More Letters to the Corinthians

Health Care

Probably the largest debate in society today is over healthcare, especially in the States. We Canadians like to brag about our system but whether you’re in Oshawa or Omaha, nobody understands their plan. And when you sit down and really look at it, we’re not that different.

There are two parts to any system: who pays and who provides. In this article, we’ll only discuss the money. There are six components to our Canadian system:

Potentially expensive events are provided by the province while the rest is covered by private plans. And though we’re generalizing to simplify, governments actually cover parts of the items on the right. Anyway, in the US they mess with the left-side column.

US

The US has five systems that pay for doctor visits and hospital care (DVHC):

Medicare (those over 65) – government paid
Medicaid (low-income persons) – government paid
VA (members of the military) – government paid (and government supplied)

Corporate Plans (employees with benefits) – private paid
Individual Plans (employees without benefits) – private paid

When it comes to doctor visits and hospital care, many are treated like Canadians but most are covered by the same system we use for seeing a dentist. Now this situation would be fine if everyone was covered but that’s not the case. 28 million Americans are walking around without DVHC coverage. So is it a big deal?

Obamacare

Obamacare tried to address this situation in three ways.

It forced companies with over 50 employees to provide healthcare that subscribed to a minimum standard (including DVHC).
Disallowed insurers from charging more for people with pre-existing conditions in the individual market.
Made it illegal to not carry insurance by forcing individuals to purchase a plan through government subsidized exchanges, or face a penalty when filing their tax return. (Called the individual mandate.)

Before Obamacare, 50 million people were not covered. Mostly those without a company plan, whose individual premiums were too high to buy (say, pre-existing conditions), or they simply didn’t want one. This number came down by 22 million when additional companies were forced into providing plans (10 million), many of those with pre-existing conditions could now buy in, and government subsidies attracted others (total 12 million individuals).

Pre-existing conditions

Now Canadians already know about pre-existing conditions. It’s what we do with car insurance. If you hold a number of tickets, premiums go up. Same when it comes to life — fat people who smoke pay more. But when it comes to hospitalizations this was poor policy. Sell me all the personal responsibility you want, I can’t help myself from having a heart attack. That’s why everyone’s favourite president disallowed any further attacks on this piece of the plan.

Canadians also understand the idea of receiving a fine if you don’t insure. We do the same thing when it comes to cars. The fine for driving without insurance in Alberta is over $2,800. (Mostly because applicable drivers often have drunk driving offences so premiums would be around $9K.)

Individual mandate

The individual mandate was removed because Republicans didn’t like the idea of forcing people into buying insurance. Especially when Obamacare included so much. Maybe if the minimum only covered DVHC, it would have worked. Up in Canada we don’t force anyone to purchase a private benefit plan, though they’re available.

Summary

Ask any Canadian and the US system seems weird. Why wouldn’t you pass the money for doctor visits and hospital care through the fed? (What some are calling Medicare for All.) US private insurers would stay in business just like Great West Life. And this certainly makes sense. On the other hand, Americans don’t get hurt like you think.

Because of Medicaid, everyone gets hospital service. They just send you the bill. If you have a company plan, you’re good. Same goes if you’re poor, with the military, or over 65. The only people at risk are those with money not currently covered. If this is your position, purchase a plan.

Risktakers are only those who’d rather save the monthly premium (e.g., young people). If you have only $10,000 in assets, why not skip the monthly fee? Worse case, you lose the $10,000 when the hospital sues. Then you can go bankrupt over the rest.

Note: In Alberta, if you’re not covered by a company benefit plan, you can get one from the province for a monthly premium. It covers prescription drugs along with other items. Once you hit age 65, you’re automatically covered by this same plan without the cost.

Investing Principles

Once you get comfortable with the various types of investments, you’re ready for basic principles. Here’s what you need to know before entering the jungle.

Buy low, sell high

One time I toured a scrap yard. The owner kept complaining about the economy but all around me were mounds of scrap. So I finally asked, “If the economy is so bad, why do you have so much inventory?” He said, “It’s an old Jewish lullaby, buy low and sell high. And right now, prices are low.”

Buying stocks is like buying anything else—you want to get a good deal. And if a stock’s price gets so high that not even you would buy it, maybe it’s time to run. Sure you can’t time the market, but you can still buy and sell based on price.

Avoid overpaying by submitting a price along with your buy order. It may take time but you’ll usually get a better deal. Same goes for selling. Most of us forget to sell on overvalue and wind up kicking ourselves after the crash. Avoid this by using a priced sell order that executes when the stock hits a certain peak.

