8/14/14
--a house in the very expensive Kenwood neighborhood (where the President purports to live but to
which he has no intention of returning once he finishes his current gig; how
ya’ gonna get ‘em back to Kenwood once they’ve seen, well, everything? But I digress.), purchased in 2007 for
$405,000.
--a summer home in Union
Pier, Michigan that has been in the family since 1961.
--a condo on the big island
of Hawaii,
bought in 2011 for $240,000,
--two time shares in Hawaii,
--a time share in New York
--a time share in Mexico,
and
--a time share in Colorado.
The predictable reaction was swift: Karen Lewis is a hypocrite, who spends her time
decrying “people of wealth and privilege” who “don’t have a clue about poverty”
and castigating Mayor Rahm Emanuel
as “Mayor 1%” while claiming that
she, Ms. Lewis, is ‘not egotistical or rich.”
The first part of that last argument was comical even before the news of
Ms. Lewis’s vast real estate holdings leaked, but, again, I digress.
Several other, more rational but not as obvious, responses came
immediately to yours truly’s mind, one with the help of his wife:
One response could be that making $200,000 per year (Ms. Lewis’s combined salaries as CTU
President and executive vice-president of the Illinois Federation of Teachers (“IFT”)) makes one comfortable but
does not make one rich. No level of
income makes one rich; being “rich” is a balance
sheet concept, a measure of wealth.
Getting “rich” involves not only making money but saving and investing
that money. Income is an income statement concept, a measure of
how much one makes in a given period of time.
Large incomes do not necessarily, and often don’t, correlate with
wealth. Lower income people who know how
to save can be far richer than high income people who fritter their money away
on desperate attempts to fill the holes in their souls on the latest gimcracks
that the rest of the herd tells them they simply must have. Apparently, for all of Ms. Lewis’s vast
education, she didn’t take, or pay much attention in, Accounting 101 or much beyond the rudiments of Finance or Economics. Neither did most of the people who make their
livings commenting on politics or economics, but that is another issue.
Leaving the rich vs. high income misconception aside,
$200,000 is indeed high income but is nowhere near the Rahm Emanuel/Bruce Rauner income leagues. If you make
$200,000, good for you and God bless you; you are doing very well. But I have news for you: $200,000 is not an especially high income in
today’s world.
A few other responses could be born of Ms. Lewis’s defense
of herself. She argued that she is
highly educated…
“You are supposed to
go to school, become educated. I have an
Ivy League diploma. (I thought they
were called “degrees” in college; “diplomas” are issued by grade schools and
high schools. Or so I thought. But I don’t have an Ivy League diploma or degree so what do I know? Okay, how to digress, but what else?) I
have two Master’s degrees. I’m a
board-certified teacher.”
There are so many things wrong with this reply that I, even without
benefit of an “Ivy League diploma”
hardly know where to begin. Ms. Lewis
more than implies that the purpose of education is to make lots of money. Yours truly understands that getting
employable, even rich, is certainly most people’s object in going to college
and I am no exception; I majored in Accounting
and got an MBA with a Finance concentrations, hardly scientia gratia scientia. But one, and especially one in the education
business, like Ms. Lewis, would like to think that there is more to education
than improving one’s income potential; after all, it’s called “college,” not
“trade school.” But apparently Ms. Lewis
has dispensed with the idea that the value of an education transcends job
preparation.
Further, if one is interested in making money, the education
field is not the first field that comes to mind. If Ms. Lewis feels entitled to make lots of
money because she has an “Ivy League
diploma” and “two master’s degrees,” and if making money was her goal in
pursuing these degrees, perhaps she should have gone to law, medical, or
business school. Being a “board-certified teacher” does not
normally put one in a position to buy homes in Hawaii and Union Pier and time shares in New York,
Hawaii, and Colorado. Apparently, though, it worked for Ms. Lewis.
