Carlos Araya used to order lobster, filet mignon and $200 bottles of red wine at the Palm Restaurant in midtown Manhattan.
Mr. Araya, 38 years old, lost his job in 2007 as a crude oil trader on the New York Mercantile Exchange. After visiting dozens of headhunters with no luck, he applied in August 2008 to be a host at the Palm to support his wife, two young daughters and mortgage payments. His salary has plunged from $200,000 to $25,000.
I was prepared to have sympathy for this guy because at least he’s willing to make the necessary changes to survive. But then I read more. Now $200k – his former salary – is not exactly big bucks. His mortgage and associated fees are $6,200 per month, making that almost 40% of his gross income. That’s living way beyond his means. That is being house poor. He bought a $960,000 apartment in Manhattan’s Battery Park City neighborhood four years ago. On $200k per year. In addition to that the story says he took “family vacations to Cabo San Lucas, Disneyland and Las Vegas” – the usual Two-Thousandaire places. He didn’t live on credit cards but he was house poor and he bought $200 bottles of wine. That’s pure arrogance. Altogether, that’s some mighty stupid stuff to be doing on that salary for a man with a family living in Manhattan.
