I’ll start today by laying out what’s happened to make college so incredibly expensive. The first is an economic concept known as Baumol’s Disease, described by economist William Baumol. He said that service businesses cannot have the same productivity gains as other sectors of the economy because they are so dependent on human interaction. If a computer loads twice as fast, that’s great; if a symphony orchestra races through a song at double normal speed, the audience would be upset. If a doctor spends half as much time as normal with us, we’d be upset, and we don’t view a kindergarten class with 40 kids and one teacher to be twice as good as one that has 20 kids and one teacher. Therefore, costs will rise faster in service sectors than in the rest of the economy.

And, for colleges, this means that costs have risen faster than the economy as a whole, and they probably always will.

That being said, college costs have increased even faster than would be expected for three reasons:

• Public Colleges have faced massive losses of taxpayer money. Simply put, the average taxpayer doesn’t value education enough to want to pay for other people to learn, no matter how much education pays off for the overall economy.
• Private Non-Profit Colleges are in an arms race to raise their US News and World Report Rankings by offering amenities that attract higher-scoring students. Some of these (nicer laboratories, a lower faculty-student ratio) may improve the quality of education; others (fancy dormitories) don’t. These things cost money, and it is passed on to the students.
• Private For-Profit Colleges want to maximize revenue, and too many of them don’t seem to give a damn if students actually graduate or get a degree. Their students have higher-than-average default rates, and that gets passed on to all student loan borrowers in the form of higher interest rates. And yes, the interest rate is a cost of going to college.

I’ll have more thoughts on this in future posts, including ways that parents and students should think about college costs and best pay for them. Hey, I’ve got a blogathon to do, I can’t put all my thoughts in one post!

Of course it cost the city money. These things always do.

The organizations that put these major events on – the NFL, the International Olympic Committee – always promise that the tax and business benefits of these mega special events are so enormous that cities willingly bid – and overbid – in order to get them.

Inevitably, it turns out that, gosh darn it, the planners underestimated the costs and forgot that, gosh darn it, the locals wouldn’t be spending money while the event was in town so the incremental effects weren’t as great as expected. Ooops!

In Chicago, the former mayor’s plan for economic growth and covering up his colossal financial mismanagement was to bring the Olympics here in 2016. I’m glad it didn’t happen. There was more than enough corruption and cost overage in the bid that city taxpayers weren’t feeling warm and fuzzy about the prospects of hosting the games.

One of the many reasons that Greece went into debt was to pay for the 2004 Athens games. It took Montreal 30 years to pay off their Olympic debt.

The NFL is a consortium of for-profit companies. The International Olympic Committee is a consortium of for-profit corporate sponsors. If they want to put on their own events, great. But they should stop expecting the public to pay for them.

City leaders need to get past their starry-eyed images of brushes with celebrity and refuse to sponsor these games. If the city leaders of Indianapolis really wanted to improve the city’s economy, they would have spent the $1.1 million on education instead of the Super Bowl.

Anyway, my second act would be my career change from being a finance analyst to a financial writer. However, the story has already been told, and better, by Adrianna Rodriguez, who interviewed me for Northwestern’s AlumTalks. If you’re interested, please read it!

I’m one of many contributing writers. Please, click over and check it out!

Jodi Torpey

The old adage, “Time is Money” is especially true when you stop to consider the high cost of a badly written email message.

An unclear email takes time for the reader to read (possibly re-read) and decipher. It also requires time to write a response asking for clarification. Then there’s the time waiting for an equally unclear reply.

That’s a lot of valuable time wasted on just one email message. Multiply that confusing email times the number of poorly written letters, disorganized reports, and disjointed documents that are written every day. Suddenly the price of shoddy writing comes into focus.

Companies can save time—and money—by improving the quality of the everyday business writing in their workplace.

The high cost of inferior writing can even be quantified. For example, when an office in a federal government agency revised the wording of just one letter, calls to the office asking for clarification declined from 1100 a year to 200.

Just think of the savings realized by revising that one letter. Readers didn’t have to waste their time trying to call the office. Staff members didn’t have to waste time answering the phones. That valuable time was spent getting more important work done. Rewriting that letter was an excellent return on investment.

I can’t be certain what the writer changed in that letter to prevent 900 calls each year, but I can make a few assumptions. These seven ideas are based on the most common problems I see in business writing today:

1. The writer didn’t think about the letter’s purpose.
2. The writer didn’t consider the readers or how they would read the letter.
3. The main point was buried somewhere in the middle or at the end.
4. Any required action was unspecified or unclear.
5. The tone was inappropriate.
6. The paragraphs were long and dense, the sentences too wordy.
7. It wasn’t formatted for easy reading.

Good business writing isn’t difficult or expensive or time consuming. Good writing simply requires the writer to think before writing, to focus on the readers’ needs, and to write as if another human being will be reading it.

Jodi Torpey is a Denver-based author, trainer, and business writing coach. She’s on a mission to change the way writers think about their business writing—one reader at a time. She offers practical business writing tips on “The Daily Blatt” blog at www.WriteBetterFaster.com. I want to thank her for this great post!

I’ve been thinking a lot about packing lately as I prepare to spend six weeks in China this summer. I need to bring clothes for my stay, materials for my classes, and stuff to keep me occupied for 24 hours of flying time each way. Yikes!

