Government Shutdown Hardships

A week ago CBS reported on IRS workers' problems that came from the shutdown. “After a month with no pay, real hardship does exist for IRS employees including not having the money needed to get back and forth to work or to pay for the child care necessary to return to work right now.” Even some cities have been struggling as spending and the related sales tax revenues decreased. There were many other reports from around the country about similar hardships: food, utility bills, transportation, credit card payments, rent, etc.

It’s sad to see about 800,000 Federal workers furloughed with no pay. Many were required to continue coming to work not knowing when they would next be paid. They would struggle until the dispute was settled and back pay arrived. I have no solution to propose to avoid shutdowns, but I know what should happen immediately upon the workers' return. All government workers should be given a class in personal finance.

Suze Orman is not the only one who has been advocating for many years that everyone have an emergency fund, but she gives familiar advice. Here from a 2015 article is a typical example. “Your long-term goal is to have eight months of living expenses set aside in your emergency fund. I know that’s a lot, but I want you and your loved ones to be okay if you were ever laid off, or sick for an extended period of time.” Other experts are more conservative, recommending 3 to 6 months. But still, that’s more than a few weeks.

Of course, no one has been listening. Unfortunately, government workers thrown into a panic, resorting to food banks after missing a single paycheck does not strike the public as unusual. An emergency fund of only $1000 would be a good start, but a Bankrate survey from 2018 showed “only 39 percent of survey respondents said they would be able to cover a $1,000 setback using their savings.” That leaves 61 percent of the entire population out in the cold – or going to a food bank – soon after losing a job.

Admittedly, losing their job is not usually on the minds of government workers. Their job security is enviable. However, there have been four shutdowns in the last six years, each with the potential to cause similar problems. Between that and the same chances of personal emergencies that they share with the rest of the population – auto accidents, illnesses, personal injuries, etc. – their lives overall are not that much different or more secure than the rest of us.

Critical thinking dictates a need to build an emergency fund. Discipline is required to stop living paycheck to paycheck in order to do that. Responsibility implies that hardships after only a month without pay gives them no right to play the victim. That status, however, is too convenient for politicians trying to shame the other side, trying to shift the focus away from their own inability to act like competent leaders or even like adults.

This is yet another crisis that can be laid at the feet of individual behavior. The news media has this same information, but don't expect them to report it that way. They are too busy pushing sob stories and manipulating our emotions to keep the ratings up, to ask what personal choices could have allowed those crises to be averted.