well-being, which doesn’t fundamentally change, and their current situation which will most certainly exaggerate. If you are unhappy, can’t manage money and you’re surrounded by people you do not trust, winning millions of dollars will probably make your problems worse. If you are happy with your life, it fulfills you, you are careful with your money and you have strong relationships in your life, a lottery win is likely to build on those strengths. We are who we are.

The downside of it all is that many people’s lives have become nearly entirely economic, and lacking any depth whatsoever. We believe we have very healthy relationships with our stuff, while our human relationships become ever more dysfunctional. And is perhaps why dog ownership is growing in leaps and bounds; people seeking unconditional love, acceptance and forgiveness. This gets us back to the idea of the American dream, discussed earlier, and how it has evolved into simply being the best consumer you can be, all the while, it is clearly warping our senses and human values. It has become the way of the world, for it keeps the global economy going. The 1% who run the world, control us by constantly reminding that if we buy, use, discard, then buy some more, all is well. If we do not, the economy will die. Meanwhile fossil fuel limits, environmental limits and debt limits are all being reached, and no heed is taken, and if it is, its then quickly squashed. It seems the only dying that’s going on here is us and all the other species that live on this rock.

In the US, it’s becoming blatantly obvious such a way of living is not working. A recent report out of Oxford University, estimates 80% of Americans (four out of five adults) will suffer the hardship of joblessness, near-poverty or reliance on welfare for at least parts of their lives by 2030. In 2012, 33 million American adults, 15% of the population, and only two million fewer people than Canada’s entire population, who were responsible for a family of four, saw their annual income fall below the poverty line of $23,021.

So if after eking through life and getting cancer, a hip replacement, suffering depression, getting hit by lightening, having a parasitic worm gnaw its way through your body, getting into a traffic accident where somebody died, becoming a superstar, writing a novel and fourteen million other things, you actually do win a lottery or receive an inheritance, be cool, chill for awhile, take your time and keep it to yourself. Yes, this will be very difficult, but so is life, and if indeed you won and if you play your cards right, it could get better.

Put one or two steps between you and your ability to spend the principle. Surround yourself with people you trust, whether a lawyer, financial advisor or even a committee of three of those closest to you. Meet with estate lawyers, accountants and financial advisors, and when you meet them do not let on you have fourteen or so million sitting in your savings account. See if they will show you respect thinking you’re just regular folk. Provide for your children with savings accounts; hold off on giving money to anybody else until you have a financial plan in order. Set aside a small amount as crazy money, but set a very small limit, do not dwell on it, and don’t hurt anyone.

Winning a lottery is much more than just money and managing it though. It is also very much about managing one’s behaviour. A real bitch or prick filled with self-indulgence, hate, greed and zero empathy living in a hovel, will no doubt be of the same character and possess the same attitude, if living in a castle. For as they say, doing the same thing and expecting a different result is a sign of utter madness.

As for the American dream, many citizens today the world over, are realizing that such a dream is becoming unattainable, and perhaps it never was, as George Carlin eloquently deadpanned, thirty years ago, “It’s called the American dream because you have to be asleep to believe it.”

No matter if one wins a lottery or has an inheritance thrown into one’s lap, or not; making a difference in your life has got nothing to do with money. Money simply gives one the freedom to do more. Our stuff does not define us. We are who we are. And we don’t change as much as we think we do.

Though I have no pension, nor substantial savings, and will never be able to retire, I don’t care. I’m a writer and though I don’t make money doing it, I wish it was all I had to do. But I continue to work, have a roof over my head, be fed and I’m blessed with family, trusted friends and acquaintances. I accept and deal with the dark days as they periodically appear, and enjoy the good ones, one at a time. So yes, I will still saunter over to the corner grocery store once a week, grab some chocolate milk and eggs, smell the smells, sample some freshly made pakora’s, gratefully take a small container of chutney, chat with the merchant and his family, smile at people there and back, perhaps shove my face into a blooming Lilac bush, and spend five dollars on BC/49. Because you never know, and no matter the truths written above, if five dollars is what it takes, in this economic world of ours to inject some confidence in looking forward to the future, and the freedom it would bring, and be able to dream of things outside our boxes and daily routines, without harming ourselves or others, I figure it’s money well spent.

 

 

04/8/13

Costs Of Living – Inequalities, Poverty Levels, and the Cost for one Person to live in Victoria BC

“Everyone who works has the right to just and favourable remuneration ensuring for himself and for his family an existence worthy of human dignity”  U.N. Universal Declaration of Human Rights


 

While we have been busy climbing ladders, wishing we were someone else and purchasing our personalities, the basics of life have become much more than simply the costs of living, and are in fact taking much more from us than just income and capital; it’s taking away the planet we live on as well.

To exist as a biological species we need safe drinking water, food, clothing, a roof over our heads, and sex. To be human we need someone to love, someone to love us, friendship, an individual talent which gives us self worth and the ability or opportunity to question. To keep humanity’s greatest resources, imagination and ingenuity, in proper context, we need what Albert Einstein called “the principles of free and responsible development of the individual so that he may place his powers freely and gladly in the service of mankind.” To keep ourselves mentally healthy is to relish each one of these essentials. But each one of these essentials, especially over the past thirty years, has now become nearly entirely privatized, as we stare like deer caught in the headlights.

