Tag Archives: recession

The end of consumerism? Part 2 – Frugality ends when living life laid off does. Pity

by Mariam Williams

“You see, when this recession began, many families sat around their kitchen table and tried to figure out where they could cut back. So do many businesses. That is a completely responsible and understandable reaction. But if every family in America cuts back, then no one is spending any money, which means there are more layoffs, and the economy gets even worse.” – President Obama, Speech on the economy at Georgetown University, April 14, 2009, about 10 minutes in.

Is frugality bad for the economy?

That’s the question author Amy Dacyzyn poses on page 61 of The Tightwad Gazette II. Here’s what’s crazy: The book was published in 1995 and references a 1992 book by Ross Perot entitled, United We Stand, for further reading on how rethinking spending can lead to a more stable economy.

The question remains relevant because we keep getting ourselves into recessions, and counting on spending to get ourselves out and to sustain our economy.  I attended a business webinar today in which speaker economic futurist Jeff Thredgold stressed that the tide has begun to turn in the economy.  He and other experts are now predicting that we will move out of the current recession, which officially began in December 2007, before the end of 2009.  Although this recession has lasted longer than those of 1980 and the early 1990s and unemployment may still increase to over 10%, the severity has begun to level off.  The stock market shows signs that consumer confidence is starting to build again, and that’s critical to our economy; seventy percent of our national income is determined by consumer spending.

Here’s the thing that’s really hitting us with a national unemployment rate of 8.5 percent: not all of that spending is from hard-earned money.  In 2008, 65% of our spending was dictated by wages and salaries, down from 80% from 1980 to 2007.  That means we rely on credit for 35% of our spending.  Those whose credit cards remain open during unemployment-because if a bank suspects you won’t be able to make your payments, they can cut you off at any time, or raise your interest rates, for any reason really, without notice-will likely continue to use them, but not on the vacations, appliances, clothing, and entertainment they did before.

If it lasts long enough, the forced frugality of the current recession could change American society as a whole from greedy, credit-burdened consumerists who work to get more stuff they can’t enjoy because they’re working too much to pay off the debt they borrowed to get the stuff, to a society that values the bare necessities, the earth, and interpersonal experiences.  As Marian Salzman, the chief marketing officer of Porter Novelli, a public-relations company, said in a story published last month in U.S. News & World Report, “[T]here is an anti-bling thing going on.”

I heard much of the same on the radio show State of Affairs last month.  People have shifted their dollars to maintenance, “do it yourself” projects, anything that will help them save money at a time when they fear they might not have a job forever, or when they know that a home equity loan is impossible on an upside down house.  The savings rate has gone from -1% to 5%.  People are tracking their spending, learning how to prioritize, and learning how to define what’s really important.  We’re learning lessons that can bring down a capitalist economy.

Greed has employed me.  I don’t understand why auto makers roll out a new version of every model of every make every year, or why most drivers get bored with their car after three years and feel the need to swap one vehicle they don’t own yet for another one they never will, but I made more money per month selling cars than I have per month at any other job.  I hated wrapping overpriced presents for ungrateful, rich snobs in Seven jeans and Juicy Couture jogging suits who routinely spent over $1000 a week in a southern California Bloomingdale’s and who threw tantrums over restrictions on the 20 percent savings cards that cost them a $5 charitable donation once a year, but without their obsession over obtaining the latest styles before everyone else and at regular price, I would not have been able to eat as I nurtured my showbiz habit.  I can’t tell you how many commercials I wrote as a radio copywriter advertising clothing sales, furniture with easy financing and guaranteed credit approval, or specials on custom wheels, sound systems, and rims.  Those same marketers’ holding back their ad dollars led to my current state and is presently sending newspapers and other publications into bankruptcy.  One of the comments in the pile Oprah’s website collected after Suze Orman’s last financial show was from an irate spa owner, appalled at Orman’s advice to cut your spending to the “bare bones,” or as the commenter saw it, put small business owners out of business.

Our country is at a crossroads right now.  The greed that unregulated free enterprise bred has screwed us, but a radically new system is still too hard for people not yet suffering to imagine.  I’m not even sure that the government should take charge of or be heavily involved in the overseeing of corporations, and I don’t know why I’m not sure.  Perhaps because I know and admire several smart, honest women who own their own businesses and feel like they deserve to revel in their success.  Perhaps because I know that money is a motivator and that it’s employed me.  Perhaps because I like paying low prices more than I care about the exploitation of workers.  (Of course, if I were earning enough money to only support local small businesses, I would.)  Perhaps because I think our government officials are just as fallible as everyone else, and if they don’t mess up a new system with their own disagreements or errors in judgment, a person with greater ingenuity will buy them out.