Holding cash

Everyone is usually fully invested, leaving no room in their portfolios for cash. But then how do you capitalize on a good buy?

We figure because cash doesn’t grow—having too much of it means we’re falling behind. That’s total baloney. Cash is the result of selling high and you’ll use it later to buy something better at a good price (maybe tomorrow, maybe next week, maybe in six months). Always keep cash on hand to capitalize on good deals (like during a market correction or crash).

Mutual funds

Ever wonder why there are so many mutual funds? It’s because there’s so much money in them.

The concept is to have a qualified analyst buy a basket of goods (stock, or stocks and bonds) and manage them (buy and sell). And though it makes sense to spread risk over a basket of goods (as opposed to holding just a few investments), these companies charge a lot for their service. Typically 2.5% per year.

A portion of the fee—usually 1%—is paid to the adviser firm. It compensates them for dealing with the client and generally gets split 60/40 between firm and adviser. This leaves 1.5% for the fund company. So on a $6B fund that equates to $90M per year. Sure they have expenses, but at the most they hold 30-40 listings and employ 10 people. (Plus, sometimes they just buy the index or subcontract the whole thing out.)

And because management fees go on forever, they reduce your annual return. So if your fund makes 9%, you only see 6.5—that’s why most don’t beat the index. They also operate within a mandate. For example, if it’s a Canadian fund and Canada’s not the place to be, they can’t react. And they’re often forced to generate cash to pay out withdrawals and fees, so they sometimes sell when they don’t want to.

Bottom line: mutuals don’t operate in the environment customers like to imagine.

ETFs

To combat these big bucks, the world has invented a lower cost alternative—exchange-traded funds (ETFs). They use a computer generated model to buy and sell according to an index. And for this service, they charge between .25 and .95%. This way, customers get the low risk broad basket approach without being raped.

ETFs are certainly gaining in popularity but not because of advisers. Why? Because advisers don’t get paid the same. With EFTs, they earn like selling a stock—a one-time commission of around 2%. Not the 1% annual fee that goes with a fund.

Of course, the downside is no person has their hands on the levers. You’re totally relying on a software program. So if computers ever take over the world, you’ll probably lose all your money. To see a list of Canadian ETFs along with their Management Expense Ratio (MER), click here.

The market is dirty

Mature investors are aware the market is unethical in a number of ways.

Agencies, like Moody’s and Standard and Poor’s, rate organizations like GM on their ability to repay loans (corporate bonds). The higher the rating, the lower the interest. But they also get paid by GM. So how diligent are they when it comes to rating customers? And can you imagine how demanding companies like General Motors can be when it comes to paying out millions in interest—no wonder there are hookers on Wall Street. It’s a total conflict of interest.

This element caused most of the economic crisis of 2008. Agencies like Moody’s rated bundles of mortgage backed securities (CDOs) as triple A quality when in fact they contained loads of crap. So buyers (like, pension funds and municipalities) got screwed by trusting the ratings.

Another way the system is rigged started when brokerage houses merged with investment banks. In the olden days, investment banks took companies public and brokerage houses bought and sold stocks. The system worked well, but now investment firms do both. They take companies public and recommend the same stocks to their brokerage accounts (people like us). So not only is it a conflict of interest (because they’re paid at both ends), it messes with the buy, sell, hold recommendations.

If they rate a company poorly, what’s the chance of them getting the investment banking business in the future (e.g., when the customer wants to sell additional shares)? That’s why recommendations are either buy or hold—they can’t say sell.

Summary

Investors have to change with the circumstances. When you had little for savings it was easy to say, “I don’t have time for money.” But now that your little pot has grown, who doesn’t have time to make an extra $70K per year?

The crash of 2008 caused interest rates to plummet, which incented investors to move safer money into the market. This caused overvaluation—so we all made profit. But now that rates are starting to climb, that money may move back. And if it does, don’t get caught napping.

Managing money takes time and effort, even when you pay someone else to do it. And if this all seems too scary, maybe go with 5-year GICs—the results aren’t much different. Either way, half your investments should be in safe places and you should always have time for money.

Creative Thinking

Many people are considered good students because they’re adept at learning from others. But do you ever wonder how those people came to their findings? It’s called creative thinking and almost anyone can do it.

Knowledge rests in the basis of opinion. And remember, opinion comes from four sources: intuition, personal experience, what you’ve learned, and what you’ve figured out. Let’s look at them in more detail until we arrive at the metaphysical.

