Month: November 2013

This week’s book learning is part 9 of a 12 part series on The Ascent of Money by Niall Ferguson. (Parts 1, 2, 3, 4, 5, 6, 7, 8)

University of Chicago professor and Nobel prize winning Economist Milton Friedman set out to solve the welfare state problem. Milton Friedman was called to consult the Chilean government as their social system had gone bankrupt.

(Interestingly, the Chile connection was thanks to the fact that one of Chile’s leading universities had an exchange program with the University of Chicago. Thus, many of the leading finance and economic ministers in Chile were Prof Friedman’s students)

Friedman and team worked with Jose Pinera, a Chilean student at Harvard, to work with Pinera’s view that the welfare state had replaced thrift with entitlement. So, they did the following –

– They offered workers in Chile an opt out of the state welfare system and had employers contribute payroll tax to a personal retirement fund managed privately
– By 1990, more than 70% of the population were on the private system – a huge success as the government deficit reduced massively leading to a stable democracy!
– The new savings were invested back into the economy developed at impressive rates. The poverty rate decreased to 15% versus 40% in the rest of Latin America
– The downside has been that the unemployed don’t have any pension. The government, however, uses it’s surplus to take care of the unemployed

This was an example of a huge gamble that did pay off and many nations have attempted to copy the Chilean example with varying results depending on the government’s corruption levels and resolve.

Sketch by EB

The implications for a country like the US is that reform will come (whether liked or not) as only 1 out of 6 Americans can afford health insurance. This is made worse when you add an ageing population with higher life expectancy to the mix. No country, however, is worse off than Japan – 75% of its tax earnings goes into funding welfare. A long life, after all, is good for an individual but a curse for a welfare system. Welfare systems are near impossible to sustain but unfortunately, are great vote-getters…

Wish you a happy weekend and happy week!

A love anecdote from “The War of Art” by Steven Pressfield –

Someone once asked Somerset Maughham if he wrote on a schedule or only when struck by inspiration. “I write only when inspiration strikes,” he replied. “Fortunately it strikes every morning at nine o’clock sharp.”

I may not have bought this idea 6 years ago but boy, is he on the button. Inspiration does strike when I open up my Windows Live Writer and stare at an empty headline. On most days, I have a 10 or 15 minute window for inspiration to strike so I can get ready to get to work on time. On days when I know I may not have the time in the morning, I open up Windows Live Writer the previous night and inspiration doesn’t disappoint. I have also trained myself to type out an idea onto my phone every time inspiration strikes during the day. These days, I find it strikes multiple times in a day and the morning involves picking the best one/the one I feel most strongly about.

It’s amazing how ideas work – you learn how to treat one well and very soon, you have a dozen. These ideas lead to inspiration – give it some space in your day and it’ll amaze you. Try it. Do it.

Once we secured admission into university in Singapore, the final step involved receiving the IPA letter – a temporary stand in from the immigration authority for a student visa. This was July 2006 and I was impatiently waiting for the IPA letter to show up in time for the scheduled departure. It didn’t.

I was upset. I kicked up a fuss. I was going a couple of days later and missing out. It was the high and low that accompanied excitement. The high of traveling to a new place for a new life with friends had just crashed. I did get there a couple of days later and of course, I didn’t miss anything of consequence. In every way, the two day delay didn’t make a difference. It had just messed with the plans in my mind.

Such delays are just part and parcel of life. We make many plans. Some just don’t work. Some work with delays. Some work on time and some happen sooner than expected. We’d like them to happen exactly as per our plan, of course, but then life happens.

My learning is that these delays and advancements don’t matter in the big scheme of things. I described the effects of a mere 2 day delay but have since faced many others. Of late, I’ve been dealing with plans delayed or advanced by up to a year! And you know what? Things work out just fine.

Don’t take the script in your head too seriously. Plan and prepare but also be ready to improvize. The only certainty is that things will change; your happiness with the change is never guaranteed. But then again, you don’t know when a good day is a good day..

My inbox had an email I didn’t really want from Goodreads. Cue: Ignore.

A few seconds later, I noticed that my inbox had an email I didn’t really want from StumbleUpon. Cue: Unsubscribe and see if I wanted to deactivate the account. I didn’t deactivate it. I figured I’d never really given StumbleUpon a shot and I might change my mind. As long as I didn’t get any emails from them, I was okay.

I hate Windows updates. I don’t mind Apple updates. Why?

In two words, love and trust.

I like Goodreads (love is too strong a word for our relationship for now). I don’t know or trust StumbleUpon. While I like Windows (yes yes, I know..), I do not trust their updates as they’ve messed my computer up multiple times. Apple, on the other hand, has proved itself trustworthy with app updates.

The problem here isn’t the individual update or email of course. It’s all about the trust and love these brands have built.

This gets interesting when we apply it to ourselves. What sort of brands have we built? How do people react when they see emails and messages from us? Food for thought.

The challenge – finding the balance between being hard enough on yourself so you take constructive action and not being so hard that you just feel paralyzed and thus do nothing. Awareness helps. So, check in on yourself when you find yourself beating yourself up. We respond okay to a harsh word but not to a verbal volley of abuses.

It is one of the toughest tight rope walks in that most amazing of balancing acts we call life.

If it is of any consolation, life is all about the balancing.. not about being balanced.

Out of every 20 experiences in our life, it is likely that there are 19 process experiences and 1 result experience.

Remember that year you spent trying to get into that university or to make that big project work? I’m sure you remember that moment of glory. But the amount of time you spent savouring the win barely compares the amount of time you spent to make it happen. Besides, if you tasted that one win, your mind probably began thinking about the next.

