One RIA in Seattle confronts Occupy Wall Street and writes a tough-love letter

Well said.

Generally well spoken. A little bit of arrogance toward the end took away from the main points. Being in my early 50’s I also lived most of what he described. The major differences between now and then, is that he and I still had role models who believed in the hard work=reward theory. A lot of the GenX and Gen Y folks didn’t/don’t have those models.

Another major difference is that in the 60’s, 70’s and 80’s most people starting out didn’t have access to credit as we do today. Having a credit line take a little of the edge off.

We are also a much more complex and interconnected society today than even 15 years ago. I marvel at who rapidly the news ccycle moves now. It has had the deleterious effect of holding us captive to the sound bite and for almost all things of importance ahs eliminted any ability to truly deiscuss and debate our differences. Our answers are always geared to the symptoms not the source of our issues.

Brilliant.

There are still some unique challenges today which the graduates of the past didn’t have to worry about.

Students have it constantly drilled into their heads that they MUST go to college, which means for most of them that they MUST incur a large student loan debt, just so they don’t have to work at McDonald’s all their life, which has been characterized to most kids as Hell on earth where nobody with any dignity would ever set foot. Whether this is true or not is irrelevant. It has become common wisdom that high school educations are woefully inadequate and only in college can a person become worthy of a good job.

Also, the people who are supposed to be creating jobs aren’t creating enough of them to cover the surplus labor force created by the latest economic contraction. there were six unemployed people for every public job opening in 2010. Even McD’s isn’t hiring. They’re full of recent grads who are happy to be making barely enough to cover their student loan and credit card debts.

Easy credit, also known as “predatory credit lending,” is another problem. People have been enticed with the “spend now, pay later” paradigm, and some of their greatest prey are kids who haven’t learned the hard lesson of carrying a constant debt.

Then there’s the simple fact that the wage of a worker in America, in real dollars, has stayed perfectly flat for over 50 years while CEO salaries have increased tremendously. The folks who drove the banks onto a sandbar universally left their companies with multi-million-dollar golden parachutes while millions of people lost their homes. The rich are very, very, very rich these days, which the common American is doing pretty much as it always did. They’re kind of getting tired of that, and wouldn’t mind seeing a little of the supposed economic growth we’ve had in America since 1940.

Well done and very true. It’s interesting that we had a discussion about the 1% movement with our two sons who are attending college as we speak. We were discussing majors and how things were going at school this year and the one thing we all agreed on is they are accountible and responsible for the decisions they make around their education and getting a job after college. They cannot depend on other’s or the gov’t to assist them. I came from a similar backround as the gentlemen in this article and while I’m able to pay for my kids college they know my story clearly and understand how fortunate they are to heve this benefit. I tell them don’t screw it up!! We cannot continue to make decisions for our children and shelter them from reality otherwise they will nver grow up and be able to stand on their own. That’s our responsibility as parents!!

I’m not quite a 1 percenter, probably more like a 1.5 percenter, which is to say I’m very well off compared with most people, so I share much in terms of biography and outlook with the author. However, I think he completely misses the main point of OWS: That the system itself has been corrupted to the point that even those willing to “work hard and play by the rules” are getting screwed while the crooks who put us into this mess not only get away with it, but take for themselves enormous taxpayer funded bonuses.

Dennis, I enjoyed your letter, you made great points. Maybe I liked it because our stories are very similar. USAF from 67-72, Vietnam 68-69 (thankfully, no purple heart) started my business career in the Bay Area in 72 moved to Seattle in 95.

Along the way I ended up starting and selling two businesses. The latest was a mutual fund company. When I was starting out there were times when I could make the payroll for everyone except me. There were always the challenges of long days, long weeks, missed family events, lawsuits and increasing regulations. In my mind the 99%ers don’t get it. It is the thrill of overcoming the challenges that makes life exciting and fulfilling. The challenges facing young adults today may be different, but are they any more difficult? When you are in the middle of the challenges they always seem overwhelming.

