This guy’s situation makes for a much more compelling story.
http://money.cnn.com/2016/04/26/news/economy/middle-class-to-homeless/index.html?sr=cnnmoneybin043016middle-class-to-homeless0900vodtop
This is too funny. When NBA/NFL players - or hip-hop stars like MC Hammer - go into bankruptcy after making millions of dollars, we have no problem understanding that it’s due to overspending and financial mismanagment.
But because Neal Gabler is a white, middle-aged guy who writes “real good” - and has won awards for his ability to tell stories in the most compelling & sympathetic light - we start speculating about him struggling with mental health problems like being bipolar?
Give me a break. It’s people like Joe in the above post who need to be the focus of national attention, not rich, irresponsible, entitled tax-cheats like Gabler.
One would think such a highly educated person in a field where income is good but erratic would have availed himself of a financial advisor well before 5 years ago - especially since a lot of his income is done by advances. It is not like the one time $250k advance he got which he didn’t pay taxes on when they were due was the first time he got an advance. He has written 5 books and just finished his 6th. Advances surely weren’t a novel concept to him.
I think it’s going out on a limb to suggest his circumstances are do to anything like suffering from a bi-polar condition or any other psychological issue.
Who said Gabler’s problems were not due to overspending or financial mismanagement?
Tax cheats? 
In Gabler’s own words
Great euphemism - “hold back enough … to buy groceries” = “not pay his income taxes”. I admire his skill as a writer.
I’ll have to try that one next time I talk to the IRS … “it’s not that I didn’t pay my taxes, I just was `holding back’ the money so that I could spend it on other things.” 
If you parse his entire paragraph closely you will see that this likely went on for years and that we’re talking about considerable sums of money.
I shed huge tears as I imagine him struggling to “buy groceries” after receiving a book advance for hundreds of thousands of dollars. I, for one, am not a fiddle whose emotions he can so easily play.
That’s not a tax cheat. He is paying his taxes…in installments.
There are plenty of tax cheats out there. Those people who get paid in cash and never report the income for example.
What are the downsides of your economic program you posted yesterday?
If I am understanding correctly, he got a huge advance that had to last him several years while he wrote the book. The huge advance put him in a higher tax bracket than he would have been in if he could have been paid in installments. How much money did he really earn per hour? Even if we took the huge advance and just divided it by number of hours worked?
I think the big advance is kind of deceiving.
I’ve had contractors who got caught out in bad economic times when they used deposits on new projects to pay for finishing previous jobs, and then didn’t have the cash to purchase materials or pay their crew on the new project. It’s bad business practice but, as my attorney explained to me, a pretty common business practice. In good times it may be the norm. At least my attorney seemed to think so.
“The growth of college costs as all colleges have increased services is also a factor. Most students and parents in the US would not prefer a college that just offers the academics and minimum possible record keeping (transcripts, diplomas) but nothing else.” Which is basically the European model. Good education but no dorms, fancy gyms, rah rah sports teams, hand holding administrations, etc.
I haven’t seen any evidence that Gabler is a tax cheat. He made a string of decisions over many years that favored prestige and immediate gratification over sound financial planning. But I don’t see any evidence of cheating on taxes.
Our local paper ran a review of his Streisand book this week: “it doesn’t seem to have been Gabler’s intention to write a groundbreaking book so much as to write a spirited and entertaining cultural appreciation. (He never interviewed Streisand.) Generally he succeeds – although at times his appreciation is so full of treacle that it’s a wonder the pages don’t stick together.”
The Irs works with people who have problems paying their income taxes in full.
One example…
Parse his paragraph very closely. Look at how he shifts verb tenses in unusual ways.
Just because the IRS catches up to you and makes you cough up the money (including interest and penalties) doesn’t mean that you didn’t skip out on paying your taxes when they were due.
One big downside is the following … it would make housing prices more affordable for young people. Of course, this means that older, established people in high priced housing markets would take a hit to the value of their homes. It’s the inevitable flip side of bringing housing prices down.
Despite being a “not young” person myself, I’m ok with that. National policy is already waaay too skewed in favor of old people (who vote). We should invest in young people. That’s my obligation to the future and what I owe those in prior generations who sacrificed for me.
@al2simon — I am addressing his ability to address the truth, the gaping holes in his narrative,not necessarily his spending habits. And I certainly don’t remember anyone pointing fingers at NFL players in this thread or any other thread I have commented on.
This is not a race thing.
AND I never said directly that he suffers bipolar disorder. But if you have in fact dealt directly with the finances of individuals with the disease as I have, you will recognize some similar approaches to the “truth”. Though I have not read that he has been diagnosed, it would explain a hell of alot.
