More Opinion by The Springboard

THE UPRISING OF THE AMERICAN PARTY "Clearly the voters are engaged right now, at least for sure on the republican side, and what they have concluded is that the republican party has not done their job. Thus, Donald Trump gets their vote."

Sunday, November 18, 2012

Tax the Rich?

It's an idea that looks great on paper, and certainly the masses enjoy the idea of taking money out of the pockets of the rich. While the vote in the recent reelection for President Barack Obama was not a clear mandate for higher taxes, the Obama administration is definitely interested in continuing its pursuit of diminishing the wealth of the most wealthy people in the country. In fact, he recently announced that he wants to raise $1.6 trillion in new tax revenues, which is double the amount he originally said he wanted.

The question is who ultimately pays the tax? I think the answer is very clear. It's not the rich.

In order to understand how taxes affect everyone and not just the rich, one has to keep in mind what businesses do when they have to incur higher costs to run their businesses. Higher taxes are costs.

While it is not a direct comparison, I can use my rental property as an example of what happens when the cost of owning and operating that property increases. As a part of the rent I offer my tenants "free" heat. I put the word free in parenthesis because whether or not the heat is truly free is a bit of sleight of hand, is it not? So long as my rental property produces cash flow, the actual cost of the heat is being paid by the tenant. So, what happens when the cost of my heat bill goes up? Of course this cost is ultimately passed on to the tenant in the form of higher rent.

The same applies to the cost to insure my property, or the cost of repairs to the property. You can also apply this to higher costs incurred through higher property taxes. All of these costs are ultimately passed on to the tenant in the form of higher rent as well. Perhaps the costs are not immediately passed on. But at some point they must be, otherwise I have no reason to own the property.

I've made the point before that businesses do not pay their overhead. In fact, they recoup their overhead.

In addition, it's important to note that any money that the government collects from the private sector are essentially removed from the real economy. I've heard many people on the left argue that dollars collected in tax revenues are simply spent by the government, and that those monies ultimately wind up in the economy as a whole inevitably.

The problem with this thinking is that it is not exactly true. Consider that much of the dollars that the government collects must go to repaying debts and interest we owe on those debts. That means that a lot of the money goes to other governments we've borrowed money from—China would be one of the larger ones. We also spend hundreds of billions of dollars a year in foreign aid. Again, that money does not necessarily return to our own economy. The money essentially just disappears.

At the end of the day higher taxes on the rich and on businesses means less money will be spent on investing in new company startups. It means less money will be spent on research and development, and on capital expenditures. It means less money will be available to hire more workers, or provide pay raises. It means less money will be available to pay, for example, certain benefits like healthcare for their workers. It means less money will be available to make matching contributions to their worker's 401k plans. It means less money will be spent on marketing that helps their businesses to grow.

And let's not forget the first example I made about investment. Less money will be in the real economy for people to help companies obtain the funds they need to expand the business. All of this leads to higher unemployment, less job creation, and higher prices for all of the goods and services that the middle class, and the poor buy.

When it comes to taxes, people really need to see the forest for the trees. Sticking it to the rich is sticking it to ourselves, and there really is no way of getting around that. If President Obama does not cut spending, and reduce taxes across the board, the people who will be hit the hardest are the very people who he says he wants to help.

Saturday, May 12, 2012

Protesting A Smoke Shop In Milwaukee?

I find myself a little perplexed why someone would want to protest a smoke shop opening? But that's exactly what happens to be planned by Alderman Joe Davis and State Senator Lena Taylor in Milwaukee today. According to Davis, he says that residents are concerned over the growing number of tobacco outlets in the neighborhood. In a statement he also said, "This application will not only change the use of the building, but will also change the environment of the surrounding community." The proposed establishment is home to what was formerly a fast food restaurant.

I have to admit I'm not sure exactly what Davis means. A smoke shop may not be the most desired use of the building. But does he mean to say that a smoke shop, as opposed to a fast food restaurant, would bring in an undesirable element? How exactly does a smoke shop change the environment and the surrounding community? And does opening a smoke shop encourage people to light up?

