We have previously followed the alarming marginal economic condition of most Americans. Another study offers another glimpse into the reality of the lives for most people struggling in this country. The study by Bankrate suggests that 63 percent of Americans say that they do not have enough money to cover a $500 car repair or $1000 hospital bill.
Real median household income has fallen to $54,000 a year. Higher health care costs, food, and other expenses have taken their toll on the middle class. The study showed that only one out of five consumers making less than $30,000 said they had enough emergency savings set aside to handle an unexpected bill.
These studies further illustrate how issues like private planes for ministers or claims of presidential candidates that they were “dead broke” can create such a backlash.
Source: CBS
Has BDS has mutated and gone airborne? This stock market is headed back to the 2009 depths. Millions have given up looking for work, something that does not show in the unemployment rate. But, the BDS infected will not blame their cult leader, they’ll blame W. They think he’s the cause of El Nino as well.
Yes, Bush dined and dashed on the bills for both the Iraq and Afghanistan wars. Congress still refuses to pay for any of it. Is it do you remember the special War Tax we all had to start paying? Me either, because there wasn’t one. No major war? Who are you kidding?
For over 10 years now there has been a trend of more businesses closing than new ones being formed. Professor Turley please correct me if I am wrong, but I thought that that the federal reserve was neither federal nor does it hold any reserves. If this is true what is it?
Our national debt went from $ 9 billion to $18 billion in 7 years during the Obama administration without a major war or a 9/11
Janet Yellen was appointed by the President and approved by the Senate–Republicans and Democrats. And in case you don’t know, the Federal Reserve is independent of the President and not taking orders from him. If anything, the Fed is more in bed with the big banks than anyone else. You should be directing your outrage to Citi, BofA, TDBank, HSBC, Goldman Sachs, Blackstone, and all the others.
The head of the fed Janet Yellen who was hired by Obama has the government printing $80 billion a month and you idiots keep blaming Bush
So you think Obama should shut down the presses, huh? Do you think that would cause a certain amount of controversy over his authority to do so?
And Bush wasn’t printing fiat greenbacks? Where’s the outrage?
Best regards.
LisaN
Sounds like you are simply inept. 2009, wasn’t that a year after the three stooges left the building? With mortgage rates around 4%, fixed and home insurance companies popping up offering half what the big guys offer, you should pay more attention.
As for Obama, he has stopped the bleeding. The bloodbath was the result of the Bush administration and the old trickle down theory. Read your history. The worst recession before this one caused by the Republicans was the one following that other genius, Ronald Reagan. He even admitted it. You can’t lower taxes/revenue and increase spending. It is a good paint job but a paint job nevertheless. The problem in this country is that too many voters are lining up for that same old trickle down John Wayne bill of goods. In the Western World the US is the only one in step.
Lisa
That’s hysterical you think Obama tanked the economy.
Do you think anyone here really cant remember that it was Bush who ordered the SEC and other financial regulators to stand down? That is was Alan Greenspan the Ayn Rand fanboy who was shocked by the housing market crash? Yes, Bill Clinton (stupidly) signed the repeal of Glass-Steagal on his last day in office, but it was Bush’s boys who let all the banks up their risk profiles to 35% and more.
I mean, nice try on blaming Obama but the FACT is that the stock market is more than fully recovered and unemployment is the lowest it’s been since, well, since Clinton was in office.
But, really, B+ for effort. D- on your facts.
That’s Obamanation for ya! My property value dropped $160,000 dollars on my home but my property taxes were not affected that much and remained high. Our taxes went from$2,400 to over $10,000 in 10 years and my homeowners insurance also doubled. My mortgage payment more than doubled and the taxes and insurance were more than the actual mortgage payment.
We couldn’t afford to live there anymore and sold our house. We made some money on it but not what it should have been prior to 2009.
Happened again in the next home I bought in 2011. My mortgage payment went up 50% in 4 years and twice my actual mortgage payment. I couldn’t afford to live there anymore either and sold it 2 months ago.
This time we purchased a farm house with acreage and animal stock. Now I get to say what my insurance coverage is but still insufficient to cover if a disaster happens and have Ag exemption on my tax bill.
It was either that or stay where I was, where my children were and live in an apartment. And rent on those are over a thousand for a one bedroom.
Ps: my husband lost a 3rd of his retirement in 2009 because the market tanked. His broker kept assuring him that Obama was the man and to keep his money in the market. Worse advice ever.
stevegroen
For a moment there I thought you were serious. There are many people that believe, seriously, your lampoon.
Pitiful, huh? It’s not the way I was raised.
If that Keynesian Obama hadn’t infused federal funds in the wake of the subprime-mortgage debacle, Reaganomics would have saved this struggling 63 percent. You can bet on it.
To help these people, we need to increase corporate income by reducing corporate taxes, enter foreign trade agreements to outsource production, and increase domestic productivity by freezing income levels for wage earners. The more concentrated the wealth, the better. That’s how we roll.
::Ahem::
The govt. has kept interest rates @ zero for a long time. It was not long ago you could get a few % interest in a savings plan. One of the best things I taught my kids was to automatically have some money withdrawn from their check and saved/invested. Every time you get a raise, you increase that automatic withdrawal. Apparently this is not what most kids were taught.