The Obama Administration could be on the right track anyway.  Keynesian economic theory suggests that we spent our way out of the Great Depression with federal stimulus packages that increased disposable income.  History also shows us that we tend to revert back to our old ways once the tough times are over.  Most of us were spending beyond our means, but at least we had some means, and once those means are restored to their previous levels-and for many industries, or people willing to learn new skills, they will be (even before the end of the year!)-most us will revert back to credit and debt.  Of course, massive debt isn’t entirely the consumer’s fault; when credit card companies and banks can change your interest rates on a whim, manageable debt becomes unbearable.  If corporate greed is somewhat regulated when the hard times are over this time, we might have even more confidence in our plastic cards.

Amy Dacyzyn believes that if we as a society were able to save more money, we would be a better society in three ways: 1) we would have more venture capital to start businesses; 2) we would have less federal debt and lower taxes because we wouldn’t be paying off our own bad decisions; and 3) we would be able to focus on real causes of economic problems, like the outsourcing of manufacturing jobs to foreign countries.

I’m hoping that the story from U.S. News & World Report is true and that our frugality may actually become so ingrained that we question every purchase and use more cash. I’m concerned about just how our economy will restructure itself if we’re not dependent on the sale and marketing of unnecessary stuff, but if the trend continues, or if we fall quickly into another recession after this one is over, we’ll have to find a new way.  And I don’t think that’s a bad thing.

What are YOUR plans for your money after you bounce back?

See a transcript of the president’s speech from last week here.

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© Mariam Williams, aka The Pink-Slipped Girl, and The Pink Slip Blog – Living Life Laid Off, 2009. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Mariam Williams and The Pink Slip Blog – Living Life Laid Off or http://livinglifelaidoff.com, with appropriate and specific direction to the original content.  Any use and/or duplication of any photo contained within this blog without express and written permission from Mariam Williams is strictly prohibited.

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Filed under Economy, Lifestyles, money, Recession, stimulus bill, Unemployment

Realistic faith while living life laid off

by Mariam Williams

“My faith is the only real thing I have now, but faith doesn’t put bread on the table.”

The pastor of an Episcopalian parish said that Thursday on Oprah.  He and his wife lost their life savings in the stock market, and at 65 years old, they’re not sure if their resources will outlast their lives.

The more righteous among us might ask, “What kind of faith is that?”  I think it’s a realistic one, and it’s a perspective I share.  I thought about my level of faith, or maybe the reality of God’s provision, just hours before seeing the show, as I prayed for forgiveness for taking God’s provision for granted, realizing that I go through many days without even a quick blessing over my food, much less a genuine prayer of thanks for shelter, safety, health, transportation, or even the portion of the stimulus money I guiltily spent on new workout clothes at Target last week.  (While I haven’t quite felt guilty enough to return them-they do fit better than the pants that have gotten so loose no amount of drawstring tightening will keep my underwear from exposure-I’ve been too ashamed to leak my purchase to the blogosphere until now.)

As I made my petition Thursday morning, I felt an entitlement farmer plant a seed in my brain.  “What am I asking forgiveness for?” I thought.  “He’s God, and I’m his child.  He has to provide …”  But before the thought was complete, I recognized its fallacy, and that moment of clarity wasn’t just the Holy Spirit convicting me for the attitude of entitlement that had momentarily replaced my appreciation of grace.

I have a bookmark-a physical one that you use to mark your place in physical books-that directs me to certain scriptures for certain situations.  I guess it’s a biblical GPS for life and emotional breakdowns.  When worried, the bookmark says I should read Matthew 6:19-34.  Loosely summarized, verses 19 through 24 warn that focusing on temporary, material things leads to spiritual blindness, as it’s impossible to devote yourself to both God and money.  In verses 20 through 34, Jesus says not to worry about your life and body when it comes to food and clothes; there’s more to your life and your body than that.  Besides, he continues, God feeds the birds, and flowers are clothed more royally than King Solomon, the wisest, richest king of his time.  Come on, now.  Don’t you think God cares more about you than some flowers?

That scripture would have watered my entitlement seed if Matthew 25:31-46 hadn’t dug it back up.  In this scripture, Jesus talks about the day of final judgment.  He’ll separate the sheep from the goats, congratulating the sheep for feeding the hungry, clothing the naked, looking after the sick, and doing other charitable acts, and condemning the goats for not doing any of it.

What does all this have to do with living life laid off?  Simply this: one scripture says don’t worry about food and clothes while the other rewards the people who feed the hungry and clothe the naked.  This means that there will be people-during this recession and forever-who will not be fed like the birds or clothed like the lilies, and I’m absolutely sure that some of those people believe in God just as much as I do.  They may even be the shepherds of a church or parish.

