Is another recession coming?

[Muushka]

I think that in general the "get govt out of education" position tends to go hand-in-hand with the "get govt out of charity" position, so lack of investment in education would ideally have no consequence on the welfare end of things.

I think what bothers me most about the whole subject is how easily we accept and even advocate for the idea that a hard day's work has no value of its own, and that it is fine and dandy that some people should work hard every day of their lives and "accept that perhaps they just can't afford" a home or children.

That is the problem. Because so many feel that they deserve their own home or their right to have as many children as they want, with no means for either, is in part why we are in the mess that we are in.

I'll set the child aspect aside because I don't have children (by choice) but I can understand why people do. And I can understand having them, even if you can't afford them. One or two .

But home ownership? Come on. Who do you think should pay for this home that you believe everyone deserves?
Trust me, I resent every single dollar of our taxes that is being wasted in this real estate mess that this country faces.
And I resent the fact that my home has lost value because of the real estate mess.
But we are by no means 'upside down'. We bought a house we could afford, not counting on anyone to help us.

I agree with you, Colleen. Many times, "poor" people work just as hard, if not harder, than the "rich".

Unfortunately the market decides which jobs pay more, not the people.

Class warfare does not help, no matter how many times it is injected into a conversation.

 

[SaraJayne]

That is the problem. Because so many feel that they deserve their own home or their right to have as many children as they want, with no means for either, is in part why we are in the mess that we are in.

I'll set the child aspect aside because I don't have children (by choice) but I can understand why people do. And I can understand having them, even if you can't afford them. One or two .

But home ownership? Come on. Who do you think should pay for this home that you believe everyone deserves?
Trust me, I resent every single dollar of our taxes that is being wasted in this real estate mess that this country faces.
And I resent the fact that my home has lost value because of the real estate mess.
But we are by no means 'upside down'. We bought a house we could afford, not counting on anyone to help us.



Unfortunately the market decides which jobs pay more, not the people.

Class warfare does not help, no matter how many times it is injected into a conversation.

I wasn't the one that brought it up first. The person that said not everyone deserves to own a home and have children did.

If you have a job, you should be able to buy a house. Unfortunately, that isn't the way this country works.

 

[MrsPete]

If we say, "the government should cut off welfare" what does that do? Do people magically get jobs?

Of course there are people who can't get jobs -- either because they're not physically able or because their educations don't qualify them for a job -- but a whole bunch of people WOULD get jobs if their welfare checks suddenly disappeared. I'm related to some of them, and they're very proud of their knowledge of how to work the system. Are they the exception or the rule? I don't know, but it's naive to say that they don't exist. Surely I don't know the only ones in the country.

This is a global market, our kids are already at the bottom of the barrel as far as technology jobs are concerned. My company cannot find American born Phd scientist in 2011 . . . So either we educate our children or we get ready for a generation of kids who are only fit to serve breakfast at cracker barrel or a larger and larger population of our country who can only find minimum wage, menial jobs.

Two things to blame: 1) We're catering so heavily to the bottom of the educational barrel, and we're figuring that the top half will figure things out on their own. Not a wise choice.
2) Instead of encouraging bright kids to go into math, science, technology fields that WE NEED, fields that'll pay well . . . instead, we're telling everyone that work should be nothing but FUN and they should follow their hearts. So too many kids go into musical theater, and then they can't find jobs. We need to distinguish between a hobby and a job a little better.

Agreed..as the book says it was "The Worst Hard Time". My parents were kids during the depression and young adults during WWII. It was very tough and I think people had so much more appreciation for the things they had. They respected food and used every bit.

Yeah, my grandmother -- who raised me in large part -- was from this generation, and she says similar things. They had to save for any little thing they wanted, and they appreciated things more. They knew how to fix things. They saved because tomorrow's paycheck wasn't promised.

They had it hard, and it wouldn't hurt us a bit to adopt a bit of that mindset.

But home ownership? Come on. Who do you think should pay for this home that you believe everyone deserves?

You're taking the wrong side of this: I believe that an adult who has a decent education, who works in a full-time adult job (not fast food or part-time at the mall), who has been at the job a while . . . that person should earn a salary large enough to buy a small house. Not necessarily a large house or a fancy house, and this assumes the individual hasn't made other foolish choices (large student debt or credit card debt).

To put it another way, a person who's made good choices and who is working should be able to afford a home.

Do you know that I NEVER made a better wage than my father in the whole of my life?? And he was not a rich person.

I was a kid when Nixon was in office, but both my husband and I earn more than anyof our parents ever did. And we have more in savings and retirement.

