Debt reduction…the new American Dream

Well, as a country we are in a bit of a pickle.  The government is being held hostage by a very right wing agenda.  The concept of compromise, which is the foundation of any good functioning government, has been replaced by intransigence.  The rich will get richer and the middle class, working classes and disenfranchised are at the short end of the stick.  Our debt load is too high from 8 years of Bush-era spending and then the Bush/Obama infusion of capital to the finance industry…again, on the backs of our children and grandchildren.  It’s not looking pretty.

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.

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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.

6 thoughts on “Debt reduction…the new American Dream

  1. Here are some conceptions:

    1. Conducting an “elective” war without raising taxes is bad. People should be in jail.

    2. Not letting Banks Fail is bad.

    3. Many trade treaties have unfortunate consequences here and there.

    4. Letting the wealthy have the lowest taxes ever, essentially, is counterproductive to capitalism, and certainly doesn’t “create jobs”.

    It’s not Trickle Down: It’s Be Trickled Upon!

    If they are taxed more heavily, they will look to riskier ventures to maintain their wealth, and that leads to innovation and a future for capitalism.


    That’s what so effin’ scary.

    The rich, seeing the oncoming mess we’re making of our environment, are in total hoarding mode, and love getting paid tax free treasury debt interest from all of we taxpayers.

    As seen in the stock market rebound, nothing fundamental has changed, except the US Government was held hostage by maniacs posing as public servants.

  2. The debt ceiling debate was about ’12 – *not* the ceiling.

    Chocolate chips are a required food group. They don’t *have* to be Belgian. 😉

  3. How about the first tax cuts taking the form of salary cuts for our politicians — 50 percent for the year 2012? And, oh yes, in terms of entitlements, perhaps the pensions to which they are “entitled”, even if they sere only one term, could take a healthy cut too.

  4. Economics does not work quite the same for a nation.
    For the individual or small group, increased revenue comes from job ooportunities. For a nation, increased revenue comes from taxation, which destroys job opportunities.
    For the individual, underemployment is a total waste, for a nation, it is part of a savings program, like keeping perishable goods in a refrigerator.
    Basically, its lonely at the top. Yet, that is no excuse for the failure of our lawmakers to deal with the problems at hand for the nation.
    Nothing will change for the better until OIL is unseated as the primary mover of the Economy. But OIL is the primary mover of your car also; and you prominently say “not an option”.
    Senseless war, covert corruption on high levels, and the non-existence of long-term corporate planning are also in the mix of our woes. Shamefully for all concerned, the teenagers of London seem to have found a way to get past the “intransigence” of their government, as did George Washington and his army of insurgents against the King.

  5. Just look at the people in that video. I estimate at least 80% are on Social Security and Medicare. How the hell can they work for fervently against their own best interests, the interests of the nation, and the simple dictates of logic? Yet there they are, cheering their own demise just so the protection of the top 1% can live on. Is it early onset Alzheimers or the toxic tea they’ve been drinking? Whatever the cause, this idiocy could doom us all.

  6. The majority of economists, many of who lean far right, agree that trickle down does not work & that tax loopholes must be closed & taxes on the wealthiest Americans must balance up. The divide between the ultra-rich & the middle class is too great to be sustained. It isn’t reasonable for oil companies to be posting 40+% profits and luxury goods showing such incredible profits when the majority of Americans are struggling to pay their everyday bills.

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