A Little History Of Actual "Monopolies"...

In 1911, at the Justice Department’s request, the U.S. Supreme Court broke up John D. Rockefeller’s Standard Oil monopoly, which began in 1870. It was split into 33 companies, including Jersey Standard (Exxon), Socony (Mobil), and Socal (Chevron).

In 1945, a federal appeals court found that Alcoa had illegally maintained its monopoly over aluminum ingot production, which began in 1888. The company was not broken up, but the government strengthened competition by selling its own wartime plants to Kaiser and Reynolds.

On January 8, 1981, after 13 years of litigation, the Justice Department dropped its effort to break up IBM for allegedly monopolizing the computer industry.

Also on January 8, 1981, AT&T signed a consent decree with the Justice Department ending Ma-Bell’s century-long telephone monopoly. It agreed to divest its 22 local operating companies, which were then recognized as the seven Baby Bells.

In June 2000, a federal judge found that Microsoft had illegally maintained its monopoly on PC operating systems and ordered the company split in two. A year later, however, portions of the ruling were overturned, and Microsoft then settled, avoiding a breakup.

Your Tax Dollars At Work...

With such a big debate constantly raging about who tax cuts benefit and how much things like the War on Terror or Katrina Relief cost, I think we as Americans fail to look at, analyze, and complain about how much of our tax money is wasted on the smaller, day to day projects that add up to far more money than any of these single-ticket large budget items.

The Department of the Interior spent $63,000,000 to consolidate 16 financial systems into one, but the project has failed and will be restarted from square one.

The Department of Homeland Security spent $104,000,000 on an infrastructure upgrade that did not meet federal law requirements.

The Department of Defense has spent $264,000,000 on their online travel booking system, a project that is currently four years behind schedule.

The FBI spent $170,000,000 on a web-based case management system that has failed to work properly and is also being restarted from square one.

The Transportation Security Administration spent $834,000,000 on their infrastructure modernization, but the project has never yielded the results they were looking for, and they, too, are starting over.

And lastly, our friends at the Federal Aviation Administration have spent $11,400,000,000 (yes, $11.4 billion) on 16 separate improvement projects, 12 of which are behind schedule, and one of which is currently 13 years behind schedule.

What A Real Bender Might Look Like

Life With The Clintons...

Bill Clinton will clear all future public-policy statements with his wife.

Senator Hillary Clinton was embarrassed last month by reports that her husband was advising the United Arab Emirates at the same time she was denouncing a ports deal involving a Dubai-owned company.

Now the couple has agreed that Hillary will get "the final say" over what Bill says and does, sources told the New York Daily News.

"He knows it’s Hillary’s time now," said an advisor close to both politicians.

A spokesman for Bill Clinton said that with Hillary preparing for a 2008 presidential run, the former president is willing to do "anything he can" to help - including, presumably, keeping quiet.

A Health Warning About Food & Plastics...

I have long been very concerned about the mixture of food and plastics. Just the other night I saw a commercial for plastic crock-pot liners that keep the pot clean while you simmer food for hours on end that made me think about how dangerous a combination hot plastics and food can be.

I find it very hard to believe that a plastic bag next to a heat source will not release chemicals into the food that it is holding. Then, this week, I received an email that addressed that very issue.

I must admit I was not surprised about heat and plastics, but I was surprised about cold and plastics. The email talks about the dangers of warming and freezing food and drinks in plastic containers.

Studies at Johns Hopkins are now showing that cancer-causing dioxins in the plastic containers that we use each and every day are seeping into food when it is being heated.

Dioxins are absorbed, eaten and then begin poisoning your body’s cells, leading to the development of cancer.

Johns Hopkins recommends the following:
1. DO NOT put plastic containers, even so-called "microwaveable" containers, in the microwave. Dioxins can seep into your food while it and the plastic container are being heated.
2. DO NOT put plastic water bottles in the freezer. Dioxins seep into the water as the water freezes.
3. DO NOT use plastic wrap in the microwave. Dioxins seep into your food when the plastic wrap is heated.

The Leap Days

Today, we worry about millisecond and nanosecond inaccuracies in times, but in the past, there have been discrepancies the length of days.

When Julius Caesar invented the Julian calendar, it was off by 11.5 minutes each year. Over the centuries, that small error added up so that by 1582, the Julian calendar being used by the Western Roman World was 10 days behind.

To fix the discrepancy in the Julian calendar, Pope Gregory XIII gave us leap days. However, before the Gregorian calendar could be put into place, the extra 10 days given to mankind by the Julian calendar had to be done away with.

Pope Gregory XIII then declared that the day after October 4, 1582 would be October 15, 1582. In Rome, all the days in-between never existed. There was wide-spread rioting in Rome because many Christians alive at the time felt that if their date of birth and date of death had been pre-ordained, the Pope had just shortened their lives by 10 days.

In defiance of Rome, England did not adopt the Gregorian calendar, so for nearly two hundred years it was always ten days later in Rome that it was in London.

Finally, in 1752 when England adopted the Gregorian calendar to sync itself up with the rest of the Western World, the day after September 2, 1752 was September 14, 1752, 11 days having never existed in London.

The problem this time, however, was not that people felt their lives were being shortened, but people actually were incensed to riot because they paid rent by the month and only got 19 days for their monthly rent that September. Naturally, landlords refused to make exceptions and expected October’s rent right on the first of the month.

The Leap Second

It received some news coverage, but nothing really major. At the end of 2005, there was a leap second that was added to analog clocks to get them caught up with atomic clocks.

To understand this, you must first know that there are currently two time-keeping systems in place for the civilized world.

Analog clocks are kept and maintained by measuring the Earth’s cycle around the sun and the Earth’s rotation on it axis, just as has been done for thousands of years.

The problem with analog, however, is that each time the Earth revolves around the sun, there is an average discrepancy of a half-second each year. In addition, each day is actually not exactly as long as each other due to the pulling of the tides on the Earth’s rotation which cause fluctuations of milliseconds.

Realizing that there was a problem with this analog time keeping, scientists developed a new method called the atomic method some 40 years ago. The atomic method uses the measurement of the extremely accurate and precise cycle of an atom of the isotope cesium-133.

In one second, the atom cycles 9,192,631,770 times. This cycle is constant, never varying and means that a half-second variance like the one that occurs in analog time each year, occurs only once every 10 million years in atomic time.

Since 1967, because of the variance in the two time-keeping methods, mankind has had to add a leap-second to analog time 23 times to ensure that the analog clocks and the atomic clocks are in sync to the tune of no more than a 0.9 second variance.

Why is it important to keep the clocks in sync? Well, if we stopped adding the leap seconds today, in the year 5000, the sun would be right overhead at noon, but your atomic clock would say it was getting close to midnight.

