December 26, 2007

No Reason To Pay The Mortgage

THE Dow soared 200 points in a Christmas rush on Friday that belied emerging details that US banking, mortgage companies and credit rating faced collapse while the nation’s mortgage insurance industry plunged into chaos.

Nearly 180,000 US local councils were placed on credit watch, with the credit agency Fitch releasing another $US5.3 billion in credit downgrades involving 27 mortgage companies. The news emerged on Friday night, when the nation’s newspapers, even if they were following the story, would miss it.

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September 6, 2006

Status Anxiety


Marc Mohan in The Oregonian

The nonfiction works of Swiss-born author Alain de Botton occupy a curious place between stringent academic philosophy and gauzy self-help manuals. Using references from great thinkers and authors of the past, books such as "How Proust Can Change Your Life" and "The Consolations of Philosophy" aim to make their ideas accessible and useful to lay readers in a way that has made them frequent best sellers. His latest effort, "Status Anxiety," uses the same techniques to address the sources of, and solutions to, that ubiquitous impulse known in the vernacular as "keeping up with the Joneses." In his continuing quest to assist readers in leading happier, more fulfilling lives, de Botton rightly addresses one of the major sources of modern discontent as "a worry . . . that we are in danger of failing to conform to the ideals of success laid down by our society and that we may as a result be stripped of dignity and respect."

This concern, he posits, has emerged over the past couple of centuries in Western industrial societies as the possibility of social advancement has expanded to larger sections of the populace, and as the levels of material acquisition attainable have increased exponentially. "A sharp decline in actual deprivation may thus, paradoxically, have been accompanied by an ongoing or even escalating sense, or fear, of deprivation."

We desire riches or power not as ends in and of themselves, according to de Botton, but as a way of seeking the "love" of those around us. Another factor has been secularization: "(W)hen a belief in an afterlife is dismissed as a childish . . . opiate, however, the pressure to succeed and find fulfillment will inevitably be intensified by the awareness that one has only a single and frighteningly fleeting opportunity to do so." The emergence of capitalism as the planet’s dominant mind-set has also contributed to the use of material or monetary benchmarks of status, and to the sense that those who fail to meet expectations are somehow faulty.

What methods, then, does de Botton prescribe to counter the relentless urge, seemingly bred into us, to judge ourselves by what others think of us? He divides his solutions into five categories — Philosophy, Art, Politics, Religion, and Bohemia — but the simple answer is: Learn to realize that other’s opinions are ultimately insignificant. Easier said than done, to be sure, but worthy advice nonetheless.

Philosophically, de Botton suggests a touch of the "intelligent misanthropy" put forth by Schopenhauer: "The views of the majority of the population on the majority of subjects are perforated with extraordinary amounts of confusion and error." The "intelligent" side of the equation should be emphasized; total disregard for society’s opinions is, de Botton holds, an equally serious, if less common, problem. Art, from the novels of Jane Austen to the paintings of Thomas Jones, can "challenge society’s normal understanding of who or what ‘matters.’ " "Oedipus Rex" demonstrates that anyone can be a failure, while The New Yorker cartoons frequently show the opposite.

Understanding politics can reveal the contingency of a society’s status markers within a historical context; here de Botton essentially expands on Marx’s thesis that "the ruling ideas of every age are always the ideas of the ruling class," and reminds us that any oppressed group can see itself as the victim of forces that can be challenged. This does lead to the debatable proposition that "in modern Europe and North America, entrepreneurs and scientists will be the objects of admiration."

De Botton credits Western civilization’s Christian heritage, and the art it has inspired, with providing an awareness of death and a sense of the eternal, as well as fostering the notion that success can be graded outside of the material world. The most radical antidote to status anxiety, though is Bohemia, defined by de Botton to include all of the iconoclastic, anti-rational schools of thought of the past 200 years — Romantics, Surrealists, Dadaists and more. From Thoreau to Baudelaire, they offer up vivid examples of perhaps the simplest method of avoiding shame in the eyes of the bourgeoisie: Thumb your nose, behave "inappropriately" and welcome their disapproval. Here we’re back to "intelligent misanthropy," and de Botton’s solutions sometimes do seem like different religions with the same god — varying means toward an identical end.

That end, though, is laudable. One phenomenon that would have been an interesting addition to this tract is the recent, mutant offshoot of status: celebrity. When people are venerated not for any discernible accomplishment, but simply for veneration’s sake, we seem to be headed for a potentially radical redefinition of success.

In the meantime, it’s not a bad idea to keep in mind de Botton’s parting advice: "A mature solution to status anxiety may be said to begin with the recognition that status is available from, and awarded by, a variety of different audiences . . . and that our choice among them may be free and willed."


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August 28, 2006

Chasing The American Dream

If you work hard, you get ahead. That’s the American Dream in a nutshell — no matter what your race, color, creed or economic starting point, hard work will improve your life and increase your children’s opportunities. Yet, this widely held dream is out of reach for an increasing number of working Americans.

