Archive

Archive for the ‘Philosophical Underpinnings’ Category

The Inflation

April 26, 2011 1 comment

The Inflation Special

I’ve been taking a break from the road for the last three weeks and plan on another ten days or so. The rhythm of life is very different here, but the constant concern with controlling expenses remains the same. I have this in common with at least eighty percent of my fellow citizens. No one but the very rich feel secure in the current economic climate. And the inflation is making it much worse.

During the last depression there was no inflation. But now the price of crude oil is driving up the cost of everything, especially fuel and food. This is tantamount to a very regressive tax, levied not by government, which would presumably give us back the money in the form of programs, but rather by private companies. And, to add insult to injury, the runaway price of oil is being driven not by the invisible hand of the market responding to a shortage but instead by un-regulated Wall Street speculators.

I call it a regressive tax because strong inflation, especially in gasoline, heating fuel, and food, always hurts the poor much more than the rich. A year ago I could buy three bags of basic groceries for about thirty dollars in my local (somewhat upscale but competitive if I shop right) market. Now the same three bags is about forty five dollars. If I don’t have it I must buy less food. The beans and potatoes stay in cart, but the fresh strawberries are traded for a can of pears. A whole chicken will make three meals for two people. The white eggs are a dollar cheaper than the favored brown eggs. I really must get chickens again. I could go to a known discount outlet, but I would have to drive further. Gas is over four dollars a gallon. This cruel calculus is my constant companion. Usually there isn’t quite enough and sometimes there is a dangerous shortfall. And I am lucky because I live in a semi-rural county with a ten month growing season. In the wastelands of the inner city and the rust belt it is so much worse…

Is America in a Recession or a Depression?

March 26, 2011 3 comments

Signs are Everywhere

In the hostel in Madison late one night a few of us were talking about the affairs of the day. I brought my reason for travelling-that is, documenting the depression in America. I was then asked “why do you think this is a depression?” I realized somewhat sheepishly that I have never publicly defended this point of view. So I will now. The available literature is somewhat unclear on the definitions of either term. But all the literature seems to center on the health of the Gross Domestic Product (GNP). But, I would argue that in an economy that has seen tremendous gains in productivity without the need to hire more workers, and that is capable having a “jobless recovery” as we are now, has to come up with a better definition, one that more accurately reflects the human costs of an economic crisis such as this.

I would suggest that we look instead at the true unemployment rate, at the foreclosure rate, at the bankruptcy rate, and at the rate at which small businesses are being forced to close their doors, among other indicators. We could also look at increases in the use of the social safety net such as food stamps, and the increase in homelessness.

A February Gallup poll finds that the official unemployment rate is at 9.8%, which is already quite high, but as we know, the official rate consistently understates the problem. It does not count the 99ers who have exhausted their benefits without finding work, or other “discouraged workers” who have simply given up. It doesn’t count the under-employed worker who lost a job that paid a healthy living wage but now works part time for far less. And it does not count the small business person who has had to close up shop and can’t find any paid work. I don’t know what the exact figure would be if these people were included in the unemployment rate, but I think it would be fair to say it would triple, giving us a rate of 29.4%.

A recent Real Estate Investors Daily states that the foreclosure rates have actually climbed in 2011 from a already alarmingly high rates in the last several years, and warns that “while we are seeing some markets in the US showing signs of “hitting bottom” and some are evening saying some markets have begun a “recovery“, I think we should be very slow and cautious to say the worst is behind us. Perhaps for those markets that had extremely high concentrations of the foreclosure activity (Nevada, Arizona, California and Florida) most of the damage may be done, but for other markets foreclosures are going to continue to put downward pressure on home prices.”

As for personal bankruptcy rates, numerous sources state that they are at a five year high and expected to rise in the coming year. Multiple sources also state that the poverty rate has gone up substantially, and this is poverty defined by an antiquated metric that does not reflect the actual cost of living in the 21st century.

That is why I am calling the economic climate in March 2011 a depression, and not the “great recession” as it has been termed. I may not be an economist, but there are some that agree with me. Columnist Jeff Cox quotes economist David Rosenberg in a 2010 article “Positive gross domestic product readings and other mildly hopeful signs are masking an ugly truth: The US economy is in a 1930s-style Depression, Gluskin Sheff economist David Rosenberg said Tuesday.” And he is not the only one to say so. The fact that any economist is using the term depression, given the emotional charge of the word and the deeply conservative nature of that profession, should give credence to the feeling that is already shared by millions of Americans.

http://realestateinvestordaily.com/foreclosures/us-foreclosure-rate-and-mortgage-delinquency-rate-continues-to-rise/

http://www.gallup.com/poll/145922/gallup-finds-unemployment-slightly-january.aspx

http://www.mybanktracker.com/bank-news/2011/01/05/personal-bankruptcy-filings-reached-5year-high-2010/

http://www.cnbc.com/id/38831550/Economy_Caught_in_Depression_Not_Recession_Rosenberg

 

More Frodo than Joan de Arc

February 22, 2011 Leave a comment

The View from my Window

Here I am, a month off course, and ready to finally take the big leap. It has been a hard winter for many, myself included. I have been ready to roll for weeks, but not with bronchitis and not without any cash at all. Today I am breathing deeply and my little paycheck will be in my hands within days. Enough to make it all work.

