Room With a View: Things are Looking Pretty Hairy Out There
By Dave Lindorff www.thiscan’t behappening
I’m the first to admit that you can get a little out of touch working as a freelance writer, if you aren’t careful. Here I am up in my upstairs garret, surrounded by my books and computer paraphernalia, my phones and two cats, and my sources of information tend to be the piles of newspapers I have delivered, my wife, who works with other human beings at a university, my son, who goes to an urban high school, and of course the internet.
When I get out, it’s either to do solitary repair work to rescue my barn, or to get a coffee at the local café.
So when I read that housing prices are picking up, or that the stock market is back over 10,000 again, it would be easy to start imagining that things are starting to look up after the worst recession since World War II.
But then, I do have personal evidence that this is hardly the case.
Take my work. Business Week magazine, a publication for which I have written for some 17 years, nearly folded and has been sold for a song by McGraw-Hill to Bloomberg, where it will operate as a shadow of its former self. One editor there wrote recently for advice because his wife had been stiffed on a $3000 writing assignment for some company, and he wanted to know how to pursue the case in small claims court. He said they need that money, because his current income is precarious, given the planned staff cuts Bloomberg will be making.
Another publication for which I’ve written for nearly as long, Treasury & Risk magazine, cut my word rate by 22% (and shortened my assignments), effectively giving me a 33% pay cut. Another mainstay publication, which will remain nameless, cut my word rate by 20%, and also cut back on length of assignments, making that an approximately 30% pay cut. Two other publications simply folded, while a fifth cut back on my assigned articles by 80%.
That’s pretty grim news if you’re me. I mean, I’m better off than the doughty workers at Republic Windows in Chicago, who lost their jobs altogether, and were actually being stiffed out of their last paychecks and vacation pay until they fought back by organizing a sit-down strike and a national campaign against Bank of America, which was refusing to honor a line of credit their runaway employer had with it (despite having just won some $25 billion in taxpayer backing itself). But I can hardly complain. The editor at one publication that was cutting me back had her own salary cut 5% and had the matching contribution to her 401(k) plan eliminated. Another editor had it worse though: she and her colleagues on staff got hit with a 10% pay cut and had their health plan summarily terminated. In its place they got a so-called health savings account plan. But get this; it’s not the standard old one where the employer makes a payment into each employee’s account from which the employee is expected to pay for medical expenses. In this niggardly scheme or scam (the insurance industry euphemistically calls it “consumer-driven health care!), the employee has to put the money into the “plan,” which is really just a glorified way of saying that the employee has to front the money to pay for medical care. After spending $3200.00 in a year, then there is a major medical plan that will supposedly pay for 80% of expenses at a list of preferred providers. But it gets worse. My editor says she can’t just go to any doctor or hospital, pay the cost, and have that payment deducted from her annual $3200 responsibility. She can only deduct what the plan provider (Aetna Insurance) decides is a “reasonable” charge—an amount that most physicians or hospitals would laugh at. The reality, then, is that this editor will probably have to pay maybe $5-6000 in annual medical bills before she can get anything from the major medical insurance plan on offer.
Now you could argue that I’m just looking at the publishing industry here, which we all know is in grim shape with collapsing ads and readership. But it’s more than that.
When I go out to buy building supplies at my local Home Depot for my barn repair and restoration project, the parking lot on a Saturday is not full of cars. In fact, it’s easy to get a slot near the exit door to load my lumber. I use the contractor’s checkout, because there aren’t any contractors, which tells you all you need to know about the state of the housing market where I live in suburban southeastern Pennsylvania.
I know that things are still hard for a lot of people around here, because my credit line was frozen, and I learned from someone at my bank that they were “reassessing” all their home-equity lines of credit in view of declining property values. I was told I could apply for a new credit line, but it would be at an extortionate rate—this at a time that the effective interest rate is almost 0 at the Federal Reserve. In other words, banks are simply not extending credit these days, which to me says, kiss the idea of economic recovery any time soon goodbye. I got another indication of this when my daughter, a teacher in New York City, called to complain that American Express had jacked her interest rate on her card’s unpaid balance from 9% to 34%–a level reminiscent more of a Mafia loan-sharking operation than bank revolving credit loan.
Then there’s my friend down the street. He’s an engineer. He used to be busy all the time designing local buildings with architects and his lawn was perpetually a mess. But these days he’s free to mow his lawn and rake the leaves all he wants. Nobody’s building things. His wife isn’t around much, though, to keep him company. She was a vice president at Wyeth, but lost her job in that company’s merger with Pfizer, and has been jobless now for over nine months. Her time is spent on the road searching for a new job in a hugely contracted industry.
The local grocery store, though it seems busy enough (no surprise since nobody’s eating out these days, as witness the number of closed restaurants in the area, particularly the chains in the malls), has laid off workers on every shift, probably not because of declining sales, but because they can get away with it—every worker is so worried about the economy that they’re willing to accept any lousy conditions, including a speed-up, as long as they are still working. (Look at me, I’m still writing at the same publications, for lower word rates.)
The only guy I see who’s doing well these days is my local mechanic. His gas sales may be down, as people cut back because of lower incomes, fewer jobs to commute to, and higher gas prices, but his repair business is going gangbusters. His lot is always full of cars in for repairs these days, because after all, who is going to go out and buy a new one with the job situation so iffy?
So even confined as I am in my little writer’s world here, it’s evident that we’re in a nasty spot.
The only good news lately was a report that the Army is closing down its Army Experience Center in the Frankford Mall in Northeast Philadelphia. Set up a year ago, the Experience Center was a video-game addict’s paradise—a kind of “Pleasure Island” where the mostly male gamers get to engage in ultra realistic mass killing, with trim, muscled sports-shirt wearing recruiters cruising the floor encouraging them with lines like, “You’re a born soldier! That’s the best shooting I’ve seen all day!” There are even two rooms there with mock-ups of a full-sized armed Humvee and a Blackhawk helicopter gunship cabin, where kids can man realistic M-30 machine guns and shoot at realistic attackers who are shown in a 3D Cinerama video setting. (I brought my 15-year-old son and his friend there for a few hours, and after the three of us had done a heart-pumping run on the Humvee, and shot up everything that jumped out at us, we were complimented by the recruiter, who told us proudly that we’d only had a 25% error rate. “What’s an error rate?” my son asked. “Only 25% of your targets were civilians,” he replied matter-of-factly. When my son expressed shock that one in four of his “kills” had been civilian, the recruiter said soothingly, “Don’t feel bad. It’s war. That’s really not a bad percentage.”)
Apparently the Experience Center, which was a multi-million-dollar experiment that the Army hoped to expand nationwide, is no longer needed now because, according to the Pentagon, the economic crisis has pushed up recruitment numbers to above annual targets. Jobless kids are fighting to get in the doors at recruiters’ offices. (The determined protests organized by local anti-war groups like Veterans for Peace, by making the Experience Center a national news controversy, may have also led the Army to abandon its Pleasure Island plan to sucker local kids into becoming armed jackasses for the nation’s imperial project in Afghanistan.)
So even the good news isn’t good around here.
But at least I’ve managed to get the barn repaired.
Now maybe I should get some chickens and a goat to go in it. At over $3.50 a dozen and $4 a half gallon, the organic eggs and organic milk we buy are both getting pretty pricey on a writer’s budget, and it looks like things aren’t about to get better.