Roger Weisberg’s alarming and heart-wrenching new documentary, "Waging a Living," puts a human face on the growing economic squeeze that is forcing millions of workers into the ranks of the poor. Shot in the Northeast and California, the film profiles four very different Americans who work full-time but still can’t make ends meet. Despite their hard work and determination, these four find themselves, as one of them observes, "hustling backwards."

One in four American workers — more than 30 million people — are stuck in jobs that pay less than the federal poverty level for a family of four. (i) Housing costs, to name just one of several essential living expenses, have tripled since 1979, (ii) while real wages for male low-wage workers are actually less than they were 30 years ago. (iii) But the new face of the working poor is overwhelmingly that of a woman struggling to support her children. Only 37 percent of single mothers receive child support, and that support averages just $1,331 per year. (iv) Nearly a quarter of the country’s children now live below the poverty line. (v)

What do these numbers mean in human terms? What is it really like to work full-time and remain poor? "Waging a Living" provides a sobering answer. Filmed over three years, the documentary offers intimate profiles of four working Americans — Jean Reynolds, Jerry Longoria, Barbara Brooks, and Mary Venittelli — as they struggle to lift their families out of poverty.

Good-humored and strong-willed, Jean Reynolds is a 51-year-old certified nursing assistant in Keansburg, N.J., who supports three children, including her cancer-stricken eldest daughter, Bridget, and two of Bridget’s four children. She receives no help from her ex-husband. After 15 years working at the same nursing home, providing care to the infirm and dying, Jean earns the maximum wage the home pays — $11 per hour. Without health insurance, Jean is losing the battle to cover her daughter’s medical bills and her own everyday household expenses. It isn’t the life she was born into, and Jean grieves that she can’t give her children what her parents gave her. Ironically, Jean leads a successful drive for wage increases that do not ultimately benefit her; she’s already at "the max." So when she is forced to take emergency custody of Bridget’s two other children, her situation becomes dire. Evicted from her home, with seven dependents in tow, Jean desperately turns to public assistance for the first time in her life and receives emergency aid. As grateful as she is, Jean knows all too well that the reprieve is only temporary.

Jerry Longoria is a 42-year-old security guard, whose $12 hourly wage barely covers the basics, including a tiny room in an SRO hotel in a blighted San Francisco neighborhood. A recovering alcoholic and drug addict, now four years sober, Jerry is nothing if not a dreamer. He dreams of finding better work, meeting someone special and finding a decent place to live. Although he manages to make child support payments every month, his fondest dream is to see his children in North Carolina after a nine-year absence. Jerry also jumps into union activism, speaking at rallies and meetings in support of a successful campaign for regular, yet modest, pay increases and health benefits for the city’s security guards. With remarkable discipline, Jerry saves enough money to travel cross-country for a warm reunion with his children, but when he returns home, he loses his job after an argument with his boss. He finds another job, but at lower pay, and laments that it will take eight years just to get back to the salary he used to earn.

Barbara Brooks is a 36-year-old single mother of five living in Freeport, N.Y. Her story most graphically illustrates the hazards of what she calls "hustling backwards." Barbara, raised in abusive and homes, is poised and determined. In "Waging a Living," she’s in a grueling struggle to balance her responsibilities as a mother, full-time worker and student. As a counselor at a juvenile detention facility where she herself was placed as a teenager, she earns $8.25 per hour and relies on a range of government services to make ends meet. Barbara dreams of a better life, which is why she continues her education despite the almost unbearable demands it places on her. The first blow comes when a favorable job evaluation brings her a promotion to $11 per hour, but the additional $450 she earns each month will cost her $600 a month in lost government aid. Though being off government assistance is part of her dream, she is falling behind financially even as she succeeds at work. More determined than ever to find the answer in education, Barbara earns her associate’s degree and gets a $15-an-hour job as a recreational therapist at a nearby nursing home. But, once again, she finds her income gains are wiped out by the elimination of government benefits. Unable to support her family on her new salary, she returns to a grueling work-and-school schedule, this time to earn a bachelor’s degree.

A 41-year-old single mother of three living in southern New Jersey, Mary Venittelli once led a comfortable middle-class life until it was derailed by a bitter divorce. When Mary re-enters the workforce, the only job she finds is a waitress position paying $2.13 per hour plus tips. In her own version of "hustling backwards," Mary must now hire babysitters who eat up a major portion of her earnings. There are nights she comes home with $30 in tips and owes the sitter $28. Without financial help from her husband while the divorce is being settled, she relies on local food pantries to feed her family, borrows money from friends and runs up $15,000 in credit card debt. She loses her car and is in danger of losing her home. She also sees the impact the situation is having on her children, especially her son Quinn, who begins throwing violent tantrums. At the last possible moment, a divorce settlement and a new relationship help prevent Mary and her kids from joining the ranks of the working homeless. But Mary, having experienced how easily the coin of middle-class life can flip, is determined to rely on herself to secure her future. She returns to school to acquire new computer skills.