So, what’s the problem with leap seconds? Well, remember Y2K? There are some folks that believe if we keep stopping our atomic clocks for one second intervals every couple years, it will cause wide-spread system failures in the flight control, traffic control, power grids, mobile phone networks and defense systems that are all tied to atomic clocks.

For example, if a GPS satellite sends a signal a millisecond early or late, it can provide a reading that is inaccurate by 100 miles. You do not want a ballistic missile being 100 miles off its target.

So, for now, while scientists debate the best method, atomic clocks continue and the old-time Earth-monitoring analog time continues, both being continually checked against the other.

What Can Congress Do?

A senator can have a corporate jet make a special flight just for them and reimburse the company for one seat's worth of first-class airfare, not the actual cost of the flight. See how a company can donate to their senator through this airfare reimbursement?

A representative cannot take travel expenses directly from a lobbyist, but can take expenses from a charity or other organization with a lobbyist on its board. This means that the lobbyist cannot give travel expenses to the representative, but the lobbyist's charity can.

Corporations cannot contribute to a politician’s campaign fund, but the corporation can contribute to a charity that a politician is associated with. These charitable donations do net even need to be reported by the politician.

Senators, representatives, and their staffers cannot take a single gift, including food and entertainment, worth $50 or a collective of gifts worth $100 from a single person. If that person, however, is a "personal friend" of the representative, that $100 increases to $250. Because of these limits, the owner of the NBA Wizards and the NHL Capitals has set the price of club tickets at $49.50.

A lobbyist can provide up to $49.99 worth of food per person for a representative and staff for late-night sessions, provided the lobbyist has no "direct interest" in the legislation they are working on that particular night.

Senators and representatives are allowed to use campaign funds to defend themselves in bribery investigations that are related to their office.

The $10 Bill....

In 1861, the first $10 bill was issued near the outset of the Civil War.

It featured a portrait of Lincoln and is the only time a sitting president appeared on U.S. currency.

In 1861, a $10 bill could have bought you an entire barrel of flour, a month’s stay in a New York City tenement, or a ride on the Great Eastern steamship from Manhattan to Cape May, New Jersey.

In 1901, the $10 bill depicted explorers Lewis & Clark on the edges with a large American bison in the middle, and bought you ten private ballroom-dancing classes, a housepainter’s labor for eight days or a full eye exam and 10 pairs of glasses.

In 1929, all U.S. currency was changed to its standard size of today. Despite the popular belief, the car on your 1929 standardized $10 bill is not a Model T Ford, but a composite of cars from the day. In 1929, your $10 bill got you a year’s worth of accident and sickness insurance, a waffle iron, or a one-minute phone call from New York City to London.

In 1942, just after the bombing of Pearl Harbor by the Japanese, special $10 bills were printed for Hawaii with the state’s name printed on the front and back and the serial numbers printed in brown ink instead of red. This was done so that if the Japanese invaded Hawaii, the U.S. Treasury would declare these $10 bills worthless.

Keep an eye out for the new $10 bill coming early in 2006. Its design is still mostly green, but now features shades of orange, yellow and red and has renderings of the Statue of Liberty torch and the words, "We The People..."

Bibendum, The Michelin Man...

We all know him and just about all of us love him, whether or not we’ve ever purchased his tires, but how much do we really know about the Michelin Man?

I hadn’t given him much thought until my wife pointed out that the Michelin tires I bought a few months back had the Michelin Man right on the sidewall. Then, just a few weeks ago, there was an article about him in Fortune Magazine, so I just had to read it.

His name his Bibendum, which is a Latin gerundive which means, "Drinking to be done." To understand why they gave him a name synonymous with drinking, you must remember that 107 years ago, only wealthy well-to-do’s could afford cars and drinking and driving wasn’t really frowned upon yet.

Though he has become such a lasting icon, Bibendum came from pretty simple beginnings. Bibendum first came to the mind of Edouard Michelin when he and his brother Andres were at an auto expo in Lyon in 1894 and Edouard commented that some stacks of tires in a row looked like a line-up of tire men...all you had to do was add the arms.

It was just four years later in 1898 that Bibendum appeared in his first Michelin ad, a poster that depicted him as being so tough that he was eating broken glass.

Later in 1898, Bibendum was depicted as having just triumphed over two other tire men in a fight who looked notably like John Boyd Dunlop and the then-chief of Continental Tire.

Bibendum as a mascot made his debut in Paris in 1898 as well when an actor was paid to stand behind a cardboard cut-out of Bibendum at a cycle show to entertain the show’s patrons.

Bibendum was so popular an attraction at the show that Michelin’s rivals started shoving patrons, trying to get them away from the Michelin exhibit, and police had to be called in to restrain them.

It might seem a little much, but early tire manufacturing was a very competitive business that in those days catered only to the folks who were affluent enough to be able to afford motorized, wheeled transportation.

The industry's competitiveness even sparked a series of Bibendum ads in the early 1900s that had him standing in triumph, sword-in-hand, over fields of battered and bloodied tire men, crying out for mercy.

Then, in 1914, we finally saw the makings of the Bibendum of today when he appeared in an ad as a middle-aged good samaritan driver, cigar-in-mouth, lending a fellow motorist his best tire from his mid-section.

Today, you can catch the Michelin Man at auto expos and trade shows. Due to the risk of liability in today’s world, the actor inside Bibendum is under strict instructions not to say anything. Bibendum will take a picture with you, but he won’t put his arm around you, and keep his hands visible in front of him at all times. They’ve kept his name, but you won’t see today’s Bibendum bibending anymore...

Some Snacking Milestones

Doughnuts without holes existed in medieval Europe, but it is said that in 1847 a Maine sea captain by the name of Hanson Crockett poked out the pastry’s center to fit over the handles of a ship’s wheel, thus giving us the doughnut as it is today.

In 1896, Louis Rueckheim gives his popcorn snack to a salesman, who tries it and says, "That’s crackerjack!" It is a real word...look it up. Rueckheim trademarks the word.

In 1916, Antonio Gentille, a 14 year-old from Virginia, wins the Planter’s peanut logo contest by creating Mr. Peanut. He receives $5 as his prize. The hat, monocle, cane and gloves are then added by a professional artist.

In 1930, the Mars company creates a candy bar and names it after the family’s horse, Snickers.

In 1930, Jimmy Dewar, manager of the Hostess bakery in Chicago, creates the first Twinkie, filled with banana cream. He gives the cakes their name after seeing a billboard for Twinkle Toe Shoes. The banana filling remains until World War II when America has a banana shortage, forcing the switch to vanilla.