Another consideration has been the weather. This winter has been a very hard one all across the country, even the Deep South. My plan was to go there first and avoid the deep freeze in the north, but then the snow and freezing weather went south before I did. But, freezing or not I will be heading out.

There is a certain excitement in the traveling, even for the purpose in which I am engaged. I have my maps, a guide book or two. I will be going by bus, so I must travel light. I have to carry my equipment-camera, computer, recorder, phone, and whatnot, plus food and water, in one carry-on bag. The other bag will have everything else. On the bus, you never know when you will have to schlep.

I am more like Frodo than Joan de Arc. I would gladly spend my days busying myself around the little piece of the world I call home, studying all the things that are fascinating and enjoying the passing days. But, I see the world (both my little corner and everyplace else) sinking into ever greater darkness. I often think that if I had been lived in France during the World War II, I would have been compelled to be part of the resistance no matter what my temperament.

Packing Up

Today, the uber-rich have been waging a vicious class war on the rest of us for a good many years, and we have not, for the most part, offered any resistance. This is finally changing.  The events in Wisconsin over the last few days should act as a clarion call to the rest of us. The uber-rich have caused a depression for the rest of us while they rake in record profits on our backs. They have used the corrupt doctrine of corporate personhood to purchase the federal government, and therefore delegitimize it. And now they want to all but dismantle that government, except for the military of course.

This is evil. Plain and simple. Wage slavery and economic colonization is just as evil as the old kind of slavery and the old kind of colonization. Ownership of one person by another is always wrong, no matter how it is framed. I am concentrating on America because I am an American, but this war, waged by the rich on people and planet is and has been a global affair. In fact, American citizens are the last victims, not the first.

I am not saying that every uber-rich person, as an individual, is evil. But, as a class, the uber-rich are destructive, anti-democratic, and wicked. They hide behind the un-workable ideology of laissez-faire capitalism, making the Orwellian claim that free markets = free people, when the opposite is clearly true. Having purchased Washington, they have caused the anti-trust laws to be all but forgotten, thereby allowing them to buy the mass media and ruin the free press in the United States. All of these things make the uber-rich a wicked class. It also make them traitors to their country, sanctimonious flag waving notwithstanding.

When faced with evil it is necessary to act, however powerless one feels. So, off I go on my odyssey into the wide world. My gift is that of the wordsmith. I can’t feed the victims of this depression, nor give them shelter, but I can at least give them a voice.

Unemployment is Not a Vacation

January 21, 2011 2 comments

There are those that believe that just because you aren’t going to work at a job every day, unemployment is like an unpaid vacation. This perception is very very wrong. First of all, when you are unemployed you are never really off work. You must be ever at the ready, in case something comes up. In addition, a formal job search can take up to forty hours a week. Then there are the networking events, those sponsored commercial get togethers, often disguised with a “party atmosphere” that are obligatory for the “serious” job hunter.

Juggling becomes a new way of life, as all the items in the expense column come up for review. This is the moment when serious mistakes can be made, if you use any remaining credit to cling to the old way of life. People you knew from work may fall away, as if unemployment were catching. Friendships shift.

Then there are the emotions: demoralization and self-doubt, fear, and boredom. Demoralization and self-doubt set in as the weeks, months, and sometime years go by without a bite. As the (situational) depression deepens it may be hard to get motivated for one more phone call, one more appointment. You have become the “discouraged worker” that we read about. The cold words on the page do no justice to the feelings behind them.

As the money left in the system from unemployment benefits and savings dries up, fear becomes a constant companion. Fear as the bills come in and it is necessary to decide what you are going to lose this month. First everything that makes life fun. Then the personal upkeep items such as haircuts and clothing. Finally, after cutting to the bone, there is nothing left to cut but shelter, food, and the phone, lifeline to potential work. There is the fear of the empty cupboard staring back at you, as you learn how to use food banks and food stamps, if you can get them. Pasta or potatoes become the main item in your diet.