Today such basic needs and rights also include education, health care, parks and recreation and freedom of speech, all of which are now packaged into products to be simply bought and sold, with many of these rights easily taken from us. Obtaining them is now based on who can pay the most, because anything good, important, healthy or reliable costs more.

The cost of living before agriculture and civilizations was called life and death. Then about twelve thousand years ago, after seventy thousand years of our current mutation as modern humans; we began to domesticate animals and invented agriculture to feed them, eventually feeding ourselves as well. We also began to live communally in larger numbers, which rose exponentially after such villages became cities. The cost of living became income. At this time the characters bearing psychopathic tendencies, such as “self-esteem derived from personal gain, power, or pleasure; failure to conform to lawful or culturally normative ethical behaviour; lack of concern for feelings, needs, or suffering of others; lack of remorse after hurting or mistreating another; exploitation is a primary means of relating to others; deceit; the use of dominance or intimidation to control others and misrepresentation of the self”, were finally able to rise to the top, feeding on their thirst for power, to control the food source, and demand tithe for doing so. Where once there was enough for everyone slowly became never enough. The seeds of inequality among humans began to quickly sprout and split into the haves and the have-nots.

At the same time, laws were formed by the individuals who controlled the wealth to control the public and soon the populations began to lose the opportunity to be noble or heroic, with everyone’s destiny and position in life laid out for them. Distractions such as literature, theatre and sports quickly followed, becoming the places where we could live out an honorable life, through someone else’s actions.  To further control the masses the elite created capital, usury, then debt, by imposing scarcity on their own populations, and any conquered ones, thus causing inequality which created poverty. To keep at least a wee bit of hope, religion was created.

Eventually the distractions and illusions became what they are today, sports heroes, movie stars, politics, and numerous economic theories that only exist on paper and which keep us focused on anything other than our own lives. Ideas such as GDP, which we base our economic worlds and societal success on, but which have nothing to do with our personal well-being or the planet’s. It operates under the illusion that unlimited growth under free market capitalism, operating on only one delicate and finite planet will work, and that a person’s well-being has all to do with material gain and how much one consumes. As it devours our social and natural environments it has us thinking that money will bring us happiness, where instead life should be doing that.

But we do not live in a world where the economy understands that there are now over seven billion people living on a single and finite planet and concerns itself with the importance of everyone getting along, the welfare of each individual, and having enough for everyone, even future generations, by caring for the earth’s resources. Instead we have an economic system, neo-liberal capitalism, which only generates extreme wealth for a very few individuals and is destroying the planets ecosystems by replacing the earth’s resources with waste, and controls the majority of the human race using nationalism, intolerance and oppression by economic means. For instance, if every country on earth were to consume resources and generate as much waste as the United States, we would need five planet earths.

Meanwhile we are extolled through the corporate government media machine that we should worry about events in far-flung places, rather than what’s happening in our own communities, ignoring the depravity within our own society by watching it happen somewhere else. More often than not, global mainstream media is not the real world; our everyday lives are not filled with horror, crime, and continuous bad news nor are they filled with the need to always exact revenge. Most all news stories are about things we cannot influence, and the daily repetition of such things we cannot do anything about, makes us passive. It is grinding us down and is undoubtedly one of the core reasons for the widespread disease of depression which is ravaging our societies. Media could and should, put life into better perspective though in many instances it is verboten to do so and now simply sticks to peddling the ideology of the corporate state.

We are further led to believe that lavish spending and waste makes one a better person somehow, to be a true human you need stuff, especially stuff you don’t need. That what one is wearing or what vehicle one drives denotes their personality and that money is everything. Even assets and debts are to be carried over, and still to be paid after we die. We are bludgeoned and brow beaten about debt and how much is owed, numbers in the billions and trillions on the national level and which we have no hope of ever relating to. On a more personal level we simply try to ignore the amount we ourselves are amassing.

We are also told that having a distinct personality is imperative to be the most powerful, invincible, admired, sexy and unique, yet our daily lives are interactive and interdependent worlds, as are most all species whether animal, bird or fish. No matter the distraction or how far one buys into it, the underlying questioning of what we are told to do, say, act and buy, goes against the reality of who we are. And it’s confusing the hell out of us.

For generations’ topics such as religion, politics, what one does for a living, inequality and sex were simply not spoken about or brought up. Climate change and the current economic crisis can also be added to this list. Yet these are all things we should be talking about, because they are the causes of the abuse we are doing to ourselves and the planet. We get upset when talking about such issues because it’s taken personally, thus we become emotional and offended. Talk about any other fundamental global issues today and people really get their hairs up and knickers in a twist, and either emotionally expounds their personal world-view at you or simply doesn’t want to talk about it and quickly changes the subject. The main reason for this is because it gets too close to the bone; we are hurt emotionally because our inaction, obedience to the system, and denial are complicit with the digression of our unequal societies and destruction of the earth’s eco-systems.

