Third in a biweekly series of interviews with Berklee graduates who have successful careers not involving music.
Listen to the interview (approx. 56 min.) or download it.
Graduated in 2008 with a major in Music Business (Management track). Principal instrument: drums.
Position: Salesperson, working for Micro Focus, (a.k.a. Borland Software) a large multinational corporation that provides many computer software products used by businesses.
Overview: Michael has had a varied career, working as an audio/visual “technical supervisor” (a.k.a. “the sound guy”) at a Marriott hotel, being a counselor at both camps and a college, touring with the Christian rock band while handling their merch. After marrying a woman from Northern Ireland and moving there, he founded his own music school, Stateside Drum Studios, where he still works on weekends. Michael applied to his current position via an agency and went to a high-pressure 3-day “camp,” where he was among the 6 out of 45 “campers” who was offered a job. Another three months of (paid) intensive training and his software sales career with Microfocus started.
You can view his LinkedIn profile here. Michael asks that if anyone wants to connect with him that they mention me and Berklee in the “connect” message, as he doesn’t like to just connect with random people. (In general, introducing yourself to someone who doesn’t know you is good form.)
Choice quotes: “As a musician at Berklee, you’re surrounded by and have to work with a very diverse group of people. You listen to and approach things differently, such as when you’re in an ensemble and are hearing the other musicians and are able to pick up whether we’re going to repeat a section or whether we’re going to drop the dynamics. You take that same sort of understanding and ‘unspoken language’ into the business world.”
“I found I can be just as much myself in the corporate world as I was in the music world, and still be able to have the fun I had in the music world, and just blend the two together.”
Hurricane and her sister Zephyr were our “mail order brides,” meaning they were the only cats we adopted before meeting. (Spitfire had come up from the Gulf Coast, but we actually got our pick of 15+ kittens in the van.) Via our friend who did rescue on the Missisippi Gulf Coast, we had the shelter sent us “two short haired black and white girl kittens.” She got everything right except the short hair, as evidenced by the photo.
Hurricane is a diva, with a huge ego that has survived getting play-hunted by her stronger sister Zephyr on a regular basis for her entire life! And yet, while Hurricane seems not to like her sister much, whenever either of them is challenged by another cat the other sister immediately runs to her aid!
Hurricane often claims Deb’s chair at breakfast, and gets very upset if moved. Many times we pull a third chair up to the table.
A lazy, weekend morning. 5 cats are around, but our little diva Hurricane gets the lap!
I have a confession about her name: many people assume that her name is from Hurricane Katrina. In fact, she was born two years after the storm. Read on for the actual inspiration…
The last part of Chapter 1 discusses measuring national income and wealth, and differences among nations.
Thomas Piketty points out that measuring income and wealth was a political act.
The first attempts to measure national income and capital date back to the late seventeenth and early eighteenth century…It is worth noting that (the authors of these measurements) often had a political objective in mind, generally having to do with modernization of the tax system. By calculating the nation’s income, they hoped to show the sovereign that it would be possible to raise tax receipts considerably while keeping tax rates relatively low, provided that all property and goods produced were subject to taxation and everyone was required to pay, including landlords of both aristocratic and common descent. (Page 56)
A cartoon from the time of the French Revolution. The nobility and the clergy were exempt from taxation, so the entire cost of supporting the state was borne by the common people, leading to an enfeebled state and larger-scale poverty than there otherwise would have been. The rough translation is “One can hope I’ll be done soon,” spoken by the commoner.
In my view, academia is inherently political, by virtue of what we choose to measure and consider “serious” versus frivolous.
I see it also as notable how these debates continue to this day, with “progressives” wanting to strengthen the state by providing it with resources to do more, while others claim poverty. It echoes how often we are told that “America can’t afford” something at a time when we are richer than we have ever been.
Thomas Piketty describes the importance of the capital / income ratio, β. “The capital/income ratio for a country as a whole tells is nothing about the inequalities within a country, but β does measure the overall importance of capital in a society, so analyzing this ratio is a necessary first step in the study of inequality.” (Page 51).
Note that income is measured in dollars (or euros) per year, while capital is measured in dollars. (As an economist would say, income is a “flow” while capital is a “stock.”)
In most of Europe, β is between 5 and 6 these days. It is a bit under 5 in the United States, and a bit over 6 in Japan and Italy. (We’ll see later in the book that this ratio is heavily influenced by population growth. Thus, the faster-growing United States has a lower ratio, while Italy and Japan have among the lowest birthrates.)
The First Fundamental Law of Capitalism: α = r × β
α is the share of the nation’s income that comes from capital (a.k.a. property), as opposed to from labor.
Capital in the 21st Century Review: Chapter 1 “Income and Output”
Chapter 1 consists of three parts.
Part 1 outlines the conflict between “capital and labor” and defines capital and wealth.
Part 2 defines the “First Fundamental Law of Capitalism:
α = r × β and briefly explores its implications.
Part 3 Focuses on national income, including how it is measured, and inequality among (as opposed to within) nations
I’ll be reviewing each section at a rate of 1/day, starting today.
Part 1 starts with a tragedy that happened in 2012 in South Africa, reminiscent of events in the United States 100 years ago, in which 34 miners striking for higher wages were killed by police shooting live ammunition. Thomas Piketty cites other 19th Century events in the United States and France as similar. He then asks whether conflict between labor and capital is inevitable, or a historical artifact.