In 1932, after tasting Fritos in a San Antonio cafe, struggling ice cream maker Elmer Doolin purchases the recipe for $100. He makes the chips in his mom’s kitchen and distributes them in his car.

In 1941, M&M’s are first sold, primarily to the American military. The coating that prevents the candies from melting in your hand makes them a popular snack for soldiers in any climate, say even Northern Africa.

In 1965, Lay’s potato chips, which already have the "Betcha can’t eat just one" slogan, become the first chips to be sold nationally.

Know We're Paying For That?

When you depsoit your money in the bank, you feel comfortable because of those FDIC plates that tell you that your money is insured.

Well, it is true that your money is insured, but here is something that you may not have known...if the U.S. Government had to pay out on that FDIC insurance on a mass scale, it could total up to $3.4 trillion based on current deposit rates.

Where do you think the U.S. Government will get that $3.4 trillion dollars when it needs it? Why from the citizens, of course, through a tax hike, where else?

Here are some other things that you might not know.

The U.S. Government insures American farmers - we all know that - but did you know that the potential for loss could be as high as $41 billion in a single farm season?

When you buy flood insurance, chances are that you are buying that flood insurance from the U.S. Government because almost all private insurance companies will not take on the risk. An unheard-of catastrophic flood season could potentially carry a bill for the tax-payers of $643 billion.

How about nuclear power plants? Did you know that once an accident bill at a nuclear power plant exceeds $9.4 billion, there are laws in place that say every penny over that amount will be paid for by the U.S. Government, again, meaning the tax-payers?

Now, here is the real kicker. You might work a job where you have no pension, or no retirement plan, but when the U.S. Government steps in to bail out failed pension plans through The Pension Benefit Guaranty Corp., it uses your income tax dollars to bail out the pension. It doesn’t matter what side of the political spectrum you are on...that’s gotta upset you.

Ukraine's Samyilo Adamovich

Since being let out from underneath the Iron Fist of the Soviet Union, Ukranian historians have been digging deep into their history, an endeavor that was virtually impossible under communist Soviet rule.

According to the Ukranian press, Ukranian historians have uncovered evidence that a man by the name of Samyilo Adamovich moved to London shortly after the Russian-Swedish war in 1708.

Once in London, Samyilo changed his name to Sam Adams, and eventually moved from London to the American colonies, where is son, Sam Adams, was born and later became the Sam Adams that we know today.

Ukranian historians also claim to have found a 1712 draft of a constitution strikingly similar to ours.

No Protection For Owners

When a reserve soldier is called up to active duty, there are laws and regulations that protect that soldier’s job while he or she is away on active duty.

What most people are not aware of, however, is that there are little to no regulations, laws, or protections for the small business owner who is also a reservist.

I recently read an article about small business owners and how their newly activated reserve status is affecting them and their businesses and felt compelled to share with my readers the facts.

As an employer, you can fill the job of a reservist, but it must be waiting for that reservist when they return from active duty, but, what about the employer him- or herself? There are no safeguards to assist the small business owner when his or her unit is called up to active duty.

There are no government subsidies that provide for lost income, provide for lost revenue, or damage to the business while the business’s owner is overseas on deployment.

I, for one, would like to see this change, but I think we all know how likely it is that this will change any time soon. For now, we need to be aware of this pitfall in our nation’s reserve policy and demand changes from our elected officials.

Keep Your Plutonium...

You’ve heard of the police stings where they send notices to people with arrest warrants that say they have won a car or a boat, then when the unsuspecting criminal shows up to claim their prize, they get handcuffed instead...You’ve also heard of programs where law enforcement officials buy back weapons, right?

Well, frighteningly enough, there is enough unaccounted-for nuclear material in Russia that they are combining the sting and the buyback and have offered to buy nuclear material at $8.25 per milligram, then are arresting the people that bring in large quantities of material.

The program has yielded an arrest of a former government enrichment plant worker. The man, Leonid Grigorow, received word from the Russian government that they were closing his plant in 1992, but when Leonid’s requests for disposal of the plant’s weapons-grade plutonium went completely unanswered by the Russian government, he simply put all 400 grams of the plant’s plutonium in a lead case, took it home, and put it in his garage, where it has been since 1992.

Upon hearing about the buyback program, Leonid did the math and realized that 400 grams at $8.25 per milligram would yield him $3.3 million, but when he went to turn in the plutonium, Leonid was arrested.

Let’s all thank the Russian government for teaching everyone that turning in plutonium to the proper officials will result in an arrest, while selling it to terrorists will actually probably get you the $3.3 million.

The Most Beautiful Benz Is The One That Saves Your Life...

Imagine that you are loyal to a car company with every purchase you have made for the past decade...then imagine that one of those cars saves the life of one of your loved ones.

There is not a single year of my life that has not been spent as a resident of Orange County, and as such, when I say that this winter’s rainy season was the worst I’d ever seen, even beating out 1993, which seemed impossible, I know what I’m talking about.

The worst day this winter for us came on December 28, 2004 when I was awoken by a call from my wonderful girlfriend of 7 years, Teresa, while on her way to work, telling me that she had been involved in a car accident.

If you’ve ever received one of those "accident" calls, you know the feelings I was experiencing at the time.

That morning, as I was driving down the 73 to get to where Teresa was, I was driving through, literally, one of the worst rain storms I have ever seen in my life.

Now, I figured that if Teresa had been able to call me to tell me she’d been in an accident, that was the most promising sign that she was, in fact, all right. The fact that she had been able to tell me that she had not hit any other cars and describe what had happened as she slid off the road was also reassuring, but I must admit that as I arrived to where the car had slid off the road, literally bent the guard rail into a "U" and was sitting in six-inch deep mud, I became very worried.

Then, when I saw the car, I became even more worried...but, as I got to Teresa, she looked a little shaken up, but seemed totally fine. The OC Fire Authority was there and I can’t thank them enough for the job they did caring for Teresa that morning.

Teresa was taken by ambulance to Hoag and was given a clean bill of health. Though she had a bit of soreness in her neck for a couple days, otherwise, Teresa came out of the accident completely unharmed.

That morning, Teresa’s 1998 Mercedes-Benz C230 did exactly what we had bought it to do...save her life.

When something in the road blew out the car’s right front tire and the mass of water in the road from the downpour sent the car veering off the road uncontrollably, it wasn’t the "luxury" part of the car that saved Teresa that morning, it was the century of unparalleled safety engineering.

Later in the morning, when we went to the towing yard to get Teresa’s things out of the car, the workers there commented about how they hoped whoever was driving the car, described by them as in the worst condition of any car they’d seen in a long while, was making it through okay, and I amazed them by telling them that she was right there, walking next to me.