It is getting harder and harder to differentiate between truth and fiction so we interpret reality through illusion, believe what we want to believe, and are quickly rid of anything unpleasant, instead of learning to cope. Our comfort zones have been separated from reality, with the media working their best for their corporate masters, to ensure that they shall never meet. The paradox today is that people have to be far enough out of touch with reality to function and yet acknowledge reality to survive.

The separation between reality and illusion is a thin veil and is creating so many contradictions in our lives that many people today, especially in the developed countries, simply can’t cope with daily life. Each year the United States and Canada consumes more than two-thirds of the world’s pharmaceutical anti-depressants, the bulk of the global cocaine supply and have some of the highest rates of alcohol abuse in the world. Not to mention deteriorating physical and mental health. There is a reason for this.

We have become a public overwhelmed, numbed, and weary of the stories and realities of climate change, unwinnable wars, whether drugs or terrorists, and the ever worsening global economic recession and the strain it’s putting on our lives. No matter how much one becomes distracted, such issues weigh heavily upon us. For many, worrying about where the next meal will come from creates stress and worry, which affects our health, therefore also becomes one of the costs to live today.

Underlying our human madness is the reality of each day in an individual’s life and the fact that our basic, modern needs, and fundamental requirements to exist as a healthy biological species, along with, income disparity and the lowering of our morals, are all becoming more expensive and much more than we, as well as the planet, can afford.

It is estimated there are billions of people in the world living on less than $2.50 per day. Most are indeed poor, but then again there are also some peoples and places on the earth, where consumerism and capitalism haven’t become a belief system, nor has the surrounding environment been eroded or poisoned. In such places $2.50 a day is all you really need to fulfill one’s daily need for water, food and a roof over your head, with lives which are just as fulfilling, loving, rich and rewarding as anywhere else. But for much of the planet’s populations, one’s life is determined by how much money one makes and what you do with it.

Today the cost of living is based on what is called the “poverty level”, which is the minimum level deemed adequate to afford the essential resources an average human being needs to consume in one year. It is based on a human’s basic food and water requirements necessary to exist.  With food, a human’s health is determined by what’s called “body-mass index”, which is a human’s body shape based on an individual’s weight and height. The minimum “allowed” body-mass index is 16, although the more accurate and real body-fat % number is being used more often as the scale, with the highest percentages being in North America. The BMI is still used globally, with the lowest BMI scores, averaging 19, are found in many of the poorest countries, especially Eritrea, Congo, Bangladesh and Ethiopia, and Southeast Asia. The highest rates are Tonga, Micronesia and Samoa, with an average of 32. As a rule a BMI of over 25 puts one overweight.

Though there is no standard caloric intake list, a person needs a minimum of 1500-2000 calories of food per day. With the actual number of calories each individual needs depending on multiple different factors, including age, gender, height, weight, lifestyle, availability and metabolism, and that not all calories are created equal, so it depends more so on what kinds of calories you eat.

The minimum amount of water our bodies need, in a moderate climate and average activity level, is about 5 litres (1.3 gal) per day, while the minimum water needed for drinking, cooking, bathing and sanitation combined is about 50 litres (13 gal) per day, per person. In perspective, Americans and Canadians use 250-300 litres (65-78 gal) of water per day per person for drinking, cooking, bathing, flushing toilets and watering lawns. In the Netherlands, they use 104 litres (27 gal) per day, while in Gambia, in Africa, they use only 4.5 litres (1.17 gal) per day. The poverty level minimum water needs also states that every person must have safe drinking water available less than 15 minutes away. And although 70% of the earth’s surface is water, less than 2% of it is fresh water, of which only a few hundredths of a per cent is actually drinkable.

As for food and water, these minimums are scary as in many parts of the world they are still not being reached, and in fact are declining, with the supply of these basic needs being the most affected by climate change. The UN estimates that there are 925 million humans with insufficient food, 1 out of every 7 people, with over half of all the children in the world today living in poverty. Global fresh water is dwindling quickly, not so much from drinking, but from growing food, while the acidification and oxygen depletion of the earth’s oceans, lakes and rivers, drought, severe weather, glaciers disappearing and rivers drying up continue unabated.  We whine about what a litre of gasoline costs, yet are paying sometimes twice as much for the same amount of water in a plastic bottle. Heck, in Victoria we are paying fifty-cents to simply put air in our tires.

The poverty level provisions must also include proper sanitation for our biological waste, health care for serious illness, injury and pregnancy, and shelter, where fewer than four people live in each room with at the least a floor and a roof.  Next up is education, where each person is able to read and write, thus learn. Finally, the poverty level includes that everyone should have the modern essentials of having information at hand, whether in books, magazines and news sources, as well as access to services such as further education, health advice and care, legal assistance, social services, and financial services such as credit unions.

While in reality many of these minimum requirements can never be reached by someone actually living at the poverty level; with many of them slowly being erased or priced too high and out of reach for the majority of humanity.

Before we continue I would like to emphasize that I understand very well there will be a wide range of circumstances when further discussing the cost of living, and to some extent income inequality, but I’m just going for an average, ballpark figure of an average Canadian, with the odd comparison to the Americans. I’m not really comparing but generalizing, because there are so many variables, such as where one lives – city, small town or suburb. Are they male or female, single or have a large family, or two people sharing expenses and with a joint income of $40,000 and having a higher standard of living than two individuals living alone on $20,000 each, with all sorts of intangibles in between.

