(CBS News) Hard Times Generation: Families living in cars

More than 16 million children are now living in poverty and, for many of them, a proper home is elusive. Some cash-strapped families stay with relatives; others move into motels or homeless shelters. But, as Scott Pelley reports, sometimes those options run out, leaving an even more desperate choice: living in their cars. 60 Minutes returns to Florida, home to one third of America’s homeless families, to find out what life is like for the epidemic’s youngest survivors.

The following is a script of “Hard Times Generation” which aired on Nov. 27, 2011. Scott Pelley is correspondent, Bob Anderson and Nicole Young, producers.

Never has unemployment been so high for so long. And as a result, more than 16 million kids are living in poverty – the most since 1962. It’s worst where the construction industry collapsed. And one of those places is central Florida.

We went there eight months ago to meet families who’d become homeless for the first time in their lives. So many were living day-to-day that school buses changed their routes to pick up all the kids living in cheap motels. We called the story “Hard Times Generation.”

A reporter’s story: Finding homeless families
Unemployment in central Florida is so acute that some families are now living in their cars. So how did Scott Pelley’s team track down people without addresses?

Now, we’ve gone back to see how things have changed. It turns out some families are losing their grip on the motels and discovering the homeless shelters are full. Where do they go then? They keep up appearances by day and try to stay out of sight at night – holding on to one another in a hidden America – a place you wouldn’t notice unless you ran into the people that we met in the moments before dawn.

Time, has carried us into uncharted territory. The great recession began December 2007. Almost 1,500 mornings ago.

If you were rushing to work this morning, in Seminole County, Florida, it’s not likely you’d notice the truck or hear the children getting ready for school.

Arielle Metzger: In the clear bin, we have dirty laundry. In that one, there’s tools that we might need.

Scott Pelley: All these bank bags are storage of this and that.

Arielle Metzger: Like shampoo….

Austin Metzger: And over here is food.

Arielle Metzger: Food.

Pelley: So, you’re really not heating up food so much. You’re eating out of cans?

Arielle Metzger: Yup.

This is the home of the Metzger family. Arielle,15. Her brother Austin, 13. Their mother died when they were very young. Their dad, Tom, is a carpenter. And, he’s been looking for work ever since Florida’s construction industry collapsed. When foreclosure took their house, he bought the truck on Craigslist with his last thousand dollars. Tom’s a little camera shy – thought we ought to talk to the kids – and it didn’t take long to see why.

Pelley: How long have you been living in this truck?

Arielle Metzger: About five months.

Pelley: What’s that like?

Arielle Metzger: It’s an adventure.

Austin Metzger: That’s how we see it.

Pelley: When kids at school ask you where you live, what do you tell ‘em?

Austin Metzger: When they see the truck they ask me if I live in it, and when I hesitate they kinda realize. And they say they won’t tell anybody.

Arielle Metzger: Yeah it’s not really that much an embarrassment. I mean, it’s only life. You do what you need to do, right?

It’s life for a lot of folks. The number of kids in poverty in America is pushing toward 25 percent. One out of four. Austin and Ariel usually get cleaned up for school at gas stations. They find its best to go to different ones every day so the managers don’t get sore.

[Arielle: Goodbye daddy.

Tom: Have a good day.]

Before the bell, they blend in with more than 1,100 other homeless students in the Seminole County schools. At Casselberry School we met 15 kids who’d been living in cars. With their parent’s permission, they told us you don’t get much sleep – with your brothers and sisters in the backseat – but that wasn’t the worst part.

Marquis Gines: We were really scared. So, so we would stay up all night sometimes and watch over my mom and keep her safe.

Pelley: How many of you, show me your hands, were worried about your safety while you were living in the car?

Tiffany Lincoln: To me it was scary ’cause I thought something was either gonna happen to my mom or my grandfather or my dad or me.

Ashley Paige: We weren’t staying in a very good neighborhood like where the car was parked. And someone came up and robbed my aunt for the little bit of money that we had.

Jade Wiley: Well, I worried that someone would just break in and steal my mom’s purse.

