Saving for the Future, Part I

First broadcast on WSHU/WSUF-FM
December 1, 1995

For years, I've heard from national financial experts that we Americans need to save more, so there is more capital to invest to increase productivity and boost the GDP.

When Suzanne began teaching school in Bridgeport several years before our marriage almost five years ago, she began saving with a government tax break for encouragement. She arranged to make regular transfers from her paycheck into a mutual fund. Her taxable income was reduced, her retirement nestegg increased, and her money was out there growing the economy.

On the recommendation of another teacher, Suzanne invested in a fixed yield fund and a stock growth fund with a well-known company. As one of the many automatic financial transactions in our lives, it just kept happening. Every two weeks, another chunk of her money (less when we were paying college costs) went into the system.

Teaching school is tough work, especially if it's done with the creativity, enthusiasm and dedication required to maintain some kind of sanity when you are caught between a big bureaucracy and a classroom crowded with needy students.The destructive and violent consumer culture (propagated universally by movies and television), a malfunctioning healthcare system, absent or overworked parents struggling just to survive, and a low level of support and remedial services make a teacher's job a real challenge.

So, imagine our surprise when we took the time to pay attention to where Suzanne's money was invested, and then to understand the connections between her retirement fund and the problems with which she deals every day.

Her mutual fund's semi-annual report listed its ten largest holdings right up front, and was proud of them, too! These included the world's largest tobacco company, the largest maker of smokeless tobacco, and the world's biggest cable company. Other top investments are the discount store chain that is bullying its way into area towns and two insurance companies involved in health care and investing. Two corporations which process investments for financial institutions, an insipid publisher, and a transportation/fossil fuel company complete the top ten. About 20 percent of Suzanne's funds are invested in these companies. Four of them (two insurers and two financial processors) are very involved in the ongoing, large-scale transfer of the control of money from individuals to large corporations. Tobacco sales build Suzanne's portfolio in two ways: with greater profits from tobacco and from health care.

Suzanne's mutual fund owns smaller amounts of stock in approximately 200 other companies. Her money helps Rupert Murdoch's media monopolies and Coca Cola's sugary drinks conquer new markets around the world. It also helps McDonald's build four new restaurants every day and PepsiCo get fast food into school cafeterias and fat-laden, salty chips into children's stomachs everywhere. Her little nestegg funds almost every player in the entertainment industry. It helps produce MTV, Beevis and Butthead, gangsta' rap, violent movies, trashy talk shows, and commercials for all sorts of rubbish. And if that's not enough, it even helps deliver them into her students' homes over the air and through a cable. She's invested in all three of the American tobacco companies which were recently cited as the most active in promoting smoking among Asian women. The health of her retirement fund is in part tied to the success of Joe Camel, the Marlboro man and the Exxon tiger.

We ask ourselves, is this a way to contribute to the creation of a healthy, sustainable future? Imagine being a party to such widespread damage with one little weekly contribution. Meanwhile, the portfolio manager seems proud of a three percent increase in value, that is, of course, before expenses are deducted.

We've decided we have to stop participating in such a dysfunctional system.We're not going to give them any more money. We'll evaluate our options for getting out of this retirement fund entirely, although it seems like we're trapped for a while. The company and the government both penalize early withdrawals. Is this some sort of conspiracy, we wonder?

This country will continue to be in big trouble until we learn how to save without simultaneously diminishing our prospects for a healthy future.

Does anyone out there know how to do that?