29 May FIRE in this time
Is F.I., S.I. – Socially Intelligent?
Against the backdrop of the fire and rage in Minneapolis following the police murder of George Floyd, reminiscent of police beating of Rodney King in LA in 1991, nearly 30 years ago, with many black deaths in between, what could possibly be the relationship of financial independence and the FIRE community to the unraveling in our society?
Are we quiescent on the edges, tending to our own business of careful managing of our money to reach financial independence? Are we concerned but powerless given our debts and gratitude for secure jobs we want to keep? Do we wonder what the connection might be between our brilliant strategy of buying our freedom through building capital and the unfair system that affords us the opportunity? Is the unrest close at hand for you or far away – and does that make a difference in how we respond?
The title of this post, FIRE in this time, keys off another era in the life of Black people in America. James Baldwin wrote Fire this Time. He said,”The brutality with which Negroes are treated in this country simply cannot be overstated, however unwilling white men may be to hear it,” The title was taken from a prophecy recreated from the Bible in a song of a slave:
“God gave Noah the rainbow sign,
No more water, the fire next time!”
Racism and injustice is the shadow of America, and it’s worthwhile to pause and take account of how our approach to money, called FIRE (financial independence retire early), may get us off the hook of a job, but not off the hook of being part of systems that rewards the already privileged and send disadvantaged to the margins.
Not your typical FI post
This is not your typical financial independence post, encouraging you to continue, giving your mental and practical tools for your own road to FI. Here I intend to pose to you the tough question I’ve asked myself for years: how does taking personal responsibility for our finances relate to the global economy’s preferential treatment of capital over people? In FI, we focus on personal responsibility; is social responsibility just not our thing?
Last Sunday I gave the keynote at the Virtual Camp Mustache titled “Are we just clever – or are we wise?”
In it I praised the brilliance of the Your Money or Your Life program in liberating individuals – myself included – and went on to ask: what is the shadow of this bright light?
Money is the life blood of a rigged system
I used this visual to explore that question.
The classic FI program helps you set up a system for observation of your daily life transactions, the emotions that arise from being stuck in the work and spend cycle, and the beliefs that drive us to accept that it’s the only money game we can play. Our feelings about our money lives can yoyo from elation (I just bought the thing I wanted) to despair (Idiot! You’ll never pay it off – or play with it). Our beliefs, drummed into us from all communication channels, are rooted in the basic mantra of society: More Is Better.
That’s where FI comes in. We pop out of that nightmare into a new dream, a dream of freedom, and doing what we want with our time. The steps of the program help us systematically unhook. We don’t struggle to adapt to the work and spend cycle, only a bit more peacefully. We jump ship, while using the advantages of the capitalist system we live in to buy sufficiency and security and freedom.
However, the book and the teaching only lightly touched on that capitalist system itself and on the impact of the design of money on life on earth.
Wising up about money
Where does More is Better come from? The economy’s imperative: Growth is Good.
It’s the demand of capital to turn a profit. Businesses need consumers. If the flow of consumption shuts down – as we are now seeing – they go under. Where does the imperative of growth come from? Some say, “Humans are greedy,” but I believe greed is just one way humans behave. We also share, love, prefer rest over work, value learning and relationships over the quest for more. I believe that the design of the money system encourages greed, even requires greed.
The right to issue money does not rest in the government. It rests in the Federal Reserve and its member banks. The Fed attempts to Goldilocks the economy – not too hot, not too cold, just right – through the prime rate, the interest banks pay on the money they borrow from the Fed and then turn around and lend – at a higher rate – to consumers. The US government authorizes the Fed, a private corporation, to run our money system. Banks do not have to have, in deposits, the money they lend to consumers. They only have to have 10% of that money in deposits, the rest is assumed to be created as people pay back their loans. This is called the Fractional Reserve. Money created this way is really a lien against future life energy – money – of the borrower. Some people end up indebted for life.
The last element that drives the Growth is Good imperative is the interest the banks charge on loans. Depending on the interest rate and the term of the loan, the borrower will need to come up with 2 or 3 times the original loan. The economy has to grow if borrowers are going to prosper enough to pay their loans with interest. Enough amateur economics – it’s just important to understand what money is at a systemic level. Class dismissed.
No system in nature grows forever. It’s juvenile – i.e. the characteristic of a body as it grows into maturity. Mature systems – trees, forests, species in ecological niches – grow in connections, not size. All mature systems are kept in balance by the give and take of animals, plants, sun, water, land, opportunities to flourish. A species that dominates a system without any predators to keep it in check will eventually eat through the easy and available energy (food) sources. The population will expand until all food is gone, and then collapse in numbers to restore the balance. Humans discovered the energy of the sun in the form of fossil fuels. While it looks like the sky is the limit, the market always goes up, are we reaching the end of our expansive economy? Much debate, but worthy of consideration.
