Super-duper financial discipline

This is not a new idea, and it's certainly one that's gotten more play in the U.S. media since the onset of the latest financial crisis: if you want to control your consumption, buy only what the cash in your pocket (or your drawer or under the mattress) allows.

Though it seems a bit backward in this area of electronic everything--and I must admit the huge advantage of being able to manage my existing U.S. accounts online--I appreciate the fact that Nicaragua still exists largely as a cash economy. There has been a noticeable increase in the availability of banks, ATMs and the like since I first started visiting here, but it's still a very small percentage of people who actually use them. So virtually everything is cash, and small bills at that. It is always a headache to deal with 500-cordoba notes (= about $25), or even 200's; I usually take care of them at the Pali, which is the Walmart-affiliated American-style supermarket in town where I buy a few select items each week. Use of credit cards is virtually non-existent, except among the wealthier tourists & folks in Managua.

Now that E. & I are pretty much done with the construction and furnishing of our apartment--paid for from savings--we are trying to live by the rule that we will not make any further withdrawals from my U.S. accounts, but rather only spend what we are actually making. Again, I know this is not a new concept. Lots and lots of people in the U.S., and I imagine elsewhere, live "paycheck to paycheck." The major difference in this case is that we don't have plastic to fall back on. And while I've never had a super-plush job, I've been fortunate enough in my working life to earn enough that I didn't really have to think too hard about maintaining what I'd call a solid middle- to middle-upper-class existence.

Here, in our collectively under-employed and under-paid state, we are struggling to cover our basic expenses--food, first and foremost, then utilities (though we have yet to receive our first electric bill; I had a nightmare a few days back that we got it and it was $3,373. Yes, three thousand DOLLARS and change. Yikes), then the bare minimum of cell phone minutes, a very little gas for the car, toiletries, and that's about it. An occasional meal out of the house--for example, our $15 lunch yesterday to celebrate a special anniversary--throws us way further out of whack than I'm accustomed to, but it does help us maintain our sanity, so I guess it can almost qualify as a necessity. After that, we try to set aside a few cordobas every week for special purchases: first, some perfume (mostly for E., who must smell good to feel good ;-) ); some furniture; and now, less glamorously, a new set of tires. We barely finish paying for one thing before the next item occurs to us...and this is for a household of only two pretty financially conscientious/a.k.a. thrifty people.

I have commented to several friends and family that I have no earthly idea how "regular" folks get by here, when prices for so many items equal or exceed U.S. levels. For example, beef and pork both cost the equivalent of over $2.00 per pound, while chicken is $1.50-2.00; milk, $3.00/gallon; butter, $4.00/pound; eggs, almost $2.00/dozen; toothpaste, $1.50/small tube; toilet paper, $2-$2.50/4 rolls; gasoline, $4.00/gallon. You get the idea. Produce is relatively inexpensive, thank goodness, but woman cannot live on tomatoes and onions alone!

To put things in further context, E.'s monthly salary of $200, for 50+ hours of work per week, is considered very good here. This is for someone who is bilingual and has computer skills, international experience, and several years of education past high school--a serious rarity in this country. With my B.A., M.S., multiple languages, and about 15 years of U.S. and international work experience, I'm pushing the envelope by asking more than $10 an hour for some of the specialized work I do. And it's far from full-time, only temporary contracts, no benefits of any kind, no long-term security.

So I'm definitely left scratching my head about other people's paths to subsistence, let alone building for the future. Especially because--here's where the criticism unfortunately has to come in--many locals' idea of what constitutes "the basics" includes cable TV, never-ending junk food for the kids, and of course alcohol in copious quantities. There is no culture of savings, no concept of a rainy-day fund, no sense of how to budget and live within one's means. Even if people had such ideas, they almost universally lack the education, skills and socio-cultural resources to act on them.

I've seen this phenomenon in other low-income countries I've spent time in, but I haven't had to live with it day in and day out. What to do? I'm speaking not for ourselves, because I'm pretty confident we will always find a way to get by--but for the people around us. Even proven ideas that have taken hold in other places, such as micro-financing or small business development programs (e.g. Grameen Bank and all its followers), fall flat here. You want to see a vicious circle in action? Come to Nicaragua.

[And by the bye, here's the wonder of the blogosphere: my original intention for this post was to say something positive about "doing more with less" and how even a well-trained consumer could change her habits...and it ended up being a depressing, seriously superficial commentary on the chicken-and-egg nature of poverty. I feel unsatisfied by what I've said but will publish nonetheless, with hopes of explicating my thoughts more effectively another day....]