It seems that it is now time for me to buckle down and face the future. My world is about to radically change. It is pretty clear that the job prospects that I am currently pursuing will not be as convenient as my previous employment and will require a complete shift in lifestyle. It will mean two parents commuting to work for hours each day. I wonder if it is the right thing to do. All of that travel to sustain a life out here.
While my spouse is lucky enough to be able to take the train, I will most certainly have to drive which will undoubtedly add further stress to my commute. Though I have enjoyed living out here, I really have not established a deep sense of community so in some ways I wouldn't mind moving closer to the city where both my spouse and I would be much closer to the corporate centers that provide the type of jobs for which we are qualified. The downside is that the children have established a community for themselves and do not want to leave.
The new reality is that employment is not the guarantee it once was; there are simply not enough jobs now even for those who are qualified. While gaining employment now requires greater sacrifice than we could have imagined even a short year ago; not gaining employment is having a devastating impact on the middle class. The middle class life is becoming even more difficult to sustain because the types of "good-paying jobs" that fueled the growth of this class continue to rapidly disappear. From all accounts, it is pretty clear that the middle class is shrinking. Long Island is a middle class world and so I fear for its future.
With little job creation on the Island to look forward to - a recent survey in the Long Island Business News indicated that 75% of Long Island companies do not plan on hiring in 2010 - many more of us will probably have to uproot or travel great distances to gain employment. I will be one of those people and so it is almost certain that it will be difficult for me to continue to write with the frequency that I do now. I will see, so shall all of us.
Showing posts with label Middle Class. Show all posts
Showing posts with label Middle Class. Show all posts
Thursday, December 10, 2009
Tuesday, September 22, 2009
The Plight of the Middle Class Continues
The plight of the middle class continues:
"For average Americans, the last 10 years were a lost decade. At the end of President George W. Bush’s eight years in office, American households had less money and less economic security, and fewer of them were covered by health care than 10 years earlier, the Census Bureau reported in its annual survey. The poverty rate in 2008 rose to 13.2 percent, the highest in 11 years, while median household income fell to $50,303. Ten years earlier, adjusted for inflation, it was $51,295." (from Timothy Egan article, New York Times, 9/16/09)
The middle class has much to ponder. Statistics show that many are falling from the ranks. The lifestyle to which they have been accustomed is in jeopardy. These are the people who pay a greater percentage of their income in taxes but are generally forced to foot the bill for themselves. Unfortunately, as our fortunes wane through job losses, home equity depreciation, and purchasing erosion through loss of credit, the increased budget deficits created by current government spending and stimulus initiatives, bank bailouts and now the soon to be unleashed healthcare reform seem like dangerous ground. At the end of the day, the increased tax burden usually falls on the middle class; the rich will find loopholes and the poor just won't pay anyway.
The middle class is struggling to hold onto its ideals; the quintessential American dream. Homes, jobs and lifestyles need saving so they don't have time to band together and fight. They don't even know what would be their common ground. Middle class means different financial classifications and values depending on what region of the country you reside in. Yet, the middle class needs to start fighting back somehow, for the current economic ills of America are disproportionally affecting them. I know it, I am staring the reality in the face, daily.
"For average Americans, the last 10 years were a lost decade. At the end of President George W. Bush’s eight years in office, American households had less money and less economic security, and fewer of them were covered by health care than 10 years earlier, the Census Bureau reported in its annual survey. The poverty rate in 2008 rose to 13.2 percent, the highest in 11 years, while median household income fell to $50,303. Ten years earlier, adjusted for inflation, it was $51,295." (from Timothy Egan article, New York Times, 9/16/09)
The middle class has much to ponder. Statistics show that many are falling from the ranks. The lifestyle to which they have been accustomed is in jeopardy. These are the people who pay a greater percentage of their income in taxes but are generally forced to foot the bill for themselves. Unfortunately, as our fortunes wane through job losses, home equity depreciation, and purchasing erosion through loss of credit, the increased budget deficits created by current government spending and stimulus initiatives, bank bailouts and now the soon to be unleashed healthcare reform seem like dangerous ground. At the end of the day, the increased tax burden usually falls on the middle class; the rich will find loopholes and the poor just won't pay anyway.
The middle class is struggling to hold onto its ideals; the quintessential American dream. Homes, jobs and lifestyles need saving so they don't have time to band together and fight. They don't even know what would be their common ground. Middle class means different financial classifications and values depending on what region of the country you reside in. Yet, the middle class needs to start fighting back somehow, for the current economic ills of America are disproportionally affecting them. I know it, I am staring the reality in the face, daily.
Thursday, September 17, 2009
Happy Days Are Here Again?
Happy days are here again. This is the famous refrain from the Great Depression when economic indicators pointed to a turnaround in the economy. Of course it took nearly twenty years after this declaration for the stock market to actually recoup the depression-era losses. But, since we have no patience this time around, we have seemingly fixed everything in a matter of 18 months.
I read a couple of days ago in the Times that average wages for 80% of the workforce had risen from $612 a week to $618 a week in the last few months. Let's not all jump for joy at once. Credibility for this factoid was attributed to the number-crunching of two (unnamed) government agencies. Is this a case of government spin at work? Perhaps not. A majority of the economists, optimists, people that matter and people wanting to matter have declared that this recession is over.
Though they all cite facts that the rebound will most definitely be tepid at best, the general consensus is that the economic crashing has leveled off; we are no longer falling of a cliff, we are just falling. And now that the lesser of bad news is treated as good news, as it has been since this spring, we should all be happy. Must we remind them that we, the millions of unemployed or underemployed, can't seem to overcome our cognitive dissonance?
I read a couple of days ago in the Times that average wages for 80% of the workforce had risen from $612 a week to $618 a week in the last few months. Let's not all jump for joy at once. Credibility for this factoid was attributed to the number-crunching of two (unnamed) government agencies. Is this a case of government spin at work? Perhaps not. A majority of the economists, optimists, people that matter and people wanting to matter have declared that this recession is over.