Here are my basic packing tips:

• You need to be able to handle your own luggage. The more transfers between planes, trains, and automobiles you’ll be making, the lighter you need to pack. Wheeled luggage is the best invention in the history of travel, followed by the backpack.
• You don’t need to worry about wrinkles if you’ll be in one place for a while, because you can hang out the clothes in a steamy shower. If you’ll be packing and unpacking frequently, like if you will be staying at a different place every night, you do need to worry about them. The best way to avoid wrinkles when packing is to put the clothes in plastic dry-cleaner bags before folding them.
• Wool doesn’t wrinkle, it doesn’t smell, but it takes a long time to dry. Polyester doesn’t wrinkle, it dries fast, but it holds odors. Pack a mix of the two to get the best of both worlds. Cotton is comfortable, but it’s not wildly practical for travel. The exception is denim, which has all the advantages of wool.
• For the most part, if you forget anything, you can buy it when you get there. That can add to your travel adventures, too. One of my favorite memories of Kyoto was asking a non-English-speaking pharmacist for a treatment for insect bites. That being said, I’m taller than the average American woman, so I will be a giant in China. It is difficult for me to find clothes that fit in Asia or in most emerging markets. In England, though, “forgetting” a shirt is just an excuse to shop!
• Don’t agonize too much over how the amount of clothes you pack, because the clothes aren’t what weigh you down. The heavy items to watch out for when packing are shoes and work materials. In my banking days, I would spend a week visiting customers in six different cities carrying just two wool dresses, jeans and a sweater, and two pair of shoes (one dress, one casual). But then, I’d have a massive stack of handouts for customer meetings and materials for working on airplanes. That was the killer. If you can reduce the heavy items, you’re set.
• On the plane, wear cotton or wool to be comfortable. Wear comfy shoes and DO NOT TAKE THEM OFF! Your feet will swell on a long flight, and you’ll have trouble putting them back on. Get one of those inflatable neck pillows. Bring a pashmina to use as a blanket. Try to sleep on the plane. It makes a huge difference.
• Carry on all your luggage, if possible. If you can’t do that, make sure to carry on your medications. A change in clothes is a good idea for a longer flight, in case you spill your dinner or find your flight diverted. Also, putting on a clean shirt will make you feel refreshed after a long flight. Bring a water bottle and food, and don’t rely on your e-reader. These are wonderful for reducing the amount of stuff you have to carry, but you don’t want to be bored silly on a long flight because your reader isn’t charged or got dropped or something.
• Leave stuff behind to make room for souvenirs. I sometimes pack old clothes and leave them in the hotel to create room for my bounty. Paperback books and magazines can be left behind, too. That way, you can still manage your luggage by yourself on your return trip.

I’ve been buying miscellaneous items for my trip at a great local store here in Chicago with a mail-order division, Uncle Dan’s. The people who work there are really nice, and they have everything you need to prepare for a Chicago winter or an extended journey to tropic climes. I especially like the pricey but comfy Icebreaker line of lightweight wool clothes.

Happy travels!

“Nobody tells this to people who are beginners, I wish someone told me. All of us who do creative work, we get into it because we have good taste. But there is this gap. For the first couple years you make stuff, it’s just not that good. It’s trying to be good, it has potential, but it’s not. But your taste, the thing that got you into the game, is still killer. And your taste is why your work disappoints you. A lot of people never get past this phase, they quit. Most people I know who do interesting, creative work went through years of this. We know our work doesn’t have this special thing that we want it to have. We all go through this. And if you are just starting out or you are still in this phase, you gotta know its normal and the most important thing you can do is do a lot of work. Put yourself on a deadline so that every week you will finish one story. It is only by going through a volume of work that you will close that gap, and your work will be as good as your ambitions. And I took longer to figure out how to do this than anyone I’ve ever met. It’s gonna take awhile. It’s normal to take awhile. You’ve just gotta fight your way through.”
― Ira Glass

That quote is all over the Internet, and for good reason: Glass tells it like it is. You’re going to suck when you try something new, and I have a manifesto about this. When my kid was playing hockey, I used to tell him that it’s good to fall down because that means you’re trying. I try to remember that myself.

It’s hard, though. I like to think that if I’m meant to do something, I’ll be great from the get-go; if I screw up out of the box, then I should simply move on to something else. And yet, I know that everything is hard. Even things that come easily have a limit. I could read before I went to kindergarten, but darned if I can understand poetry.

So this is my inspiration. It’s all about keeping the butt in the chair and getting to work. Right?

Instead, it’s a range of social and institutional factors, intertwined. Some are cultural, some are discriminatory, and some confirm everyone’s worst suspicions about business (e.g., that the most senior executives in a company care more about personal agendas than the enterprises they run, and who wants to be part of that silly game?) They go far beyond tired saws about women quitting to have babies, and that’s nice.

Anyway, give it a read, and let me know what you think.

I also think that using cash and checks makes you more mindful about your spending. You have tangible evidence of what you are doing. When you look in your wallet, you know if you have enough money to get you through the rest of the day or not, and you can plan your purchases accordingly.

I used to use checks all the time, but I gave that up when I realized that clerks no longer knew how to deal with them. I often use my credit card – which I pay off in full at the end of the month – but my favorite spending tool is cash.

I once talked to a financial planner who had a great game he used with clients to help them gauge their spending needs. He asked them to figure out how much money they thought they would spend in a week, withdraw it in cash, and then see how long it lasted. Most people found that they spent more than they realized, but they didn’t realize it until they switched to cash.

You know what else I like about using cash? It makes me look vaguely dangerous, because it’s just me and the drug dealers who still use it!

And I have a bad tendency to assume that the risk-free rate is 5 percent and the risk premium is 7 percent because, well, that was pretty much what it was in the olden days, when I went to business school. Remember in the olden days, when stocks returned 12 percent a year, on average?

Professor Fernandez has released a new working paper entitled Ten Badly Explained Topics in Most Corporate Finance Books, and I love it. It has some ideas that I can incorporate into my explanations for students, and it helps clarify many of the things that investment professionals understand but textbook authors do not.

If you’re geeky about financial theory, download and read it!