Friday, May 12, 2006

The High Cost Of Living In The U.S.

Besides being a prime terrorist target, it is the actual act of living not having fun, that is the reason why people are so stressed and worried in America. And the Republicans would like you to think that everything is A-OK.
Basics, Not Luxuries, Blamed for High Debt: "In the past five years, the costs of medical care, housing, food, cars and household operations rose 11.2 percent, the study said. Many families are trying to make up the difference by borrowing, according to Christian E. Weller, author of the report and a senior economist at the center.

'Very little can be explained by frivolous consumer spending,' Weller said. His views were echoed in a news conference by Elizabeth Warren, a law professor at Harvard University who analyzed the sources of debt that emerge in bankruptcy filings and reviewed the results of Weller's study.

'The average American family is walking a high wire and hoping there won't be a high wind,' Warren said.
"Houses made of straw and the big bad wolf is coming to blow it down.
But the share of income that is going to credit cards has been relatively stable for the past decade, falling from 0.5 percent to 0.3 percent from 1989 to 2004, according to the study, except in the relatively small number of households with significant credit card debt.

Many families, particularly middle-income households, aren't acknowledging that declining incomes mean they must radically adjust their standards of living, according to Weller and Warren. Warren suggested that families that can no longer realistically afford their single-family houses should move to condominiums, consider limiting their families to a single automobile, get second jobs to pay off debt, or move to less expensive school districts that may not have the highest test scores but where children perform acceptably well.
Having struggled to meet the American Dream, people aren't going to be in a rush to go backwards. The costs of downsizing can be great also. That's the solution. As the rich get richer (with all those tax breaks) the American people who actually do the work of keeping this country vital are now being told that they must adjust downward if they want to get ahead. The "ownership society" only seems to work for a privileged few.

People are already starting to lose their homes. A few more months and it should snowball just in time for winter. If there is a chill in the air regarding home sales, eventually the sellers will no longer be able to meet their obligations and homelessness will once again increase in America, it just won't be people with drug and mental problems, it will be people with degrees.

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