Though they all cite facts that the rebound will most definitely be tepid at best, the general consensus is that the economic crashing has leveled off; we are no longer falling of a cliff, we are just falling. And now that the lesser of bad news is treated as good news, as it has been since this spring, we should all be happy. Must we remind them that we, the millions of unemployed or underemployed, can't seem to overcome our cognitive dissonance?
How much more cynical are we going to get of the economic good news? I should not be so ungrateful for the $6 extra dollars a week that I would be earning if I were employed. I must always remain positive, I must always make lemonade, I must always believe that things can/will be better. Only a positive attitude can boost my spirits and keep me above the negative fray. Only I can be responsible for making the choices that ultimately led me to be unemployed in the first place.
All things being unequal, if the shoe was on the other foot, I would want to be holding on to that shoe and therefore I shouldn't begrudge an economy that appears to be moving on without me. If I get my foot back in the door, that would shift my compass, wouldn't it?
Wednesday, September 16, 2009
The Facts Are These
"As is now painfully evident, the economic growth of the Bush era was largely an illusion. Poverty worsened during most of the boom years and middle-class pay stagnated, as most gains flowed to the top. In a recent update of their groundbreaking series on income trends, the economists Thomas Piketty and Emmanuel Saez found that from 2002 to 2007, the top 1 percent of households — those making more than $400,000 a year — received two-thirds of the nation’s total income gains, their largest share of the spoils since the 1920s." (from The New York Times editorial, 9/15/09)
The data is finally in; definitive proof of what we have long surmised through our own anecdotal evidence. We the middle class gained nothing over the last ten years. Instead, we were living large on cheap credit and/or home equity gold and as the editorial goes on further to say, "Because many if not most Americans gained little to nothing from the Bush “growth” years, they have found themselves especially vulnerable to the recession." Yes many of us have colossal debt and many of us have lost our jobs. Double Whammy.
Too bad it takes so long to compile the data required to validate our observations. We are the people on the ground, we know what is going on. Now, the economy is supposedly turning around and whether we believe it or not, it appears to be leaving many of us behind. Not good, I say. Not good, at all.
The data is finally in; definitive proof of what we have long surmised through our own anecdotal evidence. We the middle class gained nothing over the last ten years. Instead, we were living large on cheap credit and/or home equity gold and as the editorial goes on further to say, "Because many if not most Americans gained little to nothing from the Bush “growth” years, they have found themselves especially vulnerable to the recession." Yes many of us have colossal debt and many of us have lost our jobs. Double Whammy.
Too bad it takes so long to compile the data required to validate our observations. We are the people on the ground, we know what is going on. Now, the economy is supposedly turning around and whether we believe it or not, it appears to be leaving many of us behind. Not good, I say. Not good, at all.
Wednesday, August 12, 2009
Private Sector Employment Losing Luster
Now that all of the experts are predicting that the recession is pretty much over and the stock market is up 50% since March, we all should be breathing a sigh of relief. Our 401k plans are rising again, the economy is leveling off, all should be OK right? Yet, somehow, I feel disconnected from all of this economic joy. When I look around, I do not see things getting any better for the middle class; at least those employed by the private sector.
Over the last decade our wages have been stagnant but now they are just downright declining. In the last 8 years, my husband was only able to gain a wage increase by switching jobs, the last time we both actually got raises from a private employer was at the end of the 1990s. So far, many of our fellow unemployed folks who have been fortunate to get employment offers are accepting less pay for the same or similar job that they just lost.
My husband just got an offer over $10,000 less than his old job with an inferior healthcare plan. In fact, the company announced today that next year's plan will be even more inferior due to rising costs. We accepted the offer though because you can't look a gift job in the mouth these days. We are thrilled that one of us now has a job but as he looks around at the folks toiling in his new workplace, they are grateful to have a job and fearful of losing it. They all get in by 8am, work all day, take no lunch, take no vacations, and do not leave the office before 6pm. This is the new reality for many who work in the private sector.
Last weekend, I read in the New York Times that the economy produced 120,000 private sector jobs since 1999. In ten years, during all of the economic boom that we were supposedly experiencing, before all the bubbles crashed at once, only a net of 120,000 private sector jobs were created. Yet, during those boom times, many public sector unions were able to obtain the most generous salary and benefit increases that now must be honored despite the economic reversal of fortune.
Where I live, on the south shore of Suffolk County, most of the parents that I encounter in my community are public employees of some sort; teachers or school workers, police people, railroad workers, postal workers, fire people and the like who seem to be the only people still spending money. The rest are contractors; plumbers, carpenters, landscapers and mechanics, all of which did quite well over the last 10 years judging from their homes and their lifestyle but are now pulling back because of the economy. There are very few who work in the private sector, and if they do they are Long Island based. I imagine they are in the same boat as we are.
So far, in the six years that we have been living in our community we have not met anyone who commutes to the city like my husband does; I'm sure there's a few out there, though. After traveling all over the island and meeting more people, anecdotal evidence suggests that most NYC commuters live in Nassau County or above the LIE in Suffolk County. In fact, when we moved out here, our neighbors were shocked that my husband worked in the city. I suppose if we were surrounded by more NYC commuter folk, we could get a better pulse on how they are surviving.
Anyhow, we are starting to get jealous of the public sector people. They have job security, incredible lifestyles, nice homes, nice vacations, nice vehicles, nice everything and we feel like we are struggling all the time. We have no comfort zone when it comes to employment, we have no job security, we have to save for our own retirement and every year we have to pay more and accept a lesser healthcare plan. Who knew this was going to be the case? None of those public sector jobs were glamorous back in the 1980s when we were going to college and making our choices but now they look downright lovely. Sure, there will be a day of reckoning for those public sector employees but right now they are sitting pretty and I wish I was sitting there next to them right about now.
Over the last decade our wages have been stagnant but now they are just downright declining. In the last 8 years, my husband was only able to gain a wage increase by switching jobs, the last time we both actually got raises from a private employer was at the end of the 1990s. So far, many of our fellow unemployed folks who have been fortunate to get employment offers are accepting less pay for the same or similar job that they just lost.
