New York Times reporter Edmund Andrews has some explaining to do.
The journalist and author recently wrote a much-publicized book about his own misadventures in the subprime mortgage collapse, also contributing a lengthy article on the same subject to the New York Times Magazine. Both portrayed Edmund and his wife, Patty Barreiro, as homeowners who got carried away and ended up in denial of their circumstances, which eventually lead to default. That was the story, anyway.
In an article for The Atlantic website, Megan McArdle contributed a few details that Andrews overlooked in his portrayal of events. In fact, Patty Barreiro had twice previously filed for bankruptcy. The second filing came during the couple’s marriage. The story changes a bit under these new details.
According to records obtained by McArdle, Barreiro and her first husband filed for bankruptcy in 1998, in California. California bankruptcy law requires a debtor to wait eight years before filing again, and just four months after she became eligible, Barreiro did just that.
With the new information included, the crisis that swept up Andrews, one supposedly born of bad luck and naiveté, looks a little more like a tale of risky lifestyle and serial over-indulging. Records indicate that Barreiro had been living dangerously close to the edge of her income, then straying over the edge into serious default. McArdle portrays Barreiro’s financial plans as counting on absolutely everything to go right in order to stay above water, and that certainly does not fit in with Andrews’ tale of innocent misfortune.
According to Business Insider, Andrews responded to the Atlantic’s information (and the accusations of serial bankruptcy), stating that while the previous bankruptcies did occur, they had nothing to do with the mortgage “woes” that led to the situation discussed in his book. He outlines the circumstances that led to both of his wife’s bankruptcies, and makes a fairly reasonable argument that she was not completely responsible in either case. In the case of the first bankruptcy, which occurred in 1998, Andrews says that “it never even occurred to me to mention it.” He argues that the book centered on his own ability to take out a mortgage, and that his wife’s previous concerns did not factor in to the most recent ones.
The case of Andrews and Barreiro brings up some complicated issues. How much bad luck can a person have? After being burned several times previously, shouldn’t Barreiro have known enough to be more careful? In the book, Andrews portrays his wife as being annoyed with his growing concerns regarding their finances, essentially dismissing their impending default. Is it ethical for a writer to portray his story as one that “could happen to anyone,” when in fact both he and his wife were well-positioned to interpret danger signs, and yet seemed to ignore them?
Serial bankruptcy, in some cases, becomes a strategy—something to do when you get in over your head. Whether Barreiro can fairly be accused of playing that game, Andrews’ first try through his story does not seem to have laid all the facts out on the table.