Using Coronavirus Stimulus Money To Increase Resilience
Updated: Apr 22, 2020
Hello everyone. I have angered the internet with this post, so I am required to fact check myself. I have to let the original stand, and tell you up front what is wrong with it so you can decide if you want to proceed.
First, my tone is insensitive. People would prefer I repeat earlier and more often how much some are suffering, and I agree. People would prefer I more explicitly state how much of a privilege it is not to have this money already spoken for, since it undeniably is a great privilege that I feel the weight of, and I did not shout that loud enough. People would prefer I not use the word 'luxury' at all, even to urge setting them aside. People resent the implication that anyone would think of spending this money on 'toys,' and I dearly wish no one would.
People are angry that they're being given so little money, and that the unemployment systems of many states have crashed so that the rest of the support which is meant to cover the mortgage and electricity hasn't come through yet, and that those who need it most are getting it last (like I said below). I'm angry too, and I let my do-something focus drown it out when I shouldn't have.
People are unhappy at the implication that they should take financial advice from someone who makes money off a blog. They are completely correct that I forgot to state that I believe no one should make financial decisions based on what someone on the internet says, and these are just ideas to ponder. I am not the best writer and I find I nearly always forget something very important. But I don't make money off this blog. It costs me money.
I used the word 'windfall' because we're getting more than a month's income, and that is a huge thing to us and to others in the same income bracket who have not yet lost income. It may be only a week's income to some, but to us it's a chunk of unspoken-for change the likes of which we hardly ever see. The responsibility to use it well is heavy.
Also, I let my flowery language make me inaccurate which is a terrible sin. 43% of Americans have lost at least some income according to a survey by The Hill. I can't find where anyone is willing to divulge the exact number of households who are getting stimulus checks, but based on the number of households in the appropriate income brackets it's more than 25% of the country who both have not seen an income decline and are getting a check. This is a heck of a lot of people who could help out the 43%, but it is not a "vast majority."
So if you are feeling upset by the word 'windfall' or the implication that some people have a choice about what to do with this money, I'm very sorry that I am not speaking to you in this piece. I figure you know your business far better than I do. But if you do have a choice for this money, I hope you'll look past my blunders and check out these suggestions for helping yourself and those suffering now.
Here is the original.
Most of us Americans are in for a windfall from our government. Ours arrived last week. I’ll admit, my first instinct was to save it, though that is not what it was intended for. The stimulus is supposed to stimulate the economy, so it’s supposed to be spent. But when times are looking tough and things are changing fast, I personally want to spend less because I know I might need it later.
First, how do we know this money is ours to keep? You may have heard it’s simply next year’s refund pulled forward, or that it’ll have to be paid back in taxes. These and other claims are false. People perpetuating them have either failed to do even the laziest fact check, or are deliberately stoking anti-government sentiment. Genuine government mistakes are many and egregious lately, but this isn’t one of them and we don’t need to make up reasons to be grumpy.
The unfortunate truth is that this money is unnecessary for the vast majority of us, and nowhere near enough for the people who really need help right now. I understand why it was done this way: determining who needs and who does not need help takes time, and we did not have it. But the result is that many people will spend this money, which is not current taxpayer dollars but future debt that we will all be on the hook for servicing, on new toys.
Toys and luxuries serve an important psychological need, to be sure. My life would be much poorer without good books and other things I don’t strictly need. But the more we drive our economy toward luxuries, the more we draw down our natural resources while simultaneously reducing our ability to provide basic necessities. I propose we’ll be happier in the long run if those of us who have a choice can use this windfall to increase our personal and community resilience.
Here are a few ideas.
1. Top up your emergency fund. But, I just said this money wasn’t supposed to be saved! An emergency fund isn’t really long-term savings, though, it’s just easily-accessible money that will cover necessities when income is interrupted. What good does it do the economy to spend money on toys today, if tomorrow we may not have money for food?
A modern economy thrives on steady consumption, and is damaged by wild swings in demand. You’re doing your part for economic health (not to mention bodily health!) by assuring you can consume steadily next month, too. Typical recommendations are to have six to twelve months of basic expenses on hand, while recent surveys show that half of Americans have less than $400 set aside. We're privileged to have more than that but not enough, so we're adding to ours.
2. Store a little food. Buying more than you need when products are scarce is hoarding, which is wrong because some people then go without. But stocking up when things are plentiful is anti-hoarding, because it lets you remove your personal consumption from the system just when the system is most stressed, assuring that others get more of what they need.
Some things are scarce right now, like flour and rice, especially in hard-hit areas. But other things are going uneaten, like produce from local farms. If you can buy extra now and preserve it, you’ll have something delicious and nutritious to eat later, and also help the food system to retain productive capacity by preventing farms from going out of business. I bought an extra-big order of pastured lard from my favorite local farm.
3. Address other personal preparedness issues. I don’t think any of us are at greater risk than usual for power or water outages right now. However, hurricane and wildfire seasons are fast approaching, and they have been getting more intense in recent years. With coronavirus spreading, this would be a bad year to have to leave home because of storms or fires, so anything you can do to prevent that is a great use of money. Backup water and power and a decent first aid kit are a good start. More about our personal basic preparedness here.
