Flashback to April 2011. I’m on the floor level of the Rose Quarter in the most uncomfortable chair in the history of mankind, and I’m bored to the point of making paper airplanes with the aborted pages of a program booklet.
I take my wallet out of my pocket just to soothe my numb derriere an hour into making small talk with my mother’s coworkers. Like. I. Care. This sucks. What sucks more is that I’ve been dragged to a six-hour financial seminar hosted by Dave Ramsey.
If you don’t know who he is (I didn’t), Dave is a conservative financial “guru” with a syndicated radio show who also does appearances for FOX News, etc. Basically, he’s one of those guys – the guys that bring God into economics and think the President is a socialist (works for Europe, but whatever). If you haven’t seen him, he looks like Dr. Phil after a coke binge, dressed as Steve Jobs with really bad caps on his teeth.
Having looked at his website beforehand, he is an easy man to despise. The site is littered with ads for gold merchants, financial services and other assorted evils and has his grimy mug looking back at you with an “I’m rich” smirk.
Then why in this godforsaken world would I attend such a calamitous event, one so full of depravity and working-class pandering? Not for sheer amusement, I assure you, but to decide what to make of this post-meltdown talking head.
After an eternity, the lights go down. There he is with his posse of local tag-alongs nipping at his heels for a piece of the action, throwing miniature footballs for cash prizes in the vast auditorium. I’m bracing myself mentally for what I’m sure will happen next.
I was wrong, sort of. Not genocide wrong, but more Bay of Pigs wrong. He did give a lot of common sense advice — don’t spend more than you make, get out of debt, you shouldn’t have car payments. You get the point, but to a certain degree, you shouldn’t have to pay for that knowledge. That’s why it’s called common sense.
Luckily, I can still hate him. I have more than a few issues with this character. First of all, it is not primarily a financial seminar, but a performance. He’s a personality, not a number-cruncher. He comes on stage and talks like he’s your best friend, telling you witty anecdotes about the time he went bankrupt – yeah, he rose out of bankruptcy and is now teaching people about finances – and at the same time puts it all into a context that the stereotypical blue-collar conservative can understand.
He must have mentioned ‘truck’ and ‘trailer’ about 50 times while I was there. I kid you not, he went on for over half an hour about a guy who had a car payment on his Dodge Ram 1500 Hemi@@http://www.allpar.com/model/ram/dodge/review-hemi.html@@, and the crowd was cracking up. It was quite a feat. My problem with this is that his oversimplified lessons are too broad as a rule.
I understand one shouldn’t, in theory, have a car payment when there are ways to save up cash for perfectly good used cars, but then again there are people who have to pay their way completely through school and have to take out a loan.
His financial philosophy as far as I can tell does not allow for that and isn’t really applicable to the college base. I can understand a middle ground between responsible borrowing and fiscal frugality, but one way or the other don’t allow for reality.
Some of his advice is just plain wrong. He touts a 12-percent compounded annual interest figure from “good growth mutual funds” which simply put, is incredibly optimistic. One would have to condense their portfolio mostly into stocks to achieve this, and even so the 80-year average is only nine percent. Despite this, he uses the figure to encourage people to invest. The same people who are paying him over $50 to listen to him blabber.
Here’s what I think. People always rally around a strong figure, and Mr. Ramsey is a very charismatic man. Hell, I’d grab a beer with him any day. But that’s the problem. I don’t want that guy giving me serious financial advice in a turbulent market, especially when his figures are suspect. The populous needs a strong figure, but one with the qualifications and background to give informed advice for the middle and working class.
We need people like Elizabeth Warren, assistant to the president and special adviser to the Secretary of the Treasury on the Consumer Financial Protection Bureau. She has been a prominent voice of reason in the financial debate since the beginning, and is considered a savior of sorts. She has the same basic common sense advice as Ramsey.
She wants families to rethink their finances based around what they can realistically afford, but is working to affect change on the way financial institutions can structure debt in order to eventually make it safe for people to borrow.
She has also helped create a sense of accountability in Washington concerning federal bailouts. During the congressional hearings with Treasury Secretary Timothy Geithner@@http://www.huffingtonpost.com/2011/06/23/geithner-dodd-frank_n_882863.html@@, she posed this question to him: “The auto industry has received taxpayer money, but it has been linked to changes in management … and caused bond holders to take losses at a minimum. The banks have received ten times more money than the auto industry, and yet they seem to be receiving a very different treatment. So the question I have is, why the different treatment? And in particular, do you think the banks are better managed?”
That is someone worth listening to, not some rich entertainer who feigns blue-collar relativism.