I’m supposed to feel sorry for the banker who might have to pull his kids out of private school:
Schiff, 46, is facing another kind of jam this year: Paid a lower bonus, he said the $350,000 he earns, enough to put him in the country’s top 1 percent by income, doesn’t cover his family’s private-school tuition, a Kent, Connecticut, summer rental and the upgrade they would like from their 1,200-square- foot Brooklyn duplex.
“I feel stuck,” Schiff said. “The New York that I wanted to have is still just beyond my reach.”
The smaller bonus checks that hit accounts across the financial-services industry this month are making it difficult to maintain the lifestyles that Wall Street workers expect, according to interviews with bankers and their accountants, therapists, advisers and headhunters.
“People who don’t have money don’t understand the stress,” said Alan Dlugash, a partner at accounting firm Marks Paneth & Shron LLP in New York who specializes in financial planning for the wealthy. “Could you imagine what it’s like to say I got three kids in private school, I have to think about pulling them out? How do you do that?”
First of all, the bonuses, as a whole, are only down 14%. Some investment banks capped bonuses or lowered them beyond that 14% number, but not appreciably.
Second, I know there’s a cottage industry of financial professionals whining about how they’re only millionaires and not multi-millionaires now, but on the priority of economic problems in the country, I’m going to rank this quite a bit higher:
I went through the Federal Reserve’s Quarterly Release on Household Debt and Credit released today, and there were two notable trends. One is that the amount of consumer debt is declining, but that delinquency rates are stabilizing above what they were before the crisis. And the second is in this graph, which is that the number of people subject to third party collections has doubled since 2000, from a little less than 7% to a little over 14% of consumers. Ten years ago, one in fourteen American consumers were pursued by debt collectors. Today it’s one in seven.
Wall Street bankers with slightly smaller bonus checks – outside their normal compensation – is a significantly lesser-order issue than the fact that 1 in 7 Americans have fallen into enough debt that they are being harassed by debt collectors. And this harassment can lead to imprisonment for debts, garnishment of wages or even threats that debtors will be either fired from their jobs or unable to find a new one, as employers increasingly use credit reports in their hiring decisions.
If you prefer, you can add the stat that one in five people didn’t have enough money to feed themselves in 2011. I know I don’t see a report in Bloomberg about this every other week, but I have to believe it has a bit more news value than whether the investment banker can afford his second home. It’s simply a much more vital public policy problem, a more vital social problem, a more vital human problem.
And the people in the story don’t wear fancy suits and eat at Morimoto.
…I do enjoy the part of the Bloomberg article that explains that Wall Street types don’t save their money, so when their compensation gets reduced, they suffer. Aren’t these types of people fond of explaining to the lower orders how they have to be fiscally responsible? Aren’t they often saying that nobody was hurt by foreclosure fraud because it was just about a bunch of deadbeats who didn’t pay their mortgages? Hm.




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“It’s simply a much more vital public policy problem, a more vital social problem, a more vital human problem.”
Sums “it” up precisely.
Period.
So much for the whining, way too much whining, from the self-proclaimed smartest people in the universe …
“People who don’t have money don’t understand the stress …”
!
Thank you for putting this in perspective, DDay.
DW
“The New York that I wanted to have is still just beyond my reach.”
The sad ballad of the 1%, excluding the .01%. Cue the Respighi.
This is like the nonexistent farmer who has to sell his farm to pay estate taxes. I’d bet my left nut no one making that much money has to pull their kids out of private school.
Boo hoo! He won’t be able to rent a summer vacation home or send his kids to private school. The horrid, horrid stress of it all. Meanwhile in Roanoke City where I live 10% of the children attending public school don’t even have a regular home, let alone the money for a summer rental. This guy thinks he knows stress. He ought to try living through a month where you are wondering where you are going to get the money to come up with basic needs like food or shelter for your children. The stress from not being able to pay for a summer rental or a private school indeed!
BTW, according to commenters over at Brad DeLong’s place, Schiff employer is … his brother.
Who famously (if you follow such things) last year decamped for China,
declaring the USA so last century.
And their father is in jail for tax evasion. Also.
Okay. If you can’t live extremely comfortably on 350k a year, exactly why in blue Hell would I allow you to manage my money? Maybe instead of supporting policies to starve public education, you should support strengthening it and making it the best in the world. You could do that for a fraction of what you’re paying so your children don’t have to interact with the great unwashed.
Yeah, I was floored by that. What? And at least one of the people whining in that article was…a financial planner!
The hypocrisy, the blindness, the stupid…it burns bright.
Cry me a river, cry me a river…
I am at a place psychologically, that when I read the sign, “Jobless men keep going.” I think it’s there to encourage me not to give up!
Heaven knows how many wives will have to cut back on the botox treatments and massages and stuff. Poor babies. And those hard working guys who have time to stand on a balcony, drinking wine and sneering at OWS – pity them – I think not.
When Ralph Nader was asked if he ever worried about the rich he said No. The rich are doing fine.
All I can say is welcome to the 99%, assholes.
Wall Street people don’t save their money because there’s always going to be more more more.
“People who don’t have money don’t understand the stress,” said Alan Dlugash, a partner at accounting firm Marks Paneth & Shron LLP in New York who specializes in financial planning for the wealthy.
Wow! There’s a “Lucky Ducky” ‘toon in there somewhere. How utterly clueless can this guy be?
That’s probably what he’s choosing to cut first. Use your children as human shields … to gain sympathy.
Witness the making of a dead beat dad who still has custody.. he’s already scoping out his priorities.
Today’s worst person in the world.
Are you sure about that? I just googled “Bloomberg” and “food stamps” getting quite a few different hits. Obama is after all, the food stamp President.
Wall Street moans about lost bonuses. Main Street is horrified that they’re still receiving any, at all. There’s a win-win solution for both sides:
http://financeaddict.com/2012/03/a-win-win-replacement-for-wall-street-bonuses/
This is NEGLIGENT compared to the real economic justice whose continued avoidance WILL -and SHOULD- bring this country down from within.
They’re just squawking to minimize the chance they might REALLY be forced some day to “share the pain” that the poor have borne EXCLUSIVELY for 50 years and even more so in their latest ENGINEERED -Highly profitable- “Recession.”
(just ask:) Who PROFITED?
Many analysts and authors have Followed The Money – Claw it ALL back – it is absolutely possible. We know where EVERY PENNY went, and it ALWAYS goes somewhere (& comes FROM somewhere; which is why Usury -ANY borrowing, OR investing, OR selling off risk- ie, Capitalism- is an ancient crime against society.) “Trillions in Equity was LOST?” BULL!
95% TMR
HR676 (No more 4profit insurance or Health Care – BUT no more “national security” government secrecy either. The potential for abuse is obvious, historic, clear and current. Gov’t must be ABSOLUTELY accountable & transparent. We HAVE the tech…)
REPEAL Gramm/Leach/Bliley
NO more “conservatives” -”R” “I” or “D” – in government, EVER again.
GOPextinct2012
*Rock*…….*Knit*………
It WILL happen – you know it.
You can’t evict, imprison, punish or legislate an IDEA.
After all, with that NDAA clause, all we need to do is create a definition of domestic economic terrorism…. and make it a Federal crime.
And Warren Buffett has admitted there has been a class war for 50 years – not that genocide has ever been legal.