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Going Green Is A Scam

By Frugaling 12 Comments

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going-green-bike-ride

The World Wildlife Foundation (WWF) announced that the world lost 50% of species in the last 40 years. Directors at the WWF credit this to human consumption. For climatologists and scientists, there’s a bleakness to the future — one that includes starvation, exoduses from low-lying areas, droughts, and wild weather year round. It’s clear that we need to reduce our fossil fuel usage, but how we do that is still a complicated endeavor.

The flawed governmental approach

Going green is often framed as a decision to buy “certified organic” foods, choose energy-efficient technologies, and chuck your empty plastic bottle into a blue recycling bin. While these conscious choices are more environmentally friendly and better, they seem to ignore the very real consequences of our consumption. To illustrate this point, the U.S. government suggests, “switching all the light bulbs in a home from conventional incandescent light bulbs to compact fluorescent light (CFL) bulbs…” Going green is seen as an additional item; without the latest energy efficiencies, you’re not green.

Compact Fluorescent Lightbulb (CFL)
Photo: Mike Mozart/Flickr

As the government site shows, they exclaim the ills of conventional bulbs and recommend purchasing CFLs. Unfortunately, that mass waste and consumption of a new product goes unnoticed and unaccounted for. By immediately trashing all your old bulbs for the latest and greatest green tech, you’re simply ignoring the true life of a product and upgrading before it’s necessary.

The U.S. government should be encouraging people to take full advantage of the natural lives of products; instead, we hear how we should switch every bulb in our home. They are training you to have a faster turnover and consumption rate. Eventually, they’ll be recommending you switch all the CFLs with LED lights, which last longer and take even less energy. This technology is definitely better for the environment, but each transition creates massive amounts of waste, and the new products require marketing, packaging, shipping, storage, warehousing, and a consumer that will likely drive (consuming fossil fuels) to purchase the new bulbs.

Big green is big business

For the federal government, going green cannot mean consuming less. Pro-business entities and lobbying groups would launch a massive critique and attack if that was stated. Our economy is not equipped for people to stop buying. This capitalistic system is predicated on infinite growth; a pyramid scheme that will end at some point, but whose leaders hesitate to bring its early demise. Unfortunately, the government can’t properly advise its citizenry regarding climate change prevention.

At some point, going green was co-opted by “big green” — the big business approach to energy efficiency. Big green needs you to keep spending, too. With this aim in mind, they’ve warped the dialogue into a justification to purchase more. The irony is that by buying more — in order to be efficient — we’re digging ourselves into a deeper hole.

Just look at the first sentence from this Huffington Post article: “Saving energy and water can be difficult, but now there are plenty of gadgets on the market that aim to make the process easier for you.” This comes from the “Huff Post Green” section! Articles like these (which are everywhere) advocate buying more gadgets and technology, and are only contributing to this horrible, repetitive consumption.

Even at my alma mater, Colorado State University, the institution had a habit of touting its green initiatives. All the brochures advertised the push to use renewable energy and active involvement in recycling. These are commendable efforts, but there’s a hypocrisy to it all. Throughout my years there, they were always building — I never knew the campus without yellow construction taped areas, sounds of construction, and digital photo representations on the buildings to come. All that development adds tons of pollution to the air and creates epic proportions of waste. Cranes, bulldozers, and industrial materials would all be necessary to complete the buildings. The carbon costs for these components often goes uncalculated and unnoticed.

Then there’s the story of the Toyota Prius. In 1997, the company released this awfully designed hybrid monster. Getting around 50 miles per gallon (MPG), the Prius became a popular vehicle with a clear message: “I care about the environment.” When considering the technology and energy that’s required to make it, it’s scary. The battery cells, which recharge when braking and coasting, harness energy that would otherwise be lost. But they are an environmental nightmare and difficult to dispose of properly. Moreover, the Prius gets about the same gas mileage as Honda Civics from the late 80s and early 90s. The Honda Civic Hatchback from 1992 got about 48 MPG; no hybrid battery cells needed, and for a fraction of the cost on your wallet and the environment!

Finding a real solution

We’ve been duped into believing the solution to climate change is another purchase. In reality, the better answer would be to say, “Stop where you are, turn off lights, protest for change, and don’t buy anything for a year!”

Cracked Earth Climate Change
Photo: Alosh Bennett/Flickr

Most moderate voices understand that we cannot become Luddites to combat carbon emissions. The world has become increasingly connected and globalized — it’s hard to imagine regressing whatsoever. Technological development is only ratcheting up, and people are embracing the progress fervently. But our course is not sustainable.

We need to consider movements to buy local crops and goods, collective markets and organizations, and ignoring the message to buy more to save. Going green doesn’t have to hurt your budget. It should be about consuming less and supporting sustainable development. What could be better for your budget?

