I drive a 1995 Toyota Camry that can take 15 gallons of gas. My wallet took a painful hit yesterday when the gas pump told me that my total bill was $55.00 and some odd cents. That is the highest it has ever been! Last year my average full tank of gas would cost me about $33.00. And I'm not the only one who's complaining.

Everywhere you look you hear news of the alarming consumer debt and people struggling to hold on to their homes and pay off their credit card bills. What's next? A statistic showing a drop in college enrollment simply because students cannot afford the tuition? Reported on USA Today: Shoplifting on the Rise. Good Lord. Restaurant owners are complaining about the increase in the cost of food; more and more folks choose to buy groceries rather than enjoy the luxury of eating out. Pinching pennies these days is becoming common practice.

But wait--the Washington Post says otherwise! A headline that reads, "Why We're Gloomier Than The Economy: Consumer Anxiety Outstrips the Data" caught my eye. According to reporter Neil Irwin, only 12 percent of Americans think the economy is in good shape. Others have gone as far as comparing our current situation to the Great Depression. So with all the panic about home foreclosures, high interest rates, and record-high oil prices, how is the U.S. economy really doing?

Let's compare some figures with the recession of the early 1980s:

Unemployement Rate:

May 1980 = 7.5%

Today = 5.5%

Inflation Rate:

May 1980 = 14.4%

Today = 4.2%

Doesn't look that bad, right? Furthermore, employers have not cut as many jobs as they did in the recessions of 1990 and 2001 (post-9/11). But the fact is that the biggest concerns right now--gas prices, cost of food, and declining real estate values--affect everyone's daily experience. People's perceptions of how the economy's really doing are affected by these factors more than similar price rise in other goods. Of course it probably doesn't help that media coverage tends to run bad news more than good news: "...a drop in the stock market or rise in the unemployment rate gets more extensive news coverage than a move in the reverse direction...This paradox has created a unique challenge for those guiding the economy, who worry that Americans' pessimistic views will become a self-fulfilling prophecy. Two-thirds of the economy is consumer spending. So if people's negative outlook leads them to cut their spending, a steeper downturn could happen."

So what can we do to keep this from happening?

• Don't panic about your expenses. Simply re-evaluate your priorities and keep spending your money--wisely.
• If you are having trouble paying off your debt, make sure you ask your bank for help. Lenders have said that many people who are defaulting on their loan payments do not take advantage of financial management options that banks are willing to give them. A simple phone call to your bank can help you modify your loan, adjust your interest rate and monthly payment, or for mortgages, try to sell your home for a low price instead of foreclosing.
• As much as possible, TRY NOT TO FILE FOR BANKRUPTCY. This can stay on your record for up to ten years, so it should only be done under extreme hardship.