Our economy treats the earth as “resources.” It assumes fungibility – if we run out of one resource, we can substitute another. You’re smart. You can see where that is headed.
Back to the Your Money or Your Life definition of money, now with the design of the money system and the finite earth in mind.
Money is something you choose to trade your life energy for. When you see how the work-and-spend cycle uses up your life, you choose conservative spending and building savings. You choose to live within the limits of your own life energy.
Where does the life energy freed up from earning money go?
I suggest you consider investing it – some, part or all – in building up a life energy account for the earth. What does that mean? Just about any form of service:
- Teaching FIRE to others to have ever more people spend ever less of the earth’s energy on stuff that makes no difference.
- Learning about investments that help reverse the cycle, broadly under the banner of ESG (environment, social and governance) commitments.
- Volunteering for causes you care about.
- Being involved in improving education
- Working on issues that benefit the essential workers – and humans – who do the hardest jobs for the smallest paycheck
- Innovating, innovating, innovating – using your skills and entrepreneurial spirit to build what is needed for a sustainable society, not a growth one.
- Parenting kids who “get it” – who have a thirst for service and sharp minds that can decode the messages of the consumer culture.
- Making your home a homestead with veggie garden and solar smart building and water harvesting and sharing.
- Working for justice. Being an ally to people who are on the streets – despite the pandemic – because their lives are so desperate.
And on and on and on. If you don’t need to earn money from how you spend your time, you can spend your time on some piece of making this work more safe, fair and free for all.
FIre is pro future
We conserve material resources by valuing enough and moderating consumption to just what we need.
We use our creativity and skills to maintain and fix what we have rather than toss and replace. Check out the Fix-it Clinic, created by FIer Peter Mui.
We have time enough to love. And to care about the future for all life, not just our own.
Duane Elgin, one of the grandfathers of our movement, quotes Richard Gregg in the opening of his book, Voluntary Simplicity, saying our purpose is to have a life that is “outwardly simple and inwardly rich.”
I know a lot of you are on this path or aspire to it. Perhaps the only next step needed is to aim higher and to wear your care for more than money like a badge of courage.
All is not lost if we are not lost – and we lead.
Daniel MikoszPosted at 22:23h, 29 May
Thank you. Beautifully said.
Emily BylPosted at 19:22h, 08 June
Thank you Vicki. In this high-stress time where we can be consumed with thinking about finances and uncertain futures, I appreciate the reminder of why we want to kick the rat race altogether. Take care.
JILL DentonPosted at 01:38h, 12 August
I’m truly grateful that you’re still available on this website and for this blog! My spouse and I incorporated much of this approach and philosophy throughout the nineties and this evening I got to thinking “what would Vicki say about what’s happening to all of us now with COVID 19? Thank you…I’m signing up for your newsletter!
Vicki RobinPosted at 23:55h, 17 August
I’m not doing a newsletter here anymore. but if we do one again, you are on the list.
VeronikaPosted at 19:23h, 24 January
Hello. Hope you are doing well.
I ordered money talk cards in November 2019 and haven’t received them yet(
I wrote several times to your email but my email was returned.
Fredericka LanePosted at 12:12h, 18 March
My son asked me to listen to your book on audible, which I did. I need to listen to it again. I work, so I had it on while working. This may seem strange, but my son and his family (total 7) are living with me right now, as problems occurred during covid. We currently have zero debt between them and myself, except for a vehicle loan. I have approx. 310k in my TSP, that’s the government 401k. We want to buy some land with a home so we can homestead. We currently are doing as much as we can with a garden, composting, and improving the soil. We can’t have animals (it’s the local rule). My son and wife have some savings but are both 41 and don’t have any investment accounts. I am totally invested in the system, with all my retirement money in social security, my federal retirement, and my TSP. Should I take the TSP money out next year when I retire, or let it stay there in hopes if keeps growing? Thank you so much and I realize you are giving me your opinion, and that ultimately the decision is mine.
Grant SabatierPosted at 19:58h, 09 December
just saw this! i can’t give you any financial advice.
Grant SabatierPosted at 19:58h, 09 December
very sorry! please write to grant@grantsabatier to clear this up
Vicki RobinPosted at 15:21h, 11 January
not sure if this has been handled. i believe grant sabatier has refunded everyone as he was distributing the cards. firstname.lastname@example.org
Jacquelyn RosePosted at 13:03h, 08 June
I read your book for the first time 25 years ago and it changed my life. I now publish an e- newsletter, all about the ways people can be active – participate in their community. I was just going to link to your book in my column, but your website home page is all messed up. There is code showing. Are you getting this fixed? I design websites if you need help.