If I do one day comment on MC Hammer or the NFL =-- feel free to use the term “we”.
Maybe one problem is that it isn’t a norm to have to figure out how to deal with a large sum of money that has to last. Most of us get a monthly or weekly check. (That’s what PG was talking about this morning)
I’m remembering a young man, just starting his building business, telling me that if he got a $150,000 job he could retire then and there. And I was thinking… whoaa, how much of that money do you think you are going to see if you do the project? Never even mind about taxes. Sadly, he went bust. Luckily his wife has a good job.
I paid him by the hour, not the project.
I still don’t think he is tax cheat. That’s a big jump. He said his choice was paying taxes in full.
@al2simon, I would like your proposal better if we were in a high growth, high inflationary economic environment, but we aren’t. Your program is deflationary and will make the economy smaller, jobs will be lost. At least in the short run. Maybe in the longer run too.
I like this requirement better than the 20 percent down payment requirement. If the cost of homeownership is less than the cost of renting, the downpayment required can be close to zero. Maybe 3 percent. The more expensive the cost of home ownership is compared to renting, the larger the downpayment required. This will curb a lot of the speculation when home ownership is more costly than renting.
For example, in places like Sacramento, home prices were $150,000. As home prices rose to $400,000, it became easier and easier to buy a house. Really easy when home prices were $400,000.
Then when home prices crashed back to $150,000, the middle class home buyers couldn’t get credit. The middle class was paying more in rent than the cost of ownership and they couldn’t buy the homes.
Instead, you had firms like Blackrock and Silver Bay buying the homes en masse. Then they rented out the homes to the middle class. The firms had nice cash flow because the cost of renting was higher than home ownership. Plus, the firms got to buy at the bottom. The middle class was shut out.
When prices rose to I don’t know $300,000, ok… “Middle class, you can get credit now, you can buy now, at $300,000 instead of $150,000”.
The middle class got screwed.
This was ridiculous.
Right now, with home prices higher, the middle class can buy homes with 3 percent down.
Think about it.
@al2simon — If a sports star or a music star was to conflate their financial woes with the woes of the struggling middle class ,wouldnt you think that they had delusions as well? Wouldnt that point to something a bit off?
I am going to speculate one last time, after reading the article for the third or fourth time. Maybe he isn’t really in that bad of financial shape at all and is exaggerating for literary effect. But just didn’t do that great a job, since most aren’t feeling sympathetic or identifying with him. I think the confessional style is good. He is willing to expose himself in a way most aren’t. He wants folks to quit pretending everything is okay when it isn’t. That seems a worthy goal to me.
When I write my financial how-to book or article, I’m using a pseudonym.
adding: I am having difficulty understanding why he is riling folks up so very much. That makes me think it must be a good article, even if we don’t like him. Though I very much respect Garland’s point of view on this up-thread.
Maybe though the reaction isn’t the one he had hoped to get. I don’t think it was supposed to be deliberately provocative in quite the way it was received.
@alh I’m starting to wonder about you as well. /
This guy is a professional writer, a prize winner author who has written award winning books and films, a part-time political commentator, and a lecturer on writing at universities including Harvard and USC.
Personally, I find it far more likely that he deliberately crafted his narrative in order to tell his story in the way he wanted it told than that he is suffering from undiagnosed mental illness. Any holes in his story are (in my opinion) due to trying to embellish and skew the narrative without telling a falsehood that could be easily fact checked. But we’re all entitled to form our own judgments.
Not at all. It would just tell me that they are feeling sorry for themselves and are attempting to rationalize their behavior to themselves and their friends and family. They are just latching on to a narrative that they think will garner sympathy. I wouldn’t speculate about them suffering from mental delusions without any evidence.
To me, this is an incredibly odd question. It sounds like we have very different views of human nature.
There are people who suffer from genuine mental illness. I am sorry that your friend/family member is one of them. But this is a very different problem than what is causing most people’s financial struggles. It’s certainly different than what leads sports / music stars who have made tens of millions of dollars to fritter away all their money.
“This guy is a professional writer, a prize winner author who has written award winning books and films, a part-time political commentator, and a lecturer on writing at universities including Harvard and USC.”
“It’s certainly different that what leads sports / music stars who have made tens of millions of dollars to fritter away all their money.”
Got it. Mental health issues are not your forte.
I would go on to explain to you that mental illness exists in every field imaginable. Football players, Cal Tech professors, presidential candidates, artists, mail men. But that’s another thread entirely.
I doubt that speculating about Gabler’s possible mental illnesses on the basis of his article is consistent with modern psychiatric best practice.