Many of the comments on my pro-green stimulus blogs have rejected my support for a federal shot in the arm. Instead, some of my readers are calling for more saving, less spending and the reinstatement of financial discipline. While I disagree with these readers on the best course for U.S. economic policy, I am firmly in their camp on the matter of personal financial conduct.
Financial responsibility was ingrained in me by my father, Melvin Oliver Aronson, who died in 2008 at the age of 96. I'd like to share some of my dad's principles with you in this blog. They're good life lessons that were widely applied 50 or more years ago, but which have been largely discarded in the easy credit economy of recent decades. And these lessons are sustainable.
First, some context. My father was born in 1911. His own father had immigrated to the U.S. penniless, and built two successful businesses: Boston Royal Petticoat and New England Panama Hat. My father's family was steeped in the value of hard work, and my dad took his early lessons in frugality to heart. For decades, his signature fashion item was the wearing of maroon socks of an especially horrid shade. He'd purchased a gross on sale at Boston's Jordan Marsh and was determined to wear them out (which he did), fashion be damned. My dad's favorite article of clothing was the pocket watch that he had inherited from his own father.
Many of my father's daily practices are part of the new green lexicon. My dad commuted to his office "in town" (downtown Boston) by streetcar. (Today, we'd call him transit-oriented.) He didn't like running air conditioning. (Today, he'd be a fan of passive heating and cooling strategies.) He turned off the lights when he left a room, and chided everyone to do the same. My dad didn't know that he was reducing carbon emissions, but in many ways he was green before his time.
Now to my dad's financial maxims:
• "Take care of your money, and your money will take care of you." Save. Invest. Diversify. What you don't spend now will take care of you later on. My dad would be horrified at the state of today's market, but he would also have cash reserves on hand.
• "Don't get on the wrong side of debt." Keep your borrowing to a minimum. Make sure that your current income is sufficient to repay your debts and to support savings. The more you limit your borrowing, the more you'll have to save.
• "Live off interest; never touch principal." Keep your capital base intact; don't spend all of your returns. Keep adding to your reserves (see "Take care of your money," above).
• "The world doesn't owe you a living." You have to earn your way. Study hard. Work hard. Be a contributing member of society. Take care of yourself.
But also remember:
• "You're not a walking vault." This one surprised me, but it was part of my dad's belief system. Temper your saving and investment behavior with judicious risk-taking. Spend on a few important things. A comfortable home for your family. Your children's education. Charity, especially gifts that honor the memory of your parents.
My dad's words have shaped my conduct, and have served me well. His advice on work, saving and spending -- once core values for American families and businesses -- has been largely overlooked in recent years. Recent events suggest that it is time to revive these traditional norms.
Of course, my dad and I disagreed on a number of things. He would back my readers who are horrified of the notion of a federal stimulus, green or of any other color. Those readers should appreciate this column, and I hope that others will, as well.
Leanne Tobias is founder and principal of Malachite LLC, an advisory firm that specializes in the development, leasing, management, financing and certification of sustainable or green real estate on a global basis. Write to Leanne about your thoughts on jumpstarting the economy at firstname.lastname@example.org. She'll share the best ideas in future posts.