A friend harvested this from a (helicopter?) mom’s discussion group:
I want to vent but don’t want blow back. Our 18 year old who works 6-7 hours a week filed for unemployment benefits and then filed for the additional federal benefit of $600 a month,unbeknownst to us. She has received 1950 so far and spent 1200 already on clothes etc over 800 today alone. We found out about this earlier tonight. We are horrified and ashamed and at a loss. No federal money should ever have come her way. She’s a full time student and a dependent completely cared for. She made at most $2600 a year and she’s receiving the salary if someone who makes 40k a year at least (her benefits aren’t taxed). Right now we are deciding what to do. You can’t give the money back. By the time it’s over she will have received $8000!!!!! What do i do? We are contemplating have her give it to the charity of her choice. She is not loving that idea. I’m disgusted and just want her out of the house. I’m resisting that impulse but it’s a strong one
Personally, I think the soon-to-be-well-clothed gal is entitled to the money (but, unless she heads to the South, where can she go and wear her new clothing?). Before this started, she took the initiative to get a W-2 job, even if only one day per week. Despite her near-zero personal risk of dying from Covid-19, she has lost what used to be her Constitutional freedoms, e.g., of assembly. Unless she chooses a career of harvesting tax-free child support cash from a portfolio of married dermatologists, dentists, and radiologists, she will be paying for all of the costs of coronapanic via higher tax rates for her entire working life (the shutdown was sold as an attempt to protect Boomers, but the shutdown is being paid for with bonds whose interest payments will fall due mostly after Boomers are long-retired and/or dead).
Ignoring if she is entitled to it or not, if she can’t give it away, the best thing to do is to spend it, circulate it through the economy. The clothes are just her percentage for taking part in keeping the economy alive for Jeff Bezos. Okay, so make her spend it locally at local restaurants and stores that are open…
They should return as many of the clothes as possible and at least take the money and bank it. They should have a serious conversation with their daughter about the fact that the economic disruption from this plague is going to take a decade to work itself out – if it ever does – and in the meantime that money should be saved. She’s going to need it.
What about investing it? Six or nine months from now, with $8,000 sitting in a bank account earning meager interest could be used after the market bottoms out and begins to rebound. During that time she can take the opportunity to educate herself about her financial future.
Also, what she and they should do immediately is use some of the money in a separate account for her to build the best credit rating she can possibly have. All the automobile manufacturers are going to be offering (or are already starting to offer) extremely attractive financing terms – but only to people with excellent credit. Same thing with mortgage providers. She’ll be a lot better off at age 20 with an 800+ credit score. Throwing her out of the house will mean that she just burns through the money without building anything for her future. She needs to wise up.
Spending on clothing is a great use of the money. Investing the money might be the right thing for someone to do for themselves, but it does nothing for society, in terms of actually putting people to work.
I’m concerned about what appears to be a widely held concern about the federal debt. People say things like “our children will have to pay off those bonds”. But our children will also own those bonds. So it’s not about intergenerational wealth transfer. There might be a legitimate concern about poor people being taxed to pay off bonds held by rich people. But that is easily remedied by taxing rich people so that they are the ones that pay off the bonds.
If you think of it as control system, there are two knobs that the government has: One is to add money to the economy by spending. One is to remove money from the economy by taxation. The right way to control this is to spend in such a way to keep people employed, and tax in such a way to control inflation. Instead we often see the government doing the exact wrong thing, in which they reduce taxes to try to stimulate the economy (which doesn’t work because the tax reduction just goes into rich people’s bank accounts) and try to reduce spending to control the deficit (which is the wrong thing to try to control: it’s inflation that we should worry about, not the deficit. There’s a relationship between the deficit and inflation, but if there’s one thing that the federal deficits of the past 30 years have shown, is that the relationship is tenuous. You can have a lot of deficit without any inflation.
@Bradley: What does spending money on clothing do for society? If she’s in a state where retailers are nonessential businesses, she didn’t buy them in a store, so she’s not saving anyone’s job. My guess is she bought them online, so they came out of a big warehouse, got picked and packed, and arrived on a UPS truck.
Most of the clothes are probably Made in China, and almost none of them are Made in the USA. She’s a dependent and a full time student, so they’re basically superfluous luxury goods that will have to be packed up and moved and then sold or given away for nothing. If she gains 20 pounds in the next few years or her taste in fashion changes, she won’t be wearing anything she bought. Why would anyone want their daughter to spend the money that way? Her mother knows it’s a stupid idea, to the point of wanting to toss her out of the house.
One of the main goals of the two cash infusion ideas, the expanded UI and the lumpsum payment, was to get money into the economy as quickly as possible and have people spend it quickly. My $1200 is still sitting in a checking account. I think she has probably done better with her check than I have according to our economists. Honestly, I don’t see a problem. It is for a limited amount of time and anyone not taking what they are entitled to is putting themself at a disadvantage with respect to everyone, especially if this ends up causing inflation.
Smart girl. Reward her.
Woman that wrote that is nuts. Yes her kid short term profited off a gov’t being a gov’t. So what at 18 she never voted for any of it. She didn’t cheat, lie, or steal. Now her mom wants to throw her out of the house. Guesing her mom doesn’t have a job. What a c
Right. I’m guessing mom hasn’t earned an honest dollar in her life. How dare she be mad at her daughter?!
Boy, things sure were a lot nicer in 1970. You people are mean. The Brady Bunch covered something like this in Season 2, Episode 7. The boys and girls have a little bit of a spat, but Mr. Brady and Mrs. Brady step right up and put a stop to that nonsense.