I think this happens to be just another clear example of our government officials having too much time on their hands. The city of Milwaukee has myriad issues that need to be dealt with such as high levels of unemployment, high crime, and high poverty, yet we spend time protesting a smoke shop? Granted, a smoke shop won't create as many jobs as perhaps may have been created by reusing the building for serving food or some other purpose. But that's not the point. The point is that to my mind the building is probably vacant. Being located at N. 76th St. it's not in the best of neighborhoods. A smoke shop going in is still better than having a vacant building. And again, with so many problems of greater impact facing the city of Milwaukee, this is simply a non-issue if there ever was one.

Might I only point out that there are also a high number of payday loan stores in this neighborhood, and no one seems to want to tackle that issue. Payday loans are probably more damaging to people who use them than anything that smoke shop is going to be selling

Sunday, March 25, 2012

The Trayvon Martin Murder Is Tragic, But Isolated

Let's be clear that the Trayvon Martin shooting is a tragedy. But let's also be clear that it is largely an isolated incident, and a crime fueled by one man's deranged view of the world. I think we can look at many statistics that would show that white on black crime is far from an epidemic. What the big problem is, looking at the bigger picture, is black on black crime. Far more black people kill black people than white people do. So why then is this case the one that President Obama wishes to speak out on? Beyond that, where are the Jesse Jacksons and Al Sharptons of the world when black on black crime is commited?

Come to think of it, has Barack Obama ever really touched on this subject of black on black violence? Has he ever made non-racially motivated violence an issue?

I happen to think that President Obama bringing up this case is inappropriate and divisive and serves only to create racial tension. It serves to breathe new life into a problem that really does not exist to the extent that people like President Obama, Jesse Jackson, and Al Sharpton wish to infer.

There is a thought that President Obama chose to talk on this case because he wishes to also infer some correlation between how he is viewed as president, and to suggest that some of his lagging poll numbers may have more to do with racial motivation than his actual performance as president.

I feel for Trayvon Martin and his family. I think he died without cause or reason, and any time that happens, whether you happen be black or white, or irrespective of what color the person was who was holding the gun, it is always at least a senseless tragedy. I think that George Zimmerman should be prosecuted to the full extent of the law. But I also happen to think that if we are going to single out cases like this one, we should also be looking at the much bigger picture. We need to be looking at the much bigger reality that more black people are killing each other than white people are killing black people. This fact should be far more outrageous than the Trayvon Martin case. If the president wants to talk about senseless killing, he should start with the real issue instead of making it seem as though racially motivated murder is the bigger problem.

Tuesday, February 28, 2012

Ohio School Shooter Was Bullied

According to most reports on the recent Ohio school shooting incident the shooter, T.J. Lane, was considered to be an outcast and was bullied. In most of these school shooting cases that seems to be an underlying theme. Many might suggest that these kids that wind up walking into schools with guns intent on killing people are misguided psychopaths. I take a slightly different view on this. I think they just snap.

Kids can be cruel, and while in no way am I suggesting that any level of cruelty ultimately justifies anyone being killed, I also happen to think that school officials need to look a little deeper into these kinds of problems. In fact, I think that schools should actually make cases like this a part of the curriculum. Just like many employers hold training on issues like sexual harrassment in the workplace, I think schools should at least heighten the awareness of bullying, its effects on the person being bullied, and the potential dangers bullying could pose if someone wakes up one morning and simply decides he's had enough.

Kids don't do much thinking about what they do and how what they do affects others. That much is clear. They also see life as being infinitely solid. How many times do we hear about kids being killed in high speed car crashes every year? And why? Because they don't believe they can die.

These cases are few and far between. And I should point out that most kids that are bullied don't walk into schools with guns. I also am not naive enough to believe that we can stop all bullying even if we add something into the curriculum. But to do nothing and pretend like it's not a problem, and to simply take the idea that 'this is just kids being kids' leads us down an ever dangerous path.