My husband just got an offer over $10,000 less than his old job with an inferior healthcare plan. In fact, the company announced today that next year's plan will be even more inferior due to rising costs. We accepted the offer though because you can't look a gift job in the mouth these days. We are thrilled that one of us now has a job but as he looks around at the folks toiling in his new workplace, they are grateful to have a job and fearful of losing it. They all get in by 8am, work all day, take no lunch, take no vacations, and do not leave the office before 6pm. This is the new reality for many who work in the private sector.
Last weekend, I read in the New York Times that the economy produced 120,000 private sector jobs since 1999. In ten years, during all of the economic boom that we were supposedly experiencing, before all the bubbles crashed at once, only a net of 120,000 private sector jobs were created. Yet, during those boom times, many public sector unions were able to obtain the most generous salary and benefit increases that now must be honored despite the economic reversal of fortune.
Where I live, on the south shore of Suffolk County, most of the parents that I encounter in my community are public employees of some sort; teachers or school workers, police people, railroad workers, postal workers, fire people and the like who seem to be the only people still spending money. The rest are contractors; plumbers, carpenters, landscapers and mechanics, all of which did quite well over the last 10 years judging from their homes and their lifestyle but are now pulling back because of the economy. There are very few who work in the private sector, and if they do they are Long Island based. I imagine they are in the same boat as we are.
So far, in the six years that we have been living in our community we have not met anyone who commutes to the city like my husband does; I'm sure there's a few out there, though. After traveling all over the island and meeting more people, anecdotal evidence suggests that most NYC commuters live in Nassau County or above the LIE in Suffolk County. In fact, when we moved out here, our neighbors were shocked that my husband worked in the city. I suppose if we were surrounded by more NYC commuter folk, we could get a better pulse on how they are surviving.
Anyhow, we are starting to get jealous of the public sector people. They have job security, incredible lifestyles, nice homes, nice vacations, nice vehicles, nice everything and we feel like we are struggling all the time. We have no comfort zone when it comes to employment, we have no job security, we have to save for our own retirement and every year we have to pay more and accept a lesser healthcare plan. Who knew this was going to be the case? None of those public sector jobs were glamorous back in the 1980s when we were going to college and making our choices but now they look downright lovely. Sure, there will be a day of reckoning for those public sector employees but right now they are sitting pretty and I wish I was sitting there next to them right about now.
Monday, July 13, 2009
Healthcare Reform Threatened by Simmering Bailout Regret
It seems that we Americans are starting not to appreciate the fact that the economy was rescued from the brink of disaster. With the furor over fiscal discipline becoming a soundpiece on every conservative media outlet, many are forgetting that the collapse of the financial system and the economy would have ruined all of us. But, as the recession wears on, it is getting harder to accept that the massive infusion of taxpayer funds barely made a dent in the survival of the average American.
Unemployment continues to rise and is on track to top 10% and now there is talk of a "jobless recovery." Clearly this is a bitter pill to swallow for the nearly 3,000,000 unemployed since the beginning of this year. The housing market is still in shambles and Americans already deeply in debt are being slapped with increasingly egregious penalties for carrying this debt. Finally, the cost of healthcare and health insurance has hit the tipping point where it is completely unaffordable for those who have lost their jobs and some 50,000,000 Americans are completely without it.
From the standpoint of the rich, they have been saved. From the standpoint of the poor, nothing has changed, they essentially receive the same assistance. The people who stand to lose the most are the middle class. These are the people losing their jobs, losing their homes, losing their healthcare and losing their minds. These will be the people who will have to shoulder a greater tax burden to pay the national debt and to prop up all the local governments and taxing authorities that are also suffering from revenue shortfalls. These are the people who are slowly being convinced that the government debt and deficit is too high to make any more changes to save the economy like funding a vital overhaul of healthcare and health insurance that will ultimately reduce costs and provide access to all.
When the average American is feeling so much financial pain, the collateral damage stemming from the bailouts - the skyrocketing national debt and the tripling of the annual deficit, already inflated under George Bush - does not seem worth it. Let's hope our weariness does not derail healthcare reform, at the very least.
Unemployment continues to rise and is on track to top 10% and now there is talk of a "jobless recovery." Clearly this is a bitter pill to swallow for the nearly 3,000,000 unemployed since the beginning of this year. The housing market is still in shambles and Americans already deeply in debt are being slapped with increasingly egregious penalties for carrying this debt. Finally, the cost of healthcare and health insurance has hit the tipping point where it is completely unaffordable for those who have lost their jobs and some 50,000,000 Americans are completely without it.
From the standpoint of the rich, they have been saved. From the standpoint of the poor, nothing has changed, they essentially receive the same assistance. The people who stand to lose the most are the middle class. These are the people losing their jobs, losing their homes, losing their healthcare and losing their minds. These will be the people who will have to shoulder a greater tax burden to pay the national debt and to prop up all the local governments and taxing authorities that are also suffering from revenue shortfalls. These are the people who are slowly being convinced that the government debt and deficit is too high to make any more changes to save the economy like funding a vital overhaul of healthcare and health insurance that will ultimately reduce costs and provide access to all.
When the average American is feeling so much financial pain, the collateral damage stemming from the bailouts - the skyrocketing national debt and the tripling of the annual deficit, already inflated under George Bush - does not seem worth it. Let's hope our weariness does not derail healthcare reform, at the very least.
Tuesday, June 16, 2009
Can We Fix Long Island?
So asks the Long Island Business News (LIBN) today:
"Do you know of a new way to control property taxes? Have you discovered how to keep young people here? Are you burning with an idea about streamlining special districts? How about consolidating schools, alternative energy and immigration?" (Long Island Business News, 6/16/09)
LIBN is asking for submissions from us locals with our ideas for fixes and will publish the best entries in their upcoming Long Island Annual Report. I am looking forward to reading some of the ideas for, like many, I gripe often but do not really posit any real solutions. Perhaps this is a good time for all of us to truly think about what to do with this aging suburb. Though everyone agrees that Long Island is a lovely place to live, the middle class affordability that drew so many to its newly built suburbs after World War II is gone. Yet, those in the power base wish to preserve what once was and refuse to understand that the status quo is unsustainable.
As we can see with all aspects of government, it seems that nothing is fixed until it completely breaks; those in power eventually succumb to self-preservation requiring them to placate those who hold the "strongest" votes. Sacrifices will have to be made in order to bring Long Island back in balance. Is there anyone willing to do so?