Continuing on, he points out that the real issue is inequality rather than labor vs. capital per se:
In any case, the Marikana miners were striking not only against what they took to be (The company) Lonmin’s excessive profits but also against the apparently fabulous salary awarded to the mine’s managers and the differences between his compesation and theirs. Indeed, if capital ownership were equally distributed and each worker received an equal share of profits in addition to his or her wages, virtually no one would be interested in the division of earnings between profits and wages. If the capital-labor split gives rise to so many conflicts, it is due first and foremost to the extreme concentration of the ownership of capital. Inequality of wealth—and the consequent income from capital—is in fact always much greater than inequality of income from labor. (Page 40)
One of the most common misconceptions about the minimum wage is that it only benefits workers who earn it. This past week my students got the same “quiz” that I give (in some form) every semester:
If you are earning $13/hour, and the minimum wage is raised from $9 to $12, does this hurt you, help you, or have no effect? A majority says “no effect,’ and most of the rest say “hurt.”
Not so! Why is anybody paid above minimum wage? Because their employer wants them to keep working there. If an assistant manager at a store gets 13/hour ($4 above minimum wage), this is viewed as prestige and as reason for them to stay and put up with the more awkward hours and stress than a $11/hour job. If suddently every clerk is making $12, the assistant manager’s salary is going to have to go up to keep the job appealing. (It probably won’t go up a full $3, but will go up substantially, my best guess would be at least $1.50.)
Eventually the effect wears out, but a good rule of thumb (which I learned is college) is that anyone making up to double the minimum wage is making more money than they would if the minimum wage were lower.
It isn’t discussed until later in the semester but Minimum wages generally benefit the local economy, effectively transferring some money from the richest 1-5% who often don’t live in the local area and and spend a smaller fraction of their money locally to poorer folks who put the money right back into circulation.
The argument doesn’t go ad infinitum, of course. But as this chart shows, minimum wage in the United States ties with Mexico for the lowest minimum wage as a fracion of either mean of median wage out of any country that has minimum wage laws. (Brining it up around 50% – 75%, or to the $11 – 13 range would put us near the middle. $15 would put is near, but not at, the top.)
To conclude, the first word in “enlightened self-interest” is enlightened. When folks benefit from a polity it really, really helps politically if they know it!
#2 in a biweekly series of interviews with Berklee graduates who have successful careers notinvolving music.
Listen to the interview (approx 1 hr, 7 min) or download it.
Graduated in 2013 with a major in Music Business. Principal instrument: voice.
Positions: Co-runs the family business, ELF’s Cakery, substitute teacher in local high schools, private academic tutor (mostly math) and music instructor (voice & piano). Prayre also does freelance design work (resumes, websites), and still gigs with corporate/wedding bands and does original music.
Overview: Prayre moved home (Atlanta, GA) after graduation. While at Berklee, all of her business-related projects used her family business, and were implemented. She works there part time. For over six months she worked at a bank, but didn’t like it. She had wanted to teach, but was rejected when she applied to work as a substitute teacher in the summer of 2013. One year later a regular customer of ELF’s Cakery who worked as a substitute teacher gave her advice on how to apply and make herself a desirable candidate (what her resume should look like, etc.) and put in the good word for her. She was accepted, and started substitute teaching in the fall of 2014. Substitute teaching doesn’t pay great, but the hours are flexible, and substitute teaching gets her many (well-paying) private students. She hopes to open her own school one day!
Choice quotes: “The business part of the (Berklee) degree has helped me be a better performer, because I understand more about the business so I know how to approach situations. I know how to keep up with people. I know the importance of building that brand and how to market yourself and your image.”
“It will be tough, but there are things out there that you can find to do that will still fulfill your financial obligations while allowing you to pursue your passion in music as well. Don’t have unrealistic expectations. Give yourself time and it’s OK to stay at home until you figure it out. Had I tried to just completely go out on my own from the beginning, I might have had to stay at the bank and been completely unhappy.”
No blog is complete without some cats! 6 cats currently with with my wife and I. Zephyr here ties for second-oldest.
Zephyr and her sister Hurricane (featured in the next cat post) were born in coastal Mississippi in the spring of 2007. The same person who had rescued Spitfire (and many others) from the aftermath of Hurricane Katrina continued to do rescue work. Zephyr and her sister traveled in the (pressurized) cargo hold of a plane to Boston.
Zephyr was always a very serious kitten: you really could tell that her “playing” was practicing hunting! She got bored with most toys, preferring the live target of her sister. She also liked to climb.
The final part of the Introduction starts with a bit about the scope of the book: 1800 to the present, limited mostly to Westernized countries, particularly France, the United States, and England. Thomas Piketty justifies this because of when and where modern tax data started to be collected and recorded, it being absent from everywhere before around 1800, and continuing to be absent in the Third World to this day. Also, looking at the most economically developed countries may give a clue about where the rest of the world is heading (as much of the world modernizes its economy).
Piketty gives three justifications (apart from patriotism) for focusing so much on France:
One is that the French were the first to institute a modern system of taxation, so French records go back further than those of any other modern economy.
Part 3 of the introduction starts with a few pages about methodology. The short version is that the best read on incomes comes from income tax data, and on wealth from estate tax data. Most modern industrialized countries have had income taxes for about a century, and estate taxes for longer than that. France in particular has kept wealth and estate tax data since the 1789 Revolution. This data, as well as other data on incomes, are kept in publicly-accessible databases. Thomas Piketty concludes the section with a bit about how much easier it is to obtain and process large amounts of data with the benefit of computers and the internet—something his predecessors lacked.
Next, the main conclusions of the book: One is that the reduction of inequality between 1910 and 1950 was a direct effect of two world wars and policies adopted to cope with them. The other conclusion is that “there are powerful mechanisms pushing alternatively toward convergence (less inequality) and divergence (more inequality). Furthermore, there is no natural, spontaneous process to prevent destabilizing, inegalitarian forces from prevailing permanently.”