Monday, February 20, 2012

Walgreens Erring on the Side of Caution Could Boost Competitors Bottom Lines

By all accounts it seems certain that the relationship between Express Scripts and Walgreens is done, and while I sympathise with Walgreen's concern that Express Scripts is undercutting them, I also believe that their decision to part ways with the company could give an edge to growing competition in the pharmacy retail sector. This edge would most notably go to rival CVS, which has been adding stores and beefing up advertising lately.

Walgreens tends to make light of the situation, saying that longer term implications if they'd have decided to accept Express Script's market proposal "would have been far worse than the short term impact on earnings." Still, Express Scripts accounts for nearly 10% of the 819 million prescriptions Walgreens fills on an annual basis. According to most analysts that will shave off about $5 billion in annual revenue from their bottom line. The question is, does that figure only account for the money they'd have earned filling the 80 million prescriptions—what about the losses from potential other retail sales which typically occur as people waiting for their prescriptions browse the aisles, and ultimately buy stuff?

I will say that I applaud Walgreens for at least standing firm in favor of their interests. While losing 10% of a big part of your business can't, in my view, ultimately be good for business, neither is sending a message to other pharmacy benefit managers that Walgreens is open to being strongarmed in order to keep customers.

A deal could still be hammered out. That's true. But the thing is that this tussle between the largest pharmacy retail operator and one of the largest pharmacy benefit managers in the U.S., whose largest client also happens to be the Department of Defense's TRICARE program gives time for Express Scripts to weigh in on how much of an impact on their business they will have without Walgreens in the picture. This time and assessment of impact could either benefit Walgreens, or Express Scripts. Other pharmacy retailers have been clamoring for a chunk of the 80 million prescriptions Walgreens won't currently fill, and CVS stands to gain at least around 20 million of those—a lucky opportunity for them as this could add around $200 million a year to their bottom line.

There is also the question of what impact a merger between Express Scripts and Medco Health Solutions might have, providing the FTC approves it? Walgreens CEO Gregory Wasson has already said that he would not do business with the combined companies.

It's really a wait and see game. Ultimately I think CVS stands to gain the most from this back and forth. Getting market share is all about getting people to switch to your product or service, and Walgreens just essentially handed 10% of their prescriptions business to their many competitors. I think Walgreens should hold its ground. But it should also be careful not to become the next Sears or Kmart when business for pharmacy retail really gets ramped up as more and more baby boomers over the next 15 years or so start getting prescribed more medications, and seek out providers to get them filled.

Even more interesting is that CVS over the last 4 quarters far outdid Walgrens producing better than 3 times the cash than Walgreens did over the same period. In fact, it took in more than $1 billion more than Walgreens did. That means CVS will have more cash to work with to fuel its store improvements, ramp up advertising, repurchase shares and increase dividend payouts to shareholders, and add stores. All feats which could further erode market share for Walgreens. To my mind, that's quite an edge that just gets better if Express Scripts and Walgreens stay on the wrong side of each other.

Sunday, February 19, 2012

Winning the Lottery: The Dream of the Big Win

Why bother to play when the odds are so stacked against you?

Looking at the odds of actually winning the lottery, many people simply say, "Why bother?" But unlike gambling in say, a casino, the amount of money one actually would spend just playing the lottery for a lifetime, for a chance at a huge and life changing payout, is really just pennies on the dollar.

Who wants to win?

The real question may be, who doesn't?

There are very few people I've run into in life who wouldn't want a chance at winning it big in the lottery. All things considered, the fact that nearly every state has at least one lottery, and all lotteries rake in billions of dollars each and every year, you can quickly assume that quite a lot of people play. Where else could one spend just one dollar and have the potential to forever alter one's life? And honestly, who could pass an opportunity like that up? It's of course the dream of the big win that draws us into playing as we envision days spent on mile-long yachts, enjoying what most would call the 'good life,' fat Cuban cigars jutting from our mouths, blowing smoke dollar signs instead of the more familiar 'O's.' If we could just win the lottery, we'd be able to go anywhere we wanted to, do just about anything, and buy whatever our heart's desired without so much as a second glance at a price tag.

