As I ponder all this in my apparent addiction to the news and the messages coming from both parties, I can’t help but think of my own house and how most Americans survive when revenues fall short and costs climb.
So here’s how most of us do it.
1) We look at our revenues so that we know what is coming in. In my case, being a small business, I have seasonal trends and an unstable revenue stream, but I generally know what is coming in and can project what will be coming in based on the economy as it is today. A huge number of people are on unemployment and that income may be all they have to count on. Another chunk of the population are working part time or are bringing in virtually no revenue at all. In the past, Americans counted on increasing their debt load to manage revenue shortfalls in order to pay the bills. Currently, all those with challenged credit either have no credit cards, lines of credit or any equity to leverage, or have chosen to go the cash only route.
2) We look at our expenses. From mortgage or rent payments to chocolate chips cookies. We look at all of it.
3) We figure out what is a must-have and what is a nice-to-have. For each person those definitions are slightly different, but I think we can agree on shelter, transport, food, education, health care, shoes, clothing (things to cover our otherwise naked bodies), emergency fund. Everything else can go if money isn’t there to support it.
I’m a single mom.
I must care for my child — have a safe place for her to rest her head at night. If I had no money for my rent or mortgage, I’d have to move in with friends or family. If I had no friends or family in LA, I’d have to move to where friends and family were willing to help.
I must have a car in Los Angeles. In other cities, I could abandon the car. In LA, not an option. I don’t need a new car with high payments. I could have a used car, or even a severely used car as long as it was safe. If I had to give up the car, I would. I’d bike, take public transit, change my routine if possible.
We must eat healthy food, she must go to school and we both need shoes and clothes. We do eat healthy — it costs a bit more, but we also give up buying packaged and preserved foods. It balances out but we are healthier as a result of good, fresh food. My daughter goes to public school. If she were in private school, I’d transfer her to public school in order to make ends meet. We could both make do with one or two pairs of good shoes and a few changes of clothes.
Medical coverage — If I could continue to afford my medical coverage, it would remain a top priority for this family. If I needed government support, I’d take it.
Austere? Yes. But we’d survive in the short term. In the long term, while we could survive in austerity, we wouldn’t grow. Because we’d be stuck in poverty. So I’d have to look at my revenue options. Ways in which I could earn money. If my business dried up, I’d look at anything from cleaning peoples homes, to consulting on small business and everything in between, until I figured out a way to bring in sufficient revenues to climb out of the hole.
Does that ring true to you?
Wouldn’t you like to see all our politicians live on unemployment for a year and see how they’d do? What would they do? Where would they cut and how would they find ways to bring in additional revenues while cost-cutting. At some point they’ll remember what life for most Americans is. And maybe at that point they’d understand how to balance out the country’s budgeting woes, stop catering to the top percentage of the uber-rich who will continue to earn tremendous amounts of money as they swoop in and buy bargain price stocks yet again. You can cut costs all you want, but in a recession/depression/shrinking world economy/double triple dippity-doo, KNOWING that your tax revenues will falter, you have to look at where to possibly bring in more tax revenues and from those that are hurting the LEAST, not suffering the most. In your own house, you would NEVER say you wouldn’t look at ways to bring in more revenue. That’s shooting yourself and your family through your two pairs of shoes.