 

[Colleen27]

That is the problem. Because so many feel that they deserve their own home or their right to have as many children as they want, with no means for either, is in part why we are in the mess that we are in.

I'll set the child aspect aside because I don't have children (by choice) but I can understand why people do. And I can understand having them, even if you can't afford them. One or two .

But home ownership? Come on. Who do you think should pay for this home that you believe everyone deserves?
Trust me, I resent every single dollar of our taxes that is being wasted in this real estate mess that this country faces.
And I resent the fact that my home has lost value because of the real estate mess.
But we are by no means 'upside down'. We bought a house we could afford, not counting on anyone to help us.



Unfortunately the market decides which jobs pay more, not the people.

Class warfare does not help, no matter how many times it is injected into a conversation.

It isn't class warfare to point out the fact that we - our society, culture, free market, whatever you want to call it - have devalued the contributions of vast segments of society and drastically narrowed the range of career choices that can actually support a middle class life.

I do believe that everyone should be able to attain the goal of owning a house. Not at 22 and straight out of college and not without working for it and not necessarily a "McMansion", but neither should the dream of a modest home and a couple of kids be completely out of reach for those who don't have the means or ability to earn a degree or go into a high-paying field. Blue collar and service jobs are absolutely essential to our society and I believe it is shameful that we put so low a value on the people who do those jobs.

 

[SaraJayne]

It isn't class warfare to point out the fact that we - our society, culture, free market, whatever you want to call it - have devalued the contributions of vast segments of society and drastically narrowed the range of career choices that can actually support a middle class life.

I do believe that everyone should be able to attain the goal of owning a house. Not at 22 and straight out of college and not without working for it and not necessarily a "McMansion", but neither should the dream of a modest home and a couple of kids be completely out of reach for those who don't have the means or ability to earn a degree or go into a high-paying field. Blue collar and service jobs are absolutely essential to our society and I believe it is shameful that we put so low a value on the people who do those jobs.

You said it so much better than I could.

 

[fakereadhed]

It isn't class warfare to point out the fact that we - our society, culture, free market, whatever you want to call it - have devalued the contributions of vast segments of society and drastically narrowed the range of career choices that can actually support a middle class life.

I do believe that everyone should be able to attain the goal of owning a house. Not at 22 and straight out of college and not without working for it and not necessarily a "McMansion", but neither should the dream of a modest home and a couple of kids be completely out of reach for those who don't have the means or ability to earn a degree or go into a high-paying field. Blue collar and service jobs are absolutely essential to our society and I believe it is shameful that we put so low a value on the people who do those jobs.

Sorry, but it's simple math. You make x dollars, you can spend the dollars. You DO have the option of home ownership- if you save the money by spending less on other things or make more money. It isn't easy, but it IS an option for anyone that wants to really work to make it happen.

That's like saying everyone deserves to be thin and we should make them thin. Actually, it IS possible if you excercise and cut calories. Some people have to excercise WAYYYYYY more than other people and take in a measly amt of calories compared to others to stay thin. Is it fair? Probably not, but nobody said life was easy.

I understand saving money(and calories ) and at times I am better at it than others but I am in control of my destiny and what is great about this country is that I have the opportunity to better myself if the opportunity arises and I have the motivation.

 

[NotUrsula]

I would rather say that anyone who has a steady income and a low debt to earnings ratio deserves a CHANCE to buy a home -- one that they can realistically afford. What that means is that you should not automatically be denied because of the color of your skin, the zip code the house is in, or the fact that you've only been at your job for 3 years. (Because redlining still DOES exist; though it's not longer out in the open.)

My personal preference would be that programs for low-income homebuyers still exist, and that they be tightly regulated. I'd also like for the program to require that the structure be of a certain age to qualify; it would be a good way to make sure that older neighborhoods stay viable. If they manage to keep the house in decent shape and then sell it to move to a newer neighborhood on their own, that's great.

 

[cats mom]

If you have a job, you should be able to buy a house. Unfortunately, that isn't the way this country works.

But why? Helping people buy homes they couldn't afford certainly did them no favors, and it played a major role in the financial crisis.

Can I quote a former FDIC chairman without veering too far into the political realm? Sheila Bair said: “It’s worth asking whether federal policy is devoting sufficient emphasis to the expansion of quality, affordable rental housing,” and she noted that taxpayer subsides for homeowners are about three times the size of all rental subsidies and tax incentives combined.

Why not focus on putting people into decent quality rental housing that they can actually afford rather than helping them buy houses that stretch their DTI numbers so far they can't afford to do anything other than pay for housing?

Honestly is it better to *own a house and devote the majority of one's income to that debt service ala mortgage, taxes, HOA, maintenance, repairs, etc, etc. or to rent something more affordable and actually have money left over for other things?