First three

Intuitions are like faces—people are born with them and they’re all different. So when teachers call us little snowflakes, they’re actually right. Personal experience is surely individual, since none of us grow up the same. And the same can be said about what we’ve been taught. We listen and learn uniquely. So in terms of these three criteria everyone has a different perspective, which plays into what we figure out.

Now there are two ways to creatively think: you can either put together pieces by playing Carmen Sandiego or focus deeply until you receive grace.

Figuring things out

Remember the article Carmen Sandiego? It talks about finding golden keys, similar to playing a computer game back in the 90s. Well, the second half involves putting keys together to arrive at a personal conclusion. For example, you’re struck by something you saw, plus a few things you’ve learned and/or intuitively felt. Combine them and you may get a unique understanding that others can relate to. This is the first type of creative thinking.

The second comes when you focus deeply on an issue until the heavens open up and grace comes tumbling down. Just picture an engineer trying to solve a problem. Many times, he or she will subliminally concentrate for hours, maybe days, and then viola—the solution appears. Now there’s definitely a line between grace and regular thinking but don’t kid yourself, something like electricity wasn’t stumbled upon.

Geniuses and dumb people

I don’t believe in genius. I think there are gifted Carmen Sandiego players and those who receive grace—but that’s it. A true genius would be able to exercise their powers at will and none of them can do it. (Plus, they all make mistakes.) I also think grace is present in many parts of life and we should be openly receptive to it. For example, ask any recording artist where songs come from and they’ll tell you, “the sky.”

I also don’t believe in dumb people. Yes, there are those who have difficulty learning and don’t know much but they still have intuition and personal experience to draw from, so don’t count them out. Focus on strengths.

Summary

There you have it—putting together keys, no geniuses, and no dumb people. Every human out there gets equipped with an intuition and gains loads of experience. Then hopefully we learn a few things and play Carmen Sandiego. Once everything melds, you could come up with something brilliant. And if you focus really, really hard, you just might receive grace.

Deep Thinking

Ever wonder why politicians and activists say the things they do? And if it has anything to do with psychology and how our brains work? The answer is yes, and yes. People are playing with our minds on a daily basis.

Brains have only two modes: autopilot and deep thinking. Most of our time is spent on autopilot, acting out pre-programmed responses to everyday events. Deep thinking is only activated when something new has to be assessed. Nature’s idea was to operate minds like a computer with cache memory—keep all the commonly used stuff readily available and only go to disk for hard calculations. But there’s a catch. Deep thinking takes loads of mental energy and not everyone can do it.

Nature’s theory was to use autopilot to store the results from deep thinking. For example, if you spend months analyzing something like nutrition, your findings get loaded into autopilot for daily use (e.g., what to have for breakfast). But because we’re naturally lazy (averse to mental efforts), everything in our autopilots isn’t always well thought out. And that’s how they make us do and say some pretty dumb stuff. Here is one example.

Abortion

They tell us abortion is a women’s issue. Is it? If you attend a pro-choice or pro-life rally, you’ll find equal numbers of men and women on either side. But if this were a gender issue, wouldn’t you expect mostly women at the pro-choice and predominantly men at the pro-life? You don’t because this isn’t something between women and men, it’s about religion.

In the olden days, abortion was deemed socially unacceptable because it was against church practice. Catholics, for example, still don’t allow birth control because of what they believe is the sanctity of life. As a result, old time abortions took place under unsafe, non-hospital conditions. Then a movement appeared for abortion to be treated as a regular medical procedure. Many Christians, both women and men, took to the opposition quoting scripture and their doctrine. Without getting into a discussion on ethics, the point is this: the right to safe medical abortion isn’t an issue between men and women. It’s mostly a fight over religion.

The only component that could be seen as gender-based is when the father wants to keep the baby and the mother does not. If in these situations, courts favoured men simply because they were guys, that would be discrimination. But these conditions were quickly resolved to favour the lady (and nobody had a problem with it).

And if you think further, since the pro-life argument centers on divinity being placed right inside of us, why is capital punishment still practiced in many religious countries and 27 US states? Isn’t that hypocritical?

Summary

Deep thinking involves intense effort by using forces like focus and concentration. Because of this, most of us do it sparingly—preferring the simplicity of autopilot. Social manipulators know all about nature and prey on it. As a result, much of our information doesn’t come from pure sources. Many speakers have a hidden agenda they try to sneak into our heads.