In Canada the after-tax poverty thresholds are $18,421 for one person, $34,829 for a family with two children. One in ten Canadians live at or below these levels; 3.2 million people, of whom 634,000 are children, with British Columbia continuing to have the highest child poverty rate in Canada. In the US the poverty level is $11,344 for one person, and $22,133 for a family with two children, with more than one per six Americans living at and far below these levels.

Such income levels have not changed much over the past 30 years, though the actual costs of living and the income of the top earners have risen dramatically. Consider that in 1982 the median income of an average Canadian was $28,000 annually after taxes, while the income for the top one per cent was $191,600 after taxes, seven times higher. Fast forward to today where our economy has grown twice as large, the richest one per cent now report a median income of $283,400, nearly 10 times higher than the median income of the other 99% of Canadians whose median income has only risen to $28,500.

Income inequality is even more disturbing in the US. In 1980 the average CEO’s annual pay was 42 times more than the average worker. By 2011, their pay was 340 times more, regardless of business performance or shareholder value.  As to income growth over the past 45 years and adjusted for inflation, 90% of Americans annual income, has risen a mere $59 per year, while the top 1% of the top 1%’s annual income has risen to $18.7 million. To put this in perspective, for each dollar that an average household’s income rises, the household incomes of the top 1% of the top 1% rises $311,233 annually.

In Canada the top 100 CEO’s earn an average of $6 million per year, while the average minimum hourly wage in Canada is nine dollars, in the US its $7.25 per hour. The lowest minimum monthly gross income in Canada, working a 40 hour work week, is $1,631 per month. To currently live in Vancouver B.C. an individual needs to earn at least $18.81 per hour and work a 40 hour week. In 2012, the average weekly wage in BC was $860.57 before taxes, with an hourly average wage of $23.53. In a nut shell, more than half of all Canadians are living on less than $25,400 per year after taxes and would need to work one month to make the same amount a top CEO makes in one hour.

Out of the pie, 51.9% of Canadians make $29,299 a year or less, 48% make more than $30,000 per year, and the final 1% makes $169,000 or more a year, with 0.1 % of these individuals making an average of $30 million a year. Breaking it down further, if you make more than $60,000 per year you are in the top 19%; above $120,000 per year you are in the top 5%. As for weekly income, the top 10%, who are mostly just the managers of the top 1%’s industries, governments, corporations and wealth, and who are really just commodities themselves, average $6,000 per week. Their bosses make about $160,000 per week.

The disappearing middle class in BC have individual earnings between $40,000 and $125,000, while in the US their middle class is determined to be those earning $36,000 to $57,657 per year. In both countries it’s becoming blatantly clear, yet readily ignored, that the bulk of the populations of both are below middle class, with a few at the very top.

The latest employment reports show that since the economic downturn in 2008, 60% of all jobs lost during the subsequent recession paid middle income wages, while 60% of jobs gained are low paying jobs in the accommodation or fast food industry. Declining traditional middle class jobs include executive assistants and secretaries, construction laborers, carpenters, bookkeepers, accountants, telephone operators, general maintenance and repairmen, and reporters and correspondents.  With the biggest drops in employment occurring in utilities, public administration and especially manufacturing. Although actual manufacturing sales are rising, the higher paying manufacturing jobs are disappearing quickly, and being replaced with low paying service jobs. Staying stagnant are jobs in business, trade, and information, culture and recreation, while rising employment opportunities are in education, health, and as previously mentioned, the fast food and service industry, which is growing four times the overall rate. People are getting jobs but staying poor, because the increasing low-wage jobs don’t pay enough to live off of.

Besides income disparity, wealth inequality is equally outrageous. The richest 300 people in the world have the same wealth as the poorest 3 billion. In Canada, the top 1% possesses more than 45% of the wealth, while eight out of every 10 working Canadian share 7% of the wealth between them.  As for who actually has the wealth, meaning who has the share of money, gold, real estate, stocks and bonds, not very many. In 2012, Canadians with more than $30 million in assets numbered only 4,922 individuals, with a combined worth of over $148 billion. In 2010 the population of Canada was 43 million people, yet only 164,000 individuals made more than $250,000, while in BC there were only 18,810 individuals making that much, and once again, possessing nearly 45% of the wealth.

In the US, the Walton’s, heirs to the monolith that is Wal-Mart, are worth a combined $110 billion, more wealth than the bottom 42% of Americans combined. If Wal-Mart was a country it would be the 26th largest economy in the world, with yearly sales exceeding $444 billion, $20 billion more than Austria’s GDP.

The problems with such growing inequality are that most of the wealthy do not even invest their wealth back into where they live; instead they move it offshore as quickly as possible. There is no trickle-down effect. Record profits in the private sector haven’t led to an increase in wages, but rather quite the opposite, less wages along with fewer jobs.

