Wednesday, December 2, 2009

Booms, Busts and Stocking Your Toolbox

Up until a little over a year ago, we were riding high. Home values going up and up, jobs aplenty. Loans were easy to come by; money could be made in the stock market. It seemed the ride would never end.

This was a problem of managing abundance, and on the whole, we did a piss-poor job of it.

Managing abundance is perhaps more difficult than managing scarcity. After all, the more abundance, the more choices; the more choices, the more decisions to be made; the more decisions to be made, the more chances for confusion and mistakes.

Imagine you're faced with two tables.

One has a tossed salad, turkey, some mashed potatoes, peas and a pumpkin pie. What will be your first course, your main course, your dessert? Easy to figure out, eh?

Now imagine a table with a lasagna, a prime rib, some shrimp, a platter of hors d'oeuvres, asparagus, sweet potatoes, antipasto, rack of lamb, scalloped potatoes, Polish sausage with apples and sauerkraut, ambrosia, apple pie, chocolate cake, banana pudding and tiramisu.

Hmmm, this is more complicated. Unless you want to burst, you probably can't eat it all. So even if you like and want it all -- and even if you have permission to eat as much as you want -- you're going to have to pick and choose, leaving some dishes untouched. Probably later in the evening, you might wish you'd gone for the prime rib instead of the lamb, or the banana pudding over the apple pie.

This sort of cogitating and regret probably wouldn't happen with the first table, in which the choices were clear. There was less variety, and maybe you don't like peas, but it amounted to a whole lot less stress as well (and possibly less indigestion and extra pounds down the line).

It reminds me of the scene in "Moscow on the Hudson," where Soviet emigrant Robin Williams is confronted with a dizzying array of coffee choices in a supermarket and collapses from sensory overload.

Most of us didn't manage our abundance very well. We spent what we could afford and then spent some more, certain that something would happen to make it all right. We overextended and overreached, overcome with irrational optimism that this boom, unlike any other boom before it in the history of mankind, would never end.

Of course, it did end, and those people who began their working lives in the boom and had never known anything else found themselves in a cold new world without a warm coat or a road map. But, those impacted by the tech bust of 2000 or the stock crash of the late '80s or the stagflation and privation of mid-to-late '70s and early '80s -- or those who lived through the Big One, the Great Depression -- at least had a toolbox of coping skills they could call upon.

Now it's time to manage scarcity. There is great joy to be found in detaching from excessive materialism, learning how to survive with less, appreciating more what you have, calling upon your resourcefulness to get by.

There are also great lessons, especially the one about booms never lasting forever -- and busts never lasting forever.

It also sucks.

For those, like me, who remember bad old times, there's that handy toolbox and the knowledge that this too shall pass. For those of you for whom this is your first bad old time, you have my sympathy, but you do have the opportunity now to stock your own toolbox.

Maybe, when the abundance comes back -- and it will -- we won't screw it up so badly. OK, some of us will, but every boom is built, at least in part, on the hard lessons of the bust. Yeah, the house fell down around our ears, but as long as the foundation is sound, it can always be rebuilt.

Now, if we can just keep the government from jackhammering the foundation ...