10 Reasons Why Ordinary Hard-Working Americans Are About To Really Start Feeling The Squeeze

American families better get ready to tighten their belts again. There is every indication that we are all going to really start feeling the squeeze in the months ahead. The price of gas is starting to spike again. The price of food is moving north. Health insurance premium increases are being announced coast to coast and a whole slate of tax increases is scheduled to go into effect in 2011. Meanwhile, household incomes are down substantially all over the nation and the U.S. government is indicating that there will not be an increase in Social Security benefits for the upcoming year once again. So if the cost of most of the basic things in our monthly budgets is going up and our incomes are going down what does that mean? It means that average American families are about to be squeezed like nothing we have seen in decades.

The reality is that it is getting really hard to make it out there. Not only do most households have both parents working, but in many cases both parents are getting second or even third jobs. Things have gotten so bad that millions of Americans have felt forced to turn to the government for assistance just to survive.

It can be really disheartening to come to the end of the month and realize that despite your best efforts you have less money than you did at the beginning of the month. But that is where millions upon millions of American families now find themselves.

The economic despair in the air is almost palpable. Already hordes of Americans are truly and honestly hurting and things are only going to get worse.

The following are ten reasons why ordinary hard-working Americans are about to really start feeling the squeeze....

#1 Gas prices are going up again. AAA says that the average price of a gallon of regular gasoline in the United States was $2.80 on Sunday. That is 32.6 cents higher than it was during the same time period in 2009. As oil and gas prices continue to go up, that is also going to have a significant impact on utility bills for American families this winter.

#2 The price of food is poised to rise substantially. Bloomberg is reporting that the the cost of meat in the United States is going nowhere but up. But meat is not the only thing that you will soon be paying much more for at the supermarket. Wheat, corn, soybeans and almost every other major agricultural commodity is absolutely soaring this fall. As this continues, it is inevitable that ordinary Americans will see much higher food prices at their local grocery stores.

On a previous article, a reader named Erica left a comment in which see detailed the stunning food inflation that she is seeing where she lives....

Food inflation is real, and it is here. Just yesterday I compared my receipt from a grocery run to prices I have from the same exact store from September 15, 2009. Bacon? Up 52% to $13.69 from $8.99 for 4 lbs. Butter? Up 73% to $9.99 from $5.79 for 4 lbs. Pure vanilla extract up 14% to $6.79 from $5.95. Chopped dried onions up a mere 2% but minced garlic (wet) was up 32%.

#3 It looks like those receiving Social Security are not going to be seeing cost-of-living increases again. The Associated Press is reporting that the U.S. government is expected to announce some time this week that the tens of millions of Americans that receive Social Security will go through yet another year without an increase in their monthly benefit payments. You see, Social Security cost-of-living adjustments are tied to the official government inflation numbers, and according to the U.S. government there is basically very little inflation right now. Of course we all know that is a lie, but it is what it is.

#4 The cost of health care continues to soar into the stratosphere. Americans already pay more for health care than anyone else in the world, and yet costs continue to spiral out of control. The cost of health care increased a staggering 9.6% for all U.S. households from 2007 to 2009. Now, health insurance companies from coast to coast are announcing that they must raise health insurance premiums substantially due to the new health care law that Barack Obama and the Democrats have pushed through. So in 2011 it looks like the average American family is going to have to carve out an even bigger chunk of the budget for health care.

#5 American families could desperately use a recovery in the housing industry, but that is simply not going to happen. Foreclosure-Gate is getting worse by the day, and it threatens to bring the U.S. real estate industry to a complete and total standstill. If it is ultimately proven that the paperwork for millions of mortgages in the United States is seriously deficient, it could push hordes of mortgage lenders into bankruptcy and render mountains of mortgage-backed securities nearly worthless. Regardless, it is now going to be much more difficult to get a mortgage, much more difficult to buy a home and much more difficult to sell a home. We could very well be looking at the next stage of the housing crash. Ordinary Americans could end up losing trillions more in home equity.

#6 More Americans than ever find themselves unable to pay their bills, and an increasing number of frustrated creditors are actually resorting to wage garnishment. Yes, you read the correctly. Creditors are starting to ruthlessly go after the weekly paychecks of debtors.

