Hey, Washington and Corporate America: It’s time to rescue the Hagelgans. And fast.
This Pennsylvania family and countless others across the country are in financial crisis. They have been writing me from as far away as California since last week as the coronavirus pandemic has cut them off from paychecks. I had called for immediate aid in a column last week. They are our nation’s independent contractors, and they are desperately afraid. Here’s what they need – and what even deep-pocketed money guys agree is of utmost importance:
The federal government must send cash for wages that have been cut off. Sizable cash – not crumbs.
Government must expand unemployment benefits, for which these gig-economy workers are ineligible.
And the corporations that could bankrupt these folks must step up, too. The time is now for reductions in hefty monthly cable and cell phone bills – not just deferments of late fees – as their kids are home doing schoolwork on computers. Mortgage help, too, will be essential to keep Americans from losing their homes because they’ve suddenly lost one or more incomes.
Don’t believe me. Listen to Lauren Hagelgans. The wife and mother of two cried as we talked from her Souderton home this week.
“I work in a school district. They’re all closed, which means I have no work, which means I don’t get paid,” Lauren said. I’d called after hearing from her dad, Inquirer reader Louis Russo, who was worried sick for his daughter. “I receive nothing. And I’ve got kids home. I have bills to pay. I have a mortgage. I have car payments. I have everyday household bills – everybody’s cell phones – that right now I don’t know what‘s going to happen.”
Lauren, 45, lost all income from her part-time contract job as a physical therapist assistant for special-needs children at two suburban Philadelphia school districts on Friday. It happened as Montgomery County schools were ordered shut to prevent further spread of the coronavirus in what, up to that point, had been Pennsylvania’s epicenter of the outbreak just outside of Philadelphia.
It’s a job with no benefits through a third-party company. She had taken the post only after being laid off in October from a job that had paid sick leave and vacation time. The reason she had lost that other job? Changes in the federal government’s Medicare reimbursements that forced cuts at the facility where she’d worked.
Her husband, Scott, a draftsman for a surveying company, is the family’s financial anchor – until and unless his own job falters in the weeks ahead. He’s lost jobs twice in the last 20 years due to the economy.
“My husband has a 401(k) and we borrowed against it so that we could get through those three months with Christmas and just regular household bills,” Lauren said. “And now we’re depleted, basically, at this point. [Combined], we make enough that we can pay our bills – but not enough to put in savings.”
They have a 12-year-old daughter and a son who turns 16 in two weeks. They live in a $165,000 home. They pay $1,350 a month in mortgage and local taxes, more than $300 a month for cable, and more than $300 a month for the family’s cell phones.
Unlike the staff teachers alongside whom Lauren works at the North Penn and Norristown Area school districts, Lauren gets nothing while schools are closed.
The same terror is spreading among restaurant workers, employees at other small businesses, and contractors everywhere who – like Uber drivers or Realtors – get paid no benefits and get no unemployment.
Just hours after I visited Lauren and her family on the porch of their home Tuesday morning, President Trump announced a potential federal aid package that would send an unspecified amount of cash to Americans. His people were mum on how big those payments might be.
But prior to his announcement Tuesday, Trump had been seemingly fixated on big-employer-friendly payroll tax cuts – a useless remedy that would do nothing for businesses that close due to Americans holing up at home as many governors have now ordered.
Meanwhile, a House-approved rescue bill that was hammered out last week with Treasury Secretary Steve Mnuchin and Democratic Speaker Nancy Pelosi remains in limbo as the Republican-controlled Senate led by Mitch McConnell has sat on it
This is not how you rescue ordinary Americans.
We are in a once-in-a-century crisis. We must save people immediately – and that means real money in real people’s pockets fast.
Over the last decade, big-money investors have sought to glamorize the marginalization of good jobs by labeling benefit-less Uber drivers and other contractors as “gig economy” workers. As though the no-benefits work were akin to a jazz show in a grotto somewhere.
In reality, the proliferation of these jobs has allowed corporations, universities, and school districts to get quality labor on the cheap, while turning private equity investors into billionaires by shoveling cash from gig economy industries into their already-overstuffed pockets.