Saturday, December 27, 2008

The Price of Money (or, a recession blessing)

[Warning: rambling, personal post. Not sure if useful. Hopefully not too obnoxious.]

I have long felt that people fond of the platitude "money can't buy happiness" have never felt the sting of poverty.*

I grew up poor. Not used-Toyota poor, but food stamps poor. And I cannot remember a time when I didn't want money - lots of money. I could not wait until I was legally old enough to get a job. I spent endless hours pondering the mystery of money. Why do some people make more than others? Where does interest come from? Why do prices generally increase, rather than decrease?

Yet, it never occurred to me that I could make lots of money until my senior year of college. Though never explicitly articulated, it was an accepted truth in my family that there were two ways to riches: luck (inheritance, lottery) or unsavory deeds (ponzi schemes, screwing your customers/employees, etc.). No one worked harder than the blue collar folk, Mexican immigrants and back-to-the-landers that I grew up around - so it was a revelation to realize that hard work and certain (completely legitimate and moral) career choices could put me in a very different financial situation than I grew up in.

This simplified everything. I became fond of annoying the pseudo-Marxist, knee-jerk lefties (who continued to make up my social circle despite my new-found identity as a raving capitalist) by announcing at dinner parties that my life goal was to make as much money in as little time as possible. I no longer was worried about finding my passion (farewell, artistic aspirations) or "helping others" (adios, to-be-a doctor plans). My passion was making money.

After 20 years of scrimping and worrying - living w/o electricity and running water, never being able to afford a doctor, driving cars that were more danger than help, buying only second hand clothes that barely fit, never eating out, attending a crap public school ... my mission was clear. I wanted to put the greatest "margin of safety" between my future bank account and my current bank account. And if that wasn't enough inspiration the perpetual lack of self-made women (and the lengthy list of women I knew who sacrificed any pursuit of monetary gain to ungrateful children, spouses, bosses, etc. leaving themselves vulnerable to the financial whims of others) just furthered my zeal. I was not going to be one of those women. And when I made it, I would make sure there were far fewer of those women.

Money does buy happiness. That is, if happiness is good food, clothes that fit, a comfortable home, a car that works, quality health care on demand, a decent education, a lawyer when necessary, paid vacation, top-notch childcare ... you know what I mean.

But hopefully, if you've read much of my blog, you'll know that there are a lot of things I care about beyond money. And strangely, my tour of MBA land has brought me full circle back to my undergraduate days. I went to some of the most liberal colleges in the country and emerged a reflexively cost-benefit calculating, hedge fund manager aspirant. I entered business school at the University of Chicago (ostensibly the perfect fit for me) and have found myself less and less able to ignore the fact that money has its price too.
  1. Boredom: Most of the best fat paycheck jobs you can get post-MBA are mind boggling boring. I'm too old to be so bored.
  2. Ethical issues: While my study of Economics did persuade me that this is not a sum zero game, far too many fat paychecks for MBAs-many-years-hence come at the expense of someone else's paycheck. Free market schmarket - I have yet to discover any activities that one human being can accomplish in a year that are worth $10 million (pick your favorite absurd figure). These paychecks are enabled by a strange system bereft of proper checks and balances in which dodgy boards approve inappropriate rewards because, hell, why not, it's not their money! Meanwhile folks doing real work are being paid absolute crap. It may be legal - but it sure isn't moral. If I sign on to that system - I'm not sure I will do the right thing.
  3. Time: I like my family. I like cooking and eating dinner together every night. I like getting exercise. I like to control my own time and space. I hate being employed.

This is not new news but the current economic environment and my own deepening understanding of the reality of zooming along the typical post-MBA route - is forcing me to reassess my original, clearly defined goal of making as much money in as little time as possible. It was much easier to ignore the price of money when making loads of money was theoretical, not reality. It is also easier to ignore one's qualms about job path XYZ when you hardly have to do anything to get an offer.

I will always like making money and thinking about money. That's just who I am. (And, if done right, hopefully this can be a gift to the world, rather than a curse.) But the era that began as I prepared to enter the world as a college graduate seems to be fading as I prepare to enter the world as an MBA. I'll make money eventually ... but I can wait. I'd like to think about something else first.

* (I'm also not fond of the old "do what you love and money will follow" schlock which might be a good recipe for doing what you love but is no guarantee that money will ever follow.)

3 comments:

Anonymous said...

Check out the book "More than Money" by Albion. I think it'll speak to you well.

Jaesoreal said...

Absolutely phenomenal post! Money may not be able to buy happiness but it sure can buy comfort so you can decide how to be happy!

p1n9 said...

Great post! Some of what you said really clicked with me. Thanks for sharing your background and how it's affecting what you feel about the world now. Business school is definitely something I'm considering in the future and I believe your blog will help me make future decisions.