Granted, when we think of what is the American dream, winning the lottery surely doesn't top the list. Probably because of the odds. And certainly there are many more sure-fire ways to hit it big—starting a successful business for example, or making a stock pick the likes of IBM or Microsoft, or Google for that matter. But certainly at least thinking about a big lottery payout is on the list.

And certainly the choices of which ones to play abound. Like I said, nearly every state has at least one lottery game, and most states have multiple ways to play. And of course many states participate in the multi-state lotteries like the Powerball and Mega-Millions, which by the way also offer the biggest payouts. The Powerball infact recently upped the ante when it changed to the $2 ticket, and the pot grows much more quickly now when someone doesn't win. If Powerball has a long run without a payout, the jackpot amount could certainly shatter any records set by any lottery before, so it will be something interesting to watch.

It's such a simple idea

That is, despite the odds of course. I'll readily admit that the odds are horribly stacked against you. The likelihood that any one of us reading this right now will ever be among the winner's circle when it comes to a big lottery payout is slim to none. But it is a very simple concept. Shell out a mere buck for a chance, however slim that chance, at raking in enough money to forever change one's life. I said before, you'd likely have a better chance at starting a successful business, or picking a great stock that takes off like gangbusters—still, doing these things takes quite a lot more money to do it. Even if you did get lucky, for example, and bought into Google right after its initial public offering, and held on to it through its stellar rise in value, unless you plunked down a sizeable chunk of money, and were willing to wait it out for a long period of time, you probably would have made a nice return. But even that may not have launched you smack-dab into the league of millionaires.

When you play the lottery you have to forget about how bad the odds are. It's as simple as that. You should have the same rule when you play the lottery as when you walk into a casino. Not a single casino has ever been built on winners, and the most likely scenario is that when you walk out of the casino, your wallet will be lighter than it was when you walked into it. When you play the lottery, you are probably going to wind up at least forfeiting your dollar.

So, what do you really have to lose?

I said before that there have been very few people I've run into who wouldn't want a chance at winning it big in the lottery. And while it is true that many people do play, a lot of people do not. How many times have I heard someone tell me, "You're wasting your time and your money. You'll never win." Of course, the people that tell me this are right. I probably won't. Still, even considering the improbability of the odds is $1, or even $2 to play the new Powerball, really all that high a price to pay for just the chance? Powerball starts off at $40 million. And lotteries have reached amounts as high as $300 million. That's no small change to say the least.

So, what do you really have to lose? I say practically nothing. Consider for a moment that even if you never won a single red cent playing any of the lotteries—not even a single dollar—over the course of a lifetime of playing, the actual amount you'd lose would be insignificant at best.

Let's say that a lifetime of playing the lottery is 50 years. I mean, let's say you play the lottery week after week, religiously, for the sum of 50 years and you never win so much as a dime. Hey, admittedly that's probably more possible than winning the big one. For those of you who don't ever play the lottery, lotteries typically have two drawings per week. For Powerball those drawings are held every Wednesday and Saturday. For Mega-Millions it's every Tuesday and Friday. My own state's lottery holds its drawings on the same schedule as the Powerball. So basically, the cost of playing religiously week after week would only be $2 or $4 depending on which one you are playing. When you do the math that's 2,600 weeks in 50 years, or anywhere from $5,200-$10,400 in a lifetime of playing the off-chance that you might actually win the big one.

Gosh, these really are some terrible odds

It's sort of funny when you really break down the odds. Flipping to the other side of my Powerball ticket, one of the older ones before the $2 change in price, it told me that my odds of winning the big lottery payout was 1 in 195,249,054. Doing a little research, I learned that I have a much better chance of being struck by lightining TWICE in my lifetime. My odds of having that happen to me is 1 in 9million. Putting it into further context, this means I'd more likely be struck by lightning 43 times than win the lottery jackpot once in my lifetime.