A Mercedes-Benz looks beautiful sitting, shiny and new on the car lot and looks and feels beautiful as it performs out on the road, but you’ll come to find that the most beautiful Mercedes-Benz that you will ever see is the one that saves your life.

A U.S. Tax Timeline...

1913 - The 16th Amendment authorizes income taxes. Congress taxes income over $3,000.

1918 - During World War I, Congress institutes progressive tax rates with a top bracket of 77%.

1919 - Prohibition begins. The commissioner of Internal Revenue must enforce it.

1931 - Gangster and bootlegger Al Capone is convicted of tax evasion.

1933 - Prohibition is repealed.

1942 - The Revenue Act raises tax rates but allows deductions for medical and investment expenses. President Franklin D. Roosevelt says, "In time of this grave national danger, when all excess income should go to win the war, no American citizen ought to have a net income, after he has paid his taxes, of more than $25,000 a year."

1943 - Payroll withholding is introduced.

1944 - Congress creates the standard deduction.

1954 - April 15 replaces March 15 as the deadline for filing income taxes.

1974 - The Employee Retirement and Income Security Act gives the IRS regulatory responsibility for employee benefit plans.

1981 - Congress enacts a $750 billion tax cut, the largest in U.S. history. 401(k)s are introduced. IRAs become widely available to Americans.

1982 - Deficits soar and tax cuts are repealed.

1984 - Deficits still soar and more tax cuts are repealed.

1988 - George H.W. Bush says, "Read my lips; no new taxes."

1990 - Taxes rise for the wealthy. Observers later suggest that this hike will cost George H.W. Bush the 1992 election.

1993 - President Bill Clinton signs into law a $496 billion tax hike.

1997 - President Bill Clinton cuts capital-gains rates and introduces the $500 child credit.

2001 - President George W. Bush cuts taxes and the IRS mails outs "advance refunds."

2003 - A 10-year $350 billion tax cut temporarily reduces dividend, gain and estate taxes.

When It's 2010, 2015, & 2050...

When it’s 2010, the average life expectancy of men turning 65 will be 81.4 years, while women turning 65 in 2010 will live to 84.1 years.

Mean household income, which is $92,553 today, will get up to $113,361 in 2010 and $133,831 in 2015.

Americans’ taxable payroll which is at $4.7 trillion today will go up to $5.4 trillion in 2010 and $6.1 trillion in 2015.

The U.S. GDP which is at $12.1 trillion today will shoot up to $13.9 trillion in 2010 and $15.7 trillion in 2015.

Today, Social Security revenue is 12.73 cents per $1 of taxable payroll with 11.05 cents of revenue being paid out and 1.68 cents of revenue being put into the surplus fund. In 2010, Social Security revenue will go up to 12.83 cents per $1 of taxable payroll with 11.34 cents being paid out and only 1.49 cents being put away. By 2015, Social Security revenue will reach 12.95 cents per $1 of taxable income with 12.26 being paid out and only 0.69 cents being put away.

Today, U.S. unemployment is at 5.25% and is expected to go down to 5.21% in 2010 and 5.20% in 2015.

The U.S. population, at 288 million people today, will go up to 309 million in 2010, 323 million in 2015, and reach 421 million in 2050.

Within the U.S. population, people over the age of 65 make up 12.4% today, will make up 13.0% in 2010, make up 14.5% in 2015 and make up 20.7% in 2050.

So what else is in store for 2050?

According to Elizabeth Gardner from Financial Planning Magazine:

• There will be "solar" paint with embedded semiconductor particles that can power the electronic devices that are painted with it
• Wearable electronic devices will run on power generated by the wearer’s skin (a process patented by Microsoft in 2004 that will help the company reach $1.4 trillion in market value by 2050)
• People of two or more races will be so common in the U.S. that the Census Bureau will consider dropping the "race" question from the census (the CB will actually drop the question sometime after 2100)
• Printable transistors will be woven into clothing so that people can sell commercial time on their clothing to advertisers
• Distance learning will replace institutions of learning like Harvard for the most part (where annual tuition will be $320,000 in 2050) and individual instructors who teach students all over the world remotely will become the new icons of learning
• California will be forced to institute once again an English-only policy for official city and state signage as ethnically-centered populations have resulted in entire cities having official signs in only that city’s most popular language
• Human tissue, bones and organs will be custom-made using devices that build three-dimensional structures of living cells, revolutionizing prosthetics and the plastic and restorative surgery industries
• The penny will finally be officially eliminated by congress, but other cash and coin in the U.S. will still be around for private, in-person transactions, while a new form of currency that is worldly universal for use over the Internet and electronic shopping methods will have been popularized and replace the U.S. dollar as the defacto standard for the world’s currency
• Land-fill mining companies will be becoming popular, mining old landfills for metals, minerals and other materials whose natural resources have been exhausted
• The youngest baby boomer will be 86, the oldest 104
• Books will be a retro luxury much like vinyl records are today with some pretty common books by today’s standards being displayed in museums while book-binding will become a well-to-do hobby like home wine-making or beer-brewing is today
• To deal with seething social unrest caused by an excess of single men, China will offer attractive financial packages to Chinese girls adopted buy U.S. families to get them to come back to China
• There are 800 million cars on the world’s roads today, but there will be 3.25 billion by 2050

Time To Start Checking Your Credit Reports

As of December 1, 2004, California residents are entitled to view their credit report from each of the 3 big credit bureaus, free of charge, once every 12 months.

I recommend that you get one of the three reports every four months so that over the course of the year, you see all three reports, but are monitoring your information once every four months.

You can begin the process at www.annualcreditreport.com.

Be fair-warned, though, while the reports are free, you’ll have to pay about $6 to actually see your credit score.

The good news is, though, you can dispute the inaccuracies that you find right then and there online.

Be sure to call your creditor yourself to dispute as well...don’t rely on the credit reporting bureau to do it all on their own.

Truth About Credit Cards: So, In Conclusion...

So, as we sum up this look at the credit card industry, what have we learned?

There are no laws in existence today that limit how high your credit card interest rate can go. There are no laws in existence that limit the number of fees that the credit card companies can charge you, nor the dollar amount of those fees. Even though you can avoid fees by paying your credit card bill on time, all the credit card company needs to do to raise your rate is declare that you are in Universal Default and once that happens, they can amend their agreement with you however they wish.

If you feel that you are being ripped off, the only place you can turn to is an inept federal agency that isn’t going to do anything. We have learned, that in essence, the credit card companies can do whatever they want, when they want, and there is nothing that consumers can do about it.

So, why then, do millions of Americans keep running up credit card debt? Why do we all refuse to learn the knowledge that we need in order to make the right financial decisions when it comes to credit, especially these evil monsters known as credit cards?

