As anyone who keeps a household budget can attest, the unexpected happens all the time. A refrigerator evaporator fan motor fails. Some part on your car you never realized existed breaks down. A loved one passes away and you have to — you want to — be at the funeral 1,000 miles away.
“Unexpected” expenses like these will, sooner or later, hit all of us. But not all of us, says new research out of the Federal Reserve, can afford them.
In fact, nearly 40 percent of Americans “would have difficulty handling an emergency expense as small as $400,” the Fed says.
A fifth of American adults, it adds, had major unexpected medical bills last year. An even larger share “skipped necessary medical care in 2018 because they were unable to afford the cost.”
Meanwhile, 17 percent of American adults can’t afford to pay all their monthly bills, even if they don’t experience an unexpected expense.
What these stats like these mean in human terms? If you live in a place like Northern California’s Bay Area, you need only look around to see.
San Francisco, recent research shows, now has more billionaires per capita than any other city in the world. By one reckoning, San Francisco also has the highest cost of living in the world, as all those billionaires — and the rest of the city’s ultra rich — bid up prices on local real estate.
But the Bay Area squeeze goes beyond the confines of San Francisco. Nearby Oakland and Berkeley are facing enormous affordable housing shortages as well. The Bay Area as a whole now has more than 30,000 people experiencing homeless.
Two-thirds of these people haven’t been able to find temporary sheltering services. They’ve been living and sleeping outdoors, many in lines of RVs parked along public rights-of-way like the waterfront in Berkeley. And that’s infuriated nearby residents who paid big bucks for their residences.
Berkeley city council member Kate Harrison has felt the fury first-hand — from constituents who wanted the RVs of homeless people banned from the waterfront.
“I paid a million dollars for my place,” one constituent told her, “and they have a better view.”
Local officials in Bay Area cities don’t know quite what to do. On one side, they have people without shelter who have real and unmet human needs. On the other, they have angry affluent constituents who want for little but have a big megaphone.
The more people spend on housing, Berkeley councilperson Harrison has come to understand, the more “aggrieved” they feel.
“Only the 1 percent here,” she adds, “feel economically secure.”
In other words, inequality has local officials coming and going. The ranks of the homeless are growing because almost all the gains from America’s growing economy, as the Economic Policy Institute’s Elise Gould testified to Congress this past March, are “going to households at the top.”
Empathy for the plight of the homeless, meanwhile, is withering away — particularly among society’s most fortunate, as the social distance between the top and the rest of society widens. The rich have climbed so far up the income ladder that they can’t see the humanity on the faces of people stuck on the lower rungs.
One telling sign of our unequal times: In wealthy Bay Area neighborhoods, the Washington Post reports, GoFundMe campaigns have emerged “to finance lawsuits against affordable housing proposals.”
Can a society survive without empathy? In a deeply unequal America, many of our deepest pockets are keen to find out.