I truly believe renting is the best choice for many people, and not just for those who can't afford to buy.


*I use the term "own" loosely here since folks who put no money down and/or took HELOC's out at every opportunity own nothing but the debt in my eyes.


I would argue that we don't necessarily have a foreclosure crisis in America, we have a debt crisis, and for many people foreclosure is the cure.

Personally I think until we stop kicking the can down the road and deal with the debt crisis head on; whether it be housing debt, student loan debt, credit card debt, or as frightening as it is... the national debt, the economy isn't going to improve. How can it?

 

[OceanAnnie]

But why? Helping people buy homes they couldn't afford certainly did them no favors, and it played a major role in the financial crisis.

Can I quote a former FDIC chairman without veering too far into the political realm? Sheila Bair said: “It’s worth asking whether federal policy is devoting sufficient emphasis to the expansion of quality, affordable rental housing,” and she noted that taxpayer subsides for homeowners are about three times the size of all rental subsidies and tax incentives combined.

Why not focus on putting people into decent quality rental housing that they can actually afford rather than helping them buy houses that stretch their DTI numbers so far they can't afford to do anything other than pay for housing?

Honestly is it better to *own a house and devote the majority of one's income to that debt service ala mortgage, taxes, HOA, maintenance, repairs, etc, etc. or to rent something more affordable and actually have money left over for other things?

I truly believe renting is the best choice for many people, and not just for those who can't afford to buy.


*I use the term "own" loosely here since folks who put no money down and/or took HELOC's out at every opportunity own nothing but the debt in my eyes.


I would argue that we don't necessarily have a foreclosure crisis in America, we have a debt crisis, and for many people foreclosure is the cure.

Personally I think until we stop kicking the can down the road and deal with the debt crisis head on; whether it be housing debt, student loan debt, credit card debt, or as frightening as it is... the national debt, the economy isn't going to improve. How can it?

I agree.

So much of the "talk" is mostly to raising the debt ceiling without enough emphasis on curbing spending. We have to tame the beast. Money is spent 100s of times faster than it is obtained. It is has proven to be unsustainable.

All of the "ceiling" talks are quick fixes. We need long term solutions that start with a balanced budget.

We have to tame the spending beast. Responsible adults do not spend more money than they take in. It's time we expect the same from our elected officials.

 

[Beezle2]

I understand saving money(and calories ) and at times I am better at it than others but I am in control of my destiny and what is great about this country is that I have the opportunity to better myself if the opportunity arises and I have the motivation.

I rarely have good luck quoting others but please believe I am not "attacking" you I was just thinking of how hard my dh and I have worked to try and achieve "middle class" and how frustrating it has been. We worked hard at our jobs, had a small business on the side, tried to do the right things, but it really didn't help when the recession came along. Dh's construction job:gone, my job:drastic cut in hours, our side work:gone for budget cuts.

I was raised by the kind of people that get complained about here all the time and all I've ever wanted was to not be like them. I have pulled myself up again and again but this last one took the heart out of me. I think of all the things the recession took the thought that "I" am in control of my destiny and if I just work hard I will prosper is the one I miss the most.

So I'm dragging my old tired butt to school to try and get trained for something in the medical field, I figure if I have to work until I'm 70 at least it can be indoors I'm not happy about the student loans myself but it really stings to hear people call those of us who are trying yet again to do better "the problem" on this thread.

Colleen and SaraJayne I enjoy your posts, you both post better than I do!

 

[ilovemk76]

I would rather say that anyone who has a steady income and a low debt to earnings ratio deserves a CHANCE to buy a home -- one that they can realistically afford. What that means is that you should not automatically be denied because of the color of your skin, the zip code the house is in, or the fact that you've only been at your job for 3 years. (Because redlining still DOES exist; though it's not longer out in the open.)

My personal preference would be that programs for low-income homebuyers still exist, and that they be tightly regulated. I'd also like for the program to require that the structure be of a certain age to qualify; it would be a good way to make sure that older neighborhoods stay viable. If they manage to keep the house in decent shape and then sell it to move to a newer neighborhood on their own, that's great.

I have a friend who used one of these loans to buy a small 5 room, about 800 square foot home with an unfinished basement, twenty years ago. They had 3 kids when the bought the house. Before the house they lived in a mobile home in a park that was paid off.

They could not afford the house they bought without the state's help. Guess what, 20 years later they still cannot afford the home and they dida refi and still owe about 15 years on the hoime. No money to fix all that is now falling apart. The front door cannot be used but they don't have the money to pay to get a new door installed (the jamb is falling apart and is not repairable). The roof is on its last legs; same with the garage doors. The glass sliding door is broken and other windows are rotting.