I’m somewhat concerned about the people who will run to houses of worship in the midst of this economic crisis with sincere belief in a genie-god who will make a high-paying job or an unusually sympathetic banker appear.  I’ve been a Christian for nearly 17 years, and although I do believe that God is able to do “immeasurably more than [I] can ask or imagine” and that everything eventually works out for the best, I don’t believe he will always spare me from the worst.  This realistic faith is why I quickly reverted back to my original request: forgiveness for taking God’s provision for granted.  It’s also why I added a request for help to focus on what’s necessary and for a new perspective on wealth and on what’s important in life.

Suze Orman and I were on the same train of thought today.  Later in the show, the pastor on Oprah explained that his “faith in his creator and provider hasn’t wavered a bit,” but the system, the government working for him and people like him?  His faith in that is crushed.  Suze Orman followed his comment by begging the audience-I mean literally getting down on her knees on the Oprah show-to focus on what they have and forget about whatever jobs, riches, homes, or savings they lost.  She said that we’re not judged by how much money we make, a point I will likely debate in a later post, but “by who we are in the face of adversity.”

But just to warn you, we may not be spared from the worst.  At the end of the show, Suze Orman, who was right when she said years ago that we would soon be in this mess, predicted that it will be 2015 before everyone affected by the recession retrieves what was lost and each person’s hope is completely restored.  That means there’s an end in sight and plenty of time to reevaluate our priorities as 12.5 million of us continue living life laid off.

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See a summary of Suze Orman’s financial advice for the unemployed and everyone else here.

http://www.oprah.com/dated/oprahshow/oprahshow-20090311-suze-orman

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© Mariam Williams, aka The Pink-Slipped Girl, and The Pink Slip Blog – Living Life Laid Off, 2009. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Mariam Williams and The Pink Slip Blog – Living Life Laid Off or http://livinglifelaidoff.com, with appropriate and specific direction to the original content.  Any use and/or duplication of any photo contained within this blog without express and written permission from Mariam Williams is strictly prohibited.

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Filed under Economy, faith, Lifestyles, Mental & Emotional Health, Recession, Unemployment

Is living life laid off making you fat?

by Mariam Williams

is that my weight?  you'll never know ...

is that my weight? you'll never know ...

Today I inhaled a regular-sized, chocolate milk shake from Steak-n-Shake, which I purchased for half price during the chain’s weekday “Milk Shake Happy Hour.” And it made me happy indeed.

This was a rare treat for me. Even before I was laid off, 10-dollar lunches with or without coworkers were isolated incidents rather than the norm. I saw more value in group cycling or muscle conditioning classes at noon, followed by anything I could scarf at my desk. That being my habit, cutting off dining out in favor of greater financial stability demands no great sacrifice. The treat, then, is the milkshake itself: real ice cream, measured out with a scoop, mixed with milk I wouldn’t dare delude myself into thinking is fat free, topped with whipped cream and a cherry, and served to me – the Pink-Slipped Girl suddenly craving comfort food as both fulfilling full-time work and her Zumba instructor’s six pack look increasingly unattainable.

I blame my recent diet recklessness on the desire to quickly pacify bouts of doubt and anxiety, but many newly unemployed or underemployed workers could fault the economy for the same behavior. The correlation between poverty and health is well documented; the poorer your zip code, the shorter your life expectancy, and the more likely you are to be overweight, diabetic, or have life-threatening illnesses. Poor people make poor food choices, sometimes because good food isn’t readily available within a reasonable radius accessible by foot or by public transportation, and other times, because the healthy stuff just costs too damn much.

On a recent episode of Oprah in which Dr. Oz and Men’s Health editor David Zinczenko counseled obese teens and their parents on better food choices, the mother of one such teenager voiced concerns that her family couldn’t afford the Swiss cheese over the cheddar. Dr. Oz thought it was a good point. He said something like, “The best way to gain weight? Take about $20,000 off your income.” He went on to note that people who purchase their food with food stamps tend to choose cheap, unhealthy alternatives.

When I heard Dr. Oz’s observations, then ran into a post about putting on recession pounds on reuters.com, I decided to do a little experiment. How much would I spend if I went to the grocery store and filled my cart with natural whole grains, fish, poultry, and fresh organic produce? How much would I spend if I filled it with high-calorie, low-nutrient items?

