Entitlements?

[T-Dawg]

Should only the rich be required to sacrifice for the common good or should it be every citizen's responsibility?

People should "sacrifice" for the common good proportionally to how much they are able to sacrifice. This is more for the rich than it is for the poor, obviously. Of course, giving to the common good isn't sacrifice when everyone does it, since everyone benefits noticeably.

Should unproductive people be entitled to only receive things or should they be responsible as well?

What is "unproductive"? Those who choose not to work, or those who are not able to work?

I believe to those much is given much should be expected from them as well.

How is it that we agree on things like this, but not in policies designed to remedy the situation?

I don't believe in a society where much is expected and nothing is given in return, generation after generation. We have to break the cycle.

Quite. I don't understand the idea that people will voluntarily contribute nothing.

If all my basic needs where provided for, I would have no incentive to do anything and probably would not.

That sounds unlike you. Would you not want to better yourself as a human being, earn luxuries, gather the respect of your fellow citizens, etc?

 

[Alceste]

Alceste, I understand what you're saying - I'm just not buying your generalizations.

So much of this depends on WHERE you are trying to build your life. I can assure you that you could build a career, and buy a home in your thirties, in some other areas of North America - but you voluntarily choose to live in an area that has a very high cost of living and housing.

When I bought my first house - it cost about $75,000 and our income yearly was about $35,000.

My daughter and her husband make about $60,000 a year and they would be able to buy a comparable home around here for about $130,000 - and they'd be able to afford it - without my daughter even working.

Same general area (Ark La Tex) and similar jobs - just two decades apart.

This area has largely corrected itself when it comes to the housing market. It was inflated for awhile, but not extravagantly.

We had to hold off selling our other house for two years, because the market was so volatile and crazy. We ended up selling it for a profit, but that was because it was a near total redo, and we spent our money wisely on renovations.

We've made significant improvements in our current home, and just got the appraisal on it and we're right on target with our investment.

I'm feeling pretty good about the housing market myself. But then - I live in Texas.

So you look at that chart and see what, then? Nothing of significance for first time home buyers? That seems kind of hard to believe, frankly. We already moved due to being priced out of the UK housing market (including renting), even on TWO relatively high paid, full time public sector salaries. So your advice sounds ridiculous. I look at that graph and think - aaaaaaaaaah, that explains it. A few years ago I lived on one modest salary in a really nice little apartment, by myself and still saved enough for trips all around the world. Now housing costs twice as much, so that explains why those days are gone. You look at the graph and think, what, exactly? "I don't care about any economic facts, my generation is just better than yours and that's why we have more stuff"?

 

[Kathryn]

So you look at that chart and see what, then? Nothing of significance for first time home buyers? That seems kind of hard to believe, frankly. We already moved due to being priced out of the UK housing market (including renting), even on TWO relatively high paid, full time public sector salaries. So your advice sounds ridiculous. I look at that graph and think - aaaaaaaaaah, that explains it. A few years ago I lived on one modest salary in a really nice little apartment, by myself and still saved enough for trips all around the world. Now housing costs twice as much, so that explains why those days are gone. You look at the graph and think, what, exactly? "I don't care about any economic facts, my generation is just better than yours and that's why we have more stuff"?

Hey, guess what - we can't afford a house in the UK either. We would LOVE to live in Germany, but we can't afford to buy a decent home there either.

Conversely - we could buy a freaking MANSION in Mexico or South Africa, but we don't want to live there badly enough either.

I watch housing shows like "House Hunters" and "House Hunters International" and I'm always amazed at the disparity in housing prices depending on where one is shopping for a home. Next time you get a chance, try to catch one where they're showing homes in the Dallas or Austin, Texas areas - you'll see what I mean about housing prices.

No, wait - let me give you a link to a local real estate source:
Tyler, TX Homes for Sale :: RE/MAX Professionals - The Burks Team

Here's one:

1822 square feet, 3 bdrms, 2 baths, two living areas, 12 years old, $117,500.

Not too shabby!

It boils down to WHERE you live - you honestly can't see that?

As for your weird statement at the end of your post - those are your words, definitely not mine. My own children and the decisions they are making proves to me that your generation has tons of potential, and I have great hopes for all of you.

 

[Kathryn]

Wow, and this one is only $97,500!

13706 Mark Dr, Tyler, TX 75709 :: RE/MAX Professionals - The Burks Team

You don't think you could ever afford this home? If your credit is decent you could get a 30 year mortgage at about 4 percent interest right about now.