Jade Wiley is eight years old. She spent three weeks living in her car with her mom, her dad, two dogs and a cat.

Pelley: Did you think you were ever gonna get out of the car?

Jade Wiley: I thought I was going to be stuck in the car.

Pelley: How did you keep your spirits up?

Jade Wiley: By still praying to God that somebody’d let us stay in a hotel.

Pelley: And how did you get out of the car?

Jade Wiley: Well there’s this nice lady named Beth. And then she gave us a lot of money so we could stay at the hotel. And now I’m staying at the hotel.

Pelley: She said that a nice lady named Beth came and gave the family money.

Beth Davalos: Well, a nice community came. I just delivered it.

Beth Davalos runs programs for homeless kids in the Seminole County schools. This is the video that she shot when she found Jade’s family.

[Jade Wiley, inside car: Well, we deal with it. Every day we deal with it when we live in the car.

Beth Davalos: We're going to get you a hotel room now? How do you feel about that?

Jade Wiley: Happy.]

When Davalos hears of a student on the street she uses county money and donations to get temporary shelter in a motel.

The money she had for Jade’s family lasted only a month – so the Wileys, and Jade, are painting the rest of the motel in exchange for a room. But this is rare. Of all the homeless families in Florida, two-thirds are living on the street.

Beth Davalos: I hear about it every week, every couple of days. If they’re not living in their car right now, they are avoiding it. Some of them don’t even have cars to live in. Or they recently got out of it.

Pelley: Why is it happening right now?

Beth Davalos: The longevity of homelessness continues to rise, so people are running out of resources. The unemployment runs out. Their savings run out. The family that lent them money does not have it anymore ’cause they’re looking at economic hardship. And before you know it they find themselves living in their car because they ran out of all options.

Earlier this year, when folks heard about the homeless students in central Florida, four million dollars in donations poured in. Beth Davalos set up food banks in 41 Seminole County schools; they gathered up clothing for the kids and shelled out cash for motel rooms.

Four million is a lot of money, but think of this: of all the families without shelter in America, one third are in Florida. At Casselberry School, we sat down with the Coates family.

Victoria Coates: Instead of three meals a day we ended up doin’ two meals a day. And then there was this one day where we didn’t have any more money and that’s how we ended up in the car.

Last year, the Coates left Washington, D.C., for a new life in Florida but the jobs dried up. When the savings went, Victoria and D’Angelo learned how to be homeless. They found out there’s a checklist for living in a car. You want security, lighting, a place where you might be welcome or at least a place busy enough to hide in. Walmart lots can be good – it depends on the manager, YMCAs mostly look the other way. D’Angelo settled outside a hospital emergency room.

D’Angelo Coates: And we knew that through bein’ there we could at least brush our teeth in the morning, go to the bathroom if we need to in the middle of the night. And I’m sitting on the cooler in between our vehicle and another vehicle just to make sure they’re okay.

Pelley: Standing guard all night.

D’Angelo Coates: Yup.

Pelley: D’Angelo, what does a man think about, sitting on a cooler all night with his family in the car next to him?

D’Angelo Coates: At that moment, I guess I feel less than a dad. I guess, I guess I can say or as a husband. Because I’m not able to provide for my family.

Victoria Coates: Going into that car really did something to me. I felt helpless. I felt like I couldn’t help my children.

Pelley: I am willing to bet that the whole time you were in the car you didn’t cry once, did you?

Victoria Coates: Unh-unh.

Pelley: Not in front of these guys.

Pelley: When it came time to put the girls in school, the school must have asked you for an address.

Victoria Coates: Well you have these boxes to choose and you had one that said shelter.

Pelley: You checked the shelter box?

Victoria Coates: Yeah.

Pelley: There was no box for car?

Victoria Coates: No.

Pelley: So you lied to them?

Victoria Coates: Basically.

Pelley: You do what you have to do.

Victoria Coates: There was not an option to take my girls away.

Pelley: I wonder if some of these families are hiding from the system, hiding from you because as one woman put it to us today, she said, ‘I was afraid that if they found out we were living in the car, the state would take my children away from me.’

