Saturday, 21 March 2009

Living off grids - taking responsibility for ourselves

Dear All

Believe it or not we live in a communistic World. It might not be "Communist" in the original sense, ie where a small group of people own everything, but today in our western world, a relatively small group owns everything. This is called centralisation and is supposed to be good and efficient.

But is it?

Most of us are slaves with "no free time" in a centralised world with centralised farms providing food to centralised organisations withcentralised warehouses. The centralised warehouses send their produce to centralised supermarkets and shopping centres. We get into our transport bought from centralised manufacturers and pay for fuel from centralised oil companies. We maintain our transport (cars) by using centralised (in many cases) maintenance organisations. Once we get our food, we refrigerate it and store it and pay centralised utilities for our electricity. Until the 1980's much of our electricity was made locally and in some cases businesses made their own electricity.

Until the 1960's many houses had septic tanks and french drains, but then the utilities (and councils and governments) said that they could take all this sewerage away cheaply and save us space and money.

This they did initially, but once we lost our choice they started increasing our taxation to the point where we are dramatically taxed in every sense of the word and have very little left over to better ourselves and our lives.

Here is an example of waste and inefficiency in big business. Instead of their being maybe 20 types of cars with maybe 100 options, there are 100's of cars some of which have 1000's of options. It is only in the last few months that General Motors has said that their processes are hugely inefficient and that they will start reducing the options and their range of cars. In the meantime they want the taxpayer to pay for their excesses. Why should we?

If we want to be capitalists, ie to be truly free, we need to take responsibility for ourselves instead of handing over our hard earned capital and cash to others to manage for us. For example instead of looking after our own interests for retirement we hand over up to 20% of our income to "retirement specialists" who "look after our money." From the 1880's to the 1980's I would agree that these mutual funds did look after their members interests, but then things changed and they became beholden to their shareholders and their management - who demanded huge returns on investment - the kinds of returns that yield booms and busts. So just when millions of people are retiring from the baby boom years and wanting access to their funds, they are told that there "is no money." Yet these specialists lived fantastic lives, worked in incredible buildings, and basically spent our money. I canceled all my retirement policies in 1999 when I saw what was going on.

After this I got phone calls asking me to invest my capital with long term people who would "look after it and grow it." I asked for the following guarantees:
1) at any time I wanted to be able to withdraw 100% of my capital, perhaps with 30 days notice;
2) at any time I wanted a guarantee that my capital would be worth at least its value taking inflation into account and additionally 5% over inflation.

Not one organisation was prepared to accede to my request. I didn't want 100% returns per annum, just 15 to 20% returns until I retired at whatever age. Yet many of these companies paid massive bonuses, grew their "assets" at 30 to 60% per annum and had the highest paid and "cleverest" economists, accountants, lawyers, actuaries, scientists, financiers, etc working for them. How could they have allowed this crash to happen? Why did they allow it? Why didn't they see it coming? Why didn't they have fail safe investments to cover themselves if something unforseen went wrong? Why didn't they take their money out of the stock markets in 2007 when the subprime crisis started? Why did they wait? The answer: greed. Pure and simple. I don't want people to be greedy with my money. I only want them to be prudent.

We are told that there is a "cost of living", but why should there be a cost of living?

If we make our own electricity, heat our own water, make our own food, find out own water, work from home (where possible - eg only maintenance type people should be on our roads - like plumbers, electricians, builders - the rest of us should work from home) and save on transport costs, use our waste to generate manure and gas for cooking, then at some point we don't need money anymore. If when we start working at the age of around 25, we take 15% of our income and invest it in "getting off grids" then by 55 we should be off all the grids no matter where we live and then any money we make is surplus.

We still need to make some money because it is a form of exchange, a promise to pay later, a way of valuing our work. We can also use a barter system and so in Milnerton we will be using our "growers association" to exchange food and ideas.

One of the joys of investing in yourself, eg your own energy, or your own farm at home, is that once you have made the investment you have locked in your costs for the next few decades. There will be maintenance costs, but there will be zero inflation. Your capital is protected. You have electricity, water and food when others around
you don't. You aren't better than them. You simply believe in the slow, safe, prudent approach. The approach that doesn't require large coal burning power stations to help you live. The approach where "instant gratification" is not in your vocabulary and where you can see the long term investments you are making in your family and life blossoming before your eyes.

I look forward to reinvigorating a new capitalism which is based on earning what we need to live and sharing all our excess with each other to create a more vibrant, interdependent world.

See my mindmap at http://www.mindmeister.com/14204830 for a visual representation of this essay.

Love
David

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