 

[Alceste]

Hey, guess what - we can't afford a house in the UK either. We would LOVE to live in Germany, but we can't afford to buy a decent home there either.

Conversely - we could buy a freaking MANSION in Mexico or South Africa, but we don't want to live there badly enough either

It boils down to WHERE you live - you honestly can't see that?

As for your weird statement at the end of your post - those are your words, definitely not mine. My own children and the decisions they are making proves to me that your generation has tons of potential, and I have great hopes for all of you.

OK, well perhaps you couldn't afford a house in Canada either then, because we sure can't. Canada's property prices have exploded similarly to what you see in the US graph, but there has been no market correction. In EVERY Canadian city, property prices are still going up.

As I have repeatedly stated, we DID move. Not once, but twice. We moved from the UK to Calgary, where white collar jobs are a dime a dozen and I used to be able to rent the main floor of a house for about 30% of my income, only to discover that rents had doubled or tripled over the last few years but average wages had not increased. So we moved again. Now we are where we want to be, property prices in the community where we want to live are relatively low compared to the national average and there are additional advantages such as a long growing season for growing our own food, which will cut down on our expenses. But guess what? Even here, property prices are almost double what they ought to be because we are at the peak of a massive national property bubble. (see graph).

Again, when you look at that graph, what do you see? Thinking back to your 30s and how hard it was to get into that first, half-price home you lucked into, would it be possible for us to follow in your footsteps? Would it be smart to buy property at the very peak of an obvious property speculation bubble? Considering that the cost of housing anywhere would be about 60% of our combined income, is it unreasonable that we've chosen to use our resources to start a business while living rent free with (a very grateful) grandma rather than trying to climb on the property speculation gerbil wheel?

 

[Alceste]

Here is what $100,000 gets you in our neck of the woods:

Just the trailer, mind you, not the property. That is leased.

Now I'm not saying I would refuse to live there. On the contrary, I would be happy to live there - it looks lovely. I am only saying I don't believe it is WORTH $100,000. If I bought it (and perhaps I could), I strongly believe - judging by reliable information like the graph I posted - that half that "value" would be going down the crapper within the next few years, and I would be on the hook for it.

And no, I don't want to live in the US. What if I got sick?

 

[Kathryn]

OK, well perhaps you couldn't afford a house in Canada either then, because we sure can't. Canada's property prices have exploded similarly to what you see in the US graph, but there has been no market correction. In EVERY Canadian city, property prices are still going up.

As I have repeatedly stated, we DID move. Not once, but twice. We moved from the UK to Calgary, where I used to be able to rent the main floor of a house for about 30% of my income, only to discover that rents had doubled or tripled over the last few years but average wages had not increased. So we moved again. Now we are where we want to be, property prices in the community where we want to live are relatively low compared to the national average and there are additional advantages such as a long growing season for growing our own food, which will cut down on our expenses. But guess what? Even here, property prices are almost double what they ought to be because we are at the peak of a massive national property bubble. (see graph).

Again, when you look at that graph, what do you see? Thinking back to your 30s and how hard it was to get into that first, half-price home you lucked into, would it be possible for us to follow in your footsteps? Would it be smart to buy property at the very peak of an obvious property speculation bubble? Considering that the cost of housing anywhere would be about 60% of our combined income, is it unreasonable that we've chosen to use our resources to start a business while living rent free with (a very grateful) grandma rather than trying to climb on the property speculation gerbil wheel?

It's not ever smart to buy real estate at the peak of a market. But you've eloquently shown that it boils down to your life choices, which are determining whether or not you can buy a house.

I've never said that you should buy a house rather than invest in a business - that's totally your call - and your CHOICE. But don't blame others for your own choices.

You're investing in a business. I suppose that means that you believe it will be successful. If and when it is successful, you should be able to buy a house. That's, well, a pretty normal progression, I'd say.

My husband rented crappy apartments, moved home once, lived with friends, whatever, throughout most of his twenties. His first "house" was a mobile home that was in such bad shape he had to sink about $10,000 into it to even make it habitable. He lived there for several years saving money for a down payment on a "real" home.

He will be the first to tell you, and I'll second it, that he and I both lived paycheck to paycheck, in spite of owning a home, till we were about 40 - and intermittently afterwards. Who knows, you may "pass us" and be able to climb out of that rut earlier than we did.

I don't know what you're talking about when you call my first home a "half price home." At the time, and for the market, it was about 15 percent under market value due to a nasty divorce. But I didn't "get lucky" - I waited till a true bargain came along - and they will come along, if you're patient and in the right market. I had my financing lined out and I made a strong offer, which, frankly to my surprise, they took immediately.