It is because it is so easy. A piece of plastic you carry around with you that allows you to buy things that you don’t have the money to buy. It is instant gratification without any concern for the long-term effects of that instant gratification. If that does not define humanity, then I do not know what does.

There is an industry in this country that has perfected its methodology of legally extorting more and more money from the consumer over the course of the past 40 years that is working against us and we refuse to even be bothered with such chores as reading a credit card agreement from start to finish.

We all know smoking is bad for us, but there are still smokers out there. We all know that credit card debt is bad for us, but 90 million of us are Revolvers. 90 million of us at one point had $0 in credit card debt and knew long before we charged dollar one that credit card debt was a bad idea and was going to cost us in some cases over 100% more than the actual purchase price of whatever it was that we could not live without, yet we still handed that piece of plastic over to the cashier.

They get us with late payment fees, over-limit fees, minimum payment fees, cash advance fees and interest rates that are completely ridiculous, especially when compared to deposit interest rates, yet we keep begging for more.

7 million bankrupt families worth of it over the past 5 years alone.

If you owned a 1979 Honda and a 2005 Ferrari and I bought the Honda from you for $300, then came back after the fact and told you I thought I paid $300 for the Ferrari then took you to court, we all know I’d be laughed out of there by the judge.

Yet, we “sign” open-ended credit card loan agreements that allow the credit card companies to change the deal after the fact however and whenever they want, and we keep screaming for more.

Everyone is up in arms about those damned evil cigarette companies that knowingly sold us poison for years, but how many of us are calling our government representatives about the credit card companies and the lack of laws and regulations that govern what they do to us?

How can a FICO score determine the home we get, the car we are able to drive, the very interest rates on everything that we borrow, yet be something that is a complete and total mystery to us?

How can we be surprised that a multi-billion-dollar-a-year industry has no concern for us on an individual level and be surprised when after making ten years worth of on-time payments, turn around and raise our interest rate and penalize us after just one late payment?

Whether we learned that fire could burn because our parents told us, or we found out the hard way, we only had to learn once that fire could burn and you can bet that we stay the hell away from it.

Why, if we all know that credit cards burn, do we all keep touching the flame? 

Let me close with some final words...a quote from my Bank of America credit card agreement:

“If at any time during any rolling consecutive twelve billing cycle period you fail to make two Minimum Payments on a timely basis or exceed your Credit Limit twice, we may elect to increase your Purchase, Cash Advance and/or Balance Transfer APRs to the Penalty APRs.”

For my purchases on that particular card, that means going from an interest rate of 13.24% to 29.24%.

And that, is why the credit card companies love Revolvers so much...

Truth About Credit Cards: Universal Default

Universal Default. Sounds scary, doesn’t it? Well, it is.

When you apply for a loan for a car or a home, there is an agreement between you and the bank over the interest rate. In some cases, the rate is fixed for the life of the loan and in other cases, the interest rate may fluctuate as the prime interest rate fluctuates.

Either way, you do know what your interest rate is and there is an agreement between you and the bank that spells out what it is and how it is figured. Not with credit cards, though.

You may even have a fixed rate credit card, but even the interest rate on that card can change. A credit card is a short term loan, designed to be paid off each and every month. A credit card limit and a credit card interest rate are assigned to you based on what your credit score is at the time that you apply, just like with any other loan.

The difference between a credit card loan and other types of loans is that a credit card company views their terms with you as short terms and can re-evaluate you each and every month if they wish.

How do they evaluate you? They run your credit and look at what your score is doing. Say you applied for a card and had a 750 and landed a 12.9% fixed rate. Pay your payments on time and in full and keep your 750 and there is no problem, but if your score goes down, you have made a change in the terms and the credit card company can raise your rate based on that.

Also, if they give you credit based on a good payment history and find that a year later, even though you have been paying them on time, you have been making late payments elsewhere, they can find that you no longer have a good payment history and raise your rates.

This change in your credit score and payment history is the concept called, Universal Default. You have not made a late payment on your credit card, but a late payment on anything anywhere else, or a drop in your credit score can put you in Universal Default.

All credit card agreements site Universal Default as a justified reason for raising your interest rate, even on a fixed rate credit card. All they have to do is give you 15 days notice before they change your rate and they can raise your rate to whatever they want.

Truth About Credit Cards: Watch Your Due Dates

So, they can do whatever they want to? Why yes, they can. Take a look at your due dates.

You might find that some of your cards have due dates that change each month.

There is not a wide fluctuation, like say from the 3rd to the 23rd, but it may move a day or two here and there.

So, what this allows the credit card companies to do is put your due date on a Sunday or a holiday here and there in the hopes that you might get a little too busy and forget to make your payment on time.

It might sound a little trivial, but they make millions in extra revenue each year by doing this and it is all perfectly legal...

Truth About Credit Cards: No Laws On Fees, Either

Just like there once was a limit to how much the banks could charge in interest on credit card loans, there once was a limit to the fees that they could charge you as well.

Then, a court decision, Smiley vs. CitiBank went in CitiBank’s favor and it removed all of the limits on fees.

Back in the 1970s and 1980s, a late payment fee was usually around $5 and all that happened when you reached your limit was that your card stopped working.

Today, the high late payment fees hover around $39 per occurrence and are expected to creep up to $49 pretty soon. Today, your card still works past the limit for a little bit so that when your statement cycles, you can be charged an over-limit charge.

All fees and charges go on your balance and can result in even more fees and charges. All of this is perfectly legal because thanks to Smiley vs. CitiBank, there are no limits to dollar amount of fees and the number of fees you can be charged.

Today, compared to twenty years ago, fee income for credit card companies has more than doubled. This is where the credit card companies really make their money today.

Thanks to Smiley vs. CitiBank, there have been no aspects of the credit card loan interest and fee rates that have been regulated by law since 1986.

This means that these credit card companies can charge us whatever they want to, when they want to and it is all nice and legal...

Truth About Credit Cards: Minimum Payment Scam

Now, let’s talk about minimum payments. Back in the 1970s when banks wanted you to pay your credit card balances down to get their money back because they really didn’t make that much from the capped interest rates, it was actually the norm for the bank to expect you to pay - on average - 5% of your total balance due as your monthly payment.

This average of a 5% minimum payment each month was the norm for many years, that was until the credit card companies turned to a man named Andrew Kahr, who today very rarely grants interviews, and will only do interviews if reporters promise not to reveal what part of the country he lives in and who his clients are and were.

As the big banks were turning into credit card companies because those pesky credit card interest rate caps were gone, those companies brought in Andrew Kahr to see how they could squeeze even more money out of the consumers they were now charging 20% interest.