Let's hope the former doesn't happen. Winning the lottery sure sounds like a lot more fun than being struck by lightning even once, and truth is, I have absolutely no interest whatsoever on experiencing the equivalent effects of global warming all by myself anytime soon. Of course, if I were to be struck 43 times in my lifetime, which chances are better than winning the lottery, I certainly would become a bit of a scientific phenomenon, and that could likely payoff pretty good as well—assuming I could survive that many strikes...

Still!

What I say is this. Being ever realistic you probably will never get the big lottery payout. But isn't it still worth the $2 or $4 a week to at least have the chance? Again, and I hate to sound like a dead horse, without question it's probably a total waste of money. But I can think of a gazillion other things most people waste their money on, in far greater number, than what they'd waste on the off-chance of winning the lottery. Somebody has to be that 1 in 195 million. That's the way it works. And it can only be you if you have a ticket in your hand. For that reason I'll gladly waste my money.

If nothing else, I can of course stay indoors during an electrical storm.


Monday, February 13, 2012

Obama Just Won't Give Up On Failed Policy

If I were to give President Obama credit for anything, I'd have to give him credit for being persistent. In a budget proposal he will propose today he still clings to this idea that taxing the rich is the way to go in order to get this economy moving forward at a faster pace. At the same time he says he wants to create jobs. But in that it's clear he doesn't understand the workings of the economy, and he is blind as a bat when it comes to history.

Raising taxes has never led to more revenues for the government's coiffures, and so far as I can tell, it has never led to job creation either. People, of course, like to point out that President Bush lowered taxes and look where it got us. But the fact of the matter is that it wasn't Bush's tax cuts that got us into the Great Recession, it was many years of failed policy by the Congress and bad decision making by the banks that did us in. And I've argued that it was also caused by a false sense of security and wealth by many Americans fueled by a saturated, and overdone credit market, and a generation of people that had access to too much too soon thinking that the gravy train would just keep delivering the goods—a huge trade deficit and loss of manufacturing didn't help either, but that's for another day.

I have always held that a tax on the rich is a tax on the regular folks. Sure, it feels good for the little guy to think he's getting one over on the "fat cats" when they get stuck with the possibility of giving up more of their riches. But the reality is that all that happens when the rich get stuck is to pass on their costs—to you and I.

Take the fact that I own a duplex that I rent out. As a part of the deal I pay for the heat. In the tenant's eyes they are getting their heat for free. So taking that thinking into account, let's say that the heat I pay for is a tax I have to pay. The tenants can certainly, if they want to stick me with higher costs, turn up the heat if they want to. But the end result is simply that if my costs go up to run the duplex, I will invariably raise the rent to the tenant.

Who pays for the heat? They do.

And just like raising the cost of the heat I provide to my tenants ultimately raises the cost of their rent, so does raising taxes on the rich. As a result of higher taxes the rich and the corporations will simply reduce hiring, reduce benefits, raise the cost of the goods and services they sell in the marketplace, or they will simply pack their bags and open offices and factories in places where costs, and taxes are lower.

Oil is a very good example of this effect. Airlines have been adding fees to try to make up for higher fuel costs all the time.

There is only one good thing about the fact that Obama wants to continue forward with this disastrous idea, and that is that it will, like most of his policies have, fail miserably. The American people are watching. The smart ones get it. And contrary to popular belief, there are smart people on the left, and they get it too. This will solidify the need to oust this guy from office and put someone else in his place who understands the economy, understands the path to economic growth, and who also understands why we are having such a difficult time coming out of this last deep recession and onto a path of more rapid growth—something that historically happens when we hit bad economic times—and that is that it is President Obama's policies which are largely to blame for keeping us running in place.

By the way, might I only close by asking the question, "What's that they say about the definition of insanity?" His budget proposal is more of the same. There's nothing new about it. The outcome will present more of the same as well, however unfortunate that reality may be.