4. Buy equipment that increases your capabilities. Maybe you always wanted a wood chipper to turn tree trimmings into useful mulch. Or a food processor to make peanut butter and pesto at home. Or a decent shovel or pipe wrench. In general I advocate owning only the machines that really serve us, but needs change when the world changes. A tool that allows you to insource some critical task might be a good purchase right now. We’re buying a used plow.
5. Start that garden or livestock project. We were already planning a bigger garden this year, but all of a sudden, so is everyone else I know. It makes sense. Gardens help keep people fed when the world gets crazy, such as during the Soviet collapse, the economic issues in Cuba and also here in America in WWII.
I suspect those historical gardens were valuable for more than just the food. The act of gardening is itself calming and relaxing, even if it's only tending some basil in a sunny window. In my experience, when things are hard it's a psychological balm to have too much of something, anything. Abundance is therapeutic, even if it's abundance of zucchini.
Many mail-order seed sources are out of stock now, but some essential businesses like feed stores and hardware outlets stock seed and food plants, and in my area these are still available. If you’re already going for toilet parts and new shovels, you can also get seed (unless you live in Michigan). Bigger greenhouses might be closed, but small family-operated nurseries might still sell fruit-bearing shrubs and trees if you call ahead.
Livestock is another option. I know a family who is diving in on raising meat chickens. They had not planned to, but they’re now very excited. If chickens aren’t allowed in your neighborhood, rabbits certainly will be. They’re quiet, fairly easy to keep and delicious. Just make sure you can stock feed for any new animals. My local feed store nearly ran out a few weeks ago. As a bonus, gardening and keeping animals are great activities for kids who are home from school.
6. Pay down debt? I don't know about this one. All these suggestions should be taken or left as the individual feels is right for them, but with debt this is even more true. We decided not to pay down debt because the advantage to us would be small given our particular circumstances, but circumstances vary widely.
If your personal and household resilience is in good shape, you’re in the fantastic position of being able to address your community’s resilience. I think supporting community resilience is increasing personal resilience. If more of my neighbors can meet their basic needs, it’s less likely I’ll be a victim of property crime. If everyone has enough to eat and a safe place to sleep, fewer will end up consuming healthcare resources in the near future, and maybe I’ll be able to get care if I need it.
1. Give to your local food bank and soup kitchen. We’ve all seen the awful images of the lines at food banks. Our local food bank was already serving about 15% of my county’s population, many of them children, before coronavirus appeared. They will not be able to meet the new need unless donors step up.
Even worse, the people who most need the stimulus money are also least likely to have a bank account on file with the IRS, or any bank account at all. They will have to wait weeks or longer for paper checks while the rest of us get immediate deposits, and what will they eat in the meantime?
2. Give to your local domestic violence and foster care services. You might be cranky at your family after so much togetherness, which is understandable. But in this country there are thousands of people, mostly women and small children but also disabled people, the elderly and men, who are not safe at home. And now they can’t even get out of the house for the afternoon. Pressure on domestic violence services is increasing, and they won’t be able to meet the need either, unless donors step up.
3. Give to your church if it provides for these or other essential needs. I know a lot of people are missing their religious services right now. In our county churches meet much of the need for food and shelter, and supporting those efforts is a way of staying emotionally connected to the things that are important, even if we can’t physically be there.
4. Support local businesses. In normal times we all have to make calculated decisions about what to buy and from where, balancing needs with means, time and energy. Many of us have chosen (or been coerced to choose through poverty or lack of access) cheap and global over quality and local. The value of local is clearer than ever, though, as borders close and supply chains fracture. Especially for businesses that produce the basics, like food. For those of us that have a little extra money, this is an easier choice than usual.
5. Address specific needs among people you know. Things are getting harder for many people now, often in unexpected ways. Several people I know are having babies soon, but their favorite secondhand stores are closed. It’s not as if the baby will wait politely in the uterus until the economy reopens. Those onesies are needed NOW. They’ll end up spending more on new, and I plan to help.
I know we’re all having less contact with strangers lately, but those we do meet are more likely to be in dire straits. Recently, my husband met a young man at a gas station whose battery was dead. This guy had been fired from his temp job because of coronavirus and did not have extra cash. We’d just talked about how it was silly we owned two cars and only one set of jumper cables. My husband was able to buy a pair right then, help that guy, and increase our preparedness at the same time.
I know it may not seem fun or sexy to spend on basics, preparedness and stuff for other people. But while the thrill of buying new toys often quickly fades, the security of taking care of business leaves a warm, lasting glow. One of my favorite writers, Joshua Becker of Becoming Minimalist, put it well: “In the rush to get back to normal, let’s carefully consider what parts of normal are worth getting back to.”
How we spend this money is ultimately a vote on what kind of economy we want to have. Do we want a deeply unfair system where resources are wasted on ever more luxuries, but many people cannot eat? Do we want ever bigger farms and ever more fragile supply chains, or smaller, healthier, more stable, more resilient production systems? It’s up to us. I hope we choose well.
How are you spending (or prudently conserving) your stimulus? Please help me add good ideas to this list.