Success is not a zero sum gain. My success and I’m sure yours was not at the expense of someone else. Because some CEO is successful doesn’t make it more difficult for me to be successful or anyone in the OWS crowd to be successful.

Again, great letter and thanks for your service to our country.

Patronizing, preachy and self-congratulatory prose is not going to convince anyone, who doesn’t already agree, nor help engage anyone in dialog. Producing a sales pitch for one’s personal ideology and life is off-putting and missing basic human compassion and empathy and just egocentric. Selfishness is one of the main complaints of OWS.

Imagine this approach and tone of voice being used with clients who have these same concerns — which many clients do.

Not once does it mention any data or evidence or even entertain different legitimate points of view. It is all ad hominem. It simplifies very complex social, economic and political questions of fairness and social responsibilities into one person’s story. There is no objective, detached or professional assessment of these serious matters.

The Tea Party started using the “shouting” self-righteous, venting media tactics and rallies and demonizing the government/taxes/non-evangelical Christians/etc. or anything else in the way of their perceived self-interests — and still are. They painted rifle scope targets on elected officials, etc.

OWS is merely borrowing a page form the TP folks. All extremists are best to do this. However, the discussion on both sides seems to be mainly crackpot rhetoric.

Emotional venting and anecdotes/story-telling hinder problem identification and problem solving. Also, this he said-she said journalism is popular but disingenuous.

In the interest of fairness let’s now get some OWS folks tough love letter to financial advisors. Reality based advisors will want to hear those concerns and ideas — since many of them either will be or effect their clients.

BTW, it always helps to have someone read any article you write. Editing exists for a reason.

I have to disagree, hard work, responsibility and persistence still pay. It is a shame these virtues are not taught as much as they used to be. And it is a shame that we have the political and business corruption we have, although those things are neither new nor impossible to overcome.

It is also a shame that people no longer seem capable of critical thinking. To equate the tea party, intelligent, hard working and well mannered people who did not so much as leave a candy wrapper on the ground, with this extremist mob – OWS – is just odd. You have to get our of your parent’s basement a little more often.

Very well written. I am an Indian and 25 and I have been following OWS closely. I cannot really sympathize with most of them. They tend to think that having a degree means they SHOULD get a job but in most cases those degrees are from lesser known universities and in such subjects as English, history etc. In India, most humanities grads know very well that they would either be unemployed or get some really underpaid jobs (most of these humanities ppl end up in the call centres). No one whines here although things are far worse. We Indians do not consider ourselves 'entitled’ to anything. We survive in spite of the govt. Which is why I find it comic when these youngster, most of my own age, whine about not getting a job or student debt (I am under $25,000 of student debt and I will be able to pay it back in less than 2 yrs) or those grown ups whining how they have huge credit card debt or mortgage debt. Seriously, why do you own that many credit cards and who asked you to spend that much? Mortgage, I can still understand. I always saw Americans as go getters, very entrepreneurial people who show the rest of the world how to do things. But I guess that generation and those ethos are over. What I see now are people who want to blame others for each and every misfortune (how is insider trading going to affect the guy on the street.Sure it’s wrong but it ain’t really affecting you), want to have everything served to them on a platter.

Also the whole tirade against Ivy league students baffled me. There is a general assumption among this OWS crowd that the only reason they arent in a Harvard or MIT or UC Berkeley is because their parents aren’t rich enough. Thats just BS. If you smart you could have made it; my friends are studying there and their parents dont have money to pay a month fees let alone the whole degree. They made it because these guys worked their asses off. So my message to OWS, stop whining start doing.

Hmm, guess making personal insults against people with different ideas is a professional advisor’s style of dialog. Clever.

In fact, there is no scientific evidence for any of those things claimed and evidence that success is largely chance, e.g., right parents, inheriting good genes/money/educated family, early childhood support and nurturance. Glad to provide the citations.