Jeff, I agree 100%.
It seems that people who have a sense of inferiority vis a vis education and the ability to succeed in life, at some point decide to accumulate as much mechanical stuff as they possibly can, to enjoy now and to sell or barter it later. Perhaps that is a good idea if paper money becomes obsolete.
I agree with a lot of the sentiment of the other comment as to why 2/3 of people can’t afford an extra $500 expense; people buy too much stuff. The one that always gets me is the number of people who don’t have two quarters to rub together that own a cabin up north with ATVs and snow mobiles and boats, etc, etc. Admittedly, I make enough money to own this stuff, but I don’t. Instead, I have a very healthly retirement nest egg. Can I afford a $500 unexpected expense, yes, I just paid $500 yesterday to get my car fixed. I didn’t even blink at it. I also know that I am far better off spending $500 to fix my 2003 car than buying a new car and paying $500 a month on a car loan. I think a little financial education would a lot of people a whole lot of good.
People buy too much. A cheap new car costs 30 grand? Buy a used one. Gotta have a tv in every room? Get less rooms. Kid wants to go away to college? Let him pay for it. Community college is just up the street.
An economic system that creates huge wealth gaps is a failed economic system.
If the minimum wage had kept pace with inflation over the last three decades, it would now be between $17 and $21 per hour. And other wages would have risen accordingly. Executive salaries have risen by several hundred to several thousand percent. This is why a handful of people now own as much wealth as half of America.
The middle class is going, going, gone. And while a very few prices have not gone crazy, the cost of college, houses and healthcare have put most of America on the edge where any additional emergency is enough to push them over.
Our number one business is banking and finance/investment—businesses that create nothing of actual value. Other top industries? War profiteering and healthcare. Sort that one out. I recall that when “experts” we’re estimating that the ongoing costs of the wars in Iraq and Afghanistan were going to run to $2 trillion, we all thought they were crazy. Now it turns out it’s going to be two or three times that.
Time to flip the script and stop favoring corporate “people” over real people.
Wait a minute…what was the actual question and context in which it was asked?
$500 or $1000 expense
Not enough to pay it as it occurred or couldn’t pay it if spread out? Didn’t have sufficient savings? What were they spending their money on? Not too long ago, commerce experts were complaining that people were not spending enough, and we’re keeping money out of circulation.
Why save anyway when one can buy tv’s and cars over several yrs at low rates with savings rates at rock bottom? The new Fiat 124 Spider will sell for about $30,000. My brand new one in 1971 cost $3,000 out the door…but now all the bells and whistles replace my AM radio and mechanical pull rod “cruise control.” My 286 computer of 1989 cost close to $2,000 (10 meg had) and a dot matrix wide carriage tractor feed black ink Epson printer was $500. And, we had one JVC 24″ color tv and one Ford station wagon. Living in a 80 yr old brick house house that had no exterior insulation, and a furnace that blew out just as heating season hit, and I was in grad school and mom/wife was working.and daughter in junior high.
Now I see neighbors with boats, campers, newer cars-pickups, and at least two smart tvs, cellphones, dish receivers, high speed internet….I’ll stop now. There might be a reason why a good portion of that cited percentage don’t have the cash on hand. I’m 70 this year. We started planning for these years 40 yrs ago. BTW never made more than 8% on any house sale, usually just barely broke even…kept moving with the Navy career just like many civilian folks but consistently seemed to be in the backside of the housing market.
Our daughter is an executive who put in her time in the trenches before and after college (waitress, ticket sales at a ski resort, home care assistant). Got her MBA while working.
Why mention her? Well, she is continually amazed at Ivy League new graduates coming in expecting to start at the “good” salaries and not understanding that they have to do their time and prove their worth. “But oh no, what about my car payment and broadband, cell phone, etc?” Yeah right!!
Yes there are many on the cusp of financial trouble who have been caught on the wrong side through no fault of their own. But nowhere near the number of those continually being cited who made bad or unwise decisions.
As for the megabuck CEOs? Again, lay that at B. Clinton’s feet. He’s the one who engineered the stock option problem. This is where the major disparity pops up, not salaries. Additionally, CEOs are not lifetime jobs…follow Ford, Boeing, GE, HP, Chrysler, UA, AA, Alaska Air, and on and on.
Washington State just hiked its gas tax (one of the highest in US) and its sales tax is about 10% in total, such a wonderful liberal state….guess who’s hit the hardest? Yep, the ones who have to commute the farthest.
One last vignette, a couple of years ago a reporter told the heart wrenching story of a man and his dog living in his van. Yep..heart wrenching. The guy was single, no kids, no debts and was a (now get this) a skilled sheet metal worker who couldn’t find work anywhere in the Puget Sound. Ooops, that was anywhere in Seattle. Also unwilling to relocate to other locales….weather elsewhere was not to his liking. Funny, nobody in three generations of our families had that luxury.
OK ol’ Pete, whoa there. Let me get off and take the saddle and bridle and get ya some oats.
Americans have a tendency to not be making enough money to save it.
Americans have a tendency to not save money in a savings account. When they need additional money the use a credit card. They might need an additional five hundred this month and they put it on Visa. Then they pay it off over four months. If they don’t pay it off then they are up itShay creek without a paddle.