Nearly half (48%) of all Americans are worried about debt, says a new survey from Lending Tree. One in five (20%) said they expect to be in debt with credit cards, medical debts and other non-mortgage obligations for the rest of their lives. Meanwhile, Ben Bernake is quoted today as “upbeat” about the American economy.
Is this the new steady-state in America? Half of us worried about debt, and one in four seeing no chance of ever getting out of debt? If this is the American experience in the midst of upbeat economic news, does it mean a permanent realignment of American expectations?
We once talked about the diminished expectations and lifetime opportunities of the poor — the bottom ten percent — compared with the rest of us. Now the dividing line among Americans has moved up the social scale. There are more homeowners, more people with cars and more people who own a television. But the debt loads that finance these acquisitions and pay for health care and college are staggering. At least one in five of our fellow citizens has adjusted his or her expectations sharply downward. The stock market has been a terrific engine for economic growth, but about half of us own no stock (directly or indirectly through a retirement plan), so that form of wealth creation passes us by.
Are these the early signs that a three-tiered America (rich/middle/poor) is dividing into a two-tier America, with the middle class breaking apart along debt lines?