Results – big and small – matter. They give us confidence if we win, encourage us to reflect if we lose, and keep us focused either way. They’re only a miniscule part of the life experience though. If it weren’t for the fact that result experiences leave strong memories, they’d not even be in consideration. We might look back at our lives and tend to only see the highs and lows that these results have brought us… but our life experience is a different matter.

How we live our life every day, whether we wait for happiness to come to us or whether we hone our happiness skill, how we react to life’s small frustrations and annoyances, how do we treat people, and if we express our love, care, and gratitude, i.e., the small stuff. It’s the small stuff that moves the happiness needle. Sweat the small stuff.

It’s the journey that makes the destination worthwhile.

PS: The best results rarely follow a bad process anyway.

The best relationships work when you bring together people who are comfortable by themselves. If they don’t work well by themselves, the chances that the overall result of the team is better than the individual parts is low.

If your relationship isn’t a win-win, someone is losing energy and positive vibes. If that is you, this can work out okay for a short time but eventually, you’re better off moving on.

Look at your key relationships – both professional and personal – and ask yourself if the products are better than the sum of the parts. If they aren’t, spend time fixing them.

And if they are, treasure them.

This week’s book learning is part 8 of a 12 part series on The Ascent of Money by Niall Ferguson. (Parts 1, 2, 3, 4, 5, 6, 7)

The concept of the welfare state was pioneered in Germany by Otto van Bismarck thanks to 2 beliefs-
1) A man with a pension is easier to deal with
2) A person embracing the welfare state idea is the one that would come to power (more people are poor than rich and thus, there would be more votes for socialist moves)

Following World War 1, more and more states began nationalizing industry et al to cushion effects for people but none took it as far as Japan.

Japan initial went the way of the warfare state. But, after World War II, it set upon being the welfare state where every citizen was taken care of by all sorts of coverage thanks to the government nationalizing insurance, medical, and pharmaceutical industries. Until 1970, this worked really well as the economy was predicted to overtake the US by 2000 and other countries like Britain decided to follow suit. But, things began to fall apart since..

Sketch by EB

Interestingly, what worked well in Japan in the 30 years post World War II didn’t work anywhere as well in Britain. Unlike Japan, the society wasn’t built on norms of social conformity leading to more people gaming the system and viewing welfare as social hand-outs.

So, what was the issue with the welfare state concept? How do you structure a welfare system? Coming up next week..

We have 6 basic emotions – anger, disgust, fear, happiness, sadness, and surprise. Every other emotion is a mix of these 6 in various degrees. The implication, in my eyes, is that negative emotions that we feel are hardly ever new. And if they aren’t new, it should get progressively easier for us to deal with them once we learn to identify them. How do we that? It starts with stepping outside of ourselves every time we feel negative and labelling the feeling. Once we get good at identifying feelings, dealing with them becomes easier.

I was experimenting with this approach this morning as I was dealing with a feeling I describe as “feeling unsettled.” This feeling is probably a mix of anger (20%), fear (50%), and sadness (30%). A wiser friend pointed the symptoms of this 12 months back and I am getting pretty good at identifying the symptoms of this feeling – I feel tired, irritated, impatient, and less positive/hopeful all at once. As you can imagine, I’m not fun to be around when this happens. Of late, I’ve been getting better at responding to this feeling by doing a few things that seem to help. So, as I was thinking about it as an idea for today’s post, I was led to the question – why do I feel unsettled? I realize it is because I feel disconnected, disorganized, and disenchanted with progress on things that matter most to me.

Before we examine these one by one, let me also call out food and sleep as basics that need to be gotten right first. The two of these are top priority and my first reaction when I feel unsettled is to get as much sleep as I need while also trying to make sure I get some comfort food/food I like. I love my comfort food! Over to the 3 factors next.

Disconnected. This is a feeling of disconnect from people I care about and from myself. This is one of the big reasons I feel unsettled most when I’m traveling on work as I’m away from framily (family + close friends) and often get too busy to sit down and spend time with myself. Aside from enjoying downtime and staying in close touch with those I care about, I carry photos of framily  when I travel and set them up wherever I stay. This helps a lot.

So, this morning for instance, the actions that helped were a couple of catch up calls followed by a set up all these photos.

Disorganized. A clean work desk and home are critical to a clean mind in my case. So, cleaning is a natural next step when I’m feeling unsettled.

Disenchanted with progress on important things. This is why the fear component of feeling unsettled is at 50%. There’s a trigger to fear and insecurities inside at whether I’m making any progress at all on the stuff that matters. As a result, there are a couple of natural next steps – make a list of things to do (part of getting organized), knock off the quick wins and then start hitting the big ticket items.

This is probably the most important factor that needs fixing but doesn’t happen if I don’t go about fixing the first two.

(And yes, I did pick “disenchanted” to keep consistent with the other two “dis” words)

Fixing this feeling isn’t a 10 minute job. Going through this process when I feel unsettled often takes many hours but it’s a worthwhile investment because the effects of not doing the right things can result in a vicious cycle of unproductivity, irritation, and unhappiness.

The other nice side effect that comes out fixing it is that it is often followed by a period of high productivity and happiness. Dealing with the negative feeling allows me to focus on what needs to be done and the irritation that was a part of the negativity suddenly transforms into the sort of positive stress that helps me focus and get stuff done.

Every coin has two sides. In the case of negative emotions like this one, we just have to remember that we don’t have to sit down and take the outcome of the coin flip. We can always pick up the coin and keep tossing till we find the side that suits us. We can make our own luck..