I drive a Mercury Sable. A Mercury Sable that I curse each and every day and though I am currently in the middle of Project Purchase a New Vehicle my issue right now isn't so much that I loathe my car it is that last week I went to get gas and spent $55 on good old 87. And after I blacked out and eventually came to, I told everyone I'd ever met in life that I spent FIFTY FIVE DOLLARS on gasoline and threw my hands in the air at the absurdity of it all. I shook my head and wondered what the world was coming to.

My younger brother and I sat back in our matching rocking chairs and reflected on how back in the day, we could get a quarter tank of gas in a minivan with a five dollar bill. We also used to walk to school uphill in the snow and bread was $1.09 a loaf but that's a totally different story.

Speaking of tanks, the economy is tanking but that is nothing new. What is new - at least for this relatively new adult - is the way the way the economy is on a downward spiral of doom and gloom. And to the next person who tells me that they heard on CNN/CNBC/NPR that gas will get to SIX DOLLARS A GALLON - which must be said in all caps to fully understand the gravity of the situation - well that person gets punched in the face and then I get the pleasure of using their credit card to get my $123 worth of premium. Needless to say I'm starting to become depressed by this entire situation and I sound like my grandpa when talking about what the world is coming to when the economy is in such dire straits. Then I like to just rest my eyes though I'm really dreaming of how I will be spending my stimulus check.

For the record, I plan to stimulate my savings account.

And it's a good thing that I have started to save seriously and count each penny (high fives all around for not overdrawing from my checking account) because the economy is tanking and we're in a recession and next thing you know, I'm unemployed and possibly working at Banana Republic as opposed to rolling around in their cardigans. Though I am not a Gen Xer, a recent USA Today article looked at the plight of the debt squeezed generation above me:

This generation is in the ironic position of paying for their own
student loans and feeling the pressure to put away for their own kids
for college," says Tamara Draut, a Gen Xer herself, a new mom and
author of Strapped: Why America's 20- and 30-Somethings Can't Get Ahead.

Gen Xers also face this harsh reality: The standard of living that most
of them have so far managed to achieve falls short of their own
parents' standard at the same age. The median income for men now in
their 30s, when adjusted for inflation, is 12% lower than what their
dads earned three decades earlier, a report by the Economic Mobility
Project, an initiative of The Pew Charitable Trusts, concluded.

 

The thing about Americans though is that we have never been a group of people known for wanting to wait things out or to really contemplate long term solutions. Getting the average worker to contribute to their employee matched 401(K) is like wrangling 499 geese into a pickup truck for a cross country drive. It takes willpower and threats of not being able to retire until 89 and even then people hem and haw. The concern that plagues the average American right now is how they will be able to afford things right now. That means the rising cost of the basic necessities like milk and gas. The New York Times' Paul Krugman recently opined that the cost of driving has left people 'stranded in suburbia':

It’s the kind of neighborhood in which people don’t have to drive a
lot, but it’s also a kind of neighborhood that barely exists in
America, even in big metropolitan areas. Greater Atlanta has roughly
the same population as Greater Berlin — but Berlin is a city of trains,
buses and bikes, while Atlanta is a city of cars, cars and cars.

And
in the face of rising oil prices, which have left many Americans
stranded in suburbia — utterly dependent on their cars, yet having a
hard time affording gas — it’s starting to look as if Berlin had the
better idea.

Strangely enough I had the same discussion with my mother the other day. That if I still lived in Washington, DC with my paltry salary, I would look at the price of gas and exclaim that it's such a shame for those poor suckers driving around in their gaudy H3s. I would then hop on the metro and life would go on. But now? While utterly trapped in the suburbs with the worse public transportation this side of the Atlantic? Where I drive 20 miles ROUND TRIP to my office? Well, re-read the first paragraph and you might need some smelling salts to help you come to, as well.

Of course the short term problems don't end with the ever important food and gas but also housing. The housing crisis has been prevalant for months though a recent article on CNN pointed to the growing trend of homlessness due to the rising costs of housing among the middle class:

Nancy Kapp, the New Beginnings parking lot coordinator, said the group
began seeing a need for the lots in recent months as California's
foreclosure crisis hit the city hard. She said a growing number of
senior citizens, women and lower- and middle-class families live on the
streets.

"You look around today, and there are so many," said Kapp, who was
homeless with her young daughter two decades ago. "I see women sleeping
on benches. It's heartbreaking."

She added, "The way the economy is going, it's just amazing the people that are becoming homeless. It's hit the middle class."

And that there, the story of Barbara Harvey is a harsh reality of what the current economic climate is doing to people and the fear that has and will continue to set in. When seeing everyday 'normal' Americans aversely affected it resonates with the rest of us, the other middle class normals who feel like we're doing just fine until we realize that by the way things are going, well, it's a little bleak. As part of Recession 2008 - and catchy title makes it more like a phase and not so "I'm going to lose all my money tomorrow" scary - Businessweek has started a blog called Recession in America which will chronicle the current recession or the recession yet to come.

And now I am off to look at my ING account longingly and to whisper sweet nothings to my 401(K) for being so good and thankfully, robust.

Heather B. considers a good day in personal finance to be when she doesn't overdraw from her checking account. She also blogs at No Pasa Nada.