After all that, and taking a deep breath, we come back to how much does it really cost for somebody to live. In BC the average working stiffs, putting in 40 hour weeks, with no dental plan and no pension plan, other than what the Canada Pension Plan eventually pays when we are 65 years old, gross median annual incomes, range from the ticketed master carpenter making $50,070, to a construction labourer averaging $36,147, an apartment manager making $32,300, a bartender $23,198, to a waitress making $22,242, while a bookkeeper makes on average about $17.95 per hour,  a pharmacy technician, $15.91 per hour, and someone working in retail/fast food $10.25 gross per hour. Currently, the before taxes, gross median annual income in Canada is $30,800.

The poverty level mentioned earlier, supposedly is the least one needs to survive as a human being in a developed nation. In Canada, as earlier noted, it is $18,421 per year after tax, while one’s actual cost of living is determined by how much of a consumer you are and how much of the bullshit do you buy into. In Canada, in 2012, for every $100 an average Canadian family earned in disposable after-tax income they owed over $164 in market debt.  Why this is so, is in part because many of us are buying stuff we don’t need, and with stagnant wages for the past few decades the basics are costing so much more.

An example; a single male living in Victoria BC in 2012, pulling in $24,000 a year gross, whether $2000 per month salary or working 40 hour weeks for $12.50 per hour, is determined to be on the poverty level.  Off the top goes $3600 (15%) to Federal taxes, $1214 (5.06%) to Provincial taxes, $1080 (4.5%) to Canada Pension Plan, and about $360 (1.5%) for unemployment insurance. Using public transit with a bus pass costs $82 per month ($984/year) and living in a one-bedroom apartment costs an average $830 per month ($9960/year).  Cost of consumables such as food one only makes at home and personal care averages $280 per month ($3000/year). BC Medical (health care) is $55 per month ($660/year), $66.50 per month if you make over $30,000. Some sort of Life insurance, Critical Illness insurance or even savings, will cost at least $40 per month ($480/year), and that’s if you don’t smoke. Though I will not be adding such a cost to total when complete, a pack of cigarettes averages $9.30, a pack a day habit will cost you $279 per month.

Apartment insurance is about $15 per month ($180/year); the average cell phone costs are $71 per month ($852/year), though a basic land-line phone on one’s home runs about $26 per month.  Very basic cable is about $38 per month, including taxes ($456/year), while having an internet connection is about $40 per month ($480/year).  The cost of electricity for an apartment, with free hot water with heat registers, is on average $18 per month ($216/year), if it’s electric heat, $50+ per month. Entertainment is going out for a dinner for two ($50) once a month, grabbing the $10 burger and beer special once a week at the local pub, buying a bottle of cheap wine ($10), a new book ($15) and perhaps going to a movie once a month ($12), will total about $127 per month ($1524/year).

After paying these costs of living, the single person living in Victoria will be left with nothing, in fact they will be in arrears $1046, and still have to cover any clothing expenses, stamps, laundry, newspaper and occasional coffees, and emergencies. While the two week holidays one gets annually, never really includes an actual vacation. Such things as owning a car, paying for its gas, smoking, having a drug problem, eating out and being an obedient consumer is simply not possible. Though many cut corners and/or borrow to do so, a minority steal to do so. With over half of Canadians making less than $30,800 net per year, the poverty level is not so far away for the majority, and it is very true that “most everyone is a couple of paychecks away from being on the street.”

Many people whose income is $60,000 a year are also living paycheck to paycheck. The more you make, the more you spend, most times on frivolous and disposable stuff that has no actual value, and on such things as a bigger car loan or lease, a mortgage, higher credit card debt, purchasing higher end stuff and more of it, such as phones, clothing, TVs and shoes, personal loans, eating out more often, expensive holidays, TFSA’s, RRSP’s and savings, maintenance of home and a higher standard of living. It’s all relative. Though of course, no matter how much a person makes still does not guarantee them happiness.

The proverbial wrenches thrown into the cost of living are the facts of life that drop in and disrupt our lives from time to time, the stuff that happens in between paychecks. One’s mother dies on the other side of the country. Can one afford to fly there and bury her? One breaks their collarbone in an accident at home and has to go on six weeks unpaid leave, or someone has the flu and can’t afford to take the time off work. The car needs new tires, or one who has no dental insurance needs a tooth pulled, a root canal, or heaven forbid needs a crown.  It is estimated that 60% of all the people in the States who go bankrupt each year, have done so because they had a medical crisis and huge medical bills and costs.

As it is, wages have been stagnant for thirty years, which we have compensated with debt. Our society is becoming ever the more insecure, living in fear of losing one’s job, not being able to provide for family and the worry of losing one’s stuff. Stuff which we have been programmed to believe that we simply could not get by without, but which has no value whatsoever. Yet our response to the madness continues to be, think me and mine.

We have been told to do things in our lives that make us feel important, more independent, vital and valued. Interacting in the world of my daily life, I see so much of it, where people have taken what should be self confidence and empathy, and instead have created a profound sense of entitlement and a drone like stare. But no matter the cape one wears, we are all having a hard time of it mentally and emotionally. Though we try to smile and coo that everything is alright, we are actually barely putting up with the arrogance and ignorance of our fellow human beings, including ourselves.  But then this should not be surprising considering its now three generations of people, in Canada, the States, Europe, et al, who have been raised by television, and we are never wrong.  History has also proven that the worse society becomes the more delusional they become.