"Do you know of a new way to control property taxes? Have you discovered how to keep young people here? Are you burning with an idea about streamlining special districts? How about consolidating schools, alternative energy and immigration?" (Long Island Business News, 6/16/09)
LIBN is asking for submissions from us locals with our ideas for fixes and will publish the best entries in their upcoming Long Island Annual Report. I am looking forward to reading some of the ideas for, like many, I gripe often but do not really posit any real solutions. Perhaps this is a good time for all of us to truly think about what to do with this aging suburb. Though everyone agrees that Long Island is a lovely place to live, the middle class affordability that drew so many to its newly built suburbs after World War II is gone. Yet, those in the power base wish to preserve what once was and refuse to understand that the status quo is unsustainable.
As we can see with all aspects of government, it seems that nothing is fixed until it completely breaks; those in power eventually succumb to self-preservation requiring them to placate those who hold the "strongest" votes. Sacrifices will have to be made in order to bring Long Island back in balance. Is there anyone willing to do so?
Wednesday, June 3, 2009
Unemployment Takes Toll on American Dream
Mortgage delinquency rates and foreclosure rates are rising as the unemployment rolls swell. Another 500,000+ people lost their jobs in May. I can see how one's financial world can unravel so quickly especially here on Long Island. Housing is super expensive and the majority of it is classified single family - good old suburban glory at its finest. Unfortunately, if you are a homeowner, it will be downright difficult to survive a protracted unemployment if you are without adequate savings or adequate credit; though tapping credit during unemployment only compounds one's financial predicament. Unemployment benefits in NY are a maximum of $405 a week plus federal stimulus of additional $25 a week.
It is fairly obvious that the best and most effective way to cut expenses is to reduce one's housing expenses. Unfortunately, as of April 2009, the median home price is $350,000 for houses in contract and the median income is around $65,000 in Suffolk County and $85,000 in Nassau County. Property taxes are among the highest in the nation and average more than $7,000 per year. In addition, if one has to COBRA health insurance costs, even with the 65% subsidy, the average family plan will cost over $500 a month.
Those in rentals have more flexibility to downsize but homeowners, on the other hand are stuck with few alternatives. Many have put their homes up for sale but home sales are weak due to the economy and stricter lending standards. New buyers need at least 20% or $70,000 for a downpayment to purchase a home on Long Island at today's rates and it takes about 3 months just to close on a house in NY. Also, if you bought in the last five years, selling for even close to what is owed in mortgage is difficult; only those fortunate to have lived in their home long enough can "afford" to accept a cheap price to facilitate a fast sale.
Sadly, many homeowners are left with no alternative but to fall behind on their mortgage and as we can see this is happening in droves nationwide. Not everyone is a deadbeat, many are middle class Americans whose livelihood crashed along with the economy.
In the scheme of things, I certainly wouldn't mind moving to where the jobs are but what would I do with my house? In many cases, the American dream of home ownership becomes a nightmare the moment you lose your job. People are doing what they have to do to survive but for many, with ruined credit, depleted retirement savings and little left in available funds, it will be a long road back to personal financial recovery even if they do find a job.
It is fairly obvious that the best and most effective way to cut expenses is to reduce one's housing expenses. Unfortunately, as of April 2009, the median home price is $350,000 for houses in contract and the median income is around $65,000 in Suffolk County and $85,000 in Nassau County. Property taxes are among the highest in the nation and average more than $7,000 per year. In addition, if one has to COBRA health insurance costs, even with the 65% subsidy, the average family plan will cost over $500 a month.
Those in rentals have more flexibility to downsize but homeowners, on the other hand are stuck with few alternatives. Many have put their homes up for sale but home sales are weak due to the economy and stricter lending standards. New buyers need at least 20% or $70,000 for a downpayment to purchase a home on Long Island at today's rates and it takes about 3 months just to close on a house in NY. Also, if you bought in the last five years, selling for even close to what is owed in mortgage is difficult; only those fortunate to have lived in their home long enough can "afford" to accept a cheap price to facilitate a fast sale.
Sadly, many homeowners are left with no alternative but to fall behind on their mortgage and as we can see this is happening in droves nationwide. Not everyone is a deadbeat, many are middle class Americans whose livelihood crashed along with the economy.
In the scheme of things, I certainly wouldn't mind moving to where the jobs are but what would I do with my house? In many cases, the American dream of home ownership becomes a nightmare the moment you lose your job. People are doing what they have to do to survive but for many, with ruined credit, depleted retirement savings and little left in available funds, it will be a long road back to personal financial recovery even if they do find a job.
Tuesday, March 31, 2009
NY Budget Bucks Fiscal Responsibility
Oh No! I have to reverse all of my glowing recommendations for Governor Paterson. I really thought that he was going to get things done and he has failed all of us New Yorkers. NY's 2009-2010 budget at $132,000,000,000 is $11,000,000,000 more than the current budget. How could this be possible in the face of the economic calamity that has befallen our state? How could Paterson abandon all of his impassioned pleas for fiscal discipline? What happened to making the hard choices now to ensure the future fiscal viability of the state?
Until last year, I did not know that Wall Street revenues contributed approximately $20,000,000,000 or 1/5th of the state budget. It is definitely certain that this level of contribution will not be attained again for quite some time. The new budget proposal includes approximately $6,000,000,000 in federal aid and another $7,000,000,000 in new fees and taxes. I am simply shocked that no provisions have been made to account for the upcoming shortfalls that are all but certain in the coming years. When our West Coast cousin, California, is on the verge of collapse and the Federal Government borrowing heavily to prop up the entire financial system, any rational human would expect some serious budget cuts. We cannot depend on the Federal Government to continue to provide aid at current levels.
Besides, with an approval rating of 26%, what did Paterson hope to gain by risking the ire of the wealthiest New Yorkers? Now don't get me wrong, those earning over $300,000 probably can afford to pay a few more taxes but when the budget does not contain any real effort to cut expenses, it does not seem fair. Fairness is always key in the tax equation. But then again, the wealthy folk and the rest of us don't count, do we? It seems that public employees and unions are the key to an election in New York State and without those unions, your star is all but faded.