Then there is the worst fear of all—fear of (god forbid) getting sick. Without insurance. Getting sick keeps you from looking for work, or actually working if an odd job should fall your way. And it costs money that you don’t have, or if you do you were going to use it to eat that month. You learn that small injuries and illnesses can be “worked through”. Even an infection can sometimes run its course if you wait it out. As your diet gets worse the possibility of sickness grows.

Finally there is intense boredom as it becomes apparent that everything there is to do except sit is too expensive. Driving, if you still have a car, becomes a forbidden pleasure. Gas must be rationed to get to interviews and networking events, if you still have the clothes needed to attend. Lack of money makes recreation an impossibility. As long as you have cable there is TV and then maybe Netflix. Of course television is very depressing because it represents a false reality where everyone has a wonderful interesting career and plenty of disposable income. The days seem unbearably long and begin to run together.

Finally, if you are lucky, coping skills take hold. Simple household chores take the place of other entertainment. Having become forcibly frugal, you realize that your own labor must take the place of money if anything is to get done. If you are lucky you have settled in a place where you can have a small life. A community has formed. You are very clear who your real friends are. They are the ones that are still talking to you. Family relationships may have shifted. You have found a way to put some of your unused skills to good use for barter or for a little cash, enough to make the much reduced ends meet.

One day you might look up and see the unbearable blueness of the sky, or notice the perfect way that the light from the setting sun is illuminating the mountains. Life will never go back to being what it was. But you are alive. And you are still a human being, now un-tethered to the machine. If you are not there yet it is my wish for you that you survive to see that day, and that the road treat you kindly. As Scarlett O’Hara said, tomorrow is another day.

http://frugalplanet.wordpress.com/2010/10/03/so-what-if-the-worst-has-happened/ frugality blog

http://feedingamerica.org/foodbank-results.aspx a searchable list of food banks

http://www.memorialhospital.org/library/general/stress-the-3.html the stages of grief

http://planetgreen.discovery.com/tech-transport/online-bartering-websites-tips.html how to barter

 

What is the American Middle Class Anyhow, and Why Should We Care?

January 14, 2011 2 comments

The American Dream

First, a little history: In Feudal times, there were three classes, or estates. They were the aristocracy, the clergy, and the peasants.  These classes were conferred at birth and the amount of social mobility was nil. As the market economy began to emerge in Europe and the New World this began to change. For the first time a moneyed merchant class rose up from the peasant class. These merchants came, for the first time, not from the landed aristocracy but from the common people. As their buying power increased so did their influence on the affairs of the day.

But, even at that, there were still large income inequalities. These inequalities lasted through the gilded age and continued into the 1920s.The American middle class as we know it today rose up as a result of the economic policies of Franklin D. Roosevelt and the New Deal. This is the origin of the American Dream, which consists of home ownership, a decent education, and a job with a future and a large enough salary to enjoy the good life. The social safety net created by the New Deal made this dream possible for millions of people.

Though poverty was still endemic in certain areas the overall condition of the people was lifted up. The middle class also provided something to aspire to if you weren’t there yet. Every year there were newly minted graduates of universities that could say “I am the first in my family to finish college.” And the implied promise of the social contract was fulfilled-as graduation rates went up, so did incomes. The professions, formerly the bastion of rich white males, were forced to open there doors to everyone else.

They bounty was not confined to white collar workers. Through strong unions and a powerful manufacturing base the working class too joined into the American Dream. As did small business owners of all kinds. This new middle class were able, due to increases in standard of living, to pay more taxes, which built up cities, counties, and states. It also funded the safety net to protect those who were still behind in the game from real destitution. Neither hunger nor homelessness were big problems in those days. In fact, they were almost non-existent.

It would seem that having a large powerful middle class forming the glue of society would be considered a good thing all the way around. But there were those that thought differently. I am not going to discuss reasonable criticisms of the American Middle Class in this post, for instance the criticism of American over-consumption and waste, though I will discuss these in future posts. In this instance I am speaking of the elite class, defeated (in their own minds at least) by the New Deal policies that allowed the middle class to rise up to begin with.

The class war actually began around 1980, with the election of Ronald Reagan. It was slow and quiet at first, and always surreptitious. Slowly the market was deregulated, the jobs outsourced, the safety net eaten away. The apotheosis of the “free market” created a new body of “common knowledge”. The mental institutions shut down and the inmates were ‘set free’ to freeze and starve on America’s streets. And the price of education shot through the roof, as did the cost of medical care. As a new, now global, class of corporate elites formed, the luster of the American middle class began to fade.