Beth Davalos: Yeah, they’re scared. They’re very scared. And the reality is if the state found them in a car, they could– their children could be taken away and put someplace safe for now. But when we find them we can put them someplace safe.

The Coates tried to go someplace safe – they called every shelter in the area – but they were all full. After ten days in the car, the only thing in the bottom of the cooler was an orange. So, Victoria started calling again.

Victoria Coates: And we called each and every one of them. And then I got to the last one, which was Orlando Rescue Mission. And I called and the lady said, ‘We have a program for your entire family.’

Pelley: You must have thought you weren’t hearing right.

Victoria Coates: Yeah.

Pelley: How close did you come to running outta gas on the way to the rescue mission?

Victoria Coates: We had, like maybe a quarter tank before the “E.”

Pelley: So really all you had to your names at that point was a quarter of a tank and an orange?

Victoria Coates: That’s right.

It wasn’t long after, the family made it into the shelter that D’Angelo found a job.

He’s manhandling garbage cans and proud to have the work.

D’Angelo Coates: Hard work, but hard work’s good for you. I’m thankful to have a job.

With help from his employer, they hope to get Jamie, Jamia and J’la in a home of their own by Christmas.

Pelley: What do you know now that you didn’t know before you lived in the car?

J’la Coates: I know to be grateful that you have your family and that my mom is really, really, really protective.

Protective because there’s a ferocity that comes with being a parent on the street. Hiding the kids from cops and criminals, watching options grow shorter, the days longer and the nights…the nights are just stubborn, sitting on a cooler, waiting for the sun.

One threat to a family out here is idleness, so the folks that we met fill the days with every free and normal thing. After school, the Metzgers drive their truck to the library.

Arielle Metzger: ‘Cause they’ve got the computers that we can use. And light and all that.

Pelley: I wonder what education means to you two?

Austin Metzger: It’s everything.

Arielle Metzger: It is everything to us. I plan to be a child defense lawyer. If I focus on my studies, I have that opportunity.

The American dream is durable. And there is something about growing up in a truck that makes you believe in it all the more. As we tagged along with the Metzgers they told us they like the truck better than a motel and they wanted to show us something they’ve been doing in the evenings: they’re acting in a community theater, a free and normal thing.

On stage they had a chance to be somebody else, but what struck us most was that they were just as happy in their roles as the Metzgers.

Arielle Metzger: Before the truck I always saw all these homeless people and I would feel so bad for them. And then as soon as we started living in the truck ourselves I’ve seen even more. And I just feel so bad. And even though I’m homeless myself I wanna do as much as I can to help them get up, back on their feet.

Pelley: You sound very adult to me.

Austin Metzger: She is. She likes to take over.

Pelley: And you too a little bit, Austin. You had to grow up pretty fast?

Arielle Metzger: Yeah.

Austin Metzger: Yeah.

Arielle Metzger: Every time I see like a teenager or any other kid fighting with their parents or arguing with them and like not doing what they’re told it really hurts me. Because they could be in my shoes. And of course I don’t want them to be in my shoes. But they need to learn to appreciate what they have and who they have in their life. Because it may be the last day they might have it.

At the end of this day – when the play was over and the kids were ready for bed – Tom Metzger judged the lighting behind the theater and decided this was as good a spot as any in Seminole County to make a home for the night.

Read more: http://www.cbsnews.com/8301-18560_162-57330802/hard-times-generation-families-living-in-cars/#ixzz1f4uh9sF3

Due to the large swelling numbers, the average time of the foreclosure process is taking up to 2 years in some areas. Hopefully if you are in this process this is giving you some relief while you transition to another home to live in. The same article makes some crazy claims like:

In New York State, it would take lenders 62 years at their current pace, the longest time frame in the nation, to repossess the 213,000 houses now in severe default or foreclosure, according to calculations by LPS Applied Analytics, a prominent real estate data firm.

Clearing the pipeline in New Jersey, which like New York handles foreclosures through the courts, would take 49 years. In Florida, Massachusetts and Illinois, it would take a decade.