The following is an excerpt from a recent New York Times article that discussed the rise of wage garnishment as a weapon against debtors....

After winning, creditors can secure a court order to seize part of the debtor’s paycheck or the funds in a bank account, a procedure called garnishment. No national statistics are kept, but the pay seizures are rising fast in some areas — up 121 percent in the Phoenix area since 2005, and 55 percent in the Atlanta area since 2004. In Cleveland, garnishments jumped 30 percent between 2008 and 2009 alone.

So if you are getting behind on your debt, you better watch out - your creditors may soon decide to garnish your wages.

#7 Americans now owe more on student loans than they do on credit cards. As hard as that is to believe, that is actually true. Americans now owe more than $849 billion on student loans, which is a new all-time record.

Student loan payments can be absolutely crippling to a household budget. This is especially true for young Americans that have just gotten out of school. Sadly, student loan debt is nearly impossible to get rid of. Once you are committed, it will follow you around for the rest of your life.

#8 Even as expenses rise, incomes are down from coast to coast. Median household income in the U.S. declined from $51,726 in 2008 to $50,221 in 2009. There are very few areas that have not been affected. In fact, of the 52 largest metro areas in the United States, only the city of San Antonio did not see a decline in median household income during 2009.

#9 If all of this was not bad enough, now there are rumblings that the U.S. Federal Reserve is actually thinking that we need more inflation. A number of top Federal Reserve officials have come out recently and have publicly supported the notion that the Fed needs to purposely create more inflation in order to stimulate the economy. Of course what they don't tell the American people is that inflation is a hidden tax on every single dollar in our wallets and in our bank accounts. More inflation would be really bad news for ordinary Americans, because they are already having a tough time getting their dollars to stretch far enough.

#10 Apparently the U.S. government (and many state and local governments) think that this is a great time to stick it to the American people by hitting them with a slew of new taxes. There are so many tax increases scheduled to go into effect in 2011 that it is hard to keep track of them all. In fact, there are many (myself included) that are calling 2011 "the year of the tax increase". But the Americans that are going to get it the worst of all are those that are going to get hit with the Alternative Minimum Tax. One out of every six American households is going to be hit with a tax increase averaging $3,900 (thanks to the AMT) and most of them don't even know that it is coming.

Get ready for higher food prices, higher gas prices, higher health insurance premiums and higher taxes.

Inflation is already here, but it is going to get a whole lot worse. Meanwhile, the U.S. government (along with state and local governments) is going to continue to have a voracious appetite for more revenue.

Average Americans are going to be squeezed until they have nothing left to give. Then they are going to be squeezed just a little bit more.

In ~30 years, nobody in our family has ever had a monthly car payment.
No “book of the month club” here.
We take care of our cars and drive them into the ground. Believe me, we only get a (new) used car when a car we have won’t pass inspection because of rust cancer or beyond-repair brake lines.

If you go to Sears you can get a set of American Made screwdrivers.
They do NOT cost $100. No where near that.
If you buy American made Redwings they cost about $120 for a pair of work boots, and last for years.
There is no DVD makers made in America, so I don’t know where you get your figures for that.

We buy virtually ALL non-food items at garage sales

When the kids were little, I could outfit them for the whole year on $20 from garage sales. Of course, now that they're teens, well, that just isn't good enough for them so mean mama here made them use their own money. Recently, the rich relatives decided to add us to their getting rid of stuff list so after their high priced designer clothes are picked over by other relatives, my kids get the leavings. Some still have price tags so I'm not complaining and the kids are thrilled. Just don't tell them I sneaked in a few designer label garage sale items - $4 coat and whatever I could stuff into a bag for a couple bucks. A couple weeks ago I treated my self to a new $1 purse since mine was literally falling apart and a $2 cast iron pot. Ok, so the pot wasn't a need but a want but it'll last beyond my lifetime.

Your cable or sat TV bill is divided up so $5 to 6 dollars per month goes to Viacom/CBS and their other channels like MTV/VH1/Nickelodian. $5 to 6 per month for all the NBC networks and channels - NBC/CNBC/MSNBC, etc.

So you may never watch CNN but you are giving them money every month to stay alive and enslave you.

The GOP is timid because they know the Dems and their allies in TV can destroy any Repub in about a half hour.

