Overwhelming debt is a great equalizer. "Like everyone else, we were already spending right up to our means," he says. He burned through what little savings he had. His stock options at Nortel were worthless. He had $60,000 worth of unsecured debt and $30,000 worth of new car loans, none of which he could afford to service. His three cars went back to the bank, and if not for two vehicles he borrowed from his father-in-law, he would have no transportation.
He calls his decision to file for bankruptcy "a no-brainer." It was the only chance he had to save his house from foreclosure. Not paying his obligations was something he wasn't proud of. It was also something that was becoming more prevalent in Collin County, where many of the more affluent telecom workers live.
The Collin County Clerk's Office anticipates a record number of foreclosures this year--a 57 percent increase over last. Property tax delinquencies in Collin County are up more than 21 percent over 2001. Bankruptcy filings in the Eastern District of Texas (which includes Collin and Denton counties) are up 6 percent over last year. "Our numbers are up more than 30 percent over the last two years," says attorney Scott Lemke, a partner in the McKinney firm of Lemke & Pederson. "The triggering event that puts our clients into bankruptcy is income interruption--layoffs."
Anyone from the telecom industry is suffering from a double hit: They are laid off and nobody wants them. Their assets are gone, their stocks have tanked. They hope to sell their homes or refinance them, but the top-end housing market is sluggish and banks generally don't refinance homes when their owners are out of a job. "The people we are seeing now are what I call the truly desperate," attorney Jan Pederson says. "They have tapped out every resource, and they are still not working."
For Jenkins, filing for bankruptcy was humiliating (and the reason he did not want his real name used in this story). But it did bring him to church for the first time in years, and it drew him closer to his children as he became Mr. Mom, driving car pool and working on projects for the Plano PTA. "There is an arrogance and a complacency when things are going well," he says. "It's pretty humbling when you are forced to the conclusion that your situation is not only as bad as you thought, it's worse than you ever dreamed it could be."
There were days when John Bennett would practically force himself to go online, hitting the job boards for new postings. He would punch in keywords like "manager, MBA, German, telecom," trying to narrow his search. In the downturn, if you don't have the exact qualifications companies are looking for, there is no need to apply. The 15 hours a week he dedicated to this task might generate a few leads, which he would immediately chase with a résumé. Getting no response didn't stop him. He would then follow up with a phone call, most of which would be unceremoniously dumped into voice mail by an impassive receptionist.
Fifteen months of rejection and unanswered job queries caused him "constant battles with self-doubt," he says. But Bennett was resilient, and he managed to patch together an income from whatever sources he could find. "I don't say no to any work," he says. "In July, I painted a garage. I fix people's computers. I will sing for food."
He receives $50 a week from his church as its music minister. The church has also tapped its benevolent fund to pay the $800 repair bill when his '79 Volkswagen van broke down. He doesn't know how he could weather this crisis, if not for his firm religious beliefs and his unflinching austerity program.
"We never go out to dinner, don't even get pizza delivered," he says. He and his wife only buy clothes at thrift shops, and hand-me-downs are then recycled from child to child. They don't rent videos from Blockbuster, instead checking them out for free at the Richardson Public Library. Their '92 Corolla runs just barely, without heat and air conditioning. He and his wife plan "zero-cost family adventures" for their daughters--ages 10, 6 and 2--seeking out free concerts, new playgrounds and lakeside picnics. "My kids are fine; they really are," Bennett says. "My oldest, bless her heart, at night when we pray together, she is always asking for a bigger house and a new van."
Somehow they manage to make the mortgage payment every month; carrying no credit card debt helps. But there have been weeks when Bennett has to rely on God's Food Pantry in Plano because "it was our only food," he says. His ethics won't allow him to take food for free. Once a week, he volunteers at the pantry, sacking groceries and stacking cans for the hungry, who now include people like himself. Pantry co-founder Bobby Glenn Taylor cites a startling increase in the number of former telecom workers who regularly frequent his pantry. "Of the 7,000 clients we feed every month, at least 500 of them were laid off from jobs associated with telecom," Taylor says. It doesn't help matters that the demand for food keeps rising because of the economic downturn. "Food donations are only up 2 percent over last year," says Jan Pruitt, executive director of the North Texas Food Bank, which supplies food to 222 agencies in a nine-county area. "But distributions are up more than 18 percent. We just can't keep up at that rate."