January 29, 2008

When Denial Ain't Just a River in Egypt

LADIES AND GENTLEMEN, MEET Nathan Drake. He is 30 years old. He both lives and works in Whittier, Calif. He is a Canadian expat. After taxes, he brings home some $3,000 per month. He is now $54,000 in debt.

Mr Drake has come to the world's attention through a profile in the Los Angeles Times. Amazingly, Mr Drake volunteered to have his profligate lifestyle featured in the pages of that newspaper, courtesy of its Sunday Business section, which publishes what are known as "money makeover" stories. I can assure you that profligate -- that is, wildly extravagant, or completely given up to dissipation and licentiousness -- is not an unkind word to describe Mr Drake's finances. He spends some $2,000 more than his take-home pay each month, and was forced to use his overdraft protection twice in the past month. Only now has he realized his lifestyle is unsustainable.

Well, actually, no, he hasn't. Consider: Mr Drake has a partial share in a boat, worth some $1,500 or so. Yet he will not sell it. Why? Well, he uses the boat to go on vacation. How exactly he pays for these vacations when he owes $29,000 on his six credit cards and some $16,000 to his bank (presumably for the loan on a very expensive truck); well, that seems to be a secondary consideration.

Of course, the situation is not entirely lost. The Times reports that Mr Drake may be able to boost his income some $12,000 per annum if things go well at work. Oh, and -- the coup de grace -- his wife is apparently going to indenture herself to help pay off his debts:

And when Jodi changes her immigration status and becomes a permanent U.S. resident, she'll start working too. Drake, a permanent resident, is awaiting his U.S. citizenship. It could take as long as a year for him to become a citizen and six months more for his wife to get her residency, said Louis Piscopo, an immigration attorney in Anaheim.

For now, though, Jodi must return to Canada while seeking residency. There, she plans to work for her sister's clothing company and to send most of her monthly paycheck to Drake.

Dude.

This guy's not a husband, he's a pimp.

I would be much more sympathetic (and consequently not so harsh) if Mr Drake had not involved his wife in his sordid profligacy. People make mistakes in life and everybody, of course, is deserving of a second chance, and it seems Mr Drake could receive one if he negotiates with his creditors. But it is one thing if you are screwing up your own life, and another entirely if you're screwing up someone else's along with it. Thus, it is entirely unjust to Mrs Drake for Mr Drake to not take every single possible action to right his financial ship. That doesn't just mean selling the boat or getting a cheaper car, either -- for her sake, he should resign himself to living a monk's existence for the next few years until he can get his house in order.

Now, if I were Mr and Mrs Drake, I would set out this plan. Mrs Drake should work while she is in Canada, but instead of giving her hard-earned to her husband, she should save it for an emergency fund -- it seems clear the couple doesn't have two nickels to rub together otherwise. In the meantime, Mr Drake should negotiate with his creditors, force himself to live below his means, and dispose of every single luxury that he can to help boost his finances. That means the boat and the truck and his pet rock and anything else he's got.

It will take a hell of a lot of work, of course, for Mr Drake to get himself out of the hole he is in. But he can do it. Once he takes the first few steps down that very long road, he'll find that each passing step will get easier; eventually he will start walking at a nice clip, and then sprinting along. But I fear the trouble here is that Mr Drake will not summon up the will to do the things that need done. That's a true shame, because hitting bottom is no fun at all; but from the story, it sounds as if hitting bottom will be the only thing that wakes Mr Drake up from his stupor.

Posted by Benjamin Kepple at January 29, 2008 12:01 AM | TrackBack
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