If you haven’t put sufficient energy into deriving a well thought out opinion, they’ll provide you one—exactly to their liking. But once you go deep on a few occasions, you’ll come to see speakers in a different light. Bottom line: don’t put much faith in things you haven’t thought through.

Note: the example above is not intended to make a statement. It was used because of its political implications. The American Left ties abortion to women’s rights. As in, “if you care about feminism, you must support abortion,” when in fact these are separate issues. The American Right then supports pro-life while insisting on capital punishment.

Doctor Oz

I recently read Doctor Oz’s diet book and though the jokes were terrible, it’s good advice. The whole thing nets out to the Core Diet plus a few special guests. Remember, the core diet says these six foods should be at the core of your diet:

Beans, fish, and white poultry
Fruits and vegetables
Water

Oz’s special guests are:

Whole grains
Red chili pepper (especially with eggs in the morning)
Yogurt
Fermented foods (like pickles)
Honey
Cinnamon
A handful of nuts

Dr. Oz says whole grains in the morning keep you full well into the afternoon. He especially likes steel cut oats, but any high-fibre cereal is good. He also likes chili pepper with eggs for the same reason. (I like those crushed hot chilies by Tutto Calabria.)

Yogurt and fermented foods contain probiotics, which are good for digestion. Honey and cinnamon are great regardless of reason. And a handful of nuts is his biggest recommendation. He says they contain 15% less calories than the label says and because it takes 25 minutes for your brain to register that you’ve actually eaten something, a handful of nuts is a great way to avoid hunger—especially before dinner.

So meal planning now breaks down like this:

Breakfast

whole grains (like high-fibre cereal or steel cut oats)
eggs with chili pepper
yogurt with fruit

Snacks

apple, carrot, yogurt, handful of nuts

Lunch / dinner

chicken, fish, or lean red meats with vegetables
bean soup, bean dip, bean salad
cream puffs with cinnamon

Drink a bunch of water, exercise 30 minutes a day (walking is fine), and have sex as much as possible. Oh, and he says coffee is good.

P.S. If you don’t like cream puffs, try cinnamon on cereal or toast.

Triple Crown

Before my friend Donald J gets woefully impeached, I’d like to say something nice about him that has nothing to do with politics. Donald J is the first person in history ever to win the salesperson’s triple crown—and it’s an accomplishment worth mentioning.

Every salesperson ever assigned a territory yearns to become three things: an entrepreneur, a politician, and a stand-up. And Donald J has accomplished all three. Let me explain.

Entrepreneur

Salespeople yearn for entrepreneurship because it’s the next step in sales ability. Not only do you sell yourself to customers but you have to get suppliers, employees, and investors (e.g., banks) to believe in you. No small task for anyone’s personality.

And though some feel this title should be reserved only for those who’ve gotten something off the ground—they’re wrong. Kids who inherit a business are just as bona fide—they’re not cheaters. Sure some have lived a pampered life, but most work just as hard, face as many difficulties, and are often of a higher order than their parents.

The two parts to building a business are getting it off the ground and growing it. It’s surely an accomplishment to get something going, but it’s an even bigger deal to grow it. Why? Because the second half takes more intelligence, chutzpah, and business acumen than the hard work of the first. And these accomplishments should never be discounted or diminished.

When I walk out in Vegas and see a tower with Donald’s name on it, I can’t believe how cool that is. This guy owns tons of high quality real estate (downtown office towers and apartment buildings), a luxury real estate firm, 14 five star hotels, 18 world class golf course / resorts, and a 1300 acre winery—among other things. Are you kidding me? It’s a kick-ass corporation that any entrepreneur would be proud of (trump.com).

Bottom line: Donald wasn’t lucky—he’s good. And every salesperson out there knows it.

Politician

Politician? Why politics? Because it’s the ultimate sale. You’re selling to thousands (in Donald’s case, millions) and it’s about people skills. The customers aren’t engineers trying to dismantle your argument. They’re regular folk looking for inspiration, simple logic, and a little bullshit to make them feel good. And the victor is always the one who can best appeal to the masses.

Plus almost anyone can do it. It’s not like you have to be especially qualified for the job. The most famous politicians of our time didn’t attain their reputations or get anywhere because of their brains. They did it all with people skills. And that’s what’s fascinating to salespeople.

Donald J didn’t just become a politician, he went straight to the top. Doing it all with pure strategy and salesmanship. It was amazing. Against all odds, against the media, against the establishment, against his party, and against almost everything else. It really was amazing.

