Friday, January 21, 2011

Curmudgeon's Laws -- and others

I published a list of Curmudgeon's Laws at the end of December and offered to expand on these from time to time.

Despite the near-total absence of clamor for any follow-up, I add to my list herewith:

It costs more to be poor in America than it does to be rich. I concede that this is counter-intuitive -- on the surface -- but poorer people are the ones who can't pay off their charge card bills each month and so incur high interest rates on their balances. A shirt at a department store may cost a rich man $25. The same shirt costs the poor man $25 plus interest. Miss a payment -- or be late with a payment -- and the already high interest rate goes up, up, up. Meanwhile, not only do wealthier people not incur interest charges, at least one credit card (the American Express Plum Card) offers customers the opportunity for a 1.5% discount if the card balance is paid each month when due. I suspect that things work similarly in other developed nations -- but I'm almost positive that this rule would not apply in hunter-gather societies. Are there any anthropologists out there who think differently?

Expenses do not fall easily when income drops. This is more a corollary of Parkinson's Second Law.

"Parkinson" refers to British scholar C. Northcote Parkinson, whose first law, "Work expands to fill the time allotted for its completion," is probably familiar to you even if the author is not. Parkinson's second law is "expenses rise to meet income," that is, the more you make, the more you (or your spouse) will spend. That house that was perfectly adequate before your last promotion seems tiny and cramped following same. That car that was so reliable and comfortable before, now seems old and worn out. So you buy a new house and a new car. Your expenses go up.

Here is where my law comes into play: If you are laid off, or if -- for example -- you are self-employed and your customers slow down or even stop paying your bills because of the lousy economy, your income will fall but the new house is still there -- with the new car in the driveway. The expenses don't fall -- not easily. They will only eventually fall -- after the foreclosure, perhaps, and after the repo man has come to call.

Looking up Parkinson's Laws this morning (lawyers can't help but research nearly everything -- except consumer purchases, but that's another story) I came across this trove of collected wisdom.

Let me highlight just a few:

The law of scientific equilibrium
If it is settled it is not science.

If it is science it is not settled.
The law of scientific consensus
At times of high scientific controversy, the consensus is always wrong.
The law of targets
A level set as a target maximum becomes the de facto minimum, and vice versa.
Lawyers will recognize this last one as a fundamental principle of settlement negotiations. One never tells the other side that the client will settle for somewhere between $40,000 and $60,000. Even if the conversation is reported verbatim, the client on the other side will hear only $40,000 (if he is the one who is supposed to pay) or $60,000 (if she is the one expecting to receive money in the deal).

And I don't know who this Evans was, but he or she was surely right:

Evans’ law of inadequate paranoia
No matter how bad you think things are, they’re worse.


Empress Bee (of the High Sea) said...

you know sadly this is very true. i have not paid any interest in years now, none at all. not that i want to pay it mind you, but it hardly seems fair.

smiles, bee

Dave said...

Under-promise, over-deliver.

Ciera said...

How very true