STEPHANIE SALTER: Recession got you down? How about a shot in the arm?

By Stephanie Salter
The Tribune-Star

TERRE HAUTE January 22, 2008 10:43 pm

— Letting Americans keep more of their own money should increase consumer spending and lift our economy at a time when people otherwise might spend less.
— George W. Bush on heading off a recession with $150 billion in proposed tax relief

I’m getting concerned about my neighbors, the Sammies. They just don’t seem to have a very realistic grasp on their finances.
For the last several years now, Mr. Sammy — his wife likes to call him “Uncle” — have been living way beyond their means. You know, as Mr. Micawber said in “David Copperfield”:
“Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.”
Although Mr. and Mrs. Sammy work their tails off, they continue to pile up debt. Part of it is due to a fight Mr. Sammy got into back in 2003 with a neighborhood way over in another state. Many of us told Mr. Sammy not to do it, but he was convinced this other neighborhood was out to wreck our neighborhood and had to be stopped.
You cannot believe the money Mr. Sammy has spent so far on this fight. A few of his distant relatives have managed to acquire some wealth through their involvement, but the other members of Mr. Sammy’s huge extended family have seen nothing in return for all that dough going out the door.
Then, there is the Sammy Family lifestyle. It’s a good thing all of them have to sleep sometimes because, if they didn’t, they would be working or shopping, non-stop.
Just when you think the Sammies can’t possibly find anything else to buy, in comes another new living room suit, a fancy landscaper to redo the back yard, or a big, shiny SUV for one of the Sammy teenagers to drive back and forth to school.
From what we can tell, the Sammies have three vehicles per person in their house, which includes the twins who are just babies and can’t drive.
Catch Mr. Sammy on a bad day and all you hear about is “the #*%# price of gasoline.” But most of the time, especially if you ask why the Sammies keep buying new cars and trucks that get poor gas mileage, Mr. Sammy will clap his hands and say, “We’re a consumer economy. I’m just doing my part.”
It isn’t as though the Sammies don’t have the same kinds of expenses the rest of us do. Like most Americans, neither Mr. or Mrs. Sammy has gotten a raise even remotely commensurate to inflation. Mrs. Sammy says she basically works to buy the family’s medical insurance and to meet the minimum payments on their many credit cards.
Sometimes, she says she wonders what would happen if she or Mr. Sammy got really sick, couldn’t work and lost their health-care coverage. But then she always cheers up and says, “Well, like President Bush said, we can just go to the emergency room.”
Almost no one bothers anymore to tell her that E.R.s all over the nation are close to the breaking point as hospitals are reimbursed less by state and federal governments and more people slip daily into the category of the working uninsured.
“What can I do about it?” Mrs. Sammy always asks. “We sure don’t want socialized medicine, do we? Besides, we need to use our money to buy things so our economy will be stimulated and big business will be inspired to invest capital and create lots of jobs.”
A few days ago I heard a neighbor tell Mrs. Sammy that this consume-and-stimulate formula seems to have gone off track. He mentioned that job growth was down 2.26 million from this time last year. Mrs. Sammy said something about “these market adjustments” taking time and asked the neighbor if he’d like to ride to Plainfield with her to shop at Target.
A couple of years ago, it looked as though the Sammies were actually trying to change their fiscal ways. For awhile they stopped buying new vehicles, new wardrobes, taking vacations to Las Vegas and burning the 1,000 outdoor lights on their property 24/7.
Mr. Sammy said he had begun to save a little money from each paycheck to “put away for a rainy day.” But then, the eldest Sammy daughter got engaged and wanted a big wedding, so the Sammies threw her a lulu.
Mr. Sammy borrowed the money from a guy he sort of knew who lives somewhere over in the middle eastern part of town. Apparently, the guy now owns about 5 percent of the Sammies’ entire property
When the daughter and her new husband bought a six-bedroom house, they bragged that they didn’t have to put a penny down. “Our monthly mortgage payments are about equal to a couple of lattes,” the daughter said.
When I asked her how long that was going to last, she sighed, happily: “Oh, for years. We’ll never have to worry; our mortgage is ‘adjustable.’ That sounds so much better than fixed, don’t you think?”
Needless to say, I wasn’t too surprised at Mr. Sammy’s reaction last week to the president’s income tax relief proposal.
“Did you hear?!” he said excitedly, stepping out of his just-leased Lincoln Navigator. “President Bush wants to give us $1,600 so we can go out and stimulate the economy!”
I told Mr. Sammy I had heard. I told him I also had heard that the $150 billion in tax relief was going to affect only about 40 percent of people who file taxes.
I said, “I don’t know what you make, Mr. Sammy, but if it’s less than $41,000 a year for your family of four, you will get only partial relief or maybe none at all.”
Mr. Sammy looked as though I had stabbed him, but then, characteristically, he brightened.
“I don’t believe that,” he said. “The American government knows more about stimulating the economy than any other on Earth. Like the president said, we just need a shot in the arm right now. I’m ready, my sleeve is rolled up. I just never get tired of that rush!”
Stephanie Salter can be reached at (812) 231-4229 or stephanie.salter@tribstar.com.