Filed Under: Save Money, Social Justice Tagged With: carbon, change, Climate, Development, Economy, Going Green, Green, Growth, Honda Civic, Prius, Scam, Sustainable

Stop Dehumanizing The Poor, Homeless

By Frugaling 16 Comments

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Anti-Homeless Spikes Hostile Architecture Photo
This is an anti-homeless spike in London, England.

The last couple weeks I’ve suffered from intense writer’s block. My mind has been focused on something more important than this site (sorry, frequent readers!): graduate school. Part of my role as a doctoral student requires gaining experience counseling others. This year I’ve acquired a spot at the local homeless shelter. It’s forever changed my understanding of homelessness and the financial concerns/distress they face.

Prior to working at a homeless shelter, my perspective was naive and simple. Generally, I felt for them and wondered how I could most help. Whenever I spoke with friends, I talked about how we should help people like this. Sometimes I gave pocket change or a cup of coffee to someone on these streets. But despite a couple moments in high school as a soup kitchen volunteer, I had never taken the time to serve/help the most vulnerable in America. That bothered me.

I’ve been at the homeless shelter for about a month now. The experience is different every day, and because it’s related to the practice of counseling psychology, I can’t say much about it due to confidentiality. What I can speak to is that the people I’ve met smashed my preconceived notions and gave me a framework for understanding how someone gets there.

This great country heralds a flawed understanding of success and path to achievement. Basically, we oversimplify the rules of society and deliver a soundbyte to a highly complex idea: work hard and you’ll succeed. This is a disservice to everyone; the fortunate and suffering, alike.

We have resources in this country that help young adults, but they don’t guarantee success. The world needs to receive this message — not only our country. This meritocracy claim is flawed. The importance and reliance on hard work, self-motivation, and personal responsibility are beautiful aspirations, but they don’t adequately account for the many variables that attack individuals’ abilities.

Trust me. There are cracks in society, and people fall through them. I’ve seen it in the flesh. Medical bills from horrific accidents can pile up, leaving someone unable to work or transport themselves. The financial burdens can quickly engulf any hope for personal dreams. When I ask most people what they’d like to do if they could choose something, most answer that they just want a decent job — that pays the bills. That’s all.

See, the American dream is dead for many in this disenfranchised group. They’ve been kicked around from home to home, job to job, bill to bill, with little support. When I ask this privileged question about dream vocations, they can’t answer. It hurts to hear, but I can empathize with how they got there.

Hard work, self-motivation, and personal responsibility don’t account for death, abuse, domestic violence, psychological illness, and disabilities (to name a few). Each of these unaccounted for variables are swept under the rug, and personal finance websites often miss this target population entirely. Hell, most homeless people have severely restricted access to computers. Many need to go to public libraries to access the Internet — and only for short periods of time. Moreover, I can’t imagine many of them venturing on to personal finance websites because their problems are more fundamental.

Maslow’s hierarchy of needs was introduced in 1943. The pyramidal structure postulated that individuals move through a process of needs, ultimately getting to “self-actualization.” If all your needs were met, you could feel secure, safe, and self-confident. Unfortunately for the most vulnerable, creativity, critical thinking, and problem solving skills are reserved for states in the highest level of the hierarchy. When basic needs such as food and shelter are of concern — worrying about where the next meal comes from — it can be challenging to imagine personal finance questions or plan for that dream job. Despite the psychological understanding and history for the hierarchy, society largely ignores it.

Boasting on and on about complex ideals in American society, we can become inured and desensitized to the struggles of these people. I’m a firm believer that we naturally want to help others. But with homeless people, we seem to make exceptions. For instance, I’ve heard many say, “I would donate or give change, but they’ll probably just buy drugs and alcohol.” I’ve seen parents squeeze their children tighter, as they pass a homeless man. Most people that see a sign and cup pass without glancing — purposely avoiding eye contact. Society allows this dehumanization. That’s considered normal and okay. Who else in society can be so easily cast aside?

With psychological dissatisfaction directed towards the most vulnerable, society can sometimes get creatively disturbing. For instance, The Guardian recently profiled a horrific rise in anti-homeless architecture:

“…stainless steel ‘anti-homeless’ spikes…appeared outside a London apartment block recently, the benches are part of a recent generation of urban architecture designed to influence public behaviour, known as ‘hostile architecture’.”

That simple quote doesn’t do justice for the medieval constructions. From silver daggers that prevent curb-sitting to park benches with added breaks to prevent laying down, this design destroys comfort for those with nowhere else to go.

Today, I’m here to say that it’s not okay that we tell people, “You get what you deserve.” We need to deconstruct these faults and create an inclusive, collective, supportive society. It hurts everyone when we demonize and destroy the most vulnerable. In fact, it’s cheaper to give homeless people shelter, food, health care, and job training, instead of doing nothing.

