Susan Lopez March 31, 2021 Child Custody Lawyer
Golf champion Tiger Woods lost at least a portion of his income when General Motors ended its relationship with him. The volatility of the auto industry was certainly a factor in Woods' sponsorship deal closing a year and $8 million early. But I'm not worried about Tiger-he'll roar on to other sponsorship deals. Other celebrities, however, like many of us, aren't that lucky.
Take Damon Dash, the estranged business partner of rapper Jay-Z, who may lose two of his Manhattan apartments to foreclosure for failing to pay $7.3 million on the mortgages. A judge has also requested the seizure of his Chevrolet Tahoe due to missed payments, he's got $2.1 million in claims against him for NY state taxes, and a lawsuit based on claims he didn't fully pay the law firm involved in his child-custody case. As one lawyer said, "...to borrow a phrase from my Kentucky homeland, they haven't got a pot to p--- in. They're broke."
Scott Storch, the former Roc-A-Fella Records bigwig who produced hits for Fat Joe, Beyonce, Dr Dre, and G-Unit (as well as being an ex-flame of Paris Hilton), had his Miami mansion foreclosed and his Ferrari repossessed.
I work with celebrities in my private practice and so I'm aware that they have all the same problems as Joe Six-pack, just more so. That includes the economic crisis. Just like all of us mortals, there are stars (and the people around them) who haven't received very good financial advice or have simply been too arrogant about their wealth, and now are in difficult situations. There's a lot we can learn from the problems they face, as well as from the economic recession we all find ourselves in these days.
Some big names have been rescued. Whitney Houston was deep into foreclosure proceedings for her New Jersey mansion because she was more than $1 million behind on her mortgage and taxes. Fortunately, she was able to sell the home. Ed McMahon, who was Johnny Carson's sidekick on The Tonight Show for decades, was facing foreclosure on his multimillion-dollar Beverly Hills home because he was $644,000 behind on mortgage payments; he was bailed out by Donald Trump, who bought the house and allowed McMahon to continue living in it. Michael Jackson nearly lost Neverland Ranch to foreclosure in May 2008, but got a reprieve from a real estate company that bought the $23.5 million loan that Jackson had been unable to pay back, which saved Neverland from the auction block.
We're all hurting. The 2008 presidential and local elections were swayed more by the heft of what's in our wallets than by the war in Iraq, our dependence on oil (foreign or otherwise), or whether or not gays could get married. In other words, what really counted was our economic well-being.
Those of us who aren't wealthy (or once-wealthy) celebrities are facing plenty of challenges. Are we in danger of losing our home? Have we dug ourselves deeply into the hole of credit card debt? Is our job safe? If not, can we find another one? Are we covered by enough insurance to survive a health crisis financially? Can we keep our children from going into debt in order to get an education? Can we get the loan we need to keep our business afloat? Why are we so much more scared about it all now than we were in previous recessions? And what can we do as individuals to turn the situation around?
I'm a health & wellness educator, but for many years my "day job" was as an attorney specializing in commercial real estate transactions. I'm aware of how different today's economic crisis is compared to the ones I worked my way through in the past. Last year, when my insurance agent casually remarked on how many were suffering in a downturned real estate market, I ignored his comment. After all, out here in southern California, it's always sunny. Malibu, my home, seemed untouched by the economic downturn in other areas. It didn't dawn on me that this crisis was profoundly serious across the board until Christmas 2007, when the bottom fell out of the real estate market throughout the country. Healthy real estate transactions fell apart. Lenders that had promised funds got cold feet and backed out.
Then the Bear Sterns collapse threw a shock wave throughout the industry, even in sunny California, and things have been crashing down around us ever since. When my insurance broker called for my renewal in 2008 and I asked how it was going for him, he started to cry. He had lost his house in January, his wife in February. Now everyone I talk to has a hard luck story. My acupuncturist has gotten a second job pumping gas, and he's lucky to have a job at all. Others I know have lost their jobs and are wondering what's next in this seemingly endless downward spiral.
What, I wondered, is the difference between today's economic crisis and those in the 80s and 90s? I realized that one of the major differences is that we are so much more connected these days - individual to individual, country to country around the world, so things happen much faster and on a bigger scale. Look at how oil prices are affected globally. The housing and mortgage crisis, which should have been limited to the confines of the U.S., wound up having an effect on markets worldwide as global financial institutions were involved. Our next big crisis will result from overwhelming credit card debt and we'll watch giant institutions like American Express being brought to their knees. The word on the street is that they're selling our credit card debt for 2-½ cents on the dollar! That's surely a situation that will explode.
The present crisis has in large part been created by unbridled greed - one of the seven deadly sins for good reason. It's the sheer gall of the auto industry executives arriving in Washington to discuss a bailout - all in their private jets. It's the ungodly sums of money CEOs get as compensation, even as their companies are firing huge numbers of employees. It's the brash assumption of Wall Streeters that the bull market would go up endlessly, or the cynical assumptions of others that the way to get rich is to bet on the downward bear trend.
Economic crises spring from greed, and they are compounded by fear. It's when the average depositor, the infamous Joe six-pack on Main Street, gets afraid and thinks that the stock market or the bank isn't safe, that he runs and pulls his money out, assuming he has any left. Rumor and speculation about disaster are the fuel of the economic fires. And more fuel is added to the fire by the constant reporting of the media - the doom and gloom economic forecasters, the endless pictures of foreclosure signs in front of homes, the surging percentage of job losses and unemployment.
To add insult to the already injured, the government now has to reach deep into taxpayers' pockets to bail out major financial institutions and industries so the economy doesn't completely collapse. We've created real economic chaos, and left it in the hands of our President-elect and his multitude of financial advisors to figure out what to do next.
While Team Obama battles the big picture, what can we do individually? We can look inside ourselves and see where our greed and fear have gotten us - both individually and collectively. We were all greedy, thinking that we could rent or buy homes that cost more than we could afford, that we could carry car payments and insurance payments with ease, that credit cards were somehow the same as having money, that we could borrow from the oil reserves that were meant to protect our future. While impulse buying and the desire to have the latest and greatest "stuff" kept propelling our economy, we lived in blissful ignorance of the consequences. We felt safe as long as we could stay in front of our monthly payments. It's been a rude awakening. We need to scale our wants down to fit our needs. At the same time, let's take steps to keep our fear level in check: time spent in nature, plenty of sunshine, R&R with our family and friends all help to keep us balanced.
Especially at this time of year, when temperatures go down and heating bills go up, let's look around and see where we can extend a helping hand to those who have been swept off their feet by what's happening in our economy. Invite those who are down and out to a dinner or give them a dinner out. When doing your holiday shopping, think about giving those who are hurting a gift card for groceries instead of buying some gadget for relatives and friends. Uncle Joe doesn't need another tie, but your neighbor may need your help. Donate to projects that provide winter coats to those in need. Volunteer to help those less fortunate; no matter how busy we are, we can always find a little time to be of service.
Hopefully, the pendulum has swung from the heyday of "what's in it for me" to the side of "how can we help each other." It's time to know that we can all do with less, that even celebrities can do with less, and that compassion for the plight of others is a great way to curb fear about our own situation. With peace in our hearts and plenty of love to give out, we can combat fear and greed by feeling secure in our humanity if not in our wallets.