In the 27 states where the courts play no role in foreclosures, the pace is much more brisk — three years in California, two years in Nevada and Colorado — but the dynamic is the same: the foreclosure system is bogged down by the volume of cases, borrowers are fighting to keep their houses and many lenders seem to be in no hurry to add repossessed houses to their books.

If this were true, that means the foreclosure process would be longer than the actual loan term (average 30 years) and that some people in NY and NJ could live in their homes rent free for 62 and 49 years respectively. All due to the backup in the court systems.

Personally, I believe not only are there more foreclosures in pipeline but millions more on hold in pre-foreclosure because the banks simply can not afford to take all those houses in and report their true losses. They pretend it is for other reasons, but we know they are all about the bottom line. Otherwise, they would simply modify all the delinquent loans of everyone who can still afford to make a lower payment based on a principal reduction instead of taking the homes back.

A spokesman for Bank of America said, “Any suggestion that we have a strategy to delay foreclosures is baseless.” A Wells Fargo spokeswoman blamed changes in state laws governing foreclosure for any slowdown. A GMAC spokeswoman said it was following “regulatory and investor expectations.” JPMorgan Chase declined to comment. Servicers said some of the decline in foreclosures could be traced to an improved economy.

There are only 2 things you can do to balance the budget: raise revenues (taxes) or cut spending. I agree with the statements Governor Brown makes in his video, and basically every state and the federal government will have to do the same thing to avoid bigger problems down the road. Some experts have mentioned that California may be the first state to collapse.

Right now Greece is a big headache for the EU. That country simply has too much debt and it needs to be bailed out which is very similar to CA in the USA. However, the Greeks don’t like that solution and that is why they are literally protesting and rioting right now. But I am sure the Germans are asking why should Germany have to bail them out?

As our economy continues to get ugly, you have to wonder if we will be following the same steps as Greece. We do have many public protests in America right now as we lay off many teachers, firemen, and policemen.

On top of that, we continue to increase the number of tent cities in America for our ever increasing homeless population.

I went on to college and earned two degrees and honestly, most of the university professors were awful too. I took classes at the community college, state university and a private university so this is not limited to just one school. It seems most teachers are there for a paycheck. How do you fix it? Watch that movie and I think once you identify the problem you will see the solution.

As far as the economy getting better, it  is not. How do I know? You simply look around the area you live in. There are still more foreclosures and more people becoming unemployed. Forget about that unemployment number they release because it is not real. They exclude people just to make it look better for the elections. A more accurate measurement is the BLS U6 numbers.

This video below demonstrates the reality we live in.  This is true poverty in America aka the Bush Obama Depression. Watch the video and tell me if you can argue it differently.

This customer did what most people do and unfortunately it was the wrong thing to do. She drained her retirement account to keep the house current after she lost her job. I would have recommended she stop paying all her credit cards and mortgages after a job loss and start preparing for hard times. New shelter and frugal living should be her priority as she searches for a a new job. There are people who have been out of work over 99 weeks which is how long Congress has extended unemployment benefits.

NY Times:

PHOENIX — Bank of America and GMAC are firing up their formidable foreclosure machines again today, after a brief pause.

But hard-pressed homeowners like Lydia Sweetland are asking why lenders often balk at a less disruptive solution: short sales, which allow owners to sell deeply devalued homes for less than what remains on their mortgage.

Ms. Sweetland, 47, tried such a sale this summer out of desperation. She had lost her high-paying job and drained her once-flush retirement savings, and her bank, GMAC, wouldn’t modify her mortgage. After seven months of being unable to pay her mortgage, she decided that a short sale would give her more time to move out of her Phoenix home and damage her credit rating less than a foreclosure.

She owes $206,000 and found a buyer who would pay $200,000. Last Friday, GMAC rejected that offer and said it would foreclose in seven days, even though, according to Ms. Sweetland’s broker, the bank estimates it will make $19,000 less on a foreclosure than on a short sale.

“I guess I could salute and say, ‘O.K., I’m walking, here’s the keys,’ ” says Ms. Sweetland, as she sits in a plastic Adirondack chair on her patio. “But I need a little time, and I don’t want to just leave the house vacant. I loved this neighborhood.”

