Thursday, October 24, 2013

No skin in the game

Ted Cruz sought to defund Obamacare and lost. After months of arm-wrestling in Congress, a government shutdown and secret meetings in restaurant basements, we learn the shocking truth. Ted Cruz had no skin in the game. He's sitting comfortably on his wife's health plan while she works as a director at Goldman Sachs, a health plan estimated to be worth some $40,000 a year. That's more than the average household income in America and it's just for health insurance.

While Cruz expected Congress and their staffers (who make around $40k) to forgo government provided healthcare, he was happy to omit the glaring facts concerning his ride on his wife's health care plan. This seems fitting since Goldman Sachs is an investment bank and they help people invest in, among other things, insurance companies. But that's not the main point of this article.

Ted Cruz is a multimillionaire. He doesn't have to think that hard about money like most of us do. There is a difference in thinking between a man who goes to work for a paycheck to care for his family and a man who is sitting on a pile of money looking for new ways to earn money with his money.

A working man (or woman) sees other people during the day. He has contact with other people every day, whether he likes it or not. He is doing a job that, more often than not, is a job someone else doesn't like to do. He is thinking about survival more than his next vacation - if he has ever had one. He's happy to have health insurance if he can get it.

A wealthy man can be seen jetting around the world, developing and maintaining alliances - when he wants to. I define a wealthy man as one who, doing nothing more than managing his money, doesn't have to work again for the rest of his life. A multimillionaire or billionaire. After the first billion, what else is there to do? Find a way to get more juice out of this lemon we call the economy. It is an interesting contrast in perspective.

The working man is thinking week to week, month to month. He may have a nice little house, a few TVs, a couple of cars for him and his wife. He sends his kids to public school. He has some time to be with his kids, wife and friends. He is aware of debts he has incurred. He is aware of when the next set of bills need to be paid. He is gratified that he can save any money at all, much less think about a college fund for his kids.

The wealthy man is thinking in terms of decades. By the time you get to be a billionaire, the only thing your brain understands is more money. Because more of anything else doesn't really matter anymore. He doesn't worry about the bills being paid because he has hired people to pay the bills. When he wants something, someone else will often buy it for him. He doesn't see money, he sees statements of accounts. He sees numbers. He only sees numbers because buying another car, another house, a bigger house, or a yacht doesn't make him feel any better. Material possessions cannot be quantified since they often lose their value after you buy them.

No, once you're in the stratosphere, you can't see the ground anymore. You don't see the little people milling about, getting from home to job and back again for a paycheck once a week.

So you, the billionaire, hustle with your friends to write legislation to take more money away from the economy and put it into your trust fund, your foundation or your portfolio. Then you can look at the statements and reports coming from the entities you created. You can take pride that finally, once again, you are making more money. Because buying something else doesn't matter anymore - unless it can make you more money.
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