Paterson's star has been faded for so long, how about going down a hero? It does not seem that there can be enough pandering for him to reverse his political fortune and be elected governor for an official term. Now, I don't think like most people but I would wager that a good budget would have been applauded by the rank and file; we would weather the cuts because we have to. Instead we will have to pay more to register our cars, renew our licenses, pay more for health insurance and property taxes, pay more for transportation and everything else.
My goodness, how much do the regular people of New York have to suffer and why do we have to pay so much while doing so? Will New York continue to be worth the hype? I guess it will so long as you have money, work for a union, or are simply flat out poor, you can stay. As long as the budget process remains broken, the legislature remains mired in political shenanigans and the power brokers reek what they sow, the rest of us in the middle class and the young people who don't see a viable economic future may truly have to leave; that does not bode well for the future viability of the state. And Long Island, Fuhgetaboutit!
Until last year, I did not know that Wall Street revenues contributed approximately $20,000,000,000 or 1/5th of the state budget. It is definitely certain that this level of contribution will not be attained again for quite some time. The new budget proposal includes approximately $6,000,000,000 in federal aid and another $7,000,000,000 in new fees and taxes. I am simply shocked that no provisions have been made to account for the upcoming shortfalls that are all but certain in the coming years. When our West Coast cousin, California, is on the verge of collapse and the Federal Government borrowing heavily to prop up the entire financial system, any rational human would expect some serious budget cuts. We cannot depend on the Federal Government to continue to provide aid at current levels.
Besides, with an approval rating of 26%, what did Paterson hope to gain by risking the ire of the wealthiest New Yorkers? Now don't get me wrong, those earning over $300,000 probably can afford to pay a few more taxes but when the budget does not contain any real effort to cut expenses, it does not seem fair. Fairness is always key in the tax equation. But then again, the wealthy folk and the rest of us don't count, do we? It seems that public employees and unions are the key to an election in New York State and without those unions, your star is all but faded.
Paterson's star has been faded for so long, how about going down a hero? It does not seem that there can be enough pandering for him to reverse his political fortune and be elected governor for an official term. Now, I don't think like most people but I would wager that a good budget would have been applauded by the rank and file; we would weather the cuts because we have to. Instead we will have to pay more to register our cars, renew our licenses, pay more for health insurance and property taxes, pay more for transportation and everything else.
My goodness, how much do the regular people of New York have to suffer and why do we have to pay so much while doing so? Will New York continue to be worth the hype? I guess it will so long as you have money, work for a union, or are simply flat out poor, you can stay. As long as the budget process remains broken, the legislature remains mired in political shenanigans and the power brokers reek what they sow, the rest of us in the middle class and the young people who don't see a viable economic future may truly have to leave; that does not bode well for the future viability of the state. And Long Island, Fuhgetaboutit!
Thursday, March 19, 2009
Can We All Just Get a Tax Break?
I'm getting that middle class angst again and it is creeping up on my husband too. The feeling of never getting a break in this world, especially when it comes to taxation. Our tax returns are due a month from now and I am dreading the process as usual. There, I have admitted that I haven't started. At least I can stop wishing I worked for AIG since the House passed a bill to tax their tainted bonuses at a rate of 90% though 10% of $1,000,000 is still $100,000 which is pretty much all I need to set my world straight. I am at least willing to work for the money if someone would give me a job. It can be part-time, temporary, contract or whatever; I'd be happy for some work.
But, in the meantime, I will stew about the fact that I am not making any money and remain ineligible for unemployment. Alas my tax dollars are going to work to bailout the Wall Street rich and the Main Street poor, anyone who was fiscally irresponsible or simply cannot afford their share. I, on the other hand, am left to do the "right" thing; reduce my expenses. I am thankful that I was lucky enough not to have a privileged life so I can survive no matter how lean the times. Too bad, the state, the municipalities and the school districts have few plans to reduce their expenditures in any significant manner that would reduce my taxes.
The fact that the tax rolls and government spending have grown exponentially over the last decade remains off the table. State and municipal governments are attempting to hold the budget line at the current levels (and for this we are supposed to be grateful.) Long Islanders/New Yorkers have been screaming for years about the high tax rates so holding budgets at current levels is holding them at levels that are already too high.
School budgets are coming up on the block again but districts will make few changes this year because of the stimulus funds that the state received. What about next year? I just feel like they are delaying the inevitable. Before the stimulus funds arrived, the pressure was rising on lawmakers to make some serious cuts and the special interest groups were out in force, placing ads and commercials to gain public sympathy and protect their interests from cuts. Now that stimulus funds are arriving, the urgency has dissipated, unfortunately.
Local Governments and School Districts should start getting real right now before the crisis of next year. There won't be any extra funds next year. I am pretty sure. If the value of our assets and the state of the financial world is re-setting to the beginning of the decade so should all budgets adjust accordingly. It just makes sense.
But, in the meantime, I will stew about the fact that I am not making any money and remain ineligible for unemployment. Alas my tax dollars are going to work to bailout the Wall Street rich and the Main Street poor, anyone who was fiscally irresponsible or simply cannot afford their share. I, on the other hand, am left to do the "right" thing; reduce my expenses. I am thankful that I was lucky enough not to have a privileged life so I can survive no matter how lean the times. Too bad, the state, the municipalities and the school districts have few plans to reduce their expenditures in any significant manner that would reduce my taxes.
The fact that the tax rolls and government spending have grown exponentially over the last decade remains off the table. State and municipal governments are attempting to hold the budget line at the current levels (and for this we are supposed to be grateful.) Long Islanders/New Yorkers have been screaming for years about the high tax rates so holding budgets at current levels is holding them at levels that are already too high.
School budgets are coming up on the block again but districts will make few changes this year because of the stimulus funds that the state received. What about next year? I just feel like they are delaying the inevitable. Before the stimulus funds arrived, the pressure was rising on lawmakers to make some serious cuts and the special interest groups were out in force, placing ads and commercials to gain public sympathy and protect their interests from cuts. Now that stimulus funds are arriving, the urgency has dissipated, unfortunately.