TV is about brainwashing and control. People bitch and moan about Obama, clintons etc - who keeps them in power? TV. Keep watching and supporting it. Ditto Hollywood.

I had a great 1991 Chrysler that looked identical to this one (except the seats and dash were red leather):

I traded it in on a brand new Scion xB for two reasons.
1. Although it still looked new, it was in need of several separate repairs, each of which would cost well over $1,000, and the car was no longer fitting my lifestyle. The engine, transmission and major suspension/braking components were all due for a major overhaul. I used the car up.
2. The used Scions were as expensive as a new one.

I really am not into new cars any more, but the Scion was the only real choice at the time. And it was exactly the car I needed. Nothing else fit the bill for less money. It has served me better than any car I have ever owned. But as one gets older they have a better understanding of what they really need.

I may have used a bad example regarding the screwdriver. Also, things that are made by machines should cost the same pretty much wherever they are made. And less if they don’t have to be shipped a great distance or cross international borders. More if they are built in a high business tax area.

But labor and local taxes make a huge difference. There is a reason most of our clothing is not made in the US.

If we had to make, in the US, everything we currently buy at Costco or WalMart, our prices would be significantly higher. Significantly. But there would be more non-government employment.

And if you are really interested, here is a link to a post that contains all of the associated threads.

That's way too much to read, probably some form of new cruelty.

Thanks

I would agree that there would be an increase in price, but I also believe there would in many cases be a corresponding increase in quality.
My Redwings are a good example. They have lasted me 4 years. The boots I purchased previously cost me $75, and lasted me three months, and killed my feet. (Cat brand, BTW)
I just purchased a made in USA sand blaster.
Much better qualaty of construction then the cheap stuff at harbor frieght. Basically the same cost, other then the $50 in shipping.
I also recently purchased a set of Bad dog drill bits.
Ok, this would be a good example of both sides of the argument. The set cost $180, 3/32nds to 1 inch by 32nd.
I basically got tiered of breaking bits or wearing out the large ones after a couple of uses. Very expensive, but high quality. I just drilled 18 1/2 inch holes through 1/4 inch steel. It took a lot of push, (as always) but the drill was just as sharp at the end of the job as at the beginning.

It’s funny you say that. I shop at Costco twice a month, and those price quoted in the article- they’re Costco prices. I now buy my bacon at Aldi’s ($2 lb) and only use butter for table. I save my bacon grease and have started buying margarine again (first time in 9 years!).

The only things I buy at Costco now are meat, eggs, dairy, and coupon items. All the convenience stuff is too expensive. We’ve even stopped getting the $10 hot pizzas. Aldi’s sells a 16” deli pizza that’s pretty darn good for $5.99.

Come join us in the modern day version of Galt's Gulch! We are refusing to play the game. We buy used and we work to legally deny Big Brother his tax money. You should check your withholding tax and see if you can legally send less to the Government. If you can take the extra cash and either invest it in something safe like a good local bank CD or pay off debt.

Big Brother needs all the withholding tax it can get if more of us reduced the amount we send each paycheck it will squeeze the looters in Washington. (If you get money back on your taxes most likely you can reduce your withholding but not always)

Good idea to buy the meat, eggs, and other items in bulk. But since I’m single, I plan on going easy on the milk/butter. I think that with the right mindset, you can actually live like a Roman Emperor on a small budget. I am surprised that the stupid evening news didn’t think of that when they did a segment on rationing food intake for a month.

We go through a lot of milk with four kids, but even before they came on the scene it was always cheaper to buy a gallon of milk then a half gallon at a regular store. As soon as I got it home I’d make something to use most of it up, like pancakes for the freezer, or some kind of pudding:

http://www.food.com/recipe/pancakes-65049

http://www.food.com/recipe/microwave-chocolate-pudding-128078

http://www.food.com/recipe/creamy-rice-pudding-microwave-142837

That is true.

Take away the food stamps and all the grocery stores would begin laying off, raising prices and going out of business. According to cashiers I have spoken to, even the expensive organic stores are dependent on food stamps.

"Hah! We call Costco the hundred dollar store. We never get out of there for less!"

LOL! That's what we call the local WalMart. Costco/Sams is more like "the $300 store."

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