I’ve long said to bankruptcy clients that bankruptcy can’t fix an income problem, it can just ameliorate an outgo problem.
In the last round of frantic bankruptcy filings a decade ago, one symptom seemed to be that too many families in the Silicon Valley couldn’t really afford to live a middle class life here.
They filled the gap between economic realities and their expectations with credit cards until the house of cards came tumbling down. I could provide the tourniquet that staunched the credit card outflow.
But it seems the problem of struggling families isn’t just an outgo problem: it’s income based and it’s everywhere, not just California.
A United Way study, released last week, shows 43% of American households can’t afford a bare bones budget. That’s 51 million households that can’t afford the basics of food, rent, child care, transportation, health care and a cell phone.
Even with reportedly low unemployment, the income generated falls short for a huge swath of our populace. The people the United Way set out to study were those they dubbed ALICE: Asset Limited, Income Constrained, Employed.
What they found calls out for national attention and a reordering that keeps all of our families self sufficient.
My skill-set in bankruptcy is no match for people on the edge of destitution.