The claim of such however, is the “winner take all” and “I’ve got mine – devil take the hindmost” attitude that most Americans reject as a social theory or style of government.

What corruption? Corruption is always claimed by extremist/fringe self-interested groups with no proof.

Whether is TP folks or OWS, “crying wolf” is no basis for problem-solving.

BTW, would those be the same TP folks who brandished firearms at political rallies, don’t want to pay taxes, want to install a Christian evangelical theocracy and dissolve courts that disagree with them, call Social Security a “criminal enterprise”, place rifle scope sights on elected officials online, etc. Those folks? Well-mannered? Intelligent?

Elmer, it is a little late to come out against personal insults after using the term, “tea bagger”, which I truly believe you didn’t know was a sexual act, in prior threads. My opinion is that coddling the followers of OWS will not work. They have been coddled their whole lives and it is about time they got some straight talk. Them more stories they hear of people persevering and succeeding, the better. Maybe if inundated with the real stories of the people they hate in the 1%, they will learn the truth and instead of expending their energy whining and frankly embarrassing themselves, they will turn the energy to constructive means.

If you think OWS is not a mass movement and is going to blow-over, be careful. It may have learned some media tactics from the Tea Party but will probably be around longer and be more powerful in voting. Seems to be gaining momentum:

“Unions join Occupy activists in mass protest marches across America
By Lesley Clark and Gianna Palmer | McClatchy Newspapers
NEW YORK — The Occupy Wall Street movement — looking to show staying power after losing prime real estate in various cities — got a boost of support across the country Thursday from labor and progressive organizations in what union organizers said is the most visible sign that they’re working with the activists to press for change.

“This is our way to join with the occupiers, the rest of the labor movement, community allies to declare a state of economic emergency in this country,” said Mary Kay Henry, the president of the Service Employees International Union, which earlier this week endorsed Obama for re-election. “The confluence of building this jobs movement with what the Occupy movement is doing is a huge bonus to both efforts.”

Read more: http://www.mcclatchydc.com/2011/11/17/130656/unions-join-occupy-activists-in.html#ixzz1elZb04ts”

Here is another story about American healing itself:
“Highest income-inequality tract in America is gentrifying”
http://www.mcclatchydc.com/2011/11/21/130921/highest-income-inequality-tract.html

You do also not want to bad mouth OWS with clients and share Tea Party allegiances professionally. It can be alienating and clients or their children/relatives may have sympathies not like yours.

As always, best to avoid politics, religion and sex in professional conversations.

BTW, you folks have also got to learn what ad hominem arguments are and why they are logically false. Try this:

“Abusive ad hominem (also called personal abuse or personal attacks) usually involves insulting or belittling one’s opponent in order to attack his claim or invalidate his argument, but can also involve pointing out factual but apparent character flaws or actions that are irrelevant to the opponent’s argument. This tactic is logically fallacious because insults and negative facts about the opponent’s personal character have nothing to do with the logical merits of the opponent’s arguments or assertions.

Examples:
“You can’t believe John when he says the proposed policy would help the economy. He doesn’t even have a job.”
“Candidate Jane’s proposal about zoning is ridiculous. She was caught cheating on her taxes in 2003.”
“What would Mary know about fixing cars? She is a woman.” (an example of Ad feminam)

An abusive ad hominem can apply to a judgment of works or efforts based on the behavior or unconventional political beliefs of an artist, author, or musician, or the taste of an infamous person who loved a certain work.”

Thousands of peaceful OWS protesters pepper sprayed and arrested, not one Wall St. exec or banker held accountable for the financial crisis. Hmmmm…

Where were 000’s pepper sprayed? Did we miss that?

I try to keep politics out of business. My clients span the political spectrum, but I don’t shy away when asked about where my opinions lie. I think the only thing worse than being inflammatory is being dishonest. That said, I don’t expect my clients to be reading these types of forums, but wouldn’t be upset if they did and posed questions to me about my opinions.