As an avid writer and reader of personal finance blogs, we have a ways to go before we meet this population’s needs. How can you make a difference?

Filed Under: Social Justice Tagged With: American Dream, anti-homeless, debt, Finance, homeless, hostile architecture, Maslow, Personal Finance, poor, poverty

Tax Inversions: The Most Unpatriotic, Selfish, And Shortsighted Decision Companies Make

By Frugaling 6 Comments

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Corporations Tax Inversion Evasion No Revenue

Tax evasion is persecuted heavily in the United States. If you’re caught keeping income away from the federal government, you could be looking at a hefty prison term and fine. This very crime that put Al Capone, the notorious mafia-gangster, behind bars. And yet, when companies dodge taxes, their shareholders rejoice. Nowadays, rapacious corporations are pushing the limit of U.S. tax laws by engaging in one of the sneakiest tax-dodging practices ever: tax inversions.

What are corporate tax inversions?

Bear with me as I try to explain a fairly complicated procedure. Essentially, corporations pay certain tax rates in America. Sometimes motivated by intrinsic greed — at other times by shareholders — corporate executives decide that moving their official headquarters to another, overseas location would be better for taxation. In switching to another country, with lower tax rates, they can pass on those savings to shareholders via greater earnings per share (via profit and revenue), larger stock buybacks, and more dividends. All they have to do is purchase another company that already has its headquarters in a tax haven.

When you own shares in a company like this, you can easily get swept up into this grand, wonderful idea. You’ll be getting more money for your investment and the company will be even more competitive. These are significant advantages — until you look at the dirty consequences.

When robber barons are more patriotic than today’s businesses…

Robber barons — 19th-century industrialists/capitalists — knew how to make money hand over fist. They could squeeze workers and make millions of dollars (billions when accounting for inflation). Many of these elite capitalists formed companies in finance, manufacturing, oil, and transportation. These industries were at the heart of American success; although, the robber barons made a lot more than your average, everyday peon.

There was a uniting factor to these antiquated moneymen: pride in country. They made their riches here, and much of the money flowed back into America. For instance, Andrew Carnegie, who started one of the largest steel manufacturers in the world, gave much of his wealth to schools (Carnegie Mellon University), museums, and libraries.

As America matured, tax laws and corporate structures evolved. Workers were offered more rights due to union memberships. Talk of a fair wage encouraged companies to pay more and protect workers. America became a booming economy, despite these new restrictions. Social welfare programs developed, as well, which sent people to college (affordably) and created Social Security. There was a respect for those who worked 40 years. The country believed they deserved to live safely after working so hard. Today’s businesses seem to have a different motivation.

How much do American companies have to pay in taxes?

Now, hardly a day goes by without a corporate executives complaining about excessive taxation. Steve Schwarzman famously compared the pressure for increased taxation to the invasion of Poland by the Nazis. Classy! Or, how about the Home Depot founder, Ken Langone, who said that increasing taxes, awareness of income inequality, and the Democratic agenda was “was what Hitler was saying in Germany.” Holy hyperbole! And the last one (that I’ll include in this article) comes from Tom Perkins, whose net worth is said to be around $8 billion. He said, “[there’s a] progressive war on the one percent…In the Nazi area it was racial demonization, now it is class demonization.” To put it simply, he’s saying that poor people clamoring for help is comparable to Nazis killing Jews. Better to bite your tongue, perhaps?!

Beyond the disturbing question of why some bigoted wealthy people freely invoke the Holocaust and its accompanying atrocities, I’m left wondering how bad it is in America for them. If people are that stirred up and eager to fight back poor people, tax increases, and basic rights for workers, these executives must be struggling. Alas, avoid the wellworks, the aforementioned Nazi-invokers are all billionaires. I trust they’ll find a way to pay their next meal.

Despite these clarion calls for tax revolution, American companies are doing well. In fact, corporations are seeing record profits year-over-year. How can this be happening in these awful, tax heavy times? Well, for large-cap corporations, they’re not. Armed with restless lawyers, accountants, and lobbyists, the largest companies march up to Capitol Hill and demand tax breaks. And you know what? It works.

Yesterday, CNBC reported on 20 (to name a few) companies that pay 0% in taxes. Take a look and see if you recognize any:

1. Merck
2. Seagate Tech
3. Thermo Fisher
4. General Motors
5. Public Storage
6. Iron Mountain
7. Newmont Mining
8. Eaton
9. Avalonbay
10. Kimco Realty
11. Prologis
12. Boston Properties
13. Apartment Investment
14. Plum Creek Timber
15. Citrix Systems
16. Crown Castle
17. Macerich
18. News Corp.
19. Essex Prop.
20. First Solar

These companies are likely benefiting from tremendous tax loopholes and writeoffs that are only available to them. From federal investments to research grants to special “one-time” discounts, they add up and suddenly the bill comes to $0.

