Recently the PBS NewsHour had a segment on the experiences of many middle-age Americans in today’s economy. The segment focused on two people: Elizabeth White, the author of Fifty-five, Unemployed, and Faking Normal, and Neal Gabler, who had written “The Secret Shame of Middle-Class Americans,” which was published in The Atlantic last May.
Before I go further, let me admit I have not read Ms. White’s book. It was self-published, which is pretty much what writers, including this one, must resort to these days to get their works in print. The downside to self-publishing is it takes a while for libraries to get our books on the shelves. I promise I will read the book when it gets to my library. That said, as I write this, the book has thirteen reviews on Amazon--all of them five stars, and not many books can match that—especially just two months after publication! From the reviews, it appears the book is a resource for those who find themselves laid off after an age-shortened career and features more than 100 online resources.
I read Mr. Gabler’s article in The Atlantic, and all I could do was shake my head and think, “What a screw-up.” Think of something financially stupid, and Mr. Gabler’s done it. Buy a condo in Brooklyn. Check. Send the kids to a private school. Check. Rent then buy a house in the Hamptons. Check. Sell the Brooklyn condo at a loss. Check. Become a one-income family. Check. (Mr. Gabler is the author of several books, but even though his income is variable, that’s the one income the family chose to rely on.) Keep your spouse in the dark about the looming financial Armageddon. Check. Have your parents use your inheritance to pay for your kids’ expensive college. Check. Become delinquent on your taxes. Check. Drain the 401(k) to pay for a daughter’s wedding. (Paying, presumably, the early withdrawal penalty along with the income taxes. AAUGH!) Check. I couldn’t believe a kid would allow her parents to put their retirement at risk for something so transitory as a wedding, but… . Well, you get the point. Mr. Gabler says, “Perhaps none of this would have happened if my income had grown the way incomes used to grow in America. It didn’t, and they don’t.” Mr. Gabler doesn’t ask for sympathy, fortunately; he merely points out he is in the same boat as at least 47% of Americans his age—unable to come up with $400 if a sudden need to do so arose.
How did we get into this situation?
Let’s take a trip back to the heady days of the 1990s.
Thanks to an article in The New York Times in 1992 that mentioned my book, Living Cheap, and Living Cheap News, the newsletter I had just begun, I found myself part of what the media called the “New Frugality” movement. I got to see, first hand, how the media regarded frugality.
A couple of the newspaper writers, usually the guys, were intrigued by the idea of living below their means. The women not so much. Magazines were pretty much the opposition.
I got invited to appear on Dr. Dean Edell’s show, Dr. Dean. It was a disaster. I’d been told the show was about frugality. It was. Frugality as a mental illness! I was “diagnosed” on the air by the late Carla Perez as “unhappy,” and the reasons for my unhappiness could be I was unhappily married. Or maybe I was single. Or maybe I was unhappy in my career. Well, I was single, but certainly not unhappy—except for being ambushed on TV. I was not happy about that! While Carla was droning on about my unhappiness, the producers kept waving signs that said, “Jump in.” I decided Carla was quite adequately making a fool of herself. And, besides, being the polite Midwestern boy that I was, I would not want to be rude and interrupt such an insightful, if inaccurate, spur-of-the-moment diagnosis.
When the audience was allowed to speak, their questions were about how to save money. One questioner asked what I did with the money I saved. I said I bought bonds. Dr. Dean quipped, “He just can’t help himself.”
Actually, if I’d been allowed to speak at length, I would have explained I wanted to build an independent income so I would have the option of doing what I wanted with my life and not be tied to an employer or dependent on a salary. I’d had to make two forced relocations in the previous ten years (one in 1982 and the other in 1987), and I didn’t like not being in control. Not even of where I lived.
But Carla’s point was frugality is unnatural, and if I were happy, I’d be out spending everything I made—and then some—just like every other red-blooded American male—just like Neal Gabler!
About a year later a writer for Worth contacted me. We talked at length. He seemed surprised at how good being frugal had been for me. Sometime later I asked him how he’d been able to use the information I’d given him. He said he’d discovered some bad feelings among some of the people in the New Frugality movement, and his editors had told him to pursue that story. The article (“The Three Scrooges”) was negative not only about the movement, but about the people discussed. Fortunately, I was not one of them.
Shortly after that, I was screened for yet another daytime talk show. I came across as too normal—that’s actually what the producer said. They were going for some “more real people.” I saw the show. I was happy not to have been chosen.
After Amy Dacyczyn retired, she was conned into opening her life to a reporter for Money. She didn’t really want to do the interview. After all, she had absolutely nothing to gain. After the reporter hinted Amy may have “something to hide,” Amy agreed. The article was savage. This same writer, who was childless at the time, would go on to write articles advising working mothers not to leave the work force. She may still be out there lurking and looking to write other articles that better demonstrate her lack of qualifications and objectivity.
In 1997 Amy agreed to write a chapter for a book I’d proposed. The book was published by Berkley in 1998 as The Simple Life, although my title had been The New Frugality Anthology. (“Simple” was so much more “upscale” than “frugality.”) When we were talking, she said frugality was a hard sell given the economy was so good. I remember saying, “But when the economy is good, that’s when it’s easy to save for times when the economy is not so good.” But she was right. Frugality was a hard sell in the 1990s.
Then came the dot.com bust, and the Great Recession. It was like the seven years of Biblical famine following the seven years of feast. Only it’s gone on longer than seven years for many people.
Neal Gabler is or will be 67 this year. As he admits, he may have dug a hole he and his wife will never get out of. It’s almost certainly too late for him to recover. But at least he can sell the occasional magazine article. Not everyone has that option.
For Neal Gabler and others in my generation who listened to the media about how silly and at times unpatriotic (remember the message after 9/11 was to go out and… shop!) frugality is, it’s too late. The chickens have come home to roost.
But what about those who are young enough to take control of their finances? The lessons of Neal Gabler and the 47% of middle-age Americans who would have to scrounge to come up with $400 for an emergency should be clear.
Get frugal already! Start saving. One thing I will guarantee is when you get to Neal Gabler’s age you will be astounded at how quickly the past 20 or 30 years have flown by. So make some painless adjustments to your spending today to avoid a painful old age.
Think for yourself. If the media—or anyone else--starts telling you how silly it is to save money, ignore them. I’ll admit I had a much different upbringing than many in my age group in that I was foisted off on my grandmother a lot when I was young. She immigrated to the US in 1912, homesteaded in what would become part of the Dust Bowl, and survived the Great Depression as well as the home front deprivations of World War II. While I didn’t have first-hand knowledge of those times, I certainly heard a lot about them. As a result, I was always careful with money, although if my grandmother were here, I’m sure she’d be appalled at some of the things I spend money on.
And don’t count on resorting to dog food in your old age. As one who buys food for our canine companion, I can tell you even Alpo is getting pricey.
Take control. Think for yourself. Learn to decide what you want and what you actually need. Run your life like a business. Eliminate superfluous expenses the way businesses eliminate employees. Save and invest. And earn yourself a nice life.
© 2017 Larry Roth