As for OWS, I do not believe it will just blow over and I do believe it is a direct assault on my profession. Thus, to shy away from taking it on is a mistake. That is why when people like RK spread disinformation, distortions, and just plain lies, I don’t just leave it alone. In fact, I would draw a direct link between the people opposed to DC plans and OWS. Getting rid of Wall Street gets rid of DC plans. DB plans are easily co-opted by the government and thus the move to end 401(k) plans is in my view part and parcel with the OWS movement.

That is not to say their are not genuine complaints among the OWS crowd, but they are the same complaints the tea party has made for two years, just with a totally different set of proposed solutions. Those solutions will just make things for everybody worse, and put all of us financial advisers out of business.

http://www.alternet.org/story/153134/caught_on_camera:_10_shockingly_violent_police_assaults_on_occupy_protesters/?page=entire

RK, I know the OWS crowd is desperate for a Kent State moment, but people breaking the law getting pepper sprayed for failing to obey the lawful commands of law enforcement is not peaceful protesters being violently attacked.

Larry: http://www.youtube.com/watch?v=0AbYHRg3qlw

Refusal to obey a command of law enforcement while passively resisting is part and parcel of civil disobedience. You may think given your political views that they had it coming and got what they deserved, but case law refutes that assertion.

Specifically, using pepper spray against peaceful protestors has been determined by the courts to be an unconstitutional use of excessive force (http://caselaw.findlaw.com/us-9th-circuit/1332957.html)

Trespassing is illegal and calling it civil disobedience doesn’t change that fact. Pepper spray is a minor use of force, the students were warned and chose to be pepper sprayed. Trying to use case law to say the police can’t use force to remove trespassers is non-sensical. It is not my political views that mater, it is the law.

“Trying to use to case law to say the police can’t use force to remove trespassers is non-sensical.”

Yes, trespassing is against the law, as is using excessive force AS DEFINED BY THE COURTS NOT LARRY STEINBERG to remove them.

Let’s apply logic to this argument, shall we Larry?

Suppose we have an analogous situation. You’re carrying a firearm at a Tea Party rally. A cop comes up and says, “Guns are not permitted in this trailer park, I’m taking your firearm.” You refuse. The cop says, “If you do not turn over your weapon, I will shoot you.” Invoking your rights under the Second Amendment, you state that you are entitled to keep your firearm and are willing to be arrested. The cop shoots you. According to your theory, the cop’s action was justified. After all, you were warned.

Let’s apply logic to this argument, shall we Larry?

Suppose we have an analogous situation. You’re carrying a firearm at a Tea Party rally. A cop comes up and says, “Guns are not permitted in this trailer park, I’m taking your firearm.” You refuse. The cop says, “If you do not turn over your weapon, I will shoot you.” Invoking your rights under the Second Amendment, you state that you are entitled to keep your firearm and are willing to be arrested. The cop shoots you. According to your theory, the cop’s action was justified. After all, weapons were not allowed in the trailer park and you were warned.

Let’s apply logic to this argument, shall we Larry?

Suppose we have an analogous situation. You’re carrying a firearm at a Tea Party rally. A cop comes up and says, “Guns are not permitted in this trailer park, I’m taking your firearm.” You refuse. The cop says, “If you do not turn over your weapon, I will shoot you.” Invoking your rights under the Second Amendment, you state that you are entitled to keep your firearm and are willing to be arrested. The cop shoots you. According to your theory, the cop’s action was justified. After all, weapons are not allowed in the trailer park and you were warned.

Sorry for the multiple posts.

RK, your argument is devoid of any logic because tea party members only carry gun when legally permitted to do so complying with whatever the currently enforced laws are. Pepper spray is not excessive force. If it was, the police wouldn’t be allowed to carry it.

“Pepper spray is not excessive force. If it was, the police wouldn’t be allowed to carry it.”

C’mon Larry, even you can do better than that.

Guns, batons, fists, dogs, and pepper spray are legal for police to use, but if used inappropriately can become instruments in a display of excessive force.