 

[Alceste]

I don't know what you're talking about when you call my first home a "half price home."

Look again at this graph:

Maybe you don't understand what it shows? It is an inflation-adjusted measure of the cost of purchasing a home relative to the consumer price index. If you entered the housing market at any time before 2000, you only had to work half as hard then as I do now to get yourself into a house. Any bargain hunting you did is in addition to the statistical 50% "discount" you received on the price of your first home.

But at least I've finally wrung an admission out of you that it would be incredibly foolish to try to enter the housing market at the peak of a massive housing price bubble. So, let me repeat my original question: where should we live?

 

[Kathryn]

Look again at this graph:

Maybe you don't understand what it shows? It is an inflation-adjusted measure of the cost of purchasing a home relative to the consumer price index. If you entered the housing market at any time before 2000, you only had to work half as hard then as I do now to get yourself into a house. Any bargain hunting you did is in addition to the statistical 50% "discount" you received on the price of your first home.

The reason why I didn't buy this chart hook, line and sinker, is because it's TOO GENERALIZED. I thought I made this clear, but apparently not. I sold real estate for years - I know how to make sense of this chart.

I also provided you a real life and common example from the area in which I and my oldest daughter live. 20 years ago, in 1992, our household income was about $35,000 and we bought a 1 year old brick home, 1300 square feet, for about $70,000. Today, in the same general area, my daughter's family (income about $70,000) could buy the same house for under $135,000.

Check the ratios - they're nearly identical.

To be honest with you, I don't really care what the "national average" is. We're adults - we can choose where we live. You've made it abundantly clear that you can and will move for financial reasons and to meet financial goals.

But at least I've finally wrung an admission out of you that it would be incredibly foolish to try to enter the housing market at the peak of a massive housing price bubble. So, let me repeat my original question: where should we live?

"Wrung an admission out of me?" Wow, that's a stretch. The minute you asked the question, I gave you a direct answer (as usual). I would NEVER condone buying a house at the peak of a housing price bubble. That would be a foolish real estate decision, and I don't make or condone foolish real estate decisions.

As for where you should live - it doesn't always boil down to whether or not you can buy a house in the next five years. But you know that.

Live where you can best meet your short range and mid range financial goals. Have a plan. Do your research. Set your boundaries. If something you're doing isn't working, change your plan.

 

[Revoltingest]

Here is what $100,000 gets you in our neck of the woods:

Just the trailer, mind you, not the property. That is leased.

What part of Canada is this? Does it have frontage on Waikiki?

And no, I don't want to live in the US. What if I got sick?

You'd meet a few fellow Canadians at our hospitals.
http://www.freep.com/article/20090820/BUSINESS06/908200420/Canadians-visit-U-S-get-health-care

 

[Kathryn]

Here is what $100,000 gets you in our neck of the woods:

Just the trailer, mind you, not the property. That is leased.

Now I'm not saying I would refuse to live there. On the contrary, I would be happy to live there - it looks lovely. I am only saying I don't believe it is WORTH $100,000. If I bought it (and perhaps I could), I strongly believe - judging by reliable information like the graph I posted - that half that "value" would be going down the crapper within the next few years, and I would be on the hook for it.

And no, I don't want to live in the US. What if I got sick?

If the housing market of a certain area impedes your overall financial goals and plans, you should strongly consider moving. Otherwise, I guess you just need to deal with it and focus on other aspects of financial planning to hopefully reach your long term goals. For instance, my cousin lives in NYC - an area notorious for ridiculously priced housing. But he is an internationally renowned chef, and has decided that overall, living there is the best choice for his family financially. It wouldn't be for my husband and me, so we don't live there.

As for worrying about getting sick in the US - all I can tell you is that I've lived here most of my life and always - without exception - received excellent medical care, including several surgeries, one of which was major, and facial restoration after a serious auto accident.

I've experienced socialized medicine when living in Germany and I was quite underimpressed.

Not to say there's not much room for improvement in our medical system -it definitely needs an overhaul from a financial perspective. But my insurance has taken care of the bulk of my medical expenses every time.

I had surgery on my Achilles tendon last year and when I paid my portion of the bill at admission to the hospital, it was $27. My portion of the remainder of the bill (about $1500 overall) was easily taken care of by setting up small electronic payments which I paid out over about a year, interest free of course. This was easy for me to do because I have the money, but in the past when I didn't have the money, the medical system wrote off such small amounts and I didn't have to pay them at all. This is a common practice here.

Not meaning to side track the thread with medical system debates though.

