An American Nightmare

“The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation.” –Vladimir Lenin

“The best way to destroy the capitalist system is to debauch the currency.” –Vladimir Lenin

Someone should write a novel, one where almost nothing unusual happens.  It should be about a family, maybe on Long Island. The parents both work very hard but they struggle more and more each year. 

The people in this story were doing okay a few years ago. They bought a nice home for themselves and their two kids, a Cape Cod with four small bedrooms on about one fifth of an acre. The house had an assessed value of about $600,000 when they moved in five years ago, but in spite of making significant improvements, the value is now at about $400,000.

This is the first time in history that home values in our country have gone down in four consecutive years. The “experts” on television and in government keep saying the market has “hit bottom”, but so far the “experts” have been wrong. 

In the time it took this family's home to lose a third of its value, the property taxes on it somehow went from $7,000 a year to almost $9,000 a year. They have family in South Carolina with a house that’s almost twice the size, triple lot size with a built-in pool, but their taxes are somehow less than $2,000 annually. 

The mother and father in this story were both told by their mothers and fathers that if they worked hard and saved, they’d do fine. They were taught that a strong work ethic and saving money was the key to success. They did work hard and save, but they don’t seem to be doing fine at all.

When their parents were raising families, only the dad worked full-time while the mom might have had a part-time job, and was able to devote a lot more of her time to the children. With only one income, they were comfortable and the children were well cared for.

Now both parents have to work full-time just to stay above water. They’re nervous about investing in the stock market - they’ve seen friends and family members get wiped out, and they don’t know much about it so they stay away.

They always socked their money into savings accounts, but because of the low interest rates controlled by the Federal Reserve Bank, their money isn’t really earning any interest at all. There’s almost no incentive to save, but they try to put a little away anyway, because their parents always told them it was the right thing to do.  They’re only earning about .5 percent in their savings accounts at a time when things that are absolutely essential are costing more and more. Their money in the bank is losing its value, just like their home. 

They hear on the news that inflation isn’t really a problem, but food costs and fuel costs have skyrocketed. Besides, if inflation isn’t a problem, why does the government need more and more money to operate?

Gasoline has more than doubled in the last two years and the oil they buy to heat their home has skyrocketed, too. They’ve been leaving the thermostat on 55 degrees in the winter to avoid burning more oil. During those cold months, they all walk around the house with sweatshirts and snuggies to stay warm. The kids complain. Dad put a locked cage over the thermostat so no one can adjust it but him. Funny, they don’t remember their parents needing to do that. 

Some people blame the speculators for the price of oil, others say we’re not drilling enough here - maybe there’s something to both theories, and maybe both theories are related, but one of the reasons fuel and oil costs so much might be because our money is being devalued (some say on purpose, so we can eventually pay our federal debt down with cheaper dollars).

Because of the Fed’s printing presses working overtime, our money isn’t worth as much, so when we buy things from other countries our American dollar buys less of it. We aren’t making more soup, we’re just adding water to what’s already on the stove. The only thing that seems to be (somewhat) saving us is that a lot of other countries seem to be devaluing their currency too. 

The high cost of fuel drives the price of other things up - everything needs to be transported. Food has skyrocketed, too, but somehow the government doesn’t include food and fuel when they figure out their inflation numbers. Why would they leave food and fuel out? Maybe they don’t want us to think of it for some reason.

The family once thought of themselves as middle class. They don’t feel like they’re “middle” anything anymore. They never considered the devastating effect that inflation, taxation and our devalued currency are having on the shrinking middle class. They’re not feeding their kids cans of beans for dinner quite yet, but they are worrying about what next year will bring, or next week for that matter. 

The companies which both parents are working for are barely staying afloat, they’re being taxed more and the rising cost of fuel is chipping away at their profits, so a pay raise is unlikely, maybe even impossible. Raise the taxes on business and the business will either lay people off, raise their prices, move their business to another place (“outsource”) or withhold dividends; it’s always the people that will pay, one way or the other. A hungry government creates the problem, and then blames everyone else. Same as it ever was. 

Eventually, both companies where the parents work shut their doors. One went out of business, the other moved south to a more business-friendly state. Now the only income the family is getting is unemployment checks, and pretty soon food stamps. 

The family eventually decides to sell their home and move south to follow the work.  The realtor tells them they should put the house on the market for $450,000 and hope for the best, but even if they get the asking price, they paid $580,000 for it five years ago, and still owe $ 475,000. They’re going to have to pay money to sell their home. It will take a huge chunk out of what they have in the bank earning one half of one percent interest. There are no good avenues of escape for the family. 

There is a definite exodus from New York. We once boasted almost fifty congressmen based on relative population - next year we’ll be down to twenty-seven. New York leads the country in out-migration; in fact, all of the highly taxed states are shrinking.  People are bugging out of our state like it’s on fire. Why is that? 

Fast forward a year and a short sale later. The family in this story is packing up a moving truck and loading their Grand Caravan with their kids, their dog and a cooler of snacks and drinks, and they’re heading to the LIE, then to the Cross Island, Belt Parkway, Staten Island Expressway and then south on Route 95. “Welcome to New York” will be the last thing they see of the state, but they’ll see it from their rear view mirror.

They feel like a modern-day version of the Joad family from “The Grapes of Wrath,” leaving their home and everything they know to find work and a better life somewhere else, but not “Californey” this time, they’re taxed to death there too.  They might not find exactly what they’re looking for, the “American Dream” might not be where they’re headed - it might not be anywhere - but at this point, they’re just hoping to be able to breath a little easier. 

Whatever happened to the American Dream? I think I know. I think Lenin had it exactly right. I think it was crushed to death, “between the millstones of taxation and inflation” and our “debauched currency.” 

The book wouldn’t make for much of a story because there’s nothing unusual in it. In fact, it’s becoming typical. But perhaps some people will be able to relate.