Ever since television, the powers that be have worked very hard at selecting for us what decisions we make. Forty years on, most of our decisions are already made for us well in advance and the income equality and wealth distribution gaps have widened to a point never seen in all of human history. Meanwhile the majority of us are finding it ever more difficult in bearing the brunt of what the cost of living today is demanding from us.

With any society truly only “three meals away from a revolution,” the trigger point for change in how our economic and social worlds operate is nearing. But when people rise up because their child is starving and they themselves have no prospect of an advancement or job, because as our population grows there will never be enough jobs for everyone, will pharmaceutical drugs and the gods of consumerism replace the most powerful drug we possess, which is hope?

Extreme wealth and social inequality is nothing new, nor is the inability to afford the cost of living. It has happened more than a few times over the course of human history. Each time there was ever worsening of physical and mental health, shorter life spans and more criminal behaviour, especially among the wealthiest, because unfortunately, when life gets hard, living wrong is easier than living right.

But when we cannot feed ourselves or get access to drinkable water anymore, enough will then be enough. And there will be change. Such crises in the past have touched off revolutions, which more often than not are led by middle class, educated leaders, doctors and teachers; though the problem with revolution has always been that they are messy and very violent affairs. For to achieve true change, the system must not only be beheaded, the base has to crushed and swept away as well. Leaving it and just getting a new head, operating within the same system, same rules and regulations or lack thereof, eventually fails as well, because the system is broke, and has never worked. At that time the step will have to be made to cross the great divide between being aware of our current dysfunction yet only standing back and pontificating about it, and start acting on the dialogue about alternatives and solutions to the problems and becoming involved in its reform. It’s why many of the earliest civilizations had laws where wealth would be distributed anew and all debt erased every seven or so years.

Today I fear that I myself am caught up in the current age of myth and capitalism and that as a people we do not have the courage to rescue ourselves from ourselves anymore. It has become too easy to shut out the madness of our corporate governments and oligarchs with sports, movie stars and reality TV. I sit here and peck away on the computer analyzing, researching and giving an opinion about problems that thousands have already and quite often have done so more eloquently and intelligently, but I feel this is all I can do. Of course it is not.

The proof in the pudding will be when enough of us scream “time out”, get up from our couches, step away from our routine distractions, put one foot in front of the other, get out onto the street and make our voices heard, and come up with options and alternatives as to how we currently operate as societies. Instead of future generations cursing our names, we should at least give them the impression that we tried the best we could, and for once stopped thinking about me, myself and I. How can we expect any hope for our children and our children’s children if we do not?

The height of ignorance would be for us to continue to operate on self-denial, excess and self-indulgence and believe it’s all about us, with no thought to our children and grandchildren and what type of world they will be allowed to grow old in. The epitome of ignorance personified is to actually think the ecosystems and weather patterns of the earth, which we have greedily altered, care if we can cope or change our ways, or not.

After forty short years, the reality being proven in most developed countries is that in general, and not through a lack of trying or working hard, but because we are operating within a flawed system and have become distracted, we won’t do better than our parents, and our children will not do better than us. Heaven help our grandchildren.

 

 

 

05/28/12

Student Protests: One Coin Two Sides

The student protests in Quebec, now over one hundred days in, are not unique but very similar to what’s happening in many places on the planet. Civil unrest is dominating and defining this decade, with more people each day standing up and, quietly at first, saying enough is enough.

The obedient governments that the powers that be control are becoming anxious, nervous behind their arrogance. The escalation of violence that is being used by the authorities to quell any type of demonstration only shows how those in charge are becoming both scared and paranoid. There is a growing tide of people where the corporate elite’s tools of distraction are not working anymore. Both sides are seeing the end game.

The Quebec student protests in particular are happening because of a combination of things. Firstly, there is a huge disconnect between the students, along with many others, and the provincial Liberal government’s neo-liberal economic policies and plans to raise tuition. Rising tuition rates became the fuse, but are not the only reasons why these Quebec protests have become the “biggest act of civil disobedience in Canadian history.”

Education is just like everything else today, it’s a business. Even as all the basic elements that sustain life have become cash products, education costs. Higher education is becoming no longer accessible to the majority of people. But then the bubble that was the belief that getting an actual degree in something would somehow guarantee one a job burst years ago. It is skills that are needed not portfolios. I am sure there are also many who have gone onto college or university not necessarily for the learning but because of the marketing to do so, on themselves and their parents. The continuation of a lifestyle, of a high school atmosphere, where party-hardy is often one’s major.

As for the business of education itself, for the year 2011, Harvard University, in the United States, ran a deficit of $130 million on $3.9 billion in expenses. In Canada, McGill University brought in $1.5 billion in endowments alone. The University of British Columbia had $708 million in endowments. But where 20 years ago public funding made up 80% of a university’s total operating revenues, today it has dropped down to 50%, thus greater financial burden has been put onto students and universities alike. All because most “capitalistic-democratic” governments are slashing spending and of course the first to be classed as non-essential are social programs, including education.