Local Governments and School Districts should start getting real right now before the crisis of next year. There won't be any extra funds next year. I am pretty sure. If the value of our assets and the state of the financial world is re-setting to the beginning of the decade so should all budgets adjust accordingly. It just makes sense.
Tuesday, December 16, 2008
We Didn't Start The Fire But We Still Have to Pay
The financial situation of most of the middle class here on Long Island is always foremost on my mind. I still have the same question that I had when I started this blog, how is everyone surviving? I thought I would have some insight by now but it is still a mystery to me.
Now we add to the mix the $15,400,000,000 budget gap, attributed largely to a decline in tax revenue from Wall Street, in the New York State budget that requires serious action on the Governor's part. In response, he proposed today serious cuts in school aid and health services, layoffs of state workers, an increase in many ordinary NY State fees, new taxes on just about every bit of entertainment that exists in the state and a repeal of certain tax exemptions especially the star (property tax) rebate.
Some of the Governor's proposed solutions will be painful for all of us; we don't want to have to pay more to renew our licenses and registrations or pay more to download a song on the internet. Most importantly, any cuts in aid means that the local taxpayer has to pick up the tab. More fees and taxes is the last thing that any New Yorker wants to hear right now. However, this is where fiscal reality meets us and indeed it is very unpleasant. We may not have started the fire but we certainly didn't push for fire prevention either.
Interestingly enough, the magnitude of the layoffs is very small, 521 out of some 200,000 state workers. This is an almost negligible layoff, speaking from one who has lived to tell the tale. Indeed the rollbacks on some employee benefits will meet the ire of many especially when the career veterans have already been grand-fathered into much better benefits than the new hires. As every special interest starts screaming bloody murder from the mountaintops this week, we will see what kind of backbone state legislators have when they sit down to vote on all of this.
Now we add to the mix the $15,400,000,000 budget gap, attributed largely to a decline in tax revenue from Wall Street, in the New York State budget that requires serious action on the Governor's part. In response, he proposed today serious cuts in school aid and health services, layoffs of state workers, an increase in many ordinary NY State fees, new taxes on just about every bit of entertainment that exists in the state and a repeal of certain tax exemptions especially the star (property tax) rebate.
Some of the Governor's proposed solutions will be painful for all of us; we don't want to have to pay more to renew our licenses and registrations or pay more to download a song on the internet. Most importantly, any cuts in aid means that the local taxpayer has to pick up the tab. More fees and taxes is the last thing that any New Yorker wants to hear right now. However, this is where fiscal reality meets us and indeed it is very unpleasant. We may not have started the fire but we certainly didn't push for fire prevention either.
Interestingly enough, the magnitude of the layoffs is very small, 521 out of some 200,000 state workers. This is an almost negligible layoff, speaking from one who has lived to tell the tale. Indeed the rollbacks on some employee benefits will meet the ire of many especially when the career veterans have already been grand-fathered into much better benefits than the new hires. As every special interest starts screaming bloody murder from the mountaintops this week, we will see what kind of backbone state legislators have when they sit down to vote on all of this.
Wednesday, December 10, 2008
Some Ups but More Downs
Memorable phrase of the day: "Let me have $20 of regular, please" knowing that would fill my tank.
Gas is now $1.79 a gallon in my area. I never in my wildest dreams ever thought I would see the day again when gas was less than $2 a gallon or that I would pay $2 a gallon for my latest delivery of home heating oil. I definitely have to recommend codfuel.com to any Long Islander who is looking for the best deal on oil delivery. Gone are the days of paying at least $0.80 a gallon extra for the privilege of having a full contract with an oil company that included "free" service calls. We are going to roll the dice on this one considering that we replaced the water heater and the boiler a few years ago.
Sometimes we get so accustomed to a particular level of comfort and service that it takes a bit more than the usual prodding to undergo a regular review of expenses to find savings in the budget. Thankfully, my husband and I are fairly conservative in our expenditure and even more since we are diligently attacking business debt. Mind you, I am not sure that I am going to look back and enjoy this particular factor of my life. I think I would like to live a little sometimes and not be so fanatical about every expense.
After having my job for a couple of months, we released the tight financial reins a little bit to begin the process of replacing some completely worn out, broken and/or missing items in the house. 5 years ago, we bought Ikea in the hope that 5 years hence, which is now, we would move up a step to purchasing more premium items that would take us through the college years. I know I referred to Ikea in a recent post, so you know we were back there realizing that we have to do budget-conscious replacements again and delay once more our desire to find more permanent furnishing solutions. I think I am simply out of touch now with the reality of the amounts of dollars required to do a decent room upgrade; the kind of dollars that I simply cannot afford to spend right now and not sure when.
In light of my layoff on Monday, I am so happy that we stuck to the rule that we only spent what we could afford; cash only, no credit. Granted, we were tempted to splurge on many occasions but we both managed to talk ourselves out of it as usual. This is an area that is never of issue with us, neither of us is ever willing to spend more than the other which I have to state once more is simply not the best way; always being prudent can put the damper on things much too often, I suspect. For instance, traveling is something that I truly love to do and in reality have done so little of it lately other than the typical interstate driving to visit friends and relatives. However, every time I get that crazy notion that I want to actually fly somewhere, something that I haven't done since 2002, I multiply that airfare by 4, consider the hotel and eating costs and talk myself right out of it.
Last weekend, I was optimistic about the future, I had all the ducks in a row; my job would allow us to forge ahead despite the obvious challenges. My husband was feeling a little more "doom and gloom," directly influenced by the financial and business news, which is understandable. I countered that we should have a positive outlook on things since after all we both have jobs. I actually started to consider saving for a trip next year. We decided that when we were comfortable with the dent that we made on the business debt, we were going to go somewhere to celebrate, break our usual mold and surrender our usual penny-pinching selves. Alas it is not to be, yet again. I lost my job first thing Monday morning and he got an email the same day that his company planned to lay off nearly 500 people tomorrow.
Some would say have faith, the Lord works in mysterious ways, or we all have to pay our spiritual dues or we are lucky to be in a better position than many or we are simply lucky just to be alive and be happily married with children, or that we are fortunate to have a house or that we should be just downright grateful for everything.