GMAC declined to be interviewed about Ms. Sweetland’s case.

The halt in most foreclosures the last few weeks gave a hint of hope to homeowners like Ms. Sweetland, who found breathing room to pursue alternatives. Consumer advocates took the view that this might pressure banks to offer mortgage modifications on better terms and perhaps drive interest in short sales, which are rising sharply in many corners of the nation.

But some major lenders took a quick inventory of their foreclosure practices and insisted their processes were sound. They now seem intent on resuming foreclosures. And that could have a profound effect on many homeowners.

In Arizona, thousands of homeowners have turned to short sales to avoid foreclosures, and many end up running a daunting procedural gantlet. Several of the largest lenders have set up complicated and balky application systems.

Concerns about fraud are one of the reasons lenders are so careful about short sales. Sometimes well-off homeowners want to portray their finances as dire and cut their losses on a property. In other instances, distressed homeowners try to make a short sale to a relative, who would then sell it back to them (a practice that is illegal). A recent industry report estimates that short sale fraud occurs in at least 2 percent of sales and costs banks about $300 million annually.

We have 2 current wars (where we are dramatically draining our resources), an unemployment rate in the 10% range (after the government manipulates the reports), and a  record of bank  foreclosures. For goodness sakes, we have tent cities popping up everywhere.  We literally spent trillion of tax dollars bailing out banks, car companies, and wall street and are worse for it.  I am not one of those sheeple who buy into the argument that it would be worse if we didn’t spend the money because that is a load of crap.

Everyone likes to compare by percentages, but if you look at the raw numbers of the unemployed people, you can see how massive our current unemployment is in the big picture.    Unofficially, we actually have over 30 million people unemployed. Compare that to the raw numbers from the Great Depression and you will realize how bad it really is right now.

Because our population has grown so much, more unemployed people now will tax our resources exponentially more.  This is the first time now where people are running out of unemployment benefits before they even find jobs.

Now we even have a pro-Obama economist becoming negative.  I have watched Paul Krugman on TV  and he always seemed to be selling whatever Obama did as the right course of action.  I thought he was and is still wrong about the deficit spending.  He wants so spend even more and believes that is the solution to our economic woes.  I think he is finally opening his eyes because his latest op-ed contradicts what I heard him previously state.

NY Times:

We are now, I fear, in the early stages of a third depression. It will probably look more like the Long Depression than the much more severe Great Depression. But the cost — to the world economy and, above all, to the millions of lives blighted by the absence of jobs — will nonetheless be immense.

And this third depression will be primarily a failure of policy. Around the world — most recently at last weekend’s deeply discouraging G-20 meeting — governments are obsessing about inflation when the real threat is deflation, preaching the need for belt-tightening when the real problem is inadequate spending.

In 2008 and 2009, it seemed as if we might have learned from history. Unlike their predecessors, who raised interest rates in the face of financial crisis, the current leaders of the Federal Reserve and the European Central Bank slashed rates and moved to support credit markets. Unlike governments of the past, which tried to balance budgets in the face of a plunging economy, today’s governments allowed deficits to rise. And better policies helped the world avoid complete collapse: the recession brought on by the financial crisis arguably ended last summer.

But future historians will tell us that this wasn’t the end of the third depression, just as the business upturn that began in 1933 wasn’t the end of the Great Depression. After all, unemployment — especially long-term unemployment — remains at levels that would have been considered catastrophic not long ago, and shows no sign of coming down rapidly. And both the United States and Europe are well on their way toward Japan-style deflationary traps.

In the face of this grim picture, you might have expected policy makers to realize that they haven’t yet done enough to promote recovery. But no: over the last few months there has been a stunning resurgence of hard-money and balanced-budget orthodoxy.

One reason why I like her views is that she explains how she gets to her conclusions.  She isn’t the mainstream media trying to cheer lead the economy into a better place because a report is not as bad as expected even though the numbers in general suck.

Meredith Whitney double dip housing video