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26
Sep 2011

Give vs. Take

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As the board chair for a local education foundation, I have to confess that what we do as an organization is a bit strange. Most foundations use their endowments to generate money that they give out as grants. We volunteer a ton of time to raise a bunch of money so that we can give it all away. Why?

Because it is fun.

It is fun to create something, especially with other people. It is fun to support programs that make a positive difference in children’s lives. It is fun to know that the work you do helps teachers teach and students learn. It is fun to turn your life and your community into the kind of place where you want to be.

Giving is one way to create something that lasts. It is one of the many reasons why charitable giving feels so good and is a core element of our financial wellbeing. We enjoy making a difference and using money with broader impact and purpose.

What if we thought about taxes in this way — a vehicle for giving, for creating something valuable and meaningful together? What would be different? What would need to be different about taxes to imbue them with this sense of purpose and generosity? How can we bring our experiences of raising and spending public revenues closer to the good vibes we get when we make charitable donations? I’d love to hear what you think.

 

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Categories: Emerging Economic Models, Taxes, wellbeing Tags: , ,
09
Aug 2011

Creating and Distributing Time

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Click on photo for easier viewing.

What is needed in order for us to have great relationships and life experiences?

Time.

If we had more time, we could use it to play with our children, visit with friends or volunteer in our community. We could go back to school, exercise or take up a hobby. All these things increase our sense of wellbeing, particularly our financial wellbeing according new Gallup research detailed in Wellbeing by Tom Rath and Jim Harter.

Time is the ultimate finite resource — we all have the same amount, we can’t store it and we can’t transfer it. If we were to aim the economy at creating financial wellbeing and know that time is an important part of it, how could we create more time?

Productivity has been one way that businesses have sought to get more out of workers and other resources in the same amount of time. The promise of productivity from a worker’s perspective is that if we are able to produce more in less time we could receive our dividends in time off or leisure.

While many Americans say they would exchange less money for more time, try finding a 30-hour a work week job. It’s not easy to do, because our jobs are structured according to a forty-hour standard. Benefits such as health care, workers compensation and retirement benefits are also tied to this definition of full-time work which provides employers with strong incentives to squeeze as much work out of as few workers as possible.

While our national productivity has been consistently high, few people get the time to enjoy it. Juliet Schor’s classic book The Overworked American demonstrated that Americans were working longer hours since the 1960’s and had not reaped the productivity gains one would have expected. Had all those gains been translated into time instead of pay, we would be down to 20-hour work weeks according to Schor (in “The (Even More) Overworked American” in Take Back Your Time by John de Graaf).

While some of us are overworked, increasingly more of us have no work at all. National unemployment is currently at 9.2% (Bureau of Labor Statistics, June 2011). This fact isn’t good for wellbeing either. Widespread and persistent unemployment is going to have some drastic impacts on how we feel about our lives, because according to Tom Rath and Jim Harter:

A landmark study published in The Economic Journal revealed that unemployment might be the only major life event from which people do not fully recover within five years…Our wellbeing actually recovers more rapidly from the death of a spouse than it does from a sustained period of unemployment. (emphasis in the original)

So from the perspective of wellbeing, we have a distribution problem with time where some have too much work hours and others too few. According to recent CPS data, the average full-time worker in the U.S. works more than the standard 40-hour work week (42+). If some people need time and other people need work, isn’t there something we can figure out here so that needs are met with the resources we already have?

Redistributing work hours through practices such as job sharing to reduce unemployment is one possibility that has been successfully tried recently by Germany and the Netherlands to help them weather the global economic storms in 2007. Rather than making time scarce for some and paid work scarce for others, we can implement policies that create both time and jobs for those who need them and in the right amounts. Giving people more time and reducing the strain of financial worry increase our sense of financial wellbeing especially during a tough economy — which is what we are really after, isn’t it?

[This post was the second in a series on wellbeing. The first can be found here.]

 

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Categories: Emerging Economic Models, wellbeing Tags: , ,
27
Jul 2011

Creating Financial Wellbeing

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What makes life worth living?

This is the question answered by Tom Rath and Jim Harter in “Wellbeing: Five Essential Elements” and answered in a way only Gallup pollsters can. The answer is culled from massive amounts of data gathered by Gallup over fifty years and across 150 countries to describe what 98% of the world’s population would say is the best future possible for themselves. Rath and Harter call this best possible future “wellbeing” and say that it is:

 

the combination of our love for what we do each day, the quality of our relationships, the security of our finances, the vibrancy of our physical health, and the pride we take in what we have contributed to our communities.

The researchers refer to those elements as career wellbeing, social wellbeing, financial wellbeing, physical wellbeing and community wellbeing. They were careful to pick aspects that “we can do something about,” and throughout the book they make suggestions for what individuals can do to improve their wellbeing in each of those areas.

The book’s advice is limited largely because their definition of “what we can do something about” is restricted to what individual people acting by themselves can affect. For example, their three recommendations for boosting financial wellbeing are to: 1) buy experiences such as outings with friends and loved ones; 2) spend on others such as giving to charity; and 3) set up automated payments and savings. I do these things already but I don’t see them having a huge impact on my quality of life and virtually none on my community. I’m skeptical that these acts will create the wellbeing 98% of the population seeks.

