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Senior Correspondent

Shaping Your Economic Future: Are You a Thermostat or a Thermometer?

Shaping Your Economic Future: Are You a Thermostat or a Thermometer?

Whether you are the head of government or head of a household, I see two interesting choices in shaping your economic future: You can choose to be a thermostat or a thermometer. Did that grab you? Good! Read on. Here is the essential difference between the two devices: A thermostat shapes its environment; in this case, your lives as you envision it. A thermometer, on the other hand, reflects its environment.

A thermostat is dynamic, proactive, and it regulates its climate. It is a force within itself. A thermometer is passive. For example, when it’s July and you’re sitting in midday traffic, it tells you it's hot and that your engine may be about to overheat. We need both devices but we cannot be both. I like this analogy because it focuses your attention. After all, how many have thought of comparing their approach to anything to the functions of either device?

The state of the economy was the impetus for writing Chapter 7 of my e-book — “How to Build Your Confidence During an Economic Downturn.” The self-assessment exercise at the end of that chapter inspired this update.

At a critical juncture in my life, my career thermometer said the safe career choice was that of a public school teacher. That would have made my mother very happy. Mother loved to teach and she felt that had I chosen a career in public education, it might have kept me closer to home, thus inhibiting my wanderlust.

While I am indebted to a strong public school education, including to an early mentor — he a public school teacher — that landscape was too limited. My dreams were larger than the landscape of Camden, N.J., could accommodate at that time. I chose to shape my landscape by including nontraditional choices with more risk. I wanted options that were more consistent with my dream to live a more transformative life. This attitude was the genesis for what became my Foreign Service career.

We are neither robotic nor mechanical but that really is not the point. The point is the idea that we can program ourselves to achieve, just as we program a thermostat.

We can exercise the self-discipline required to succeed. We can offer ourselves positive reinforcement to muster up the energy to persevere. We can concentrate to block out the noise and clutter of negative input from others. And, we can assume control and transform our lives if we have the will.

Self-assessment is the starting point: check your mindset, evaluate your skill set; be attuned to your attitude; review your habits and reassess your goals. Remember, thoughts — often preconceived — do shape your circumstances.
The symbolism of the thermostat and the thermometer is as apt today as it was when I was telling myself daily my dreams were achievable. Unemployment can wreck havoc on dreams but dreams were my lifeline at that time. You can become your lifeline.

We continue to live in turbulent times, and the partisan debate surrounding the best approach to addressing the great challenges this country faces portends an even more turbulent future. If the current national debate was over the real issue of job creation, we might feel more optimistic. What passes for wisdom these days among those whose decisions shape our future is increasingly more distant from the reality they create for the rest of us.

Here is a little context. In the U.S. in the second half of 2011, we faced a “significant good jobs deficit” says the National Employment Law Project (NELF). They are the worker advocacy group that crunched the Census numbers. Therefore, our range of desirable employment options for those seeking entry to the workforce was limited and represented opportunity on a lower level of the income scale.

Included were the current crop of undergraduates and many graduate-level applicants. Low-wage occupations increased by 3.2 percent from the beginning of 2010 to the beginning of 2011, while mid-wage jobs grew by 1.2 percent. During the same period, higher-wage jobs fell by 1.2 percent. This is the basis for my suggestion to choose between a thermostat and a thermometer.

A passive approach to exercising choices during the decade of the roaring '90s could — and did — offer a foundation upon which many of us built viable futures.

We were buoyed by unusually strong economic growth, a strong employment base, rising prosperity, affordable education, reasonable interest rates, manageable household debt when measured against average household wealth, and a shot at the good life, all while being a member of the middle class. There was no need to entertain risk? The economic and social landscape of that era reeked of abundance. However, by 2001, everything began to change. As I look out the symbolic window today, I see an economy littered with the detritus of past prosperity. There is presidential leadership and policy proposals increasingly more connected to the angst of the middle class. And, there are the visible effects of policies that weakened the lifeline tethering the middle class to the economy. Who needs a thermometer? We know the “economic temperature” of the times.

Did we take it all for granted? Yes! Did we think it would last forever? Nothing lasts forever, but at least the future appeared bright. The real question is, did we think the prosperity we experienced then could not be affected by other political decisions we made as voters? We allowed ourselves to be persuaded that “debt and deficits don't matter.” Shaping a future today can be problematic, complex and potentially costly when we factor in the cost of higher education.

You could logically argue that the odds favor the job seeker since the economy created 233,000 jobs in January this year. The passive approach would be to look to the markets for jobs. It is also true that opportunities are always generated during the down times; they just involve a willingness to be more creative, bear risks and bring content and power to the dream. If your dreams are still whole, then it is incumbent upon you to think bold, accept or create, risk  and exercise the will to shape your environment. This is the thermostat in you.

The natural by-product of this mindset is greater and better choices. It is worth noting that the financial, corporate and government elite who created the new American nightmare were not afraid to take risks. They wanted to shape this country's national priorities and government at all levels, and they succeeded through the 2010 elections and in the recent debt ceiling agreement. They and those imbued with their radically peculiar worldview now compel the rest of us to assume risks for our future; a future for which we may not have volunteered under different circumstances.

A passive approach looks at the landscape and asks, “What's there for me?” A thermostat looks at the landscape and asks, “How can I shape an environment in which my options, the choices I create, optimize my future?” That is a different question. This choice suggests you have to transform the landscape. It suggests you see possibilities invisible to the naked eye, not just those apparent to the casual observer. You may have to change yourself rather than wait for change. You take control of the situation; you assume responsibility for outcomes. If the temperature of your life is too high — or too low — install a thermometer. Regulate it — get it under control. Why?

The costs to live are going to increase. States and municipalities — in response to persistent high unemployment, a slow-growth economy, and budget deficits — are demanding more resources from the middle class to pay for local services, public education, infrastructure modernization, access to state parks etc. Interest rates on mortgages, car loans, business loans and credit cards would have risen had we defaulted on our debt last fall.

The national media trumpeted the consequences if we defaulted. Meanwhile, local media informed us about rising costs where we live, seek employment, consume and demand services.

When you have tightened your belt to the extent it creates respiratory problems, what then? Many of those who created your dilemma are more prosperous and more removed from your daily life. The sad fact is that those segments of the electorate that supported debt agreement last fall did so out of ignorance. They will suffer the consequences with the rest of us. The future we deal with on a daily basis will belong to both the thermostat and the thermometer. Which one is the best fit for your plan?

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