Ask me again tomorrow what I think about that. Right now, I am definitely having trouble seeing the bright side.
Gas is now $1.79 a gallon in my area. I never in my wildest dreams ever thought I would see the day again when gas was less than $2 a gallon or that I would pay $2 a gallon for my latest delivery of home heating oil. I definitely have to recommend codfuel.com to any Long Islander who is looking for the best deal on oil delivery. Gone are the days of paying at least $0.80 a gallon extra for the privilege of having a full contract with an oil company that included "free" service calls. We are going to roll the dice on this one considering that we replaced the water heater and the boiler a few years ago.
Sometimes we get so accustomed to a particular level of comfort and service that it takes a bit more than the usual prodding to undergo a regular review of expenses to find savings in the budget. Thankfully, my husband and I are fairly conservative in our expenditure and even more since we are diligently attacking business debt. Mind you, I am not sure that I am going to look back and enjoy this particular factor of my life. I think I would like to live a little sometimes and not be so fanatical about every expense.
After having my job for a couple of months, we released the tight financial reins a little bit to begin the process of replacing some completely worn out, broken and/or missing items in the house. 5 years ago, we bought Ikea in the hope that 5 years hence, which is now, we would move up a step to purchasing more premium items that would take us through the college years. I know I referred to Ikea in a recent post, so you know we were back there realizing that we have to do budget-conscious replacements again and delay once more our desire to find more permanent furnishing solutions. I think I am simply out of touch now with the reality of the amounts of dollars required to do a decent room upgrade; the kind of dollars that I simply cannot afford to spend right now and not sure when.
In light of my layoff on Monday, I am so happy that we stuck to the rule that we only spent what we could afford; cash only, no credit. Granted, we were tempted to splurge on many occasions but we both managed to talk ourselves out of it as usual. This is an area that is never of issue with us, neither of us is ever willing to spend more than the other which I have to state once more is simply not the best way; always being prudent can put the damper on things much too often, I suspect. For instance, traveling is something that I truly love to do and in reality have done so little of it lately other than the typical interstate driving to visit friends and relatives. However, every time I get that crazy notion that I want to actually fly somewhere, something that I haven't done since 2002, I multiply that airfare by 4, consider the hotel and eating costs and talk myself right out of it.
Last weekend, I was optimistic about the future, I had all the ducks in a row; my job would allow us to forge ahead despite the obvious challenges. My husband was feeling a little more "doom and gloom," directly influenced by the financial and business news, which is understandable. I countered that we should have a positive outlook on things since after all we both have jobs. I actually started to consider saving for a trip next year. We decided that when we were comfortable with the dent that we made on the business debt, we were going to go somewhere to celebrate, break our usual mold and surrender our usual penny-pinching selves. Alas it is not to be, yet again. I lost my job first thing Monday morning and he got an email the same day that his company planned to lay off nearly 500 people tomorrow.
Some would say have faith, the Lord works in mysterious ways, or we all have to pay our spiritual dues or we are lucky to be in a better position than many or we are simply lucky just to be alive and be happily married with children, or that we are fortunate to have a house or that we should be just downright grateful for everything.
Ask me again tomorrow what I think about that. Right now, I am definitely having trouble seeing the bright side.
Wednesday, December 3, 2008
The News That Surrounds Me
With all of the news that surrounds most of us, it is easy to understand why Americans are 6 in 10 against the bailout of the auto companies. It is hard to emphasize with the UAW when the realities of your own situation pale in comparison to their privileged world:
There are rumors that my husband's company is ready to do a significant layoff next week. It is a large company but it has significant debt that creates an almost permanent negative impact on the books; there are always quarterly losses prompting quarterly layoffs over the last few years. The rumors are usually true since the layoffs have become more regular now, the corporate culture is one of uncertainty, about people holding onto their jobs for a paycheck until they are the next to go; no one expects a week without upheaval. There is no union preventing people from being laid-off at-will or exacting the promise of a paycheck even if the work dries up. Most employees now work at their own risk, the propects of a similar job for similar pay are slim since the industry has been suffering a downturn since 2001 from which it has never really recovered.
The other major aspect is that management has changed little, with the layoffs coming bottom up, not top down. Unfortunately, this scenario gets compounded by the fact that management usually has the most management experience even if they have done a terrible job. If you listen to the logic of most companies, they have to preserve bonuses and other perks to keep their managers from absconding; how can they run without experienced managers? Unfortunately, many of these managers may be the very same people who ran the company into the ground in the first place. It is clear that my husband's company has been badly run for some time but those people are not getting rid of themselves anytime soon.
My husband is grateful that he has a job and receiving a decent paycheck for his hard work and so am I. Hopefully he will survive the next round but we still could tighten our belts even further and save even more money just in case. I double-checked with my benefits representative that if he loses his job and we lose our health benefits that I qualify to sign us all up for the health benefit at my job; I am currently waiving mine since both of our plans cost about the same and there is no reason to upset the cart, for now.
Since I have only been at my job for 3 months, I simply have no comfort zone at all. I don't think I will ever settle in since the job trimmings continue despite the assurance after the layoffs last month that we were the crew going forward, in fact the executive who told us that is no longer with the company having been terminated last week.
Friday, September 12, 2008
Today I Found a Job
Today, against the tide of a declining economy, I found a job on Long Island. No matter the economy, even if
I am looking forward to starting my new job and garnering a paycheck and perhaps feeling just a tad more worthy now that I will be making a financial contribution to the household. It is a unique experience to be able to stay home and raise your children but it remains an incredibly challenging gap to overcome on a resume. Explaining to a potential employer your new found relevance is a daunting task after being out of the workplace for 6 years. Then, when you find your way back in, you still have to request concessions; you have to negotiate for flexibility because you cannot abandon your children’s carefully chosen trajectory.
Up until this point their path has been laden with extracurricular activities and unsparing parental involvement, some may call it indulgence, that is now threatened by your absence. Juggling and paying for after school care becomes a mad dance between you, the school, the school bus, the after care provider and most importantly their geography as I found out. The geographical boundaries of your child’s school take precedence, you can’t have a provider that is not in the geographical area serviced by your child’s school bus. OOps!
