Orman’s Hobson’s Choice

By Beacon Staff

Suze Orman is a well-known and well-respected person in financial circles and over the past several years she has achieved prominence for her no-nonsense advice to persons who have lived beyond their means.

And now demand for Ms. Orman’s oracle-like advice has skyrocketed because of the financial mess our country finds itself in.

So what do you suppose Suze advised “average Americans” do to help dig themselves out of the global recession and the transformation of their 401(k)s into 201(k)s?

She told them/us to stop going out to eat at restaurants.

Let me see if I have this straight: Unemployment now creeps toward 8 percent; restaurants employ 13 million people, second only to the government; Suze thinks that putting millions of restaurant workers in unemployment lines will help the American economy recovery. Yeah – that makes a lot of sense.

Is she nuts?

This problem has been compounded because Suze Orman has a “bully pulpit” on talk shows and financial networks, so her word is taken as divinely inspired by Oprah’s loyalists, Larry King’s fans, Today Show aficionados, and others.

Let’s be frank about this piece of advice from Suze: it’s ridiculous and makes no sense. Right now, the restaurant industry is one of the few that continues to create jobs. I’ll grant that most don’t pay like Wall Street investment banks – but they are jobs nonetheless. And tens of thousands of workers support their families on what they earn in restaurant jobs.

Furthermore, I don’t know of one restaurant, independent or chain, that has accepted a penny of bailout money from any source. There isn’t even a thought among the thousands of restaurant owners in America about asking for a handout from the government. Yet, Wall Street bankers and investment firms continue to take tens of billions of taxpayer dollars, use the money to shore up their capital positions instead of lending it to businesses, and we’re still stuck in an untenable downward economic quagmire.

So if people stop eating in restaurants, where do you suppose all of those out-of-work Wall Street types will find work to tide them over until they find “regular” work or until their share of the TARP money comes through? Do you suppose any of Suze’s friends in the financial world would consider giving back any portion of the billions they received in bonuses for all the great work they did for you and me last year?

Restaurant sales in the U.S. exceed $550 billion (that’s more than half a trillion dollars – almost the size of the latest bailout bill). Boycotting restaurants as a money-saving strategy is wrong-headed and misguided, at best.

Maybe Suze (who, by the way, used to work in a restaurant) could redirect her advice to an area of real trouble like, say, overspending with credit cards, or how to avoid mortgage defaults, or strategies for recovering our lost retirement savings.

Let me tilt at the Suze Orman windmill. I’m not suggesting you eat out at a restaurant every day of the week. But don’t think that avoiding the night out at your favorite eatery, bôite, or lunch at the local diner will do anything to get us out of this recession. You do that and, trust me, you’ll only help prolong the mess we’re in.

On this count, don’t listen to Suze Orman.

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CORRECTION: In my column on kitchen gadgets, I mistakenly attributed the invention of the Ginsu knife to Ron Popeil. The inventor of the Ginsu is Ed Valenti. My apologies to Mr. Valenti for the error. Mr. Valenti has a book about the subject and you can find information about it at www.ginsuguys.com.

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