Andrew looked at the psychology behind America’s emerging lack of financial responsibility in the 1980s and came up with a theory. Andrew felt that the 5% minimum payment was requiring the debtor to properly manage and worry about the amount of debt they took on, but that if the credit card companies lowered that minimum to a mere 2%, the debtor would have a much smaller minimum payment to worry about and would feel free to become relaxed about their debt management.

Not only was Andrew’s theory correct, it resulted in a fringe benefit for the credit card companies. See, at a 5% minimum, it would take you much less than half the time to pay off the debt that it would at a 2% minimum, and on top of it, the people making the 2% minimum still would think they were being financially responsible because they were not missing payments.

Today, the 2% minimum is industry wide and consumers take on a larger amount of debt because their monthly minimum payments are lower, and all the while, it is taking them more than twice as long to pay off their debt, giving the credit card companies more chances at late payment fees and over-limit fees.

Truth About Credit Cards: Are You Friend Or Foe?

Some of this may be hard to hear, but believe me, it is important for consumers to know and understand this information. I've explained how the banks became credit card companies and I hope that we can all agree that someone who would borrow a dollar from you at 0.25% interest, then turn around and loan you that same dollar at over 20% interest, is not a friend.

So now, let me ask you if you are a friend or a foe of the credit card companies?

Don’t answer just yet...let me give you some more info first.

55 million Americans pay off their credit card balances down to $0 each and every month. The credit card industry calls those people “Deadbeats”. 90 million Americans do not pay off their credit card balances down to $0 each and every month. The credit card industry calls those people “Revolvers”.

Deadbeats are foes of the credit card industry and Revolvers are friends of the credit card industry. So, now, answer...are you a friend or a foe of the credit card industry?

Deadbeats are foes because the credit card company does not make any monthly interest off of them and does not make any fee income off of them with over-limit fees and late payments fees.

Though credit card companies make a small percentage from the merchants that the Deadbeats purchase from, that is all they ever get from Deadbeats.

Revolvers are wonderful friends of the credit card companies because they are able to make monthly finance charge income that, in turn, goes on top of the credit card balance, compounding to a point at which even the interest can result in over-limit and late fees. Revolvers are much more prone to miss payments or not make minimum payments, generating late payment fee income, again, which also compounds on top of the credit card balances.

So, now, answer...are you a friend or a foe of the credit card industry?

Truth About Credit Cards: Interest Rates

I have always considered myself in-the-know when it comes to credit and pride myself on what my little three-digit number is, but I just learned some very, very interesting things about credit cards that I am anxious to share.

First and foremost, today, we are going to take a look at credit card interest rates and how they became the monsters that they are today.

I don’t know if this stuff is new to all of you, but it was to me. Though it is hard to imagine in today’s world where the average American family has $8,000 worth of credit card debt at average interest rates that tower over 20%, there was once a day when credit card companies were real banks and were regulated like banks.

Let me take you back to the early 1970s for a picture of the credit card industry that is unimaginable today. See, back then, your bank and the bank that issued your credit cards made money from loaning money out at a higher interest rate than it paid on deposits.

Just like today, right? Well, not exactly.

Back then, there were state laws in place called Usury Laws that, in order to protect consumers, capped the interest rates that people could be charged on loans from banks. There was a limit for the rate for a new car loan, a limit for the rate for a used car loan, a limit for the rate for a mortgage, and yes, a limit for the rate for credit card loans.

Though we tend to forget today, that credit card balance is a loan. Credit cards were a small business back then and the credit card powerhouses of today were just banks that offered credit cards as one form of a loan.

So, what in the world happened? Well, in the late 1970s and early 1980s interest rates were skyrocketing. Credit card issuers, like CitiBank, were being forced to pay nearly 20% on its deposits to keep competitive with the market, but the New York State Usury Laws capped credit card interest at 12%.

Do the math and you’ll see that CitiBank was going to run out of money and run itself out of business with high interest rates on deposits and low interest rate caps on loans. With conditions like this, capitalism did what it is supposed to do and created an opportunity.

With Usury Laws capping loan interest rates in all 50 states, what if you were the one state that turned things upside down by eliminating the caps on interest rates, allowing banks to charge higher interest rates on loans?

Bill Janklow was elected governor of South Dakota and immediately asked that question. He, in a matter of mere weeks, pushed through legislation that revoked all Usury Laws in the state of South Dakota. So, long story short, CitiBank moves its credit card division to South Dakota and begins charging a rate higher than the going interest rate being paid on deposits in South Dakota. Shortly thereafter, other banks moved their credit card divisions to South Dakota, and then, seeing South Dakota’s new-found success, a few other states dropped their Usury Laws.

As bad as this was for consumers in these states who were once protected by Usury Laws, the final nail in the coffin on Usury Laws that capped loan interest rates came in the early 1980s with a court decision called the Marquette Decision that allowed all U.S. banks to export the non-capped rates of their home state to all other 50 states, thus, in essence, rendering all the Usury Laws in all the states null and void as long as a bank’s credit card headquarters was in a state without credit card Usury Laws.

So, in essence, following the Marquette Decision, there were no more caps on what banks could charge their customers for loans through credit cards. 

Needless to say, that as interest rates on deposits deflated and came down over the years, the banks never adjusted their credit card loan rates back down and today, while you get a 40-year low of 0.25% on a savings account from a bank, that same bank will charge you over 20% on the credit card you have with them.

With the Usury Laws null and void, it is perfectly legal for the bank to do this. 

The mass of income that this has generated over time as Americans became less and less responsible with their credit and personal finances turned those banks like CitiBank into credit card companies with credit card interest being their main money-maker.

How Wal-Mart Pricing Works...

The CEO of Wal-Mart will tell you (and I’ve seen the interviews, folks) that the giant chain does not get discounts from their vendors because they purchase from them in such large volumes.

Though he’s not telling the truth entirely, he’s not lying entirely, either. Here is how the big chain’s pricing edge works.

A local mom and pop tire store will purchase a tire for $18 from Goodyear. Wal-Mart will buy a very very similar tire from Goodyear for $6. Naturally, the final price the consumer pays at Wal-Mart is much lower than the price they will pay at the mom and pop tire store.

First, Goodyear can get away with charging Wal-Mart so much less for the tire because Wal-Mart buys a large volume of tires. Also, large chain stores like Wal-Mart do their own advertising, so Goodyear has absolutely $0 in promotional and marketing costs in order to sell the large number of tires that are purchased by Wal-Mart to be re-sold to the end consumer.

Now, you ask in your 1930s draw, “ain’t there laws a’gain’ it?” Yes, there is, but here is how they work.