"In making ‘Waging a Living,’ I wanted viewers to understand what it’s like to work hard, play by the rule and still not be able to support a family," says producer/director Roger Weisberg. "It’s easy to take for granted the janitors and security guards in the offices where we work, the waiters and bus boys in the restaurants where we eat, and the nurses and caregivers in the facilities where we place our children and elderly. I wanted to bring viewers inside the daily grind of the nameless people we encounter every day who struggle to survive from paycheck to paycheck."

"My goal," he concludes, "was to get people to take a new look at the prevailing American myth that hard work alone can overcome poverty."

"Waging a Living" is a production of Public Policy Productions in association with Thirteen/WNET New York, with funding provided by the Annie E. Casey Foundation, Ford Foundation, David and Lucile Packard Foundation, and the Corporation for Public Broadcasting (CPB).


(i) Thirty million Americans make less than $8.70 an hour, the official US poverty level for a family of four. Source: Business Week, May 31, 2004 p.61. Authors relied on Economic Policy Institute and the Census Bureau for their statistics.

(ii) Housing costs have tripled since 1979. Source: Kaufman, Leslie. "Surge in Homeless Families Sets Off Debate on Cause." National Report, The New York Times, Tuesday, June 29, 2004. Statistics from Economic Policy Institute.

Mortgage payments, percent change graph (for families with children): increase 282 percent btw.1978-2001. Source: "Working Families with Children: A Closer Look at Homeownership Trends" by Center for Housing Policy, May 2004, p.5 graph.

Annual new home prices: 1980: $64,600 2003: $195,000. Source: National Association of Home Builders, "Annual New Home Prices, 1980-2003" www.nahb.org.

Annual existing single family home prices: 1989: $89,500 2003: $170,000. Source: National Association of Home Builders, "Annual Existing Single Family Home Prices, 1989-2003" www.nahb.org.

(iii) Real hourly wages for male workers in the bottom quintile: 1973 = $9.70; 2003 = $9.22. There has been a decrease of 4.95 percent, or 5 percent. Source: Conlin, Michelle and Aaron Bernstein. "Cover Story: Working and the Poor," Business Week. May 31, 2004. Statistics from the Economic Policy Institute.

(iv) In 1997, only 37 percent of custodial mothers received child support from nonresident fathers, and the amounts they received were small, averaging only $1,331 for the entire year (Lerman and Sorensen 2001). Source: Johnson, Richard and Melissa Favreault "Economic Status in Later Life among Women who Raised Children Outside of Marriage," The Urban Institute, February 2004, p. 4.

(v) Number of low-wage workers: 28,280,343; Total number of workers: 116,288,910. Source: The State of Working America, Table 5.12: Characteristics of low-wage workers, 2003. Economic Policy Institute.

PBS


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July 21, 2006

America’s Addiction To Consumption & Debt

Americans are awash in red ink. Consumer indebtedness is soaring, the savings rate is down to zero and people are filing for bankruptcy at record rates. To many observers, these are symptoms of cultural decline, from sturdy thrift to flabby self-gratification — embodied in the current obesity epidemic. The fattest nation on earth is also the greediest consumer of global resources and now is borrowing more than ever to satisfy its appetites. There is a large core of truth to this indictment.

But as the history of debt in America shows, condemnations of extravagance can obscure more than they illuminate. The equation of debt and decline assumes that once upon a time Americans lived within their means and saved for what they bought. This is fantasy: there never was a golden age of thrift. Debt has always played an important role in Americans’ lives — not merely as a means of instant gratification but also as a strategy for survival and a tool for economic advance.

Yet our moral traditions have concealed this complexity. "Owe no man anything," St. Paul warned, and from the New England Puritans forward, legions of Protestant ministers made this their text. Indebtedness signified a sin against the Protestant ethic of self-control; it also threatened the ideal of independent manhood that underwrote the founders’ vision of a virtuous republic. The indebted man "must smile on those he hates, he must extend his hand where he would strike, he must speak pleasantly with a curse in his throat," a Harper’s contributor wrote in 1894. "He wears dependence like a yoke." Benjamin Franklin coined similar lessons in aphorisms later memorized by generations of Victorian-era schoolchildren: "The Borrower Is a Slave to the Lender." "Be frugal and free." The link with lost freedom was more than metaphorical: you could still be imprisoned for debt in many places (including New York City) down to the early 1900’s.

Still, the case against debt was more principled than practical. Every generation of moralists imagined the same fall from financial rectitude. In their novel "The Gilded Age" (1873), Mark Twain and Charles Dudley Warner mourned the disappearance of the antebellum "horror of debt" amid the speculative borrowing of the post-Civil War years.

NY Times

Bill Coppedge




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