Force is deemed to be excessive when it exceeds the minimum amount of force needed to arrest and detain a subject. Guidelines about when and how and to what degree police can use force are strict, as are laws protecting the rights of you and your fellow citizens not to be subject to unnecessary violence at the hands of law enforcement.

But hey, don’t take my word for it. Read http://caselaw.findlaw.com/us-9th-circuit/1332957.html

It is settled law. Case closed.

If Americans, or any other democracy, has to debate what levels of violence against political demonstrations is acceptable — that’s a BAD thing. By definition.

Indeed, you walk around brandishing a gun, you are going to get shot by the police. So the TP’s should be given special treatment? Why?

And another thing — democracy is just messy and drives most people a bit nuts. But societies have tried kings, tyrants and fascism (that was a big failure), nobles-warlords, hunter-gather societies and communes. Great ideas — bad on execution.

“All ideas are good ideas, not all good ideas work.” The country, getting a lot more diverse and just bigger. The global economy seems to be changing at a exponential rate. All of this is impossible to even describe, let alone comprehend, let alone effect.

The most vulnerable and emotionally “sensitive” are going to react with fear and aggressiveness first — whether Tea Party or OWS.

No need to let the “loudest voices” have any say in anything. The world is not coming to an end — again. We’ll survive. Actually we predict America will thrive.

For example, OWS cries for bankers to be arrested — what about the folks who lied on mortgage applications. Half the country would be in jail. lol

Pepper spray is the least amount of force. What is more benign than something that hurts like hell, but does no real, long term damage and renders the subject powerless? They were warned by the vastly outnumbered police and then sprayed. Come on, use common sense.

Here’s what we are up against as well — human nature. (well actually animal nature.)

Neither side can or wants to hear reason or facts. Of course, every advisor knows this is what clients do as well. So apparently our minds “off-load” difficult subjects to our government and likely advisors as well. Detaching from the exact problems they should be most engaged with. Big problem.

“Ignorance Is Bliss When It Comes To Challenging Social Issues
According to new research published by the American Psychological Association
• The less people know about important complex issues such as the economy, energy consumption and the environment, the more they want to avoid becoming well-informed
• the more urgent the issue, the more people want to remain unaware

“These studies were designed to help understand the so-called 'ignorance is bliss’ approach to social issues.”

In one study, participants who felt most affected by the economic recession avoided information challenging the government’s ability to manage the economy. However, they did not avoid positive information

To test the links among dependence, trust and avoidance, researchers provided either a complex or simple description of the economy to a group. The participants who received the complex description indicated:

• Higher levels of perceived helplessness in getting through the economic downturn
• More dependence on and trust in the government to manage the economy
• Less desire to learn more about the issue.

“This is despite the fact that, all else equal, one should have less trust in someone to effectively manage something that is more complex. Instead, people tend to respond by psychologically 'outsourcing’ the issue to the government, which in turn causes them to trust and feel more dependent on the government. Ultimately, they avoid learning about the issue because that could shatter their faith in the government.”

Participants who felt unknowledgeable about oil supplies not only avoided negative information about the issue, they became even more reluctant to know more when the issue was urgent, as in an imminent oil shortage in the United States, according the authors.

“Beyond just downplaying the catastrophic, doomsday aspects to their messages, educators may want to consider explaining issues in ways that make them easily digestible and understandable, with a clear emphasis on local, individual-level causes”

Another two studies found that participants who received complex information about energy sources trusted the government more than those who received simple information. “

Great story; shows the old formula of hard work, sacrifice, and persistence still hold true. The problem is the expectation of instant gratification, started with the baby boom generation and is getting progressively worse. It really is unfortunate because we are in dire need of reform, however, the current situation turned into a bug light for losers.

You made 35 dials per day and it took 13 hours? Let’s hope that is a typo and that you really meant 350 dials per day. Regardless…interesting viewpoint.