This is why people go "home" and/or move closer to their families when they have children because childcare and activity scheduling is practically impossible otherwise unless you have ample funds to afford it. One child is sometimes manageable but daycare for two children means a bill so large that it is more cost effective for someone to stay home. Generally, if you are rich, you can help yourself or poor, the government will help you; if you are middle class the choices mean the difference between realizing any benefits from working or working to pay for daycare in which case why go through the hassle and expense?
Nevertheless, I was kicking and screaming when I left work 6 years ago because I had suddenly lost my individual worth but after a while I realized I had regained it as a mother. Now, I have to go back to work, I am suffering in reverse, once again kicking and screaming but this time for interrupting my motherhood with work.
Wednesday, August 27, 2008
Democratic Convention: Obama-Biden is the Ticket
With a lead up by President Bill Clinton and Sen. John Kerry, Sen. Joe Biden of
Once again the speeches were on point and delivered exactly what was expected of them. Though the press may want to continue to trump up a Clinton-Obama discord between the delegates, it was pretty clear that the Democrats had reached common ground.
Whether we want to accept it or not, this election is different. The policies of the past 8 years have left the country bereft. Reaganomics worked in the 80s when we needed to spur industry and growth, back when
Thursday, August 14, 2008
Long Island Economy Under Pressure
The numbers are creeping up around us:
The unemployment rate onLong Island hit 5% in July
The unemployment rate on
Consumer prices rose at the fastest pace in 17 years.
Tuesday, August 12, 2008
Thank Goodness for the Olympics
The dog days of summer are just that; dog days. The economy is in the toilet and no amount of massaged news can reverse reality. We are getting a little bit of a reprieve at the gas pump with gasoline prices now averaging $3.89 a gallon, down about 40 cents a gallon since July. Unfortunately, for middle class Long Islanders, this is not enough savings to stave off the indebtedness we are all facing and the fact that the home heating oil season is soon to be upon us. Thankfully for the past few days and another week or so to go, we have had the distraction of the Olympics and these games have been far from ordinary.
The sheer magnitude of the opening ceremonies captured our imaginations so completely that we were immediately swept up in the glory of the games. There is no way to deny that the Chinese are a force to be reckoned with; a new rival. We were completely upstaged in these opening ceremonies, for most of us felt that America (or any other country for that matter) could not have, would not have, produced anything so breath-taking and amazing, yet we are enjoying the games. It is a dichotomy that speaks volumes. There is a tacit understanding as we cheer for
Friday, August 8, 2008
Property Tax Cap: Solution or Disaster?
It is nice to see that the NY State Senate Is meeting to tackle the property tax cap issue in response to the Commission on Tax Relief’ recommendations. The Commission, instituted by former Governor Spitzer and headed by Nassau County Executive Tom Suozzi, recommended a school property tax cap of 4% annually; a proposal supported by Governor Paterson. This means that school budget increases must result in a property tax increase of no more than 4% each year. We have long known that
Monday, August 4, 2008
Are You Maxing Out Your HELOC?
My June 27, 2008 Bracing for the Big One entry regarding the lowering of credit limits for credit cards failed to mention that home equity lines of credit (HELOCs) are also under the knife. In response to the threat of credit line deductions, many Americans are doing the next best thing; taking out whatever balance is left on the HELOC and putting it into savings accounts. Fearing the real possibility that their credit lines won’t be there when they need it, some folks have realized that they do not have to sit idly by and watch the banks snatch back their credit lines, why not take the money now, just in case, as a way of propping up their emergency funds. By doing so, they are opting for higher principal and interest payments now in an effort to secure those funds and a little peace of mind.
Thursday, July 31, 2008
Beware the Economy: Proceed with Caution
It is the last day of July, a fact that I wish I could avoid, the summer is going by too fast already. August is upon us and it seems I have not gotten to all the things I would like to do. We are definitely hanging closer to home and doing fewer outings. In previous summers, Newsday’s Fun Book was our guide and we went somewhere every day. This summer the children have attended some mini camps here and there so they are having a swell time and they don’t seem to mind spending more time at home.
Right now we are trying to preserve our funds for the uncertainty of the future and aggressively pay down debt, which unfortunately did not come from spending, though I wish it did. Then, I would be able to look around and see all of the nice stuff and at least be enjoying what I am struggling to pay for. Our debt comes from a failed business enterprise so in reality we have nothing to show for it except to acknowledge the experience as a very expensive lesson learned. For years, we scrimped to ensure that we had no debt and plenty of savings so that we could become small business people, deciders of our destiny and maybe even transcend the middle class. All of the money that we could have spent on home improvements is now gone plus a whole lot more. We are now stuck indefinitely with the old 1970’s kitchen, dreadful bathrooms and a myriad of unfinished home improvements that we decided to forego in order to have enough start-up capital for our business. Now we face the long road of reducing our lifestyle and spending in order to tackle that debt. Nevertheless, we are fortunate to have preserved our livelihood.
Thankfully, most of us are surviving and adjusting to the new price thresholds for energy and food and we will probably make it through the back-to-school shopping season fairly unscathed. Lucky for me, our school district has been phasing in a uniform policy for Kindergarten - 8th grade. This will reduce our clothing budget significantly. I suspect that the major rough patch for the Northeast will be winter when the heating oil bills kick in and right now it appears that nothing short of a miracle will reduce the tab for the 1st fill-up projected to be at least $1000 for those with the standard 275 gallon tank. Perhaps many will be prepared to absorb the impact of that 1st bill, the problem will be the 2nd and subsequent ones arriving every 4-7 weeks throughout the cold weather season. I know people who are already saving the “oil money”; I have become one of them. We should plan for it so we do not find ourselves with empty pockets at the worst time of year.
Yesterday, the Governor of New York warned of difficult economic times ahead and that the state should re-evaluate its budget and spending in order to head off a financial disaster. We should all take heed. If there is anything we can learn from all the government bailouts, insolvencies and foreclosures is that we all need to be wise about how we spend and save money at least in the short term.
Subscribe to:
Posts (Atom)