Comic

Comic? Yes comic. It’s the least important of the three, but still a silent aspiration of most people in sales. Why? Because you’re showing off your abilities in front of strangers. Entertainment abilities. And what salesperson doesn’t think he or she is entertaining?

Okay, so Donald didn’t do a stand-up show on HBO, but every comic out there has a dream for television. And Donald J jumped passed all the grunt work and got right to it. Remember, The Apprentice and Celebrity Apprentice were number one shows that ran for long periods of time. Number one shows. Pretty big deal for just a salesman.

Italy’s Silvio Berlusconi got close. He was a billionaire who also became country president. But he owned television stations, he didn’t perform. And Newfoundland’s Danny Williams was also a rich guy who became political leader, but Danny was a lawyer by trade (so he probably knew what he was doing—and wasn’t funny).

Summary

Salesmanship is the ability to do something with just your personality. To move people with only your words and a smile. It’s not likeability. Lots of people are likeable. Salesmanship is the ability to move people without losing your likeability. And to attain sustainability in the field, you must move them to a place that’s beneficial for both you and them.

Forget your political views for a moment and see who this guy is. Donald J is the first person ever to win the salesperson triple crown. And he didn’t just win it, he demolished it. His achievements set a bar that will probably never be matched. Entrepreneur billionaire, TV star, and President of the US. Give me a break. What’s cooler than that?

So on behalf of overachievers everywhere, I hereby declare Donald J, king. He’s ambitious, fearless, and works very hard. And has incredible focus. Something that’s definitely part of the success. Then again, he could also be a psycho (which doesn’t take away from the above).

Note: Watch Conrad Black on Trump. Black is one of his staunchest supporters.

Used Cars

When it comes to buying a used vehicle, people always want a good deal. Unfortunately, the only way to get one is by understanding the numbers. There are six you need to know:

Dealer wholesale – what dealers pay for used vehicles
Dealer input cost – money put into a vehicle to make it ready for sale (e.g., oil change, new tires)
Dealer markup – dealer profit added to total cost
Sell price – sell price of vehicle (after you get your “deal”)
Admin fees and taxes – charges added to sell price to arrive at the final invoice price
Final invoice price – what the customer actually pays

So there are a bunch of numbers but that’s not the confusing part. The confusing part comes when someone says “blue book.”

Kelley Blue Book

Kelley Blue Book is the gospel of used car pricing and is available free online. The problem is, they have different prices based on how you access it. They are as follows:

Dealer wholesale – what dealers pay for your car
Dealer sell – what dealers sell it for
Private sell – what someone should sell the exact same vehicle for, privately

If you access KBB from a dealer ad on Autotrader, it shows the price a dealer will sell for (not the wholesale cost). But if you enter the same information as an inquiry (using a separate window), you get dealer wholesale.

Why does this matter? Because it explains how to get a good deal. For example, Marty wanted a 2010 Lexus ES 350. He opened two windows on KBB’s website and grabbed a telephone. Here’s what he discovered.

Dealer wholesale – $8,000
Dealer input cost – salesperson said just an oil change
Dealer markup – $5K less an oil change
Sell price – advertised sell was $13,900, but they’d take $13,000
Admin fees and taxes – salesperson said $495 plus sales taxes
Final invoice price – $13,000 + $495 + PST/GST

Once he understood the numbers, Marty could then negotiate the dealer markup (down). Better yet, he could compare the dealer’s price to what it would cost him to buy the car privately.

Private sale

KBB offers a third price called private sale. It’s their estimate of what a private seller should ask. It’s always above dealer wholesale, but below what you’d pay from a lot. As you’ll see, you pay less for the same wheels when you buy privately, plus you avoid the taxes and admin fees (which, using Marty’s example, adds up to $1-2K, depending on where you live).

The only issue with buying private is inspection. Dealers have on-site staff to evaluate a vehicle, you don’t. So you’ll have to take it to a mechanic to ensure the vehicle is sound. And if you don’t have a mechanic, there are plenty of private inspectors around.

Curbers

So who are curbers and what do they do? Curbers are regular people who buy vehicles, for as close to dealer wholesale as possible, and sell them for something more. And because a lot of us aren’t good with numbers, they make money.

Summary

There’s good mark up in used cars. Kelley Blue Book is owned by Auto Trader, who get most of their revenue from dealers. That’s why the system is rigged in their favour.

The spread between dealer wholesale and final invoice is huge, so you can save a lot if you keep your eyes peeled and buy private. Paying more than dealer wholesale, but less than dealer retail, lets everyone win (plus you save admin fees and taxes). Yes, it takes more effort, but in the end it’s worth thousands.

