2020-12-23

35% of Americans are financially wiped out already

Johannes Ernst

https://reb00ted.org/after-covid-19/20201223-covid-economic-wipeout/

Newsweek has the story:

The latest data from the Census Bureau’s Household Pulse Survey, taken between November 25 and December 7, found that 35.3 percent of U.S. adults are “living in households not current on rent or mortgage where eviction or foreclosure in the next two months is either very likely or somewhat likely.”

More than one third of adults.

Washington D.C. holds the record with 67.3% in this survey.

Can you imagine a third of all adults being evicted? Or two thirds in DC? I don’t think that is possible, because wouldn’t they have to move into the apartments and houses of other people being evicted, in a grand game of musical chairs? And if they indeed were evicted, with a third of the population suddenly homeless, the real estate market would totally collapse, and that wouldn’t make landlords happy either. So I would expect some kind of compromise to be found because it’s in the interest of renters and landlords, buyers and lenders.

But if you are in danger of being evicted, it means that you are basically wiped out financially. Risking the roof over your head, or any roof over your head, is not something anybody does easily.

But we are nowhere done with COVID-19. We may have made it into the second half of the pandemic, but not by much: vaccination has only started, and is supposed to continue into the summer. So if by now 35% of people are wiped out, what about, say 6 months from now?

And even if they somehow make it, and we beat back the virus, how are 35% of people, or more by the summer, ever supposed to financially recover? Just the accumulated debt would take years to pay off even with good jobs. Which are in short supply, and shorter supply now given the impact the pandemic is having on even further worsening inequality.

Many have been wondering why there aren’t more people on the streets, demanding a proper government response. They simply may not because a pandemic is going on. Once the threat from the virus recedes, however, there may be a very hot summer.