The truth is that there is far more we can do to create wellbeing than the book suggests if we choose to pursue it together as a society. Take a look at the research findings about financial wellbeing that led them to their advice, because they are really quite profound:

  1. Universally what matters to people are quality of the relationships and life experiences we have;
  2. We derive more satisfaction giving money away than spending it on ourselves; and,
  3. The freedom from worry of finances creates three times as much financial wellbeing than a higher income.

Notice that these things have less to do with money than we think. The quality of our relationships is more impacted by our time and attention; charitable giving (or even gift giving) can occur with very small sums of money or just volunteer time; and the last finding puts the role of high income way down the pecking order of what really creates financial wellbeing.

If we want to create a world with lives worth living, we could harness the power of economic policy and focus it on creating a society that promotes the financial wellbeing of its citizens rather than the accumulation of wealth. To do that, we might use those three research findings as goals and create the right economic conditions that allow people to have great relationships and life experiences, that allow people to give generously and freely, and that enable people to avoid and recover from financial disaster (the most common these days is just getting sick).

To know what the economic policies need to aim for, we can ask ourselves: “What is needed in order for us to have great relationships and life experiences?” “What are the things or thoughts or feelings that enable us to give freely?” and “What would financial security look like concretely in our lives and communities?”

What would your answers to those questions be? Mine are coming over the next few weeks.

 

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Categories: Emerging Economic Models, Wages, wellbeing Tags: , , , , ,
20
Jul 2011

Changing Tack

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The signs of being in the wrong job are pretty obvious when you pay attention to them. I thought I had picked the perfect job for myself right out of graduate school by working as a researcher for a labor-community partnership. Had I been more discerning, I might have seen the poor fit in advance.

The first sign appeared when someone from the labor half of the partnership took me to lunch to get to know me better. The 50′s-style local diner he selected was union-approved — the waitresses were members of HERE and had been working there for 25+ years. I can’t remember details about what the place looked like, but I distinctly remember what I saw.

When he asked me why I wanted to work in this job, my answer played like a movie in front of me. I saw people working hard in their jobs but joyfully because they felt purposeful in their work. I also saw them not working in jobs — they were doing homework with their children, cooking for their aging parents and playing sports. I saw that what I wanted for all these people were also the very things I wanted for myself — a work life with meaning and purpose and a family life with time to care. It wasn’t an extravagant life that I envisioned for everyone, but it was full and rich. And, I knew that one of the things happening behind the scenes in this movie was a freedom from anxiety about money. That was just a given.

I returned to our conversation to see a furrowed brow on his face. “Don’t you care about wages?” he asked. Oh yeah. I’m supposed to care about wages.

But I don’t.

*************

I actually do care about wages, but improving wages is a means to an ends. To the degree that improving the wages and benefits of low-income workers helps them be able to live with less anxiety and enables them to care for their families (which in this economy it does), then that strategy is important to me. But there are lots of ways to help make sure that people are generally free of anxiety about finances in addition to improving wages.

Creating policies that promote widespread freedom from fear of financial devastation — policies that assume that collectively we have enough and enough to share — has always been a key part of my vision, and working for a great organization that improved low-income workers’ wages was consistent with that vision and values. But for a host of reasons, that job was not the right means for my ends, and I left it.

I’m not trying to say that similarly we should abandon efforts to improve wages especially among the lowest earners. But I am wondering if wealth accumulation — whether by the poor or the rich — is the right target for an economy that is based in sufficiency. If we wanted people to have the feeling that there is enough and we have enough, for what would our policies aim?

I’ve been playing with the notions of financial security and financial wellbeing. What do “financial security” and “financial well-being” mean to you? What would that look and feel like in your life and in your community?

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Categories: Emerging Economic Models, Wages, Wealth Distribution Tags: , , , , ,
28
Dec 2010

Vulnerability and Possibility

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This video is one of the most powerful TED Talks I’ve seen to date. (If you can’t see the video above, watch it directly on their site here.) It doesn’t talk about the economy directly, but as you probably suspect, for me it does. Brene Brown talks about our universal need for human connection and what happens when we fear having that connection lost — shame. To me, the economy is this incredible tool that we can use to either support human connection or create shame. This video has me wondering what is possible with the vulnerability many of us feel with the current economy, and how to use it as an opportunity to tell authentic stories and create an economic system where joy, gratitude and human connection are the goals rather than accumulation.

And before you think creating that kind of economic system is pie-in-the-sky, idealistic, unrealistic, froo-froo stuff, watch this video below. I’m so grateful to have spent 2010 getting to know Hildy Gottlieb, Dimitri Petropolis and the work they are doing to support the community benefit sector (aka nonprofits) in reaching its highest potential.

What  is a world that is peaceful, healthy, joyful and loving worth to you? Donate just some of that to their work here. It could make a world of difference. Literally.

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Categories: Emerging Economic Models, Values
15
Nov 2010

Marketplaces of Enough

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One of the issues with demand-side policies is its reliance on consumption to drive economic activity at a time when consumption is not sustainable environmentally nor personally. The fact is most of us have enough stuff and as individuals we need to be saving more than spending, but the system actually needs us to consume. How can we more efficiently use the resources already available, have a high quality of life and save money? What might economic markets might look like if we embrace sufficiency?

It might be something like Collaborative Consumption.

WHAT’S MINE IS YOURS from rachel botsman on Vimeo.

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Categories: Emerging Economic Models, Sustainability Tags: , , ,