There’s a good article appearing on msn.com today concerning the “secret shame” of the middle class. Written by Neal Gabler for The Atlantic, it begins by revealing a surprising statistical find by the Federal Reserve Board: that 47% of American consumers would either have to borrow or hawk a possession in order to cover the cost of a $400.00 unexpected emergency. Surprisingly, the tone of the article was not one of shock or disbelief, but empathy and resignation. Gabler openly confessed that he, despite his career success as a writer of some five books, hundreds of published articles, and even television appearances, is one of these 47%.
To his credit, Gabler made no excuses. Instead, his point seemed to be that times are tough, even for the hard-working and well-disciplined. A real estate market collapse here and staggering college tuition there is enough to bring anyone to the point of financial fragility, he reasons. While I applaud Gabler for coming out of the financially fragile closet, I disagree with this bleak suggestion that no matter how hard one tries, we are all destined to live in a paycheck to paycheck lifestyle.
The reality, you see, is that the majority of Americans are walking a financial tightrope without a safety net because of one bad choice after another. In reality, the “secret shame” of which the article speaks is just not there at all. It used to be, mind you, but over the last 20 or so years, there simply is no shame in being financially impotent. Instead, people with little to no net worth think nothing at all of eating meals out daily, of buying new clothes every season of the year, or of purchasing large SUVs for the single person commute to work each day. No one is encouraged to delay gratification, to work hard and save aggressively as a young adult. Why bother, the reasoning goes. Life is too short, and if we get in over our heads there is always bankruptcy and government safety nets.
There really is a better, and more responsible, way. Despite having reached a level of financial independence from 24 years of frugal living habits, it is still a rare occasion when I, for example, visit a restaurant where the dinner tab for two will exceed $35.00. I never, ever join the tens of thousands of fellow local residents who happily drop two, three, or four hundred dollars to attend a football or basketball game for 2-3 hours. I still do not pay people $40.00 to mow my grass or thirty to change my car’s oil.
And yet on those rare occasions when I do visit a restaurant as high priced as an Outback or Longhorn, I am constantly surprised by the length of the wait list. Once inside, I see families of 4 – 6 just living it up, stuffing their already obese waistlines with $25.00 entrees, drinks, and deserts. How many of these people, I wonder, could handle a $400.00 emergency? Probably all of them if they simply ate at home and drove a Nissan Sentra rather than the Chevy Tahoe that sits outside.
The other part of Gabler’s article that bothered me was a gratuitous injection of politics. He writes that the financial stress of Americans causes us to lash out at innocent targets, such as President Obama. Really? I don’t care what side of the political aisle you sit on, there is no disputing that real wages in America have fallen under this administration. Also beyond dispute is that the concept of fiscal responsibility has been all but destroyed by a federal government that has ratcheted up the national debt to a truly unbelievable 19 TRILLION dollars, all while raising taxes and handing out more and more and more free entitlements, from Obama phones to Obamacare. The hope of climbing out of debt and building a financial safety cushion takes a mighty beating when we have a federal government that spends like a drunken sailor on shore leave, only to raise taxes on the one-half of Americans who pay them in order to give entitlements to the other half who do not.
The main point, you see, is that responsible choices and discipline are still the keys to financial stability, both at the governmental and personal household levels.