Americans fleeing California due to poor economy
28 Apr, 2011 19:57
There is much talk in Washington, DC that the economic recovery is underway, but in some parts of America the economy continues to take a downward spiral.
New home construction and a series of redevelopment projects give the appearance of an economic upswing in Riverside, California, but below the surface, a darker reality is blanketing the area east of Los Angeles.Panhandling and homeless encampments are scattered around the landscape of the Riverside area.Like most cities in America, the housing collapse caused great financial suffering here.The problem is that all indications show the situation is actually getting worse.Linda Whitlock, hands out sack lunches near a homeless encampment every week. “It’s getting tougher and tougher,” said Whitlock. “In my own family I have two son in laws that are out of work.”Despite her own family’s struggles, Whitlock continues to hand out food to the needy.She has been doing it for seven years, providing a lifeline for those who might go hungry otherwise.“I would have to go back to dumpster diving and getting food from behind grocery stores,” said Deborah Bastien, a homeless woman who said she would be devastated without the food assistance she receives.It is not just the homeless asking for a handout.Some people standing in line, waiting for a free lunch do have a home, but need help feeding their loved ones.California ranks 16th in the nation when it comes to food hardship, and Riverside ranked number two among all US metropolitan areas.According to Daryl Brock, the Executive Director of the Second Harvest Food Bank in Riverside, requests for food have risen 25 percent in the past three years.“While we are able to feed as many as 300 to 350 thousand people per month, there are almost 750 thousand people, who are living at or below the poverty line, so we still have a long way to go,” said Brock.In the bedroom communities east of Los Angeles, hunger is not the only issue that indicates a worsening economy.There are many properties, which have been foreclosed on and are now boarded up, sitting empty.According to Realty Trac, an online foreclosure marketplace, there is foreclosure filing for every 49 homes, one of the highest rates in America. That is part of the reason that Riverside has earned the dubious distinction of being on top of Forbes’ list of cities where the economy is still getting worse.Over the decades, economics professor Mason Gaffney has seen Riverside go through some difficult financial cycles.“They call it capitalism, but they probably should call it land speculation,” said Gaffney about the market speculation, which contributed to the 2008 financial crash.That factor along with a decrease in tax revenue, have created an environment with grim prospects.“We’ve been through bad times before and we have bounced back, but I’m pessimistic about the near future,” he added.That pessimistic sentiment is shared by DeWayne Nichols, an unemployed Riverside man.“I would like to know where the economy is getting better,” said Nichols. “Send me an email.I would like to know because I don’t see it happening here.”Nichols has been unemployed for two years and is applying for food stamps. The divorced father of two thought his job as a floor installer would be secure. Now he takes whatever odd job he can get and has swallowed his pride to apply for government assistance.“It’s really difficult, but being a man at the same time, you do what you have to do to make sure your family is provided for,” he said. “You don’t want your children to wake up at night with their bellies hurting.”Last year, Riverside had an unemployment rate of 15 percent. Only Detroit was worse. Today, the unemployment rate is holding steady at about 14 percent in Riverside.While Nichols prays for a call back from one of his interviews, he’s already considering leaving Riverside all together. He is not alone. Economists predict that some four thousand people will leave the area this year as the dream of financial prosperity in sunny California becomes more elusive, and too many, just plain impossible.George Hemminger, the founder of Survive and Thrive TV, said homelessness and other economic problems have become increasingly pervasive throughout California. “We are now arresting homeless people. If you are too poor that you have to beg, you are going to be arrested,” he said. He explained many in California “over did it” by investing in real estate which collapsed early in the recession. The people were not prepared for the market to fall and were hit hard by the impact. “I’ve been here over 30 years and I am leaving,” Hemminger said. “California is dead, but the Midwest is halfway decent.”“We [California] have a political strategy that is killing businesses, killing job growth,” he added. “The economy is coming back, but it isn’t good jobs. It’s part-time, minimum wage.” It is time to head to farm country, he explained, for jobs and possibly prosperity.
Nationwide, unemployment has spiked, inflation fears have grown, consumers prices are up and the economic growth shrunk below US expectations. Writer and editor Joshua Holland from AlterNet explained in the bigger picture, the Average American must remember over 7 million jobs have been lost and the current growth rate simply is not going to cut it.“We need super above average Growth,” he said. “We need to catch up because we have fallen so far behind.”The country has lost trillions of dollars in wealth, and basic economics shows that when wealth declines spending declines. With less wealth, and declining jobs, other areas of the economy suffer – such as home sales and general consumerism. When people spend less and buy fewer things, small businesses suffer. Without greater growth and more jobs, the economy will continue to shrink or stagnate. The federal government is not solving that problem; the Fed is focusing on the deficit but ignoring problems that impact Americans in the here and now.“There was no discussion about the fact that we have a truly painful jobs crisis,” Holland added.He explained the US suffers from an unsustainable amount of foreign commitments, which limit America’s ability to care for domestic issues – including the economy and social programs which aid poorer Americans. Instead of spending to help Americans, the government invests trillions in overseas defense and military policy, far above what any other nation spends.