Even further, if one wants to get rich and buy homes in Hawaii,
one generally doesn’t, or at least ought not, go into the business of running a
union. Yes, I know this sounds, and is,
naïve, but the idea of becoming a union big shot should be to defend the
interests of your fellow members against the otherwise overwhelming powers of
their bosses. Ms. Lewis, however, has
decided that she is entitled to make more than any of her members and to “earn”
a considerable multiple of what her average member makes. This makes her not at all unique among union
bosses, but could she and those union
nabobs at least show a little shame?
Apparently not.
Ms. Lewis, in her own awkward defense, went on to point out
that she makes more than even the most highly paid teacher because she is paid
for a full working year, not the 39 week
year her members put in.
Hmm…
It is standard cant among the education profession that one
should not pursue a career in that field because one “wants summers off.” Colleges of Education drill that into their
students. The commercials run by
teachers’ unions constantly emphasize that teachers work tirelessly, year round
for “our children.” Now Karen Lewis
comes back and tells us that this is all a bunch of baloney, that her members
don’t deserve to make nearly as much as she does because, after all, they only
work 39 weeks a year. It’s that shame
thing again, a concept with which Ms. Lewis has little if any familiarity.
As my wife and I considered the Lewis story, my better half
brought up another point. Ms. Lewis
says that she works very hard. Even
though she is paid for a 50 hour work week,
“I wish I were working
50 hours. My day usually starts at 7 in
the morning, and, if I’m lucky, I’m home by 10 at night. I work really long hours.”
Where, my wife asked, does such a busy woman find time to
visit all of her homes, time shares, etc.?
Something doesn’t add up.
Another thought that came to me concerned Ms. Lewis’s
qualifications for the job of mayor of Chicago, to
which she aspires but which she will never hold. I don’t care what the polls are saying now;
no one is going to beat Rahm Emanuel
in 2016. He has all the money and all
the organization and can buy all the votes he needs in all the demographics he
needs. There, I’ve said it again…and did
so in yet another digression. Getting
back to my point, one would think that the mayor of our once great city would
know something about finance and investing.
Ms. Lewis, though, betrays her financial ignorance not only in her
confusion of the concepts of having a high income vs. being rich but also in
her apparently heavy investment in time shares; she apparently owns four of
them. Until someone comes up with navel lint futures (and who knows, in
this era of brilliant “financial innovation,” our deep thinkers in the
investment/trading industry might come up with such a useful financial tool),
time shares will remain the worst investment out there. Yet Ms. Lewis has apparently backed up the
truck on this load of financial excrement.
How much judgment does that show?
Finally, my biggest concern about Ms. Lewis’s three homes
and four times shares is another worry that no one, as far as I know, has
mentioned. It centers on both the
concept of wealth vs. income and, more saliently, Ms. Lewis’s financial
judgment. I fear she is financially
severely overextended and fear even more intensely that it is her lack of
financial acumen that has dug her into this hole.
Think about it. Ms.
Lewis makes $200,000 per year, a very nice income. But $200 grand is not enough to support a
$405,000 primary residence, two secondary residences, and four time shares,
none of which, with the possible exception of the Mexico
time share, is in an especially affordable area. And what about the costs of flights to Hawaii,
Mexico, etc.,
to use her properties? Being a financial
person, yours truly’s first thought when I read of Ms. Lewis’s amateurish
attempts at real estate moguldom was Ms. Lewis’s probably, er, highly leveraged
financial condition. Then I thought
that maybe her husband had some dough, but he is a retired CPS gym teacher. This is Chicago,
and anything is possible, one supposes, but retired gym teachers aren’t
generally rolling in dough.
One can come to two possible conclusions concerning Ms.
Lewis’s personal financial situation:
Ms. Lewis is not disclosing all of her income or Ms. Lewis has spent
herself into oblivion, displaying a complete lack of financial acumen and
showing, at least in this respect, a remarkable similarity to our former
Governor
Rod Blagojevich. I’d bet on the latter, but neither bodes well
for Ms. Lewis’s possible political aspirations...or her leadership of her union.
