Of Pigs and Pecuniary Pride

Today we are going to talk about economics. Not because I want to. No - I hate economics. It was my worst subject in school. Here's why.

Economics should be one of the simplest subjects at school (along with P.E. and lunch), but it isn't because it's peppered with impossible-to-comprehend terms which obviously were invented by economists: wild-eyed and fuzzy-haired number-crunchers who couldn't get a job as an accountant or auditor, and therefore - in their angry-at-all-the-world rage - invented their own language to create the impression that they were smart and confuse us humble bread-winners into unanimous awe at their supposed incredible wisdom.

Seriously. Which one of you knows what X-inefficiency means? Or Countercyclical Fiscal Policy? Or Pareto Optimal Policy? Or what is the Law of Diminishing Marginal Rate of Substitution? Do you really care? Or are you an economist? I didn't think so. (For all those curious readers and Trivial Pursuit fans, I will display the definitions at the bottom of this article.)

But let's stop harping on the economists. We all know that they do a great job trying to lie to us about how great the economy is doing on Nightly News with Brian Williams and Good Morning America when we all know we can feel the fiscal fire and brimstone descending upon us. But I suppose they do convince a minority of the population that everything is hunky-dory: mainly politicians and CEO's of major corporations, which hire them to convince them that spending more money is the key to creating wealth (more on this later).

Anyway, let's talk about the economy. It's junk. Okay, I'm glad I got that out of the way. Now onto something else - something infinitely more important - let's talk about why the economy is junk.

I am an American, and therefore I will be speaking from an American perspective. But I venture to say, reading reports from economists (yea, they're helpful for some things, such as reminding us what we already know), this is a global economic disaster just waiting for permission to play harder. But I'm going to pick on America because, frankly, we're the idiots who started the whole downward spiral. I'll tell you why.

Kids know economics because they have piggy banks. Piggy banks are one of the most incredible learning tools in the world and - in my humble opinion - should replace graphs as the most displayed prop in economic classes. This is because when a kid doesn't have money in the piggy bank, he stops spending. Take little Johny for instance. He sits back and thinks and perhaps gets a bit perturbed and cries about how life is so unfair, but he doesn't spend money, because he doesn't have it. Then he goes to dad or mom and asks if he can work so he can have some more change in the piggy bank. So he works, gets paid, puts the money in the piggy bank, thinks about what he wants to buy, and purchases it. The cycle continues.

Let's jump ahead 30 years. Little Johny is now Big John, and consequently spends about 80% of his yearly income on his wife's jewelry and kitchen appliances, while she spends the other 95% on clothing and shoes. Wait a second! That doesn't add up! And you're absolutely right, but we do it anyway! Us humans are known for doing things that don't make any logical sense whatsoever.

Enter debt, which is a word we learned when we bought our first car back in high school. We couldn't afford our dream car, so we got into debt over it. Same with college, the wedding, the honeymoon, the house, the vacations, the boat, the swimming pool, etc. You get the idea. What happened to the piggy bank? It became obsolete along with Gunsmoke, MC Hammer and the 49er's.

But us little normal people peons aren't the only ones living outside our means. A conversation about debt cannot honestly be spoken without bringing up the United States government. What is it now? Close to $10 trillion and counting with the war against terror, failed investment banking bailouts, and White House dinners raking up. But that doesn't matter, because according to economics (at least what I learned in class), the stronger economy is the one which spends the most. Wow! Eye opening and amazing! That's what I should be doing to be in a better state financially. What a bunch of ludicrousy!

So now we are getting to the crux of the matter. This is really why I hate economics. The word has simply become an excuse for trying to make the numbers work when we know they don't - when we are spending more than we are bringing in - when we are living like a prince and only making the pauper's income. And don't get me wrong: the average American is quite wealthy. But even wealthy has its limits. Even the most affluent kings and businessmen and governments throughout history have dug themselves into financial pits in the name of extravagance and unchecked spending.

Which brings me to another point while I'm on the subject of ranting about economics: budget surplus. Americans will remember the days under the Clinton administration when the budget surplus was flouted as an amazing thing. Wow! We finally as a national government started raking in more dough than we dished out! And that is a step in the right direction. But while we were celebrating about how great our economy was, we almost forgot about the few trillion dollar debt still over our heads. It's still there, people. We can't just ignore it and hope it passes away like summer.

And this leads me to my final rant: People, stop blaming the economists and government. Government, stop blaming the people. Everyone, stop blaming the system. What's all this talk about the system anyway? It's like we're in the Matrix or something. Get real, people! The only system there really is is your habitual system of living outside your means!

So if you happen to be an economist, a government treasury worker, a CEO of a major corporation, or just a normal person, consider this: get a piggy bank. For a change start paying off the debt you have racked up. Take responsibility for your fiscal mismanagement. Get back to the days of pigs and pecuniary pride.

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Answers to pop quiz economic questions in article above:

- X-inefficiency - The underperformance of a firm that has a monopoly position.

- Countercyclical Fiscal Policy -Fiscal policy in which the government offsets any change in aggregate expenditures that would create a business.

- Pareto Optimal Policy - Policy that benefits some people and hurts no one.

- Law of Diminishing Marginal Rate of Substitution - As you get more and more of a good, if some of that good is taken away, then the marginal addition of another good you need to keep you on your indifference curve gets less and less.