As to the Quebec students and their problem with rising tuition rates, let us be inquisitive and compare, shall we? Premier Jean Charest’s Liberal party is planning to raise provincial tuition fees 82%, or $1,700, over the next five years. Even though Quebec is one of the most heavily taxed and indebted territories in North America, this past school term (2011-12), the full-time post secondary tuition fees in Quebec were $2,519., the lowest in Canada. And even with the proposed tuition hikes, they will still be one of the lowest in Canada. Since 2007-08 tuition rates in Quebec have risen about 25%. Total enrollment this past term was 487,482 students. Next lowest tuition fees in Canada, with an enrollment of 27,462 students, is Newfoundland/Labrador at $2,649 per. British Columbia’s tuition rate, with 260,000 enrolled, has actually gone down from 2007-08’s $4,922 to 2011-12’s $4852. Ontario has the most expensive tuition rates going from $5,388 in 2007-08 to 2011-12’s $6,640 and also having the highest enrollment at 745,455 students. New Brunswick is right up there as well, as to cost of education.

Comparing the costs a step further, for a full time student not living at home, a bachelor pad in Vancouver is the most expensive, with an average monthly rent of $839. Toronto is next with an average of $819 per month. In Victoria, rent averages $676 per month and one of the lowest monthly rental fees for a bachelor pad is in Montreal, Quebec, at $549 per month.

Much of the living and tuition costs for the average student are covered by student loans. Which is another aspect driving the protests. For many, after completing their education, rarely does one find employment in their chosen field. Reality kicks in and the job to simply put food on the table begins. On top of this they have their student loan debt to repay.

In 2011 the United States had 37 million borrowers of student loans, totaling $870 billion. Of this total about $234 billion or 27% of it is past due. The average outstanding is $23,300, with 25% owing more than $28,000, 10% owing more than $54,000 and 167,000 students owing more than $200,000 on their student loans. Further, $580 billion of the $870 billion in student loan debt is owed by Americans under the age of 40, with 10% of all loans defaulting in 2 years after graduation. Though President Obama recently dropped the interest rate on student loans to 10% of discretionary income, the interest rate has been 15%. While federal law dictates that there is no declaring bankruptcy on student loans and no debt relief. If you are unable to pay your student loan in the States it stays with you forever, even if you make it to the point where you start receiving old age social security payments, deductions to repay your student loan debt will be drawn.

In Canada the average, advanced education, student has almost $27,000 in debt when their studies are completed. In all, two million Canadians have student loans totalling $20 billion, with interest rates between 5-9%. British Columbia has the highest interest rates on student loans of 2.5% above prime, while in 2009 Newfoundland eliminated interest rates all together. The loans can be paid back in monthly payments over a 9.5 year period or can be extended to a pay period up to 14.5 years. Of course there is always the option of paying off loan as quick as you like. Most students believe they can pay off their loans in 5 years, in reality the average time is 10 years.

Then, when students graduate, they begin their journey to become a consumer and have to readjust themselves to the realities of the day. As of February 2011, mortgages, credit cards, lines of credit and student loans have put the average Canadian family in debt to the tune of $100,000, with debt to income ratio of 150%.

Another driver behind the 30% of Quebec students who are actually protesting is attitude. They are a generation that see the future clearly and they are afraid. Yet they are a more assertive and more confident group than previous generations. They are not intimidated by professors or any other adults for that matter, including their parents. Many now attending post-secondary schools have become a distraction for their teachers and fellow students alike. They have a deep sense of entitlement due to the last twenty years of child centered educating and parenting styles, each one has been repeatedly been told they will do great things in life. In school they demand better marks than they deserve, have no problem scorning and slighting professors, demand that deadlines be altered, that their explanations be accepted without confirmation or verification and would like course requirements to fit their schedules, to fit their availability to do the work. The concept of empathy has been thrown aside and forgotten. Many have learnt their life lessons by watching their parents, who the majority of the time have lived separate lives. Their childhoods have been all about societal permissiveness, overwhelming materialism, video games, texting and I-phones, sexualised TV, music and film and never reading anything of value. But then the more university students think they are sacred cows the more they become similar to the universities themselves, aloof and isolated. Within this ingrained attitude, reality must be quite the body blow and shock to the psyche. The horror of having been programmed into feeling self entitled yet unable to find the job you want.

Now the other side of the coin are the puppet masters. The corporate elite who are pressuring the governments they control to get a handle on this civil disturbances dissident thing. They are pressured themselves because they know we now know the end game. They do not care about this of course, even as their modes of distraction are wearing thin. The fact is nobody can afford the bells and whistles anymore. While the ones at the top arrogantly and blatantly continue try to make as much money from the earth’s resources as fast as they can before the wheels fall off and the planet is a wasteland. But more and more people each day are finally rising from the baby stage; where shiny things have always made our faces alight and cheeks glow, and we would goo goo gaa gaa and clap our hands, with big smiles on our faces. Not so much smiling going on these days. Which impels people all over the world to stand up, especially the young, who still are willing to believe, and the poor, because they got nothing to lose. The corporate elite are urgently trying to suppress the ability and freedom of assembly and protest of the growing amount of people who are becoming unfazed by the propaganda used by the use of distraction and suppression, whether on the street or online. The authorities have decided to do this through violence and because the corporate elite also love cash cows, they are using civil disobedience as just another income stream for their businesses of government.