If it had not been for DH and I doing many home repairs for them over the years the home would be in worse shape. Many times we even paid for the items needed. When they insisted on paying for the items, we would buy them and tell them it cost a certain amount that was way lower than what it cost. We draw the line at doing repairs that we would pay a person to do on our home. All the ones listed we would not do. Plus we are now in our 50s and not as excited to do certain home repairs. We have replaced hot water heaters, fixed plumbing leaks, helped them stud out the basement, hung drywall in the basement and so much more. They really appreciated all of our help.

If they try to sell the home it will sell for way under what it should and they would fail the inspection.

So was this really a good program? I am not sure for them. I am sure they are not the only ones.

The sad part is they always felt they could afford the house since they could make the payments. They could not save for repairs or afford the repairs when they need to do them, so in reality they could not afford the home.

 

[nunzia]

I rarely have good luck quoting others but please believe I am not "attacking" you I was just thinking of how hard my dh and I have worked to try and achieve "middle class" and how frustrating it has been. We worked hard at our jobs, had a small business on the side, tried to do the right things, but it really didn't help when the recession came along. Dh's construction job:gone, my job:drastic cut in hours, our side work:gone for budget cuts.

I was raised by the kind of people that get complained about here all the time and all I've ever wanted was to not be like them. I have pulled myself up again and again but this last one took the heart out of me. I think of all the things the recession took the thought that "I" am in control of my destiny and if I just work hard I will prosper is the one I miss the most.

So I'm dragging my old tired butt to school to try and get trained for something in the medical field, I figure if I have to work until I'm 70 at least it can be indoors I'm not happy about the student loans myself but it really stings to hear people call those of us who are trying yet again to do better "the problem" on this thread.

Colleen and SaraJayne I enjoy your posts, you both post better than I do!

I don't think anyone here has any problems with people who are trying to better their lives and those who work hard and then have bumps..those are the people we need more of in America and are the ones who made America great. The ones I have issue with are the users..or as Ayn Rand correctly calls them, the 'looters', ones who want and think the want is their right. I think in many many areas of the country you can still be able to buy a house on fairly low wages with planning and sacrifice. Lower paying jobs like retail and service industry also have ways to get ahead and move up..good people don't need to stay at entry level forever. I know many without college degrees who've worked in these areas all their lives and own their modest home and are 'middle class"..I think we've elevated what middle class is..it used to be if you had a home, a car and maybe a tv you were doing great Neither one of my parents had a degree..Dad worked for MaBell and Mom was a bookeeper for a paving company. Neither DH or I had a degree until later in life..we bought a house while we were young low income..but it was about 700 sq feet..we had 2 boys who shared a tiny room and we had the other tiny room..add a tiny bathroom, living room and kitchen/dining and there you go. Then we had our daughter and she got our room and we slept in the living room on a fold out couch for quite some time until we could move up to a fixer upper with slanting floors and flocked wallpaper and the only heat being a wood buring stove ( heaters had been red tagged and too much $ to fix). Anyway..it can still be done and we don't all need grandness out of the gate..I think it's better when life is a progression of struggle and reward, and it is still do-able with the right mind set.

 

[fakereadhed]

I rarely have good luck quoting others but please believe I am not "attacking" you I was just thinking of how hard my dh and I have worked to try and achieve "middle class" and how frustrating it has been. We worked hard at our jobs, had a small business on the side, tried to do the right things, but it really didn't help when the recession came along. Dh's construction job:gone, my job:drastic cut in hours, our side work:gone for budget cuts.

I was raised by the kind of people that get complained about here all the time and all I've ever wanted was to not be like them. I have pulled myself up again and again but this last one took the heart out of me. I think of all the things the recession took the thought that "I" am in control of my destiny and if I just work hard I will prosper is the one I miss the most.

So I'm dragging my old tired butt to school to try and get trained for something in the medical field, I figure if I have to work until I'm 70 at least it can be indoors I'm not happy about the student loans myself but it really stings to hear people call those of us who are trying yet again to do better "the problem" on this thread.

Colleen and SaraJayne I enjoy your posts, you both post better than I do!

I am so sorry that you have been knocked down by this economy. It doesn't sound like you are giving up at all since you are going back to school. I wish you the best of luck.

 

[eatatmidnight]

To the OP. Unfortunately, it does look like we are headed to recession. However, I am not convinced that we ever rebounded from the last one. I think a few years down the road, we will look back and see that things have been worse than I thought.

To the other conversation that has stemmed from this post, I think that the American people, as a whole, have been following the example that the federal government has given...If you can't afford it, borrow the money and get it anyway.