The competition pricing laws, most passed during the 1930s, were designed to protect the end consumer from price fixing. The laws state that a company like Goodyear cannot sell the exact same tire at grossly different prices to different customers unless they can justify the cost difference as a saving to their own bottom line.

The lack of promotional and marketing costs are the justification for the price difference and what companies like Goodyear do is add a number or two to their model number or maybe a different notch in the tread pattern and they are now no longer selling the same exact tire to the mom and pops as they are to Wal-Mart.

So, between the “different” tire and the “justification” of the price difference, the mom and pops do not have a leg to stand on.

To seal the deal, all of the 1930s competition laws state that in all cases, the consumer must be the end beneficiary of any intervention, so when the consumer can save 2/3 of their money by buying from the chain, there aren’t many lawmakers out there who are going to want to force the consumer to buy from the mom and pops.

Remember Where It Started...

As reports are being released and the quality of the intelligence that led us to war in Iraq is coming under fire, it is important for us to remember a few important things.

Most notably, President Bush did not undertake the gathering of intelligence himself, nor did he misinterpret the intelligence. Though we may all be in agreement that the intelligence was bad, it was not the President’s fault that he received bad intelligence.

The President was right to rely on the intelligence provided to him from the CIA, intelligence from the world community, and yes, even intelligence from the UN.

Also, it is important to remember that despite what the media is trying to throw at us everyday, many elements of the intelligence were, in fact, quite true. Also, it is important to remember that the US policy prior to President Bush coming into office was one of containment when it came to Saddam Hussein.

The problem with just holding him at bay was that he was in the midst of beefing up his long-range missile development program and developing long-range missiles with chemical and possibly nuclear warheads. The only thing keeping the Iraqi regime from being nuclear capable was purchasing the material at a time when Pakistan was selling nuclear material left and right.

These were missiles that could have hit Turkey, Israel, Greece, Saudi Arabia and other Mediterranean and Middle Eastern nations. Intelligence on the missile program came from the UN, so this is not a Bush-led conspiracy, folks.

Another key point to remember as people bemoan the quality of intelligence that came from the CIA is that the Clinton administration cut back military and intelligence spending in the years before 9/11.

It was the Clinton administration who continually robbed the CIA of the hands-on intelligence gathering methods of the Cold War that kept us safe. It was the Clinton administration that put us in a position where we were relying on satellite passes instead of boots on the ground.

And lastly, we still cannot ever forget that it was the Clinton administration that sat back in 1993 and in 1997 and in 1998 when U.S. targets at home and abroad were attacked by Al-Qaeda terrorists.

Michael Moore will point out that the Taliban sent an envoy to the U.S. that was welcomed in Texas, even though they were harboring Osama Bin Laden, but he doesn’t mention that the Clinton administration refused time and time again to capture or kill Bin Laden himself when the CIA had him in their sights.

Constitutional Crisis in 1876

If you think the presidential election of 2000 was ugly, you should have been around for the election of 1876.

Waged against the backdrop of Reconstruction, the race pitted Democrat Samuel J. Tilden, a reform-minded New York governor, against Republican Rutherford B. Hayes, a three-term governor of Ohio.

Amid vote-buying, intimidation, and political skullduggery of the most blatant sort, three states, Florida, Louisiana, and South Carolina, submitted two sets of electoral votes, one for Hayes and one for Tilden.

A constitutional crisis ensued, and Congress appointed a special election commission to sort out the disputed votes.

Then, in a backroom deal, the Republican-controlled commission asked Southern Democrats to award all 19 disputed votes to Hayes, and in return, once president, Hayes would withdraw all federal troops from the South.

The bribe was accepted by the Democrats and Hayes ended up with 185 electoral votes to Tilden’s 184. For the next four years, bitter Democrats called the new president “Rutherfraud” and Tilden “President Tilden.” Tilden called the debacle “the greatest political crime of our history.”

Unchecked School Administrators

Well, here we go again with school...

Shiba Pillai-Diaz is a middle school teacher in New Jersey. She decided to decorate her classroom’s bulletin board with an American theme. So, she put up an American flag, a poster of the Declaration of Independence and portraits of several U.S. Presidents. Wanna hear why she had to take the bulletin board down?

There were enough parents and spineless school administrators who listened to those parents, that’s why!

What was their complaint? Well, one of the pictures of the U.S. Presidents was George W. Bush, the current sitting President, and whiny parents said that if this teacher was going to have a picture of George W. Bush up, she should have a picture of John Kerry up too, to be fair.

She was given a choice...put John Kerry up on the bulletin board, or take the whole thing down. So, when we put up pictures of the Presidents of the United States of America, do we now need to include the current Presidential Candidates as well?

According to these parents and this teacher’s bosses, we do. So, is this where we are at in America? Our teachers cannot put up a picture of a sitting President during his re-election without putting up pictures of the people running against him?

Now, hold on a second...understand what you just read? I said “people,” didn’t I? Yes, there is more than one person running against George W. Bush in this election, but there was only an outcry for John Kerry’s picture, not an outcry for pictures of each of the Presidential Candidates. What do we call that, boys and girls? We call that hypocrisy.

Parents claimed it was unfair for the teacher to put up just Bush’s picture and whined for Kerry’s picture. They did not, however, whine for pictures of all of the candidates...just their candidate. Why did they want Kerry up on the bulletin board? They said it was to be fair, but I must call them on the fact that it is just because it’s their candidate, not because they are looking for something to be fair.

“Damn Right I’m Paranoid!”

At times, I have been accused of being paranoid. Maybe it is because I love to watch documentaries on crime so that I can stay informed on the criminal mind that is constantly working against us, the people who work for a living.

If always keeping in mind that there are dangerous people out there and being wary of placing myself in situations where they can get at me and my loved ones is paranoia, then I welcome being called paranoid.

Did you grow up in a neighborhood where gunfire broke the night silence at least once a week? I did. It may sound like an after-school special, or a sub-plot from Boyz N' The Hood, but by the time I graduated from high school, I’d been to five funerals of murder victims that I had known personally...and I grew up in Orange County, California.

Maybe that’s why I have an understanding that there are people and places in the country that are dangerous. Why, just last Friday, there was a shooting in Newport Beach and the suspect fled down the 73 South, the same toll road Teresa and I use everyday. Did I see the suspect? No, but I did almost get hit by a Newport Beach Patrol Car that passed me on Pacific Park in the bike lane, racing to catch up with the chase without his siren or lights on.

This guy’s sworn duty is to protect me and he almost killed me with his pursuit-induced bad driving, so can you image the capability of doing damage of someone who is intending to hurt me?

Now, I am not endorsing that we all live in fear, and I do not consider how I live living in fear, but it cannot hurt to be cautious of our surroundings and to watch for warning signs.

