In our daily lives, as anyone who keeps a household budget can attest, the unexpected happens all the time. A refrigerator motor fails. Some part on your car you never realized existed breaks down. A loved one passes away and you have to â€” you want to â€” be at the funeral a thousand miles away.
â€śUnexpectedâ€ť expenses like these will, sooner or later, hit all of us. But all of us, says new research out of the Federal Reserve, canâ€™t afford them.
In fact, just under 40 percent of Americans,Â saysÂ the Fedâ€™s sixth annual household economics survey, â€śwould have difficulty handling an emergency expense as small as $400.â€ť
A fifth of American adults, the new Fed study adds, had major unexpected medical bills last year. An even larger share of Americans â€” one quarter â€” â€śskipped necessary medical care in 2018 because they were unable to afford the cost.â€ť
Meanwhile, 17 percent of American adults canâ€™t afford to pay all their monthly bills, even if they donâ€™t experience an unexpected expense.
The new Fed report offersÂ no anecdotal color, just waves of carefully collected statistical data. For a sense of what these stats mean in human terms, we need only look around where we live, particularly if we live in one of the many metro areas where inequality is squeezing millions of Americans who once considered themselves solidly â€śmiddle class.â€ť Places like the Bay Area in California.
San Francisco, recent researchÂ shows, now has more billionaires per capita than any other city in the world. By one reckoning, San Francisco also has theÂ highest cost of livingÂ in the world, as all those billionaires â€” and the rest of the cityâ€™s ultra rich â€” bid up prices on the most desirable local real estate.
But the Bay Area squeeze goes beyond the confines of San Francisco. Nearby Oakland and Berkeley are facing enormous affordable housing shortages as well. The Bay Area as a whole nowÂ has moreÂ than 30,000 homeless.
Two-thirds of these homeless Californians havenâ€™t been able to find temporary sheltering services. They live and sleep outdoors, many in lines of RVs parked along public right-of-ways like the waterfront in Berkeley. And that has infuriated nearby residents whoâ€™ve paid big bucks for their residences.
Berkeley city council member Kate Harrison has felt the fury first-hand â€” from constituents who wanted the RVs of homeless people banned from the waterfront.
â€śI paid a million dollars for my place,â€ť one constituentÂ told her, â€śand they have a better view.â€ť
Local officials in Bay Area citiesÂ donâ€™t know quite what to do. On one side, they have people without shelter who have real and unmet human needs. On the other, they have angry affluents with shelter who see their neighborhoods under siege from homeless hordes.
The more people spend on housing, Berkeley councilperson Harrison has come to understand, the more â€śaggrievedâ€ť they feel.
â€śOnly the one?percent here,â€ť she adds, â€śfeel economically secure.â€ť
In other words, inequality has local officials coming and going. The ranks of the homeless are growing because almost all the gains from Americaâ€™s growing economy, as the Economic Policy Instituteâ€™s Elise GouldÂ testifiedÂ to Congress this past March, are â€śgoing to households at the top.â€ť
Empathy for the plight of the homeless, meanwhile, is withering away, particularly among societyâ€™s most fortunate, as the social distance between that top and the rest of society widens. The rich have climbed so far up the income ladder that they canâ€™t see the humanity on the faces of people stuck on the lower rungs.
One telling sign of our unequal times: In wealthy Bay Area neighborhoods, theÂ Washington PostÂ reports, GoFundMe campaigns have emerged â€śto finance lawsuits against affordable housing proposals.â€ť
What happens when empathyÂ all but totally disappears? You get the life that the 33-year-old Ashana Cunningham lives in southwest Connecticut, the home to some of Americaâ€™s grandest hedge-fund fortunes â€” as well as more separate and unequal housing, a devastating just-published analysisÂ notes, â€śthan nearly everywhere else in the country.â€ť
Cunningham, the mother of three, lives in a homeless shelter amid abandoned factories and rundown houses. She takes a long bus commute every day to a high-priced day care center in one of Connecticutâ€™s poshest areas. Cunningham couldnâ€™t afford to live in that area even if she made triple her $12.50 per hour salary because, asÂ joint reportingÂ by Pro Publica and theÂ Connecticut MirrorÂ details, Connecticutâ€™s wealthiest communities have been blocking construction of any modestly priced housing â€świthin their borders for the last two decades, often through exclusionary zoning requirements.â€ť
Towns like Westport â€” median homeÂ value: $1.15 million â€” have surrounded themselves â€świth invisible walls to block affordable housing and, by extension, the people who need it.â€ť
One local developer five years ago proposed a project for Westport that would accommodate up to 12 families via a mix of single- and multifamily housing units on a 2.2-acre property he had purchased. The density, the developer explain, would allow the units to sell â€śfor less than the typical Westport home.â€ť
The Westport Planning and Zoning Commission denied his plan.
â€śTo me,â€ť declared one commissioner who voted against the plan, â€śthis is ghettoizing Westport.â€ť
In reality, the wealthy in localitiesÂ like Westport have effectively â€śghettoizedâ€ť their corner of Connecticut, locking in place an extreme inequality thatâ€™s doing deep damage to the young people who grow up within it. So suggests a study thatÂ appeared last monthÂ in the medical journalÂ JAMA Pediatrics.
The researchers involved in the study examined data from nearly 30,000 schools and found â€śthe first evidence of an association between early-life inequality and adolescent bullying.â€ť
â€śPut another way,â€ťÂ explainsÂ an analysis of the study from Harvardâ€™s Shorenstein Center, â€śthere is a link between early life inequality and being bullied at school later in life.â€ť
The new studyâ€™s lead author, Frank Elgar of Montrealâ€™s McGill University,Â emphasizesÂ that the link his teamâ€™s researchers found rests between inequality and bullying, not poverty and bullying. The â€śeffect of growing up in an unequal setting,â€ť Elgar points out, may well be significantly â€” and negatively â€” altering the course of childrenâ€™s development.
JustÂ howÂ does inequality have this impact? The researchers say we need more research. How about they start that probing in southwest Connecticut.
This blog was originally published at OurFuture.org on June 10, 2019. Reprinted with permission.
About the Author: A veteran labor journalist, Sam Pizzigati has written widely on economic inequality, in articles, books, and online, for both popular and scholarly readers.