Things I Should Teach My Son, Part V

Private property. It sounds so good, so right, so true. It’s so dang important that it was written into that old document about our Rights (no, not that one; I mean this one, which is much better.)

But when we talk about rights, we usually perceive them to be only about a benefit to us; in the case of private property, we think about our stuff.

A true respect for property rights would also hold the converse to be true: that others have a right to their own property. The proper respect of the rights of others is a mark of maturity. You should never think you have any claim to the property of another person unless that person granted or sold you an interest in that property. You should never assume that such an interest exists without an explicit statement saying so.

Likewise, never give up any interest in any property without remuneration; even if that remuneration is merely implied gratitude when the property is shared gratis. The only exception to this is cheerful giving, when you just want to give something away.

Families screw this up big time with children, when they force the little ones to “share”. This was true of our family when you were young; a major mistake. Little ones should be taught early that their property is theirs to dispose of utterly; and that they should bear the consequences of their choices. If parents want some toys to be “community property” among their children and guest children, they should make it clear that they own the toys.

Read this article about the nuts and bolts about teaching children to understand private property from a very early age. I did not find it until very late; but it won’t be too late for you if you read it now.

Things I Should Teach My Son IV

So you want to be a pilot. That’s great. It is a superb profession. I’ll give you an anecdote. I start with the worst thing that happened to me in aviation: getting laid off from my airline job in 2003.

To pay the bills I sold health insurance. I got my license, started making cold calls, and drove all over California’s Central Valley to pitch health policies to my clients. Early in this game, I had a meeting in Kingsburg with a family. Before leaving our house, I called to verify our 4 p.m. appointment. Still on. They lived in a modest single family, single story home near the 99. I rang the doorbell. No answer. I rang that doorbell five times more. No answer. I called their number. Total disavowal of any meeting! This family was home, and lying to me about having agreed to a meeting. I could hear them! So I drove home.

I complained about this to my manager. I was very bitter about it. He just laughed. “Happens all the time,” he said. And it happened a few times more before I changed jobs.

The point: I had enjoyed living in a moral hot-house my whole career, namely, aviation. In the Navy, integrity was taught as the essential ingredient in becoming an officer and pilot. This was pounded into our skulls. Dishonesty would inevitably get your wingman, squadronmate and shipmate killed. Open, frank and honest discussion about everything on the job was the “go juice” that made aviation possible. No integrity, no flying.

I got used to this and forgot to appreciate it. It’s still true in the airline business. I find that at least in terms of the job, dishonest people are vanishingly rare.

Become a pilot. The greatest good is the awesome people you’ll meet.

Things I Should Teach My Son III

As I age, it’s becoming more interesting to watch my sons’ trials, especially comparing their reactions to mine. Here’s one: a painful social situation that gives rise to a temptation to remonstrate with a former friend or acquaintance. In the short run, giving in to the temptation feels good. But in the long run, it’s terrible choice.

Angry words about past hurts are a waste of time for the hurt party; the better choice is the uncomfortable and lonely high road. This looks like:

  1. Forgiveness, even if that is never asked for by, nor expressed to, the other party. Forgiving and forgetting past hurts is better; this is science.
  2. You’re likely to see this person again in a social context (reunion, Christmas party, etc.) At a minimum, offer a friendly hello. He or she should walk away believing you want to maintain friendly terms. Silence = hostility in this situation. “Hi, great to see you,” is a good start. See here.
  3. Never gossip. If you need to talk about the painful situation, talk only to family or to the most trusted friend.

This is all type 1 advice. I never received it but wish I had (I probably wouldn’t have listened.) Acting out on a grudge has never produced any kind of good result.

Ab Initio Pilot Training in America

JetBlue has requested authorization to launch an ab initio pilot training program in the United States. I’ve written about ab initio training before (see here, here and here.) The main difference between this proposal and the European practice is that JetBlue will send their candidates out to fly at a smaller airline until they get the required hours (1,500.) That matches the minimum time requirement for pilots at U.S. carriers; most applicants exceed that number. The candidates in this program might gain a leg up on their competition by securing an job at the minimum level.

The company attempted to justify the request by citing a pilot shortage (see here.) If you don’t click through, here’s the summary: airlines have thousands of applicants for pilot jobs if the jobs pay well. If not, as in the case of regional airlines, pilot shortage. JetBlue starting pay for pilots is about $44,000/year. Starting pay at a typical regional airline (e.g., Mesa) is about $20,000/year.

A McDonald’s cashier makes about $17,500/year.

So why? Under the plan, pilots could get hired onto the JetBlue seniority list at a younger age than otherwise. They would enjoy a permanent lifestyle benefit at the expense of their peers; and thus the creation of a cadre of grateful pilots. That difference would be an exploitable wedge between union members, potentially useful during contract negotiations. In fairness, unions also create wedges between members over time.

Things I Should Teach My Son II

Usually advice is too general. The previous post, Pay Yourself Second, was a good example. It promoted the idea that a young person should save regularly but didn’t show how.

You could set up automatic distributions, from your paycheck, to a savings account in a bank ($100 per paycheck when starting out) to build up an emergency fund. What could be more accessible than money you could easily transfer to your checking account? Also: how much? Let me … If that’s too much just save $1,000.

After that, how do you save money? Here’s a specific answer: put money regularly into a Dividend Reinvestment Program (DRIP.) The key quote: “The compounding interest of DRIPs allows investors to purchase additional shares of stock at little or no cost …” (emphasis added.) That zero-to-low cost is a big deal in terms of compounding over time.

Not specific enough? Click here and sign up with Realty Income. This company pays dividends so incredibly regularly that it trademarked “The Monthly Dividend Company” as its slogan. Assuming all else is equal, a higher frequency of dividend payments is better. And, if you’re bored, here’s another article on Realty Income.

$100 a month. Increase this when you can afford it. Never decrease. Do this and be rich when you’re middle aged.

Things I Should Teach My Son

My oldest son is in college. He is studying engineering. His first semester was unremarkable; we were surprised how quickly he took to social life there, but not much because his university attracts young people exactly like him – on the serious side, but with some sense of humor. Not a party school. But that first semester was all about school.

His second semester, he decided to say “yes” to everything. He joined the school ensemble choir, began competing in a club sport, and joined an engineering fraternity. This has continued into his second year, with the addition of military training in place of the singing. He is also carrying 20+ credits. When he comes home, he buries my wife under a mountain of laundry, then spends most of his time sleeping with occasional breaks for a meal. We don’t bug him about this.

Obviously, we should be telling him to manage his time.

But advice given to college students, especially the fatherly variety, comes under 3 categories: advice I was never given, but wish it had been; advice I was given, but that I ignored; and advice that I received and applied. There are no entries under the last category.

So here’s some category 2 advice: Pay Yourself First. To a Christian, the advice reads badly. We’re not supposed to do anything for ourselves first … God has to come first, so the tithe is critical. OK: Pay Yourself Second (after God, but ahead of everybody else.) Rather than attempt to prove why this is important, I’ll just link this.

To that good advice, I’ll add this: never sell. Whatever you invest in, keep it in there until you can look at the compounding balance and conclude: “Wow, I can pay off my house/investment real estate/retainer for my defense lawyer!” Keep it in there until the balance gives you some real relief and financial peace. Warren Buffett said, “Lethargy, bordering on sloth, should remain the cornerstone of an investment style.” So just keep adding and don’t sell.