Saturday, January 28, 2012

Change the Rules of the Game?

Should we change the rules of the game, or just keep playing and enforce the rules we have?

Reform is a word on everyone's mind right now.  Everyone, it seems has an idea on how we can throw out all the old rules and start over with a new game.  Herman Cain, he of Presidential Timber, had a "9-9-9" plan for reforming our taxes, which would have been a radical overhaul of our tax system.  Is this what we need?  Or a flat tax?  Or a national sales tax?  Or something else?

The problem with changing the rules of the game, once everyone is playing, is that some folks rightly feel that they are doing pretty good at the game, and don't see why the rules should be changed, just because they ended up with Boardwalk and Park Place - with hotels on both.  To them, the game is going pretty good.  And maybe you have Marvin Gardens and Atlantic Avenue - and are hoping to get Ventnor.  Starting with new rules at this point sort of throws your plans into a flux.

Perhaps we just need to enforce the rules we have.  It always pisses me off that people make up new Rules for Monopoly - so-called "house rules" such as "Free Parking" - and usually it is white trash that does this, as they want to make the game "more fair" or more like a lottery, and less like a game of skill.  So they create a rule that all the money from Community Chest and Chance, or get-out-of-jail fines, goes into a "Free Parking" pot, and whoever lands on "free parking" wins it all.  It ain't in the official rules, but probably half my friends liked to play the game that way.

It's like changing how the pieces move in Chess - you may still have a game, but it ain't Chess.  Or one of your annoying friends who makes up weird rules of Poker - where there are so many wild cards and aces are high and, well, you get the idea - no one knows how to play the freaking game, and then your friend throws down a "sampler" hand of random cards and says "Royal Flush! - See, the two's and seven's are wild, and the diamonds and hearts are counted as the same suit, and since aces are high, my two-seven-jack-king-ace hand is a royal flush!"

At this point, everyone groans and decides to call it a night.  And it is one reason I don't bother playing poker anymore.  Stick to the rules!

And you know, I think whether or not you play the "Free Parking" house rule in Monopoly says a lot about who you are and your character.  People who like the "Free Parking" house rule, tend to want to make things "fair" and "give everyone a chance to win" and perhaps favor redistribution of the wealth.  Folks who prefer to play the Official Rules, want to play strategy and work to get ahead, and don't want someone who doesn't take the game seriously to just win at the last minute by landing on "Free Parking."

You either are a Free Parking person, or you are not.  It is as simple as that.  And if you like to play the "Free Parking" house rule, chances are, you end up in a lot of financial trouble in life.  In real life, there is no "get out jail free" card - and there is no pot of cash waiting for you in Free Parking.  The something for nothing or lottery mentality of life ends up causing more grief than joy, for those who engage in such thinking.

In our economy, it is tempting at times to throw out the rule book and try to "start over" with a new one - to make things fair and "give everyone a chance to win!" -  But rarely does it work out well.  And in fact, over time, the new rules tend to morph to be a lot like the old ones.  But funny thing - the guy who suggested all the new rules - like my crazy poker friend - somehow end up winning all the chips in the interim.

In the 1930's, a lot of people suggested that Capitalism was broken and should be discarded.   And a lot of Americans started to embrace Socialism, Communism, and other leftist causes as the "cure" for Capitalism.  We could not reform our existing system - no, it needed to be discarded and a new one put in its place.

Rarely does this work out well - whether it is the French Revolution or the Russian Revolution, the new forms of society are often not stable, and usually end up reverting back to their old forms in short order.  The American Revolution was successful in that it did not substitute a radically new form of government, but rather just replaced who ran things.  Once we tossed out the British, it was back to business-as-usual, including that whole slavery thing.  So much for holding truths to be self-evident.

Today we are seeing similar calls to overhaul or replace our system.  Some are contemplative ideas that suggest ways our economic system can be tweaked to make it more stable and to eliminate the excesses caused by various bubbles in housing, electronics, oil, minerals, and the like.  Others want to directly redistribute the wealth through more socialistic means.

And still others just have silly half-assed ideas that are more style statements than anything else.   When you see some suburb-raised 20-something with a bandanna over his face, smashing a Starbucks and shouting "Anarchy Now!" you know you've met a really deep thinker.

Most of the major problems in our economy do not come from a lack of rules, but from a lack of enforcement of a lot of existing rules, and also an utter lack of common sense in the populace.  We create financial instruments that are designed to fail - and then we buy them without vetting them properly.  We build houses and sell them for fantastic sums using dubious financial instruments - and we buy these houses and sign the loan documents without thinking very hard about them or what they mean.

Companies cook their books and accounting firms give them stellar ratings - violating many laws in the process, and no one bothers to look more closely at the specifics of the transactions involved.  The shouting guy, or the fellow in the jester suit, on the TeeVee says "buy stocks!" and we buy, and then grouse when the go down in value.

You bought stocks based on the advice of a guy in a clown suit and you wonder why it all went horribly wrong?  Whose fault is it?  His, yours, or the company whose stock you bought?  Call me a radical, but I think when you take financial advice from crazy people on the television, it is YOU who are to blame when it goes wrong.

What it boils down to, in the end, is personal responsibility.  The folks who are "hurting" now in the recession - who bought overwrought and overpriced (and poorly built) mini-mansions that they could not afford - using toxic loan instruments - were not "victimized" by anyone but themselves.  If you buy crack cocaine, you can try to blame the dealer for selling it to you, but the upshot is, you decided you like crack.

No one forced you to buy it.  No one forced you to buy a house like that - you were merely greedy and thought you could afford a fancy house and not have to pay for it - and you could "flip" it and make money.  And now your dreams of avarice are gone and it has to be someone Else's fault, dammit!

Don't get me wrong, I am all in favor of credit card reform, student loan reform, mortgage reform, Wall Street reform - and so on.  But like legalizing marijuana, (or colonizing the moon) it ain't likely to happen in my lifetime, at least not to the extent that people still won't be safe from victimizing themselves.

In the very end, it comes down to you.  Changing the rules of the game isn't going to save you from making bad choices, in the end.  We need to stop making bad choices - that is the fastest and most direct way to improving your own lot in life.  Railing against the unfairness of it all rarely accomplishes anything.