 

[Magic Man]

Alceste - I am fifty years old. I am blessed to be able to quit my full time job because in the past three years, my husband has nearly tripled his income. All his decades of hard work have finally paid off.

If this hadn't happened (and rather unexpectedly, I might add), we'd both be putting our noses to the grindstone for at least 15 more years.

I'll repeat - I'm fifty years old. I've worked more than full time for over two decades, and prior to that, I stayed home to raise four kids till they were in school (eleven years of VERY hard work, as I've described).

OK, I don't want to hear any more from you then. You're retiring at 50, and you got to stay home to raise your kids for 11 years. When my wife and I start having kids hopefully next year, there is no way in hell she'll be able to stay home for more than a couple months after the baby is born. Even with our small house and relatively little luxuries (our cars are 4 and 5 years old), one of us simply couldn't support the whole family by ourselves. And we're 50% above the median household income in the country. In fact, our income puts us in the top 28% of households in the country.

There is almost no way we'll be retiring in our 50s, and that's even with both of us working full-time until then, making good financial decisions and me hopefully making damn good money within the next 10 years.

Yes, raising kids is very hard work, which is why it'll be extra hard for us who have to work full-time while doing it for their childhoods. You no longer get to criticize the current generation, considering how good you've had it. I know had some rough times where you didn't have much money, but if you were able to stay home to raise kids for 11 years, you had it pretty damn good, by my standards.

Life is good. It was good before - but it's better now. And part of that satisfaction comes from knowing how hard and how long we've worked to get here.

You have not worked that hard. You've worked full-time for 20 years. Raising kids doesn't count. I've already worked full-time for 10 years. So, if I found a sugar mama, maybe I could retire in 10 years, too, but I wouldn't be bragging about how hard I worked when I retired at 40.

 

[Reverend Rick]

OK, I don't want to hear any more from you then. You're retiring at 50, and you got to stay home to raise your kids for 11 years. When my wife and I start having kids hopefully next year, there is no way in hell she'll be able to stay home for more than a couple months after the baby is born. Even with our small house and relatively little luxuries (our cars are 4 and 5 years old), one of us simply couldn't support the whole family by ourselves. And we're 50% above the median household income in the country. In fact, our income puts us in the top 28% of households in the country.

There is almost no way we'll be retiring in our 50s, and that's even with both of us working full-time until then, making good financial decisions and me hopefully making damn good money within the next 10 years.

Yes, raising kids is very hard work, which is why it'll be extra hard for us who have to work full-time while doing it for their childhoods. You no longer get to criticize the current generation, considering how good you've had it. I know had some rough times where you didn't have much money, but if you were able to stay home to raise kids for 11 years, you had it pretty damn good, by my standards.



You have not worked that hard. You've worked full-time for 20 years. Raising kids doesn't count. I've already worked full-time for 10 years. So, if I found a sugar mama, maybe I could retire in 10 years, too, but I wouldn't be bragging about how hard I worked when I retired at 40.

You have only worked for ten years? You have way more than I had after 10 years of work. I drove 10 year old cars and did not even have a house yet.

It took me forever to get an education and even longer to start a business.

I had to risk my life working over seas as a contractor to get my business off the ground.

I think it is a little premature of you to compare your life to others who are older than you.

You may in your life time, become a sucessful business man and vote Republican one day in your own best interest.

 

[Magic Man]

When I bought my first house - it cost about $75,000 and our income yearly was about $35,000.

My daughter and her husband make about $60,000 a year and they would be able to buy a comparable home around here for about $130,000 - and they'd be able to afford it - without my daughter even working.

Great. I'm glad you live in a very cheap area. I could move to a cheaper area, too. I could probably have bought a similar home and be paying $200-300 less a month. And then, having to drive an extra 30 miles each way to work, I'd be spending an extra $140 a month on gas, and putting an extra 15,000 miles a year on my car. And if I move farther away than that, I wouldn't have support from my family and friends, especially in the next few years when we start having kids. So, you were lucky that you were able to get into an area that's cheap. I'm not that lucky.

 

[Magic Man]

You have only worked for ten years? You have way more than I had after 10 years of work. I drove 10 year old cars and did not even have a house yet.

I've worked for 17 years actually. I've only worked full-time for 10 years. My last car was 14 years old when I had to get rid of it last year. So, I bought a 4-year-old car. We just bought our house 2 years ago, when we were 29. You were 27 when you bought your first house. Nice try, though.

It took me forever to get an education

Me too, and my wife hasn't finished hers yet.