Of course, there’s always the financing part—but isn’t that what in-laws are for? (Take post-dated cheques.)

Russia

Before the First World War, Russia was a regular kind of place. Included in its past were the likes of Peter the Great, Catherine the Great, Ivan the Terrible, and the great grandparents of a really hot left-winger named Ovechkin. They also had a long history of being ruled by czars.

Their military had saved Europe from Napoleon’s ambitions in the early 1800s, and Russia had freed the serfs (their version of slaves) in 1860. But after heavy casualties in WWI, severe food shortages (caused by the war), and old-style government thinking—it was time for a revolution.

Russian revolution

Like their global counterparts, Russian workers in the early 1900s were fed up with selfish monarchs and capitalists. They’d been hosting strikes and socialist organizations for years, pushing for a better life. Early gains forced Czar Nicholas to grant them a parliament, the Duma, to assist with running the country. But being the obstinate fellow that he was, Nicolas abolished and restarted the Duma a number of times.

In 1917, while the war was still going on, Nicholas was overthrown and replaced by a provisional government (the Duma) made up of mostly liberals. This government was then overthrown, eight months later, by the communist Bolsheviks headed by Vladimir Lenin (John’s evil twin).

Civil war

Because not everyone wanted to be a commie, the revolution turned into a civil war that lasted three years. A number of groups were vying for control but we’ll summarize into three:

Bolshevik Reds – those subscribing to the communist beliefs of Marxism
Whites – those aspiring to become a democracy with left-wing ideals
Loyalists – those who were happy to remain with the czar

Britain’s Winston Churchill screamed for allied support to anyone but the Reds, but allied ambition was drained after the loses of the just fought war. And working class people everywhere were sympathetic to the communist cause. As the war went on, Loyalists got lumped in with the Whites but in the end the communists won.

Lenin and Stalin

Upon retaking power, Lenin was faced with converting a nation that didn’t totally agree with him and his interpretation of Marx (what we now call Marxist-Leninism). He chose to persuade them through a reign of terror. Over the next two years, until his death, and long after by his successor, Joseph Stalin, the communist party imprisoned, murdered, and terrorized its own people through acts of barbarism.

Targets included loyalists, liberals, capitalists, and the religious (since communism abolishes all religion). In total, over 30 million people were killed from a population of 184. (And Nazi Germany learned its tricks of concentration camps from Siberia.)

Post WWII

Like many others, old time Russia was in the empire business. Its empire was one of the world’s largest and, in 1922, it became the Soviet Union (made up of 15 nations—Russia plus 14 others). After WWII, the UN was formed with the intent of ending imperialism. This made Stalin change course. His ambitions moved away from acquiring land to spreading communism.

Because of heavy contributions in defeating the Nazis, a tired world agreed to Russian demands by granting them communist influence over countries they’d taken during the war, plus others they negotiated. These countries were called the Eastern Bloc. They included Poland, Czechoslovakia, Bulgaria, Romania, Yugoslavia, Hungary, and East Germany.

Due to social uprisings in the above countries and financial instability in the Soviet Union, soviet influence in these areas fell in 1989 and everyone gained back their independence. Two years later, the Soviet Union itself fell, granting the same independence to the nations they’d acquired through their empire (e.g., Ukraine, Georgia, Belarus, Armenia, Lithuania, and Latvia).

Communism

In total, communism in Russia lasted for 70 years. Idealists rejected Western actions to improve worker conditions and introduce a welfare state—believing they could do better. (Remember, Britain was making changes in 1910, so things were well afoot by the time of the revolution.)

So how was it? This great social experiment of equality for all and everyone by their own needs. Horrible. Communism broke the country’s spirit, instilled fear, restricted freedoms, and promoted jerks. Oppression became the name of the game and people were conditioned into an attitude of defeatism. This bred depression, alcoholism, and incompetence. Poland fared better since they maintained much of their religion (social control wasn’t as strong in the Bloc) and they were still Polish (occupied by a foreign land). So they had hope. But Russians brought this upon themselves.

You can’t stifle ambition and expect to get things done. You can’t accomplish much without stability. And you can’t be successful with powerful jerks. One guy said, “You know in Canada how we have community leagues to promote friendship and provide activities for kids? We didn’t have anything like that in Russia.”

Conclusion

Today, Russia is a seven-foot teenager—looks like an adult, acts like a kid.