 

[Colleen27]

Sorry, but it's simple math. You make x dollars, you can spend the dollars. You DO have the option of home ownership- if you save the money by spending less on other things or make more money. It isn't easy, but it IS an option for anyone that wants to really work to make it happen.

It is simple math - salaries for blue collar workers have been flat or declining for a generation once you control for inflation using the "official" inflation number. But that official number excludes food and energy, both of which have significantly outpaced inflation in other sectors, and doesn't adequately reflect the soaring costs of housing and health care. Working people simply don't have the money they used to have, the money that used to enable them to save for a traditional 20% down and buy a home.

 

[punkin]

First off, careful folks .. the discussion is veering into the political. Mentioning party names is probably not the best avenue to keeping the thread open.

As to this:


They are simply not looking in the right places or taking the right tack to find them. These fields are ones in which a BS is enough to get you a decent-paying job, and fellowships are really few and far between.

If tech companies are looking for Ph.D's then they need to get the word out and start offering more undergrad internships, because I can tell you that most folks who are considering trying to get a Ph.D. in the sciences are reading the Chronicle and deciding that it isn't worth it, because academic hiring is completely stagnant right now, and they are worried that they will spend an enormous amount of time and energy only to end up in Adjunct hell.

I work with a large number of postdocs; yes, we have a lot of foreign nationals, but our undergrad summer intern program is full of promising native-born undergrads. An internship where I work is a VERY hot ticket, because it looks good on applications to the very best grad programs -- the ones with fellowships to give. Often they come back here to work as postdocs, but then they usually go to the commercial employers, because they are tired of working long hours for peanuts, and often have student loans to pay off from undergrad.

...and they are not willing to pay them enough.

 

[fakereadhed]

It is simple math - salaries for blue collar workers have been flat or declining for a generation once you control for inflation using the "official" inflation number. But that official number excludes food and energy, both of which have significantly outpaced inflation in other sectors, and doesn't adequately reflect the soaring costs of housing and health care. Working people simply don't have the money they used to have, the money that used to enable them to save for a traditional 20% down and buy a home.

Most "working people"(which implies that the white collar folks aren't really working) I know own homes. The ones that rent or live with family made some very poor choices and are in bankruptcy. The homes in nearby communities are full of foreclosed homes, but those are white collar communities with much larger homes that had multiple mortgages. Some of our friends have left MI to work in other states. They have purchased a home there. What you are saying sounds correct, but hasn't been my experience. We are in a rural community with mostly blue collar jobs.

 

[NotUrsula]

It is simple math - salaries for blue collar workers have been flat or declining for a generation once you control for inflation using the "official" inflation number. But that official number excludes food and energy, both of which have significantly outpaced inflation in other sectors, and doesn't adequately reflect the soaring costs of housing and health care. Working people simply don't have the money they used to have, the money that used to enable them to save for a traditional 20% down and buy a home.

Not really true. DH & I come from skilled-worker blue-collar backgrounds, and are some of the few people in our families with college degrees, yet all of our extended family own their own homes, and none of us are in danger of being foreclosed upon. Jobs represented include a 4 mechanics, a truck driver, an office manager, a warehouse manager, a plumber, a finish carpenter, 3 LPN's, and a tile-layer.

Lots of white-collar folks seem not to understand that blue-collar work comes in two flavors: skilled and unskilled. While large numbers of unskilled workers do live paycheck to paycheck, the majority of skilled workers do not, unless they only work sporadically or have been careless with their money. The average master plumber in the US grosses more than $60K.

 

[CloveLeaf]

That is extremely easy to do. Put out a request and have a list of 25 requirements. Nobody has all of them so you make an offer at half the person's current salary. They turn you down. Now you have the proof you need. The H1B will take tha job at an even lesser salary.

This is so NOT true. H1B visa can't be approved if the salary is less than the prevailing wage in that area and field. No way can a company bring in an H1B at 1/2 the cost. High tech H1B employees get the same salary as everybody else. Now I know how all the rumor started. People who has no idea how something works will pretend they know everything about it and spread the rumor.

 

[HHSTigerFan]

Sort of my opinion on this, when comparing this generation to past generations, its not so much the "everyone should own a home" mentality thats putting our country where its at, its the other stuff too.. comparing myself to my parents when they were my age:

Them- House payment, car payment, gas bill, electric bill, phone bill

Us- Same as above including larger house payment/income, PLUS internet bill, cell phone bill, cable bill, plasma TVs, Ipods, laptops etc..

We have greatly increased our standard of living, haven't really increased income, and we wonder why the middle class is struggling?