Sunday, February 12, 2012

I Will Play the Facebook IPO

When I read Al Lewis' column in the Wall Street Journal, Facebook, Dead or Alive, last week Sunday, I had to laugh. Quoting himself from a previous colum in 2004 he wrote, "Google's growth curve won't last forever. It's only a matter of time before someone gobbles Google's lunch." He went on to point out that since the IPO Google's stock has soared 580%.

Oops.

And oops is right, because I've admittedly kicked myself as well more than a few times for thinking Google was just a fad, and that it's stock would eventually be as worthless as nearly all Internet stocks eventually wound up. I didn't play the Internet boom when it was literally going through the roof mainly because I simply couldn't grasp how any of them would make their money. How in the world could a company have a valuation in the hundreds of millions of dollars, even in the billions of dollars without a headquarters and at least some revenue to speak of?

In the end that question certainly was a good one, and while I could have cashed in on short term gains, I simply chose to stick to what I knew.

But Google has been a different beast, and unlike the other Internet stocks of their time, Google actually does have a headquarters, and they do certainly make plenty of revenue. And so far as I can tell, nobody has come along to gobble Google's lunch, and there doesn't seem to be anyone immediately around the corner to take a good shot at it. Google will likely continue to perform well, and despite it all, I have yet to ever own a single share of this company and have no intention to buy any shares now.

Perhaps that's simply because I have this sort of luck that once I plunge into an old winner like this one, things tend to take a swift turn in the other direction. Might I only add here that I was late into Krispy Kreme as well and as soon as I finally pulled the trigger and opened a position, besides the holes in their doughnuts, that decision wound up leaving a hole in my portfolio.

To quote Homer Simpson, "D'oh!"

Facebook, on the other hand, gives me pause. It is a real company, and I do think they can make money—and they are. And let's face it, their subscriborship appears to be on a relative continuous growth curve. People, so far as I can tell, still like Facebook, and newcomers keep rolling on in, in droves. Like Google, I'm just not sure there's anyone who will be able to top Facebook's appeal in the near term.

For that reason I'll be going in on this one. Granted, I will by no means bet the farm. And I intend to only go in for the short term. But I think it's a play that will certainly prove well worth it. For all I know this thing may well gobble my lunch. But if it doesn't, and I think it won't, it certainly is not going to be another one that got away.

Friday, January 20, 2012

Newt Was Brilliant in the CNN Debate

Whatever your opinion of former speaker Newt Gingrich, his response to John King in the recent CNN debate wherein John King chose to open the republican debate with a question about the accusation by Newt Gingrich's former wife that he wanted an open marriage was nothing short of brilliant. The standing ovation he received from the audience was more than well deserved. Even Mitt Romney deserved some kudos for his very poignant response, "John, let's get on to the real issues."

My sentiments exactly.

The sad fact is that so many of these debates led by the largely liberal media have been grossly out of touch with the many real issues we are currently facing as a nation, focusing on things that frankly aren't all that important. Just one example would of course be the "condom" question posed to Mitt Romney in a debate not so long ago. Newt made an obvious point when he said, "I am tired of the elite media protecting Barack Obama by attacking republicans." Because that's exactly what the media has been doing by posing really silly questions in debates that should not only shed light on the proposed policies of the candidates vying for the presidency, but that should also shed light on the very real failures of the Obama administration, and the very real dangers we face nationally if Barack Obama is elected to a second term in office.

The media is supposed to be reporting the news objectively. In the world of journalism there should be no democrats, and no republicans. There should only be unbiased reporting of the facts. Something that is, without question, seriously lacking in the reporting of the news as it relates to our politicians.

No real news, of course. This has been going on for years. But I absolutely applaud Newt Gingrich for attacking back. Isn't about time someone finally takes the media to task?

Another thought comes to mind when I think of Newt Gingrich, because he's really been doing this since the very start of his campaign. He takes no prisoners. He tells it like it is. He does not parse his words. I find this interesting in the sense that one of the guys we all would have enjoyed seeing enter the presidential race was Governor Chris Christie. Without a doubt Christie would have responded in much the same way that Newt Gingrich had if he had found himself in a similar light.