Germany went through the same process rebuilding its image. Tie yourself to culture and forget about the past. German identity is now focused on cars, good beer, and those funny little outfits they wear in October. Russia is doing the same thing by highlighting its kick-ass vodka, beautiful women, and those really cool Easter eggs.

Most of the world gets it, for we all have blood on our hands. The only way to relinquish your past is to rebirth your nation through a new identity. Germany has become a highly productive, socially minded country, that’s completely different than at any point in its past. Russia is now doing the same, but it takes time for the ugliness to rinse through. Anyone in Germany who remembers the war is now well over 80 and anyone who participated is over 90. Russia has only been free for 26 years.

Russia today is a capitalistic democracy. Yes, many of the elections are rigged, but not all and not everywhere. (The same can be said for most early democracies.) Yes, the economy is mostly run by oligarchs, but again, this is true for most countries coming to capitalism. And yes, many of the jerks are still around.

In order to understand Russia you have to identify with its past. When people say “Russia is,” remember it’s a nation in transition. So Russia isn’t anything for long because it’s a body in motion. And right now, it’s a seven-foot teenager.

Note: For a good book, try The President, the Pope, and the Prime Minister by John O’Sullivan. You can also watch, The Russian Revolution (2017) available on Netflix.

Inquiry-based Learning

Twenty to thirty percent of kids today leave school early or barely pass. Many wind up believing they’re not capable and avoid intellectual endeavors their entire adult lives (like, reading or taking a course). Because they hated school, some get robbed of the most essential life skill—the belief that you can do it. Fortunately, there’s help on the way—inquiry-based learning

Traditional learning involves school boards deciding what you should know and shoving it down your throat. Inquiry-based starts from the position of what you’d like to know and facilitates your interests from there. For example, Language Arts. Wouldn’t it be nice to pick your own book? One that peaks your interest and was written in this century? Or how about writing an essay from a list of topics?

Now, since doctors seem to be doing a good job and bridges aren’t falling down, let’s leave the maths and sciences alone. And elementary schools are working just fine, so their systems stay. Inquiry-based is for high school subjects more social in nature. Here’s an example.

Language Arts

My son recently completed grade 12. His Language Arts course included reading the 1940s play, Death of a Salesman. It’s about a 63 year-old salesman married to a stay-at-home mom. They have two sons, Biff and Happy. The plot involves the salesman facing the struggles of aging adult life and, in the end, he kills himself.

I enjoyed the story because the character is close to my age, shares my family situation (married with two sons), and I too, am a salesperson. I also loved seeing the old expressions my mother used to use. But my 17 year-old son got absolutely nothing from it.

This play is famous for touching people’s hearts at the time. A time that a person of my age and circumstance can relate to. But are you kidding when it comes to modern day students? Stay-at-home mom? Biff and Happy? Just sons? 1940’s expressions? Suicide? Certainly we have better books for these kids to read. And if not, let’s write one.

Objectives

The objective of LA should be to foster a love of reading and teach proper writing skills. This way kids will be encouraged to explore and know how to properly write an email. Likewise with history. We need to open their minds to the events of our past without making it seem boring. Yes, we still need to teach the basics, but there’s definitely room for individualism.

Schools are too focused on memorize and regurgitate. So we’re only teaching how to survive within a regimented system. And nobody is leaving with any bonafide knowledge. The platform needs to be changed to where kids learn “how to learn” and enjoy doing it. So they’ll be able to tackle any topic throughout their young adult life.

Levels and paths

In the business world, teaching doesn’t involve playing games since our objective is simply to ensure students acquire knowledge. Test questions are often given at the beginning of a lecture and there’s no complicated grading system. We want everyone to get 100%.

We feel learning is best done in levels along a well prescribed path. Start with an overview and then go deeper from there. For example, a one-page summary, then three, then ten. Eventually, you’ll be keen to read the whole book.

Learning paths and knowledge should be everywhere. They’re not supposed to be secrets. And textbooks aren’t something to be lost or handed back. They’re treasures to be reread.

The Department of Education could post the details of a basic adult education. One we should all know and happily assist in delivering to our kids. This kind of organization would lead to a society that can better communicate, work together, and vote.

Practicality

As you know, the world is operated by two spheres: theory people and practical people. Theory people are good students who grow up to be post-secondary graduates who eventually operate organizations and school boards. Practical people includes the thirty percent.

It’s not that theory people know more, it’s that what they know is different. And herein lies an issue. Conceptual people don’t know much about real stuff and practical people have a hard time with theory. So if we exposed our conceptual kids to more practicality, they’d be better able to bridge the gap.