That means that the preceding list doesn’t contribute a single dollar to our federal budget via traditional taxes. Moreover, they don’t properly fund our infrastructure that they rely on. Without the education, federal investments/breaks, transportation system, etc., these companies would have a devastatingly hard time finding success here.

Business-first media outlets such as the Wall Street Journal swiftly defend companies by saying:

“We’ve written for years about how the U.S. has the highest corporate income tax rate in the developed world, and that’s an incentive for all companies, wherever they are based, to invest outside the U.S.”

In this strange time when taxes are demonized, it’s important to realize that many companies aren’t paying their fair share. These claims that America has the highest corporate tax rate in the world don’t reflect the numerous benefits; after all, membership has its privileges and sometimes that includes sizable tax breaks.

How do corporate tax inversions hurt countries?

Despite this business-friendly reality, some companies still seek to lower their tax burdens — wherever they can find them. Tyco International, Fruit of the Loom, Ingersoll Rand, Transocean, and Eaton Corporation all successfully left the U.S. (for tax purposes), but they all still benefit from the infrastructure and development here. See, even after you leave a country, its people, and suck another $1 billion into your coffers because of the move, we welcome you to do business here with open arms.

It’s sickening. Companies vacate the U.S. for places like the Cayman Islands, Ireland, and Switzerland, where the corporate taxes are zero percent. Americans, again, lose all that tax revenue that would’ve gone to state and federal programs. This all contributes to widening budget gaps, shortfalls, and growing austerity measures. Then, the welcoming nation holds out open arms for the new company. But despite the new headquarters, they make zero percent from their new neighbors.

This is a brutal act that causes disruption for both countries. With zero percent coming in for either party, they both suffer the consequences of a newly globalized world.

Globalization was supposed to bring greater diversity and talent. Suddenly, the world is flat, right? Aren’t we supposed to be benefiting from a shared upward mobility? When tax inversions are employed, it’s hard to see how anyone could possibly benefit — except for a select few shareholders and corporate executives.

Filed Under: Social Justice Tagged With: Business, Companies, federal, Government, invest, irs, market, Robber Barons, stocks, tax inversions, taxation, taxes

I Just Moved From A Utilitarian Batcave To An Opulent Apartment

By Frugaling 10 Comments

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Hope you enjoy this little tour of my old apartment!
(Warning: sarcasm ahead.)

Over the last 7 days I’ve been moving boxes, furniture, and settling into a new abode. I have a terrific roommate and some good friends with me — all in the same complex. We’re one big, amalgamated family. It feels wonderful to be around and supported and having fun with such great people.

But there’s a foreignness to my new residence. Every time I walk into the brand new apartment (for me and the area), it feels opulent and grand. It’s like I’m a little ant, looking up at the big blue sky — captivated and scared by the scale.

My home has wood floors and a stone-tiled bathroom, which reminds me of a hotel room. There’s fresh, soft carpet in the bedroom to greet me in the mornings. Central air and heating insulates me from the inevitable weather extremes of Iowa. A community center features a fitness room, laundry facilities, and regular staff.

As my friends know (and certainly some of my readers), I’m quite class conscious. When I see inequality and/or inequity, I can’t help but comment and try to change it. This new apartment, full of accoutrements and amenities is a reminder of my privilege. And with that, I feel deeply mixed.

The previous couple years were spent in a batcave-like apartment, which was comically awful. I lived 20 feet from an active railroad, 40 feet from a lurking cell tower, and my views were of a crater-filled parking lot. Despite its misgivings, I felt at home; at times, proud of it. I just never wanted to be above it all — separated too greatly from how many live.

Physical separation from more humble surroundings scares me. I worry that if I move to far from poverty, lower incomes, and more modest livelihoods, I could get swept up in craving endlessly. Perhaps more importantly, that this distance may come at the cost of being able to empathize with those who struggle economically — that I wouldn’t be as inclined to give back.

And now, I feel like I’m in a gated community. The demographics have shifted, as families departed as they couldn’t afford the new residences. The multiculturalism that once filled my old neighborhood has significantly changed. It’s evidenced in the growing number of white people and shiny cars.

I’ve joined the economically privileged, and I’m still wrapping my mind around the shift. I feel both honored to have this place, and unsettled by the way privilege begets privilege — a burdensome path and procession of more, greater, bigger, and taller. It feels paradoxical, as there’s great happiness here for my friends and I, and yet the discrepancy between the haves and the have nots has never been greater.

Filed Under: Social Justice Tagged With: apartment, Economics, home, house, Income Inequality, Inequity, moving, Renting

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