What would happen to you and your family if you lost 25 percent of your income — or faced exploding and unexpected medical costs?
What about one-third or a half of your income? All of a sudden, without warning.
Would you be prepared? Do you have the savings to weather the storm without your life falling apart? Without needing help from the government, from your family, from your community?
Before we continue with Gov. Paul LePage’s headlong assault on the poor, the near-poor and working families in Maine, we should ask ourselves those questions. And we should understand the odds because accident, illness or job loss can happen to any of us.
Data collected by a respected team of researchers, including political scientist Jacob Hacker from Yale University, tells us that catastrophe isn’t that far away. With support from the Rockefeller Foundation, the researchers developed the Economic Security Index.
According to the research, one in five people in this country can expect a major economic loss, whether it’s a sharp decline in household income or a significant increase in medical expenses, during the next year. More than 15 percent can expect income to decline by a third. And almost 10 percent can expect to see household income decline by 50 percent.
“Economic insecurity has increased substantially over the last generation, and especially in recent years,” the researchers conclude. “It’s clear that the economic security of Americans is under greater threat today than at any point over the last quarter century.”
The number of people who are economically insecure has increased from an estimated 34 million in 1986 to 62 million in 2010.
And while step declines in income, often associated with a lost job, are part in the increased insecurity, the exploding cost of health care is also a major factor. According to ESI, the median household spent about 36 percent more out of pocket for health care in 2010 than it did in 1986.
Increased long-term unemployment, less access to health insurance and high medical costs swirl into a toxic stew that is crippling families, not just in Maine but across the country.
And no one is immune.
While the incidence of dramatic income loss hit families with lower levels of education the hardest, even relatively well-off families were affected.
“Many of those who experienced such losses, including solidly middle-class families, reported being unable to meet basic needs, such as food, shelter and medical care. More than half of families with incomes between $60,000 and $100,000 that experienced employment or medical disruptions, for example, reported being unable to meet at least one basic economic need.”
When job loss or an accident strikes, few of us can recover without help.
You can go to work every day, play by the rules, live modestly, pay your bills and there are still no guarantees that fate’s cruel hand won’t find you. In fact, the odds suggest that for one in five of us, it will.
None of this should come as a surprise. In Maine, we’ve seen the effects of the Great Recession and the growing gap between the rich and poor for some time. And in reaction, we have worked boldly to make sure that an unexpected medical expense or sudden job loss doesn’t destroy families.
We’ve been innovative and a leader in expanding access to health insurance and improving health. Maine ranks sixth best for the number of uninsured in the country and our state is the eighth healthiest.
But that’s all at stake.
Gov. LePage has proposed taking health insurance away from 65,000 Mainers. His plans would force thousands of seniors, who have limited income, to spend more on their prescription medicines. He would take away substance abuse treatment, Head Start and needed medical care, like podiatry, from thousands more.
His plans do nothing for jobs, to control the cost of health care or to make Mainers more economically secure.
The governor’s political strategy around the cuts has been to try to divide people into groups, and pit one against the other. He said in Aroostook County that he’d have to close schools or nursing homes, for example, if his proposals aren’t adopted.
When it comes to having the financial rug pulled out, there isn’t an “us” and a “them.” Today’s economic reality could leave any of us needing help to care for our children or to keep our homes.
If Gov. LePage has his way, that help might not be there.
David Farmer is a political and media consultant. He was formerly deputy chief of staff and communications director for Gov. John E. Baldacci and a longtime journalist. His clients include Maine Equal Justice Partners and EngageMaine. You can reach him at firstname.lastname@example.org. Follow him on Twitter @dfarmer14.