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Phone Cards, My Big Investment

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Tags Capital and Interest Theory

I remember Mama. She was a shopper along with her other talents. And since baby sitters were beyond the means of middle class families of her era, she took the 6 year old who was to become me, along. Clinging to her discounted skirts, I caught the shopping bug. It was a life-long infection. I grabbed many a bargain in my career, but mainly I specialized in groceries; you know, two for one chicken pot pies, 99 cent round steak.

My discovery of discounted Round steak was interesting, but later in my shopping career I encountered my first telephone card — a locked in price for a stipulated period of long distance discourses. We were introduced by a garish sign that shrieked, "3 cents a minute". For what, I wondered. Given the so-called vitality of inflation, 3 cents a minute is amazingly cheap for any pleasurable human activity ranging from back scratching to the consuming of a bun stacked with mayo, lettuce, tomato, and ground round, which I noticed was on sale only 20 feet away on aisle 3.

The lady behind the phone card counter explained that 18 bucks and change got me 600 minutes of long distance time. What a bargain! A bonanza for a garrulous Patriarch who yearned to advise his far-flung clan on their choice of mates, automobiles, investments, supper menu, and the design of their den wallpaper. How cheaply I could solve their problems, with no worry of inflation to come.

When that overblown barometer of price, the CPI, tells us of inflation I giggle. Well, maybe housing and education is way up. But us golden geezers have been residentially immobile for years and we've left college campuses far behind, both for us and our kids. And even I, who just forgot the subject of this rumination, can recall our long distance bills of a few years back when two heated dialogues with my daughter about her new, unemployed boyfriend cost us 20 bucks. And now this harbinger of fiscal spring! Eighteen bucks for 600 minutes! What great arguments we could have.

What a clever way to lock in Long Distance costs — just as I did with the residence I purchased 30 years ago. Let inflation blaze — I'll still have a 1976-priced home and dependents to counsel at affordable rates.

Thank goodness, phone time is not a commodity like bargain sirloin that, in large quantities, demands warehouses and subzero temperatures. Lovingly, I look at my small stack of cards. Only six inches high in a corner of my desk. That kind of savings in hamburger meat, I quickly calculated, would occupy 300 cubic feet. But my phone card thrives unfrozen in my wallet. And a glance at an actuarial table tells you that a 70 year old — even with a hi-volume patriarchal mouth — could carry a lifetime of calls in a simple brief case; say fifty cards with 600 minutes each. That's 30,000 minutes of long distance advice, counsel, recommendations, and similar intrusions into the private lives of his children.

In a way, I've bought a bond. I've locked in a long distance rate just as you lock in an interest rate in a bond. Who knows what the future will do to the cost of long distance patriarchal yammering? What if MCI rings off for the last time? What if Sprint hangs up on us? What if one or two telephone goliaths rule the fibre optic world and the marketplace of callers bids up the price of verbosity. So what? I'll still have it made. And just like a bond, my card — with its commitment for a 3-cent minute — will be worth more than I paid for it. I'll sell it — at a profit — to the guy next door, who is oppressed by 15-cents a minute rates. With a little imagination I could see a thriving marketplace for phone plastic — maybe on the Chicago Commodity Exchange. If you can bet on pig bellies, why not on phone rates?

Well, as Robert Burns tells us: the best laid plans of mice and men go oft astray. Even a certified futurist like me could not envision cell phones and the long distance packages available today. What happened to that devil inflation when it attacked the world of communication? Anybody want to buy a fat deck of phone cards?

Jeffrey Tucker is Editorial Director of the American Institute for Economic Research. He is author of It's a Jetsons World: Private Miracles and Public Crimes and Bourbon for Breakfast: Living Outside the Statist Quo. Send him mail.

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