I think it is a little premature of you to compare your life to others who are older than you.

Maybe you should go back and actually read. I compared my life to Kathryn's because she put hers out there. She has no right to criticize anyone on these issues, after hearing her whole story.

You may in your life time, become a sucessful business man and vote Republican one day in your own best interest.

I don't want to be a successful businessman. I want to continue up the ladder in IT. But herein lies the difference. I don't want to vote in my best interest; I want to vote in the best interests of the country. That seems to be the big difference between conservatives like you and people like me.

 

[Reverend Rick]

That seems to be the big difference between conservatives like you and people like me.

Actually, we are more alike than you would care to admit. You believe government is the solution to everything where I try to fix social woes using the private sector.

I figure every dollar I keep out of the governments hands, the more I have to give to others. I believe private dollars go further to help folks than wasteful federal ones.

I like to get my hands dirty and become involved, where you seem to like to step back and let others handle things for you.

I believe we genuinely both care, but we have different solutions to the same problems.

 

[Magic Man]

Actually, we are more alike than you would care to admit.

No, I have always readily admitted that we're very much alike. That's why there are just small key differences. If we could focus on starting with what we have in common, things would be a lot easier.

You believe government is the solution to everything where I try to fix social woes using the private sector.

Incorrect. I believe the government is there to do certain things that only a government can, and do certain other things that a government can do better than the private sector. You believe that some things that are best left to government would be better off in the hands of the private sector.

I figure every dollar I keep out of the governments hands, the more I have to give to others. I believe private dollars go further to help folks than wasteful federal ones.

I'm glad you believe that. It's just too bad that belief is not based in reality.

I like to get my hands dirty and become involved, where you seem to like to step back and let others handle things for you.

Nope. Your main problem is your ability to look past reality to get to a place where you're better than others and where you don't have to let facts cloud your view of things.

I give to charity too. If I thought there was any possible chance private charities could replace welfare and unemployment, I'd consider the option. Since I know from my dealings with reality that that's a ridiculous idea, and that the government is needed to provide the safety net in such cases, I dismiss it. That doesn't mean I don't like to help out by helping charities. It just means I realize that the government is the only realistic way to go to actually deal with poverty.

I believe we genuinely both care, but we have different solutions to the same problems.

This is true. And my solutions are based on historically verifiable facts. Yours are based on an unsupported ideology.

 

[dust1n]

You'd meet a few fellow Canadians at our hospitals.
Canadians visit U.S. to get health care | Detroit Free Press | freep.com

Wow... so even when Canada can't outright perform a very specific and difficult surgery, they still pay for you to go to America.

 

[work in progress]

If the federal state fails at letting others enjoy the benefits of their exists and gain access to a fair and reasonable livelihood, than those others shouldn't be indebted to something that has not served them.

Considering the growing inequality in wealth and incomes, it's pretty brazen for an argument like "We ARe the 53%" to be tossed up as any sort of rebuttal. All the right talks about is federal income taxes. They don't mention the sales taxes, gas taxes and fees that serve as virtual flat taxes that do not affect the rich, but are a burden for low income earners trying to pay for food, rent and clothing.

And, needless to say, they are not going to talk about corporate taxes that so many major corporations haven't paid for years, and are demanding sharp reductions before they consider moving any of their billions back to the U.S. Maybe if a president with a backbone was looking for a new foreign military venture, it should be the Cayman Islands!

 

[work in progress]

Yes, that has been my point. When young people come to terms with the fact they may never be able to earn enough to buy property, what are they supposed to do with their wages? Everybody I know either got into a home at the very beginning of the current boom by buying in their VERY early 20s using downpayments donated by their parents, or they live in a rented house with a bunch of fully employed room-mates, or they live with their parents.

I'm afraid to say that unless you become the next reality TV star, the odds are stacked against you or any of your generation achieving the same level of comfort as your parent's generation. It's a simple fact that we are heading into a situation worldwide where capitalism isn't going to help us, and will in fact lead to an uglier more violent outcome. I say this because the modern capitalist system, based on debt-driven currencies, cannot function without continuous economic growth; and we are reaching a time where the natural economy is serving as a constraint on the hopes and wishes of economic theory.

There will be no Chicago-School or Keynsian fix for a steady decliine of cheap energy sources; a decline in agricultural production; and declines in both renewable and non-renewable resources. The longer this dreamworld of trying to fix the economy by using the same tired old tactics continues, the worse the end result will be. If there is hope -- it will come from a widespread realization of the scope of these problems, and the need for longterm solutions instead of short-term economic fixes.