Which leads me to another thought that perhaps there is still some steam in the Gingrich campaign to actually win the nomination after all is said and done. The fact is that what conservatives are looking for is someone who can go toe to toe with Barack Obama in a debate. Newt can do that. What conservatives are looking for is someone who can articulate his ideas and plans. Newt can do that. And conservatives are looking for a strong voice who can lead the party, and right the path we're currently on. I think Newt can do that too.

There's still time to make that determination. But in the meantime if we get one thing out of the CNN debate, my hope is that we get a return to a focus on the issues. It's time to get down to the brass tacks. It's time to stop wasting time talking about things that don't matter. We need to be talking about tax policy, economic policy, getting Americans back to work and how we accomplish that, how we restore faith in our president and our system of government, and how we regain respect from our allies as well as our enemies. And most importantly, we need to get on to talking more indepth about exactly why Barack Obama's policies not only do not work, but why they will harm our country if we continue with them.

Let's hope that happens.


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Sunday, January 1, 2012

A 9-9-9 Plan At Home

In 2011 Herman Cain made the term "9-9-9" famous. It was a simple plan, even if in reality, the actual probability that he could have ever made it the reality was not very likely. I tend to think that even if he would have somehow found himself in the White House, the "9-9-9" plan probably would not have amounted to much aside from an interesting idea that would have needed quite a lot of scrutiny and ultimately, a morphing.

We'd have gotten something. But it wouldn't have been the "9-9-9" plan that Herman Cain campaigned on.

Still, I think as Americans we can use at least the simplicity of the concept of the "9-9-9" plan to right our own paths individually, and to make a strong effort toward getting our own financial houses in order. As we jump into 2012, I think we have a greater opportunity than we've had in a long time to set a new course for ourselves, and to pave a path that is far less rocky than it's been since at least 2008.

So what does a "9-9-9" plan at home mean? It means looking for simple ways to increase our earnings by 9%, decrease our spending by 9%, and reducing our debts by 9%. Granted, this is not something that's entirely easy. For example, how in the world do you increase your earnings by 9% when the average worker is probably lucky to get even a 2% increase in their wages?

Well, let's take a step back momentarily. I didn't necessarily suggest our plan would be 9%. What I said was we can use at least the simplicity of the concept of the "9-9-9" plan to right our paths individually, and to make a strong effort toward getting our own financial houses in order.

At the end of the day that number is probably not going to be 9%. But what if that number is just 1%? Can this still work out to be an effective plan? I think it can. Let's say you earned $40,000 in 2011. A 1% increase is a mere $400.

The point I'm making is that irrespective of whatever percentage number you choose, having a plan and being committed to that plan is what's important. And by the way, keep in mind as well that all of these numbers combined work together to acheive the goal. If you can increase your earnings, for example, by whatever percentage you decide is workable for you, why couldn't you also redirect that increase in earnings directly to savings? And what about debt reduction? What is the actual cost benefit to reducing debt? Paying less in interest payments of course. If you added it all up at the end of the day, I tend to think that engaging a plan like this would all benefit the entirety of the plan. Each part would complement the other, and compound the overall effect of the plan. The effective percentages would be higher than the base percentages overall.

Going into 2012 I think it's vital that we head ourselves onto a better path. We need to be more self-reliant. We need to be more capable of weathering a storm. We need to have more flexibility and therefore, more opportunity to get things accomplished, and make the path we're on less dangerous and risky as we've done in the past. Going into 2012 is a time to lay out all of our cards on the table and determine the best way to play them. It's a time to reflect on how we've played our cards in the past, and avoid the mistakes we made that helped us into this fine mess that we're only now starting to see ever so sligtly tidying itself up.

For you maybe it's the "2-2-2" plan. The numbers you pick aren't what's important. But if you want to see the most benefit in 2012, certainly picking the do-nothing "0-0-0" plan, or worse, picking the negative percentages plan from pre-2008 we were on will only get us right back where to we started in this whole fine mess.