Last week, the Wall Street Journal published an article on the business and leisure travel of Tom Donohue, the president of the US Chamber of Commerce. During 12 days in May, Mr. Donohue traveled from Washington DC to Greece, Tokyo, and Beijing. The entire trip was flown on private charter, the first half of which was personal travel. Though disputed by the Chamber, independent analysis suggests the transportation cost alone were between $615,000 and $850,000. A nice perk, if you can get it. 

Background

The U.S. Chamber of Commerce is an American nonprofit advocacy and lobbying organization based in Washington DC. Indeed its offices are located directly across the street from the White House. It represents thousands of US companies, large and small, and its advocacy presence is felt in governments across the globe. 

As someone who’s day job is focuses on company advocacy I thought I could reflect  on the nuances of the profession.   

Here the thing about lobbying. It can be extremely valuable when done effectively. If a meeting with a senior government official in Beijing or Tokyo led to a reduction in a tax rate, exclusion from a tariff process, or new license for a member company, that translates into specific value. It could be worth millions, depending on the result.

The reality, however, is that most advocacy work is a slow, plodding affair that makes incremental progress over months and years. Very rarely does a single meeting lead to some significant breakthrough. It’s just not how the Chinese or Japanese governments operate. 

The reality

You might be thinking to yourself, “but Mr. FIRE Power! Surely a meeting to push for the successful conclusion of the trade conflict between the US and China would be worth many multiples of Mr. Donohue’s travel costs! Assuredly any de-escalation resulting from this visit would be well worth the unusually high costs?!” 

To that, dear reader, I say “yes!” Regrettably I fear this visit led to no such outcome. 

In the 30 days since the group departed Beijing, China’s government released a “unreliable entities list” targeting foreign companies (likely U.S.) with commercial sanctions. The National Development and Reform Commission threatened to restrict the export of rare earth minerals. The Ministry of Commerce released a White Paper excoriating the United States and its companies for the tariffs imposed by the US government. Indeed, some might argue that the entire US-China relationship is at the lowest point in at least the last 28 years. 

Lets assume then that the trip led to no advocacy breakthroughs. 

Far be it from me to question the compensation committee of the U.S. Chamber of Commerce. By all accounts, over his twenty-year tenure at the top of the organization, Mr. Donohue built the Chamber into the most influential business lobbying organization in the United States, possibly the world. That accomplishment is worth something—in this case somewhere between $615,000 and $850,000 for two weeks of travel.

But I thought it would be interesting to compare these costs to those of another association that works on US-China issues.

This scenario also offers a moment to reflect on the general tenants of the financial independence movement by comparing the outcomes of one lifestyle to another. 

A Comparison to Mr. FIRE Power’s business travel

I write today from seat 35C somewhere between New York and Texas on a United regional jet. I am currently on leg 3 of a 7 leg trip from Beijing to Washington DC, New York, and Louisiana.

The objective of my travel is two fold: (1) share information from the field in China with US-based company executives; and (2) recruit companies that are not currently members of the organization.

Over the past five days, I’ve engaged with more than 100 companies individually or as part of speaking events. I have also met with well over 50 potential recruits to discuss USCBC value and seek their membership. One is in the process of signing up, netting $15,000 in new revenue. I suspect I will gain 2-3 more through additional follow-up in the coming weeks. 

How much did I spend on flights to facilitate this visit? $1718.16. I admit that vanity got the better of me on the international leg of the journey. I paid to upgrade the from economy to premium economy, resulting in a $400 premium in my ticket price. 

Assuming consistent pricing, I could have flown 357 round trips between the US and China for price as Mr. Donohue’s. That is one flight a day, everyday for an entire year, between the US and China. 

Nothing Mr. Donohue has done is illegal perhaps even inappropriate. But I think most reasonable folks would agree the actions are unseemly. And indeed the article seemed to coincide with an announcement of his pending future retirement.

The allegory of financial independence

This was primarily a long winded commentary looking at the difference between one organization and another. But it also offers a useful foil for comparing a normal, consumption-driven lifestyle with that of frugality.

The latter leads to retirement significantly faster than the former, but admittedly at a much higher personal cost (eliminating gratification of spending). 

Like Mr. Donohue, the average American pursues a comfortable life at a considerable cost. In the case of the Chamber of Commerce, the costs are borne by companies that support the organization. In the case of the average individual, the costs are borne by years of work. 

I suppose the ultimate point is that choosing the course of financial independence is less comfortable and frankly much more costly in the short term. It is the Mr. FIRE Power travel plan. It means sacrificing some of the niceties of a “normal” life in hopes of achieving that greater goal of pursuing your true passions in financial independence. 

A final look at the numbers

Before we conclude, one last look at the specific cost of that 12 days of travel. Based on the 4 percent rule, at the low end of the predicted travel costs of $615,000, a FIRE adherent could guarantee yearly revenue of $24,548 per year for life. Not enough for a gold plated existence, but enough for some of the most frugal amongst us to leave the workforce and focus on what is important. 

On the higher end of the predicted travel costs of $850,000, a FIRE adherent could guarantee $34,000 per year for life. In 2017, the nominal median income per capita in the United States was $31,786. 

So here’s the rub. The high-end of a 12 day trip travel costs essentially guarantees one American a median income for the rest of their life. It puts the cost of a private jet into perspective.