There’s nothing wrong with showing good students the operations of a car or how to fix a sink. It’s generally good stuff that makes them better able while accommodating the thirty percent. Yes, we could provide practical kids with different types of programs, but that’s not the point.

Summary

Kids are tired of learning what they don’t care about. And the truth is, no matter what you teach, it mostly gets forgotten. Not only are the unsuccessful disheartened, plenty of good students are burned out. The whole school experience drains them of wishing to learn more.

Imagine a teacher saying, “Rather than talk about the war, what would you like to know.” And as a teacher—who knows lots about history—I’ll facilitate. Too much individuality? What if they gave presentations to groups? And if we kept all the information online, accessible forever?

Within certain subjects, the object should be “how to learn.” Getting kids to go deep and keep all their findings shows them “how to do it.” And if done well, they’ll be on the way to writing their own book of knowledge.

But can’t they just google Wikipedia whenever they want? It’s not the same. Knowing history is knowing the pain we endured overcoming natural desires. It isn’t places and dates. Liberals and cons aren’t personal brands that gets etched into tombstones, they’re avenues for discovery that get exercised every time you go to the polls. And if you can’t learn, you’ll never get there.

The problem with education is it’s run by people who were good at it. So it never changes. They say it’s successful because we have doctors and engineers, but it’s not if we measured by grads love of learning and how much they still knew in five years.

Relationships, psychology, and what it’s like to be human—spark any kid’s interest. As would other topics that deal with everyday life. Inquiry-based does this. It ends the facade of marching around with no clothes by delivering a menu of applicable stuff—thereby turning kids into learners who know how it’s done.

This way, the smart will be bright, everyone gets confidence, and no one’s left out.

Note: You may like these videos by Ken Robinson: Changing education paradigms and Do schools kill creativity?

Efficiency

In part, understanding economics comes down to imagining 100 people living on an island. If 50 were involved in farming, you’d have 50 left for everything else. Then if conditions improve (say, through technology) to where only 40 were required to work in farming, 10 more would be available for everything else. That’s the core theory of efficiency. As fewer people are required to produce the desired outputs in one area, the price and cost of those outputs are lowered. That saved money and those workers are then free to pursue something else. And that something else becomes a rise in the standard of living.

Let’s use an example, if those freed people start a hair salon, then everyone gets food and beauty for the same price as food. (Remember, the cost of food decreases since it requires fewer people to produce. That saved money and those workers are then directed to salons.) You can extend this principle to the modern world. If we taught everyone to cook—and changed common culture to favour home cooking—all the additional money spent on restaurants would then be saved and those workers would be free to do something else (say, work in health care).

Needs vs. wants

Any increased production in industries that provide for basics leads to money and workers becoming available for luxuries, which is great. If we only need 40 people to produce the goods and services that relate to basic needs, everyone else works for products and services that pamper us (like, massages). But obviously basics come first.

Basics include food, shelter, clothing, utilities, and safety. And it’s important to keep the price of these items down so everyone can easily get by. But two things can prevent this from happening: cultural attitudes and market intervention.

Cultural attitudes

If culture says restaurant food is better or that weddings cost $40,000, people misinterpret the meaning of basics. That’s how you get 60 year-olds on skid row because they overspent on their kid’s nuptials. Unfortunately, no one has control over what society feels and even the best of intents can become ruined by belief. So even a super-efficient system would result in society having the poor because of what some people think. And remember, cultural attitude doesn’t mean one size fits all. Many ethnic groups live their own way financially, and so do many families and friends.

Market intervention

If everyone needs water and it’s only provided by the government, the cost of wages and the water company’s efficiency greatly affect price. Same goes for any monopoly. Take this deeper and you’ll see that outside of food and clothing, most basic needs are affected by public intervention. Shelter is built according to regulations and subject to property tax. Utilities are all regulated. And minimum wage affects the cost of my burger.

In Canada, education is only provided by the government. If they say it takes four years and $50,000 to learn about business, that’s what it takes. And if they overpay for fear of strikes or to appeal to voter loyalty, that too is just the way it is.

Summary

In general, there are two economies: one for basic needs and another for luxuries. Government is heavily involved in basics and luxuries are greatly affected by culture. In a perfect world, governments would operate efficiently by not overpaying for labour or adding unnecessary regulations, and people would divorce themselves from certain aspects of culture to purchase only what they can afford. Then again, the world was never intended to be perfect and sometimes we drive each other crazy.

Note: See the article Emotional Quality.