“The boys find a wallet with $1,100 [2020 value ~ $7,500] cash in it and no identification. The boys want the money for themselves, the girls want the boys to split the money with them, but Mike turns to the police to help the owner find the wallet.”
Spoiler alert: Mr. Brady turns the wallet and money over to the police for safe keeping, and takes out an ad in the newspaper asking people to call and identify the lost treasure. The boys and girls do think about spending the loot. Greg wants a car, Peter wants a bicycle, Cindy tries to buy a horse, etc., but Mr. and Mrs. Brady are having none of that stuff. By the end of the episode, the boys and girls reconcile their differences, discover the wisdom of sharing, and the money is returned to an old couple who respond to the ad. They had been saving up for “years and years” to take a vacation. The grateful old gentleman visits the Brady family at their home. He knocks on the door, Mrs. Brady answers and ushers him in, and he offers $100 as reward to the boys, which they decline. They finally accept $20, which they share with the girls.
https://www.dailymotion.com/video/x6u2iy7
No internet, landline phones, printed newspapers, no laptops for schoolwork, people just coming and knocking on the front door and being let right inside, and happily ever after. No coronavirus. Health drama is limited to Alice crying from peeling onions and Mrs. Brady splashing water on herself trying to load ice cube trays into the freezer (which has an ice maker!)
@Alex
If Mrs. Brady didn’t work, why did they need Alice? It was different when Mr. Brady was a widower.
@ScarletNumber: As it happens, there is a backstory to Alice! She was Mike Brady’s housekeeper for the family before the death of his previous wife:
“Alice was the housekeeper to Mike Brady, his previous wife (who died before the series started), and their three boys. Alice stayed on, to be the housekeeper for not only his boys, but for his new wife, Carol, and her three daughters.”
So Mike and Carol apparently agreed to keep Alice on after they got married and the number of kids went from 3 to 6. In the original series, Carol is a stay-at-home mom but in the sequels, Carol takes a job as a real estate agent using the boys’ converted bedroom as her office.
Remember, Mike Brady was an architect, so he was pulling down enough money to support the whole family and thus, Carol had the freedom to choose not to work, at least right away, while they were raising six young kids.
More on Carol Brady:
“For her time, Carol is a liberated woman. Although she chooses to be a stay-at-home mom, she is anything but a housewife. She’s a freelance writer, a sculptor, a political activist, and a singer. She also organizes plays and PTA events while keeping dinner on the table. Some of her favorite things are a large terra-cotta vase, dangly earrings, and singing in church. She also loves telling corny jokes and finding clever ways of zinging her husband.”
https://bradybunch.fandom.com/wiki/Carol_Brady
@Scarlet: We can also note that the “found treasure…return to rightful owner” plot device was recycled for the 2002 TV Special “The Brady Bunch in the White House”. It all begins with Bobby finding a winning lottery ticket that Mike insists on returning to its rightful owner, a decision which results in him becoming President of the United States! By that point (2002) we also get the death penalty, environmental activism, political dirty tricks, and a planet-destroying asteroid written into the script, plus a whole lot more:
https://bradybunch.fandom.com/wiki/The_Brady_Bunch_in_the_White_House
“Mike then needs to select a new vice president, and he picks Carol. He asks Congress for permission to appoint her and initially, the speaker of the house, Sal Astor, is skeptical of Carol’s abilities but she wins Congress over with a song and dance number. “
I can see both sides of this situation. At the same time, I believe she’s going to later pay her share (actually probably more than her fair share if she’s a middle or lower income person) for all the Government-funded, Covid-related giveaways that are happening. If she was truly eligible, then let her keep it.
I do agree that the money should be invested for her future. Maybe she’ll make enough on the money to offset sone portion of the increased lifetime taxes that she’ll end up paying because of these giveaways.
That’s my point. This is $8,000 in basically found money for someone who is a dependent and a full time student. She was working only a few hours a week, the benefits aren’t going to pay her rent, food, or any of her other expenses. It would be a much better thing for her if she kept as much of it as possible, used the rest to maintain a stellar credit rating, invest it when the situation with the markets become a bit clearer, or put it aside for an emergency. Once the world opens back up and assuming she graduates and can find a good job (unless her parents are going to keep supporting her forever) that money will be very useful to her.
It’s hard to say what her whole family’s financial situation is but from the sound of it, her mother thinks that spending $1200 on clothes was a very irresponsible thing to do. She’s probably right.
She also can’t spend it on travel right now, and blowing it on clothes that she’s not going to be wearing in a few more years is really a dumb thing to do with it, IMHO.
Alex, we’re in violent agreement! 😀
> We are contemplating have her give it to the charity of her choice. She is not loving that idea.
If her judgment is poor enough to blow $1200 on clothes when she doesn’t need them, I’d question her judgment about which charity to donate to. Here’s a better idea: tell her to fund some of her own expenses for a couple of months, and then she and her parents choose the charity, make sure it’s a 501(c)(3) and her parents donate an equivalent amount. Then her parents can deduct the donation from their taxes. The money goes to the same place and her parents save a little money. If the young lass was only making $2600 a year in the first place, she’s not paying any taxes to begin with.
Stuck inside these four walls,
Sent inside forever,
Never seeing no one
Nice again like you,
Mama you, mama you.
If I ever get out of here,
Thought of giving it all away
To a registered charity.
All I need is a pint a day
If I ever get outta here
If we ever get outta of here