The coup de grâce came in 2007 with the completely avoidable sub-prime crisis and the collapse of the economy, at least for us ordinary folk. The stock market itself came back very quickly, as did the million dollar bonuses. But not the jobs or the tax base. Now the rest of the safety net is in great peril, both from attacks by the elite and from being overwhelmed by millions of new ‘customers’. The middle class, once the greatest source of funds for services to the poor are now in need of such services themselves. And the elite class is not willing to foot the bill. They believe, along with Marie Antoinette, that we should “eat cake”

Here are some informative links:

http://www.youtube.com/watch?v=5kwA-CwFK5A Paul Krugman discusses the origins of the American Middle Class

http://www.youtube.com/watch?v=akVL7QY0S8A Elizabeth Warren on the coming collapse of the middle class

http://www.alternet.org/economy/41192/ Thom Hartmann on the war against the middle class

Being Poor is Hard Work

January 5, 2011 8 comments

The Money Problem

Contrary to the popular opinion that “poor people are lazy”, the truth is that every aspect of life becomes much harder when you are poor. And the learning curve if you suddenly become poor is staggering. It is hard enough for those who understand the system. For the newly poor, life is fraught with peril. There are so many things where the solution was once money, and now it is waiting in line, or filling out forms,  or figuring out how to do it yourself. Sometimes the solution is to just do without. For the poor, a great deal of time is spent just fulfilling basic needs that could be obtained easily with money, or dealing with the effects of needs that can’t be met at all, such as, in many cases, medical care.

For the moneyed, getting food is as easy as deciding what to get and getting it. Cooking is an option, and ingredients are no problem. The very people who have the greatest access to medicine also have the pick of healthy food choices. For the poor, at a certain point, getting food requires standing in long lines for assistance, which is often inadequate. With or without food stamps there may be few healthy food choices in the neighborhood. To get healthy food if you are not lucky enough to have a garden plot or live near a community garden, it may be necessary to go a long distance, possibly without a vehicle, and then get the provisions home. This takes a lot of effort, and that is before the stove gets fired up.

Then there is the question of transportation. Car ownership, even an old beater, is expensive and wrought with peril. If you are not a mechanic and have no mechanics in your immediate circle, there is always a chance that things can go wrong. Buying car insurance can cut into money for food or heating, and fuel prices are spiraling upwards. It may be impossible to get the car registered in a timely fashion, which drives up the cost in the end. In that case it is necessary to take evasive action every time you spot a cop on the road. And when you finally get caught the fees can exceed the value of the vehicle, or make it so you can eat nothing but peanut butter for awhile.

Without a car, in many areas, getting anywhere takes a lot of time, and some money unless you walk. This can be mitigated by living in a place with good public transportation, especially if there is a program for a low-cost monthly pass.

Money management presents a problem. At a certain point, having any kind of bank account becomes a liability. The few bills that must be paid by mail not involve a trip to the store for a money order, one of the most insecure and difficult ways of paying. God help you if it gets lost in the mail…

If you get sick or injured enough to absolutely require medical attention there is always the emergency room. You will be hounded for an outrageous amount of money for years afterwards, and may get substandard treatment, but will likely survive. For lesser ills, you can try to get an over the counter remedy or just tough it out. And if is a dental problem, just forget it. Teeth are not considered part of a poor person’s body.

These are just a few examples of situations where poverty creates the need for massive amounts of work just to survive. It is not laziness that keeps the poor impoverished, but rather a system that is completely stacked in favor of maintaining the status quo. There is the ever present chance of stepping on some rich person’s “property rights” and there by incurring some mountainous expense at law. For instance, if you park on private property and get towed, the initial fee may be hundreds of dollars and increase by fifty or more dollars (a week’s groceries) each day. The towing yards are full of cars that could not be retrieved by their owners. These vehicles may have been keeping their former owners employed. And the private towing company gets to KEEP this unconscionable profit.

There are whole industries that prey on the poor, raising the prices that they are likely to pay for everything from milk to tires. The worst are the predatory lenders offering quick cash at fees that are beyond usury.

And, if there are any infractions of government codes, such as rolling a stop sign, a choice must be made whether to lose the vehicle, risk jail, or just stop eating for a month. A moneyed person would just pay the bill and drive on.

In many places there are laws about sitting or standing on the street without obviously being in the process of buying something. Even going to the bathroom when not at home costs money, to become a “customer” and therefore eligible to use the facilities. The list just goes on and on. It is safer, when poor, to never leave your house. But then you will just get evicted and join the ranks of the homeless.

Yes, being poor is very hard work and it will likely get much harder as the ranks of the former middle class start to press in on available services while the government struggles to keep up. At the same time the tax revenues that used to be paid into the system by the former middle class are drying up as millions of people either remain unemployed or replace (at long last) high paying jobs with minimum wage jobs. The mean streets are about to get a lot meaner.