Last Friday, in Kansas City...why is it that when a meat-packing plant worker has walked into the plant and murdered five people, it seems like everyone saw it coming, but did nothing about it other than to stand around afterwards and say, “I knew it was going to happen.” Were they afraid of being accused of paranoia?

We live in an America where you can be at work and have a co-worker standing in front of you, gun in hand, and literally passing judgement by saying, “You haven’t done anything to me, so you can go,” then moving on to the next co-worker.

You’d better hope you didn’t accidentally spill coffee on this guy yesterday, or have taken too long in the bathroom when he needed to use it, because today is the day that he is going to walk in and end your life for it.

Oh, but I’m paranoid...

Is Democracy Temporary?

You may recall hearing a quote from Alexander Tyler, a Scottish history professor at The University of Edinburgh, about “The Fall of The Athenian Republic” some 2,000 years prior. It was written about the time our original 13 states adopted their new constitution in the year 1787.

Here’s what he had to say: “A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, (which is) always followed by a dictatorship.”

The average age of the world’s greatest civilizations from the beginning of history, has been about 200 years. During those 200 years, these nations always progressed through the following sequence: From Bondage to spiritual faith; From spiritual faith to great courage; From courage to liberty; From liberty to abundance; From abundance to complacency; From complacency to apathy; From apathy to dependence; From dependence back into bondage.

More recently, Professor Joseph Olson of Hamline University School of Law, St. Paul, Minnesota, points out some interesting facts concerning our 2000 Presidential election:

Population of counties won by:
Gore = 127 million
Bush = 143 million

Square miles of land won by:
Gore = 580,000
Bush = 2,427,000

States Won By
Gore = 19
Bush = 29

Murder rate per 100,000 residents in counties won by:
Gore = 13.2
Bush = 2.1

Professor Olson adds: “In aggregate, the map of the territory Bush won was mostly the land owned by the tax-paying citizens of this great country. Gore’s territory mostly encompassed those citizens living in government-owned tenements and living off government welfare...”

Olson believes the U.S. is now somewhere between the “complacency and “apathy” phase of Professor Tyler’s definition of democracy; with some 40 percent of the nation’s population already having reached the “governmental dependency” phase. It comes as no surprise that the team of Kerry/Edwards is appealing to the same electorate. There’s a lot at stake in this Election Year and apathy is the greatest danger to our freedom.

Thomas H. Moorer: A Story That Must Be Shared...

Thomas H. Moorer, died in February 2004. I am saddened that I did not know who he was until I read his obituary.

Thomas H. Moorer was most well-known for his appointment to chief of naval operations by Lyndon Johnson in 1967 and for his service on the Joint Chiefs of Staff during the Vietnam War. Moorer’s story is a very fascinating one.

Moorer was a Navy lieutenant pilot stationed at Pearl Harbor on December 7, 1941. He was one of the few pilots who actually got airborne that morning and fought in the air against attacking Japanese fighters.

A year later, while leading a push back against Japanese forces moving towards Australia, Moorer and his crew were shot down by a swarm of nine Japanese fighters. Moorer bounced his plane off the water three times, slowing it and finally making a successful water landing. After being adrift, Moorer and his crew were rescued by a Philippine freighter.

Amazingly, just minutes after they were pulled from the water, the Philippine freighter was attacked by Japanese dive bombers and sunk. Moorer led the ship’s evacuation into two life boats and successfully guided the survivors to a deserted island, where, finally, two days later, Australian fliers saw the large S.O.S. that Moorer and his men had made on the sand from beach debris.

Moorer would go on to become the navy’s youngest rear admiral in history at age 45 in 1958. Moorer would later be appointed to the Joint Chiefs and serve as Chairman from 1972 to 1974. Upon his passing, I felt it only right to tell his amazing story and to thank him for his service.

Why Ethics Are In Decline...

There are two reasons that I am writing about business and ethics again today. 

Reason #1: At the end of May, I began receiving emails from Strong Financial, my former investment company that became my former investment company after it’s founder and captain, Dick Strong was caught using time zones and different closing times of international markets to pad his own personal stake in the company. These emails were talking about how exciting it was for Strong Financial customers that Strong Financial was going to be “merged” into Wells Fargo, thus resulting in access to new Wells Fargo investments. I must admit that I had a very difficult time getting excited about this because I knew that the only reason these Wells Fargo investments were being made available to me was because Dick Strong acted in an unethical manner, was caught, and forced out of his leadership positions, resulting in the fail of Strong Financial and the necessity for it to be picked up by Wells Fargo in order to survive. Could you imagine spending your life building a company, then losing it just because you got a little greedy? This time-zone play was wrong and Dick Strong knew that it was wrong, and now his life’s work is going to end up as part of a division of Wells Fargo.

Reason #2: Teresa was at traffic school this past Saturday and re-told to me a story that the class’s instructor told her. When this instructor was a young girl, her family was involved in a car accident while on a road trip. The evening of the accident, the instructor and her sister found themselves in a strange town with nowhere to stay the night while their parents were in the hospital being treated for their injuries. The instructor’s mother called for a priest and the priest found a family for the girls to spend the night with that lived in the same town that the hospital was in. As the instructor was telling the story to Teresa’s traffic school class, she commented on how things were different back then and how people could be trusted.

We all know that things were different back then, but then this led me to ponder the question of why we have accepted this decline in ethics over time.

There is no question that, on the whole, American society grows more and more unethical every year. American business can do little but follow that trend because American business is made up of the same individuals that make up American society.

Ethics do not decline overnight, so there is not a clear-cut morning where we wake up and things are suddenly unethical, but even though this slide of ethics has occurred over decades, I cannot help but ponder why there are so many people out there in the business world that tolerate loose ethics, or a lack of ethics altogether, from the people they do business with and the people that they employ.

Why does an 18 year-old kid in the work place today think it is perfectly all right to sit in the company bathroom and text message his friends while on the clock? Is it technology’s fault? Is it how children are raised now as opposed to then?

It may be part of the reason, but what I am coming to believe is that the largest portion of blame for this slide in ethics lies with people out there in the business world who tolerate it.

Ethics thrive when unethical behavior is not tolerated, therefore, naturally, ethics decline when unethical behavior is tolerated. The text messaging kid’s managers know what he is doing, but they continue to let it happen. If the company’s owner knew what the kid was doing, he would be fired, but why do the managers tolerate this unethical behavior? Their tolerance of it not only allows his unethical behavior to continue, but contributes to the rise of unethical behavior from others at the company as well.

So, what can we as business owners and professionals do to ensure that ethics stop declining? Never tolerate unethical behavior from those we do business with and those that work for us.