“Black Friday,” November 23, is coming up fast and shoppers will hit the stores with credit cards in hand. It is a day when a lot of household debt is created. So we will use that date to look at debt because the terminated nuclear project leaves South Carolina – and some of its electric customers – in a dark shadow of debt.
Look at the context of debt in families. It can be helpful. The average American household debt is $5,700 and the average for balance-carrying households is more than $9,300 (source) People will spend an average of $1,000 for holidays this year (source).
The amount of debt is one thing, and reconciling that debt is an added issue. “Among shoppers who charged their holiday gifts in 2017, over 1 in 4 are still paying off those credit card purchases as they head into another holiday season” (source). Finally, “35% of U.S. adults reported that they would not be able to pay all of their bills if faced with a $400 emergency.” (source) So there is family debt, but there is often not the ability to pay even a fraction of it.
An estimate of Santee Cooper nuclear debt “per customer” has been reported about $60,000 by one study (Palmetto Promise). That kind of dollar number is lofty for an individual family.
Is such a significant obligation well-known in the state? Not necessarily. The Greenville newspaper reported on a survey about finances and the nuclear project termination: “But the controversy has passed many South Carolinians by. Slightly less than half of the S.C. residents surveyed, 48 percent, reported being familiar with the project’s collapse. Another 12 percent weren’t sure.”
That survey can be found here.
“Black Friday” is not only a shopping day. It is also known for being the day that retailers turn a from red to black ink in the accounting for the year. Or, put another way, the day that retailers will pay off what they owe for the year; they turn a profit. They have to work hard to get there.
Paying bills is tough. “There are no shortcuts when it comes to getting out of debt.” That quote is from a media financial personality, Dave Ramsey. Many people listen to his thinking about financial wellness.
There’s a lot of truth to that quote, too. Debt has to be faced head-on. That may be in the mind of policymakers, regulators and other experts as they examine the debt of Santee Cooper and the terminated nuclear project in South Carolina. If you are in the portion of consumers who are keeping up on this issue, terrific. If not, help others know the importance of the debt issue. Leaders need to hear thoughtful and constructive communications about the debt issue so its is faced squarely, timely, and resolved with consumers as a priority, not as debtors.