If anyone wants the real story of what happened and is happening at UC Davis, here is an article that will interest you

http://www.aim.org/aim-column/meals-toilets-and-marx-for-uc-davis-protesters/

http://www.zerohedge.com/news/hedge-fund-insider-explains-why-retail-investors-should-flee-stock-market

here is an alternative view….

If we really believe in free speech and openness and transparency we should seek out a non-financial services set of views.

Here’s what those “evil”, misguided, uninformed UC Berkeley OWS kids are doing. The Tea Party is shivering in its slippers and bathrobes. “News Dispatch, dateline, UC Berkeley: What’s really going on. (Video)” Pretty typical young person stuff. Ho hum.

http://neurologicalcorrelates.com/wordpress/2011/11/14/news-dispatch-dateline-uc-berkeley-whats-really-going-on-video/#comment-43276

“We are easily convinced by data.” There are interesting articles attached to this original post: http://reason.com/blog/2011/12/12/biggest-handouts-to-1-percent-are-social

“Biggest Handouts to 1 Percent Are Social Security and Medicare
Nick Gillespie | December 12, 2011

John Merline of Investors Business Daily has published a fascinating analysis of $10 billion the government annually gives to the dreaded 1 percent:

Using IRS data, IBD found that the top 1% of income earners claimed approximately $7 billion in Social Security benefits in 2009. That year, the program paid super-rich seniors — those with adjusted gross incomes exceeding $10 million — an average of $33,000 each.

Medicare, meanwhile, paid roughly $2.6 billion in health care subsidies for the richest 1% of enrollees, based on calculations using Medicare enrollment, overall Medicare spending and premium data. (Medicare does not track spending by enrollee income.) And if you consider that 5% of Medicare enrollees have more than $1 million in savings, the amount taxpayers spend to subsidize retiree health benefits skyrockets.

It gets worse from almost any conceivable perspective short of a French aristocrat before the Revolution:

The richest 1%, for example, claimed a total of about $400 million in jobless benefits in 2009. The reason for these billions in payments to the wealthy is that many federal transfer programs don’t have income limits on benefits.

“This is not an accidental loophole in the law,” Sen. Tom Coburn, R-Okla., noted. “To the contrary, this reverse Robin Hood-style of wealth distribution is an intentional effort to get all Americans bought into a system where everyone appears to benefit.” In November, Coburn issued a report focused on federal subsidies going to millionaires.

In addition to direct payments, the top 1% claimed about $31 million in tax credits for buying electric cars, $469 million in home energy credits, and $111 million in child care credits, according to IBD’s analysis of IRS tax return data….

“Shifts in the distribution of government transfer payments (since 1979) contributed to the increase in after-tax income inequality,” according to a recent study by the Congressional Budget Office. The rapid growth in Medicare, for example, “tended to shift more transfer income to middle- and upper-income households.”

The CBO also found that while the poorest fifth of households got 54% of federal transfer payments in 1979, they received just 36% in 2007. Several political leaders and policy groups have proposed changes to reduce federal payments to the super rich.

As you begin pondering the coming generational war and think about ways to create a safety net that isn’t just one entitlement program to folks who should be paying their own freight more fully, read the whole thing here.

And read this whole post from a month ago to get your Irish up on a chilly (in D.C. anyway) December Monday morn:

For centuries, wealth flowed from the old and relatively rich to the young and relatively poor. Nowadays, the direction has been reversed. Via FICA taxes, the young and relatively poor give money to the old and relatively wealthy (you not only make more money when you’re older, you’re sitting on all sorts of assets accrued over time). Every study of Medicare and other entitlements that are not particularly means-tested shows that we can’t have both a safety net and an entitlement system that sucks in huge amounts of cash and then gives it to people regardless of need. I think it would be a better world and a fairer world – and a richer world – if the government took in enough money to help the poor and indigent (whatever their age) and let the rest of us keep more of our money and make more of our choices for our futures.”