Total cost for items in cart full of healthy stuff: $157.60 (See the cart by clicking total cost)

Total cost for items in cart full of not so healthy stuff: $83.26 (See the cart by clicking total cost)

Difference: $74.34

I should note that since I would never fill my grocery cart with the latter, the easiest course of action was to shop for the items online. THIS IS NOT THE WAY I NORMALLY SHOP FOR GROCERIES. I’ve previously noted my coupon obsession, and I try to always use the coupons when the items I have coupons for are also on sale, thereby saving myself even more money. (That’s how I can get a box of Multi-Grain Cheerios for less than one dollar when the regular price for one box ranges between $3.50 and $4.86.) Some of the items I chose were on sale, but most were not, and shopping online prevented the use of coupons. I should also note that I was thinking about a family of four, with at least two heavy eaters, and that I have no idea how long the amount of food I picked out would actually last for such a family. I also couldn’t take Dr. Oz’s suggestion to save money, support the local economy, and buy fresh by shopping at local farmer’s markets, although I remember organic strawberries costing about $4 per pint at the outdoor markets available in St. Matthews (Louisville) from May to September. And no, that’s not cheaper than the grocery or mega-store chains.

In keeping with experts’ findings that energy dense foods are less expensive – and in paying homage to the food from my chunkier childhood – I didn’t just replace “natural” or “organic” items from the healthy cart with non-organic or “regular” items. I made it as unhealthy as possible. I eliminated fresh produce completely, opting for the canned variety. Yogurt was replaced with another popular source of calcium: ice cream. Instead of almonds and organic pretzels for snacks, I chose potato chips, regular pretzels, and cookies. Soda and that gallon-size jug of punch (also known as grape, lemon, or orange drink) with about 10% juice, 50% water, and 40% sugar stepped in for 100% apple or orange juice. There’s no fish in the junk cart, and breakfast items include sugary cereal targeted to children, white bread, and donuts. I forgot the can of pork and beans, but I did add Ramen noodles to the unhealthy cart. I don’t mean the good ramen that my American roommate born to Korean immigrants bought at a specialty store and made for me and our third roommate our freshman year in college. I mean the stuff that has no nutritional value, costs 25 cents per package, and that I swore to myself years ago that I would never eat, no matter how bad things got.

I still refuse to eat Ramen, and I probably do better than most in my situation for food. I’m fortunate enough to not live in an area in which subsisting off of food found solely in and around that area could kill me (here’s the story of one brave soul who did it); I walk less than a mile and run into two chain grocery stores, one natural market, an Asian restaurant with at least 20 vegetarian entrees, and an Indian restaurant with the same option. Yes, I pass at least six fast food restaurants and one popular bakery on my way to the healthier options, but at least I have choices. And for now, the choices I make aren’t bankrupting me. (If I swear off comfort food, I’m sure I’ll be even more frugal.) I’m tempted to try the fast food chains instead of the grocery store for two weeks, just to see what how much money I would spend — or save — by living like the bachelorette that I am instead of a housewife in training.  But I’m too accustomed to healthy living, I’m a little to vain to force that much of a setback on the body I’ve worked so hard to get, and as it is, I just don’t feel like I’m spending that much money.

I’ll be posting real grocery receipts soon. Until then, look for coupons, remember that there’s nothing wrong with the store’s brand as long as the ingredients are healthy, be good to yourself, and try not to get fat while you’re living life laid off.

Related links:

McDonald’s is playing on your weaknesses. http://www.rockymountainnews.com/news/2009/jan/27/mcdonalds-posts-profit-low-prices-menu-cited/

Food Security in Louisville, KY

http://leoweekly.com/news-features/major-stories/features/eating-ourselves-death

http://leoweekly.com/news/fruit-their-efforts

http://leoweekly.com/arts-entertainment/food-drink/full-it

Will American’s Put on Recession Pounds?

http://www.reuters.com/article/email/idUSTRE50805W20090109?pageNumber=2&virtualBrandChannel=0

Louisville Free Public Library

www.lfpl.org

I searched magazines and academic journals under Research Tools for the “well-documented” facts about obesity and poverty. I can’t give you the links to all the info I found because it’s saved under my account, but you can find and read tons of full-text articles yourself from your own local library.

© Mariam Williams, aka The Pink-Slipped Girl, and The Pink Slip Blog – Living Life Laid Off, 2009. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited. Excerpts and links may be used, provided that full and clear credit is given to Mariam Williams and The Pink Slip Blog – Living Life Laid Off or http://livinglifelaidoff.com, with appropriate and specific direction to the original content. Any use and/or duplication of any photo contained within this blog without express and written permission from Mariam Williams is strictly prohibited.

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Filed under Diet & Nutrition, Economy, Food, Health, Lifestyles, Unemployment