The pretext of laws to do with dealing with free assembly and protest, are based on the premise; “To protect protesters and to protect the public”, and to be civil about it. In Quebec the authorities are using the tactic known as “kettling”, which oddly sounds like killing. It is where the police surround a large group and arrest every single person in that group. After a few hours or days of confinement and upon being released, each person arrested is given a ticket and fined an average of $640. To date (May25th) over 2500 protesters have been arrested with fines totalling $1.6 million. When the authorities actually receive this money is anyone’s guess. The crowds in Quebec, especially in Montreal, grew after the government’s attempt to suppress them a week ago by enacting Law 78. One point in this Law is raising the fines from $640 to $1000-$5000 per ticket, with much higher fines given to people deemed leaders of their peers. Wow, all the authorities have to do is arrest another 2500 citizens, fine them at least on average $2000 and voila, a cool $5 million in unpaid fines. Law 78 also states that any group of 50 or more people planning to meet must submit detailed plans to the authorities at least 8 hours before and which can be denied. Another slippery slope we have walked upon my friends, how soon does the day arrive where in North America, when four or more people standing on the street corner talking will be broken up and deemed a civil disobedience.

Another fear that the mainstream media is pushing is, if the protests keep happening they will upset such things as the Montreal Jazz festival, the Just for Laughs festival and a Formula One Grand Prix race. All components of the distraction theme and in reality are events that the average person cannot afford to attend or buy the t-shirts. Especially the car race, where millionaires gather to watch million dollar combustible-engine race cars race around a million dollar race track in a city, then fly off in personal aircraft to the next party, leaving the greasy smear of their carbon footprint behind. It is one of their playgrounds for a couple of days, much like the chariot races were for the elite of Ancient Rome.

Right now in Canada, our corporate government has but only one concern. And that is the wealth they can make from the oil-sands of Alberta. To be able to continue to subsidize the multi-billion dollar oil companies with billions of Canadian dollars, cuts of course have to be made elsewhere. Thus much hacking and whacking of social programs is being carried out. And we the people are feeling every hack and whack. While at the same time an undercurrent of anger and frustration is rising in people, stemming perhaps, from 2008 and the global economic crises that exploded and continues on today. The fact that the corporate financial world that caused and continues to cause it were not held accountable, but instead were bailed out, so they can carry on their insatiable ways. But it could also prove to be one move too many on their part.

As to freedom of peaceful assembly and protest, when it is for righting an obvious wrong and as long as one is not dressed in neo-Nazi black, wearing a balaclava, toting a fully loaded knapsack and needing to create chaos, there is nothing wrong with it. Is it not what being a community all is about? We must not allow our governments to make us think it is wrong.

Both sides of the Quebec student protests will eventually come to terms because even though more and more people are seeing that something is fundamentally wrong with society, the Quebec protest was over money, specifically tuition fees, the need for more accessible higher education and the debt they accumulate while in school. It was not unlike, more than one hundred thousand people gathering for an alumni, Welcome to Reality festival. The universities themselves are as much to blame for such unrest. With tuition rates rising quickly to offset continuing losses and to keep the profit margin where they like it. As a business they have also had to make cuts, specifically in academic standards and institutional integrity, while continuing to sell and give away useless degrees and whose curriculums are filled with far too many inane and downright silly courses.  But then “taught knowledge” can only be learned and digested when you are aware of that moment, involved in that moment and not daydreaming about the coming weekends club crawl or where are you going to get your next meal.

We must stop relying so much on governments to create change. We must do this. The most personal, lifestyle, ecological and economic changes to us individually happen within the communities we live in. If your community is doing something you don’t like, go to the next municipal meeting and say your piece. The people you will be speaking with were elected to the position, not given to them. And in most cases such a process is working. To create change on the federal level, each one of us should vote, not for a party but for an individual who will speak on your behalf, not blindly follow the party line and most importantly, knows he or she will be held accountable. But reality dictates it is we and sustained movements that must create change for things such as inequality and poverty, because electoral victories do not.

All through history, whenever mankind arrived at a point where fundamental changes and the right decisions had to be made, often times we waited until we were standing on the edge of the precipice, teetering back and forth on the balls of our feet. Times when the outcome could go either way, like the flip of a coin. Let us not decide to take the easy route and simply fall or step off the edge, or be allowed to be pushed off and blindly rely on being distracted enough to ignore the feeling of the impact when we hit the bottom. But we instead take the harder, but true way, of stepping back. Reclaiming one’s bearings, keeping that coin solidly on its edge, and then with civility, getting together to create the changes our society desperately needs right now. Hopefully this is what is behind the students protesting in Quebec and hopefully this is an idea the government should seriously consider. I also hope both sides have their eyes wide open, are digesting the lessons learned and have the collective wisdom to make the right decisions. For indeed there are two sides to every coin but alas, only one planet.