On the Social Psychology of Rising Credit-Card Debt: A Reflection of American Society?

It is perhaps too easy to point to economic reasons for an increase in debt within a society. The Wall Street Journal reported during the first quarter of 2020 that credit-card debt in the U.S. “rose to a record in the final quarter of 2019 as Americans spent aggressively amid a strong economy and job market, and the proportion of people seriously behind on their payments increased.”[1] The record $930 billion, according to the Federal Reserve Bank of New York, was “well above the previous peak seen before the 2008 financial crisis.”[2] After critiquing the economic explanation, I will suggest that a social-psychological mentality or attitude may be behind not only the rising debt, but also other disappointing manifestations in the contemporaneous American society more broadly speaking.

The U.S. economy between 2001 and the third quarter of 2007 had been “weaker, overall, than its performance in the equivalent years of the 1990s.”[3] So if spending aggressively (a rather strange expression) amid a strong economy and job market in 2019 led to the record in credit-card debt, why was the debt level higher in the 2001-2007 period than during the 1990s? Furthermore, why wouldn’t a weaker economy result in more buying on credit and a jump particularly in serious credit delinquencies? In actuality, the fourth quarter of 2019 saw only moderate growth of 2.1 percent, a full percentage point below the comparable figure from the year’s first quarter. The softening of domestic consumer spending and the low unemployment rate of 3.5% should result in more credit-card debt being paid off rather than added. Going on economic factors alone takes on the look of a twisted pretzel.

I submit that a creeping pathological mentality in the some segments of American society, or perhaps outside of society, may be another, steadier trending factor. Specifically an attitude toward money and personal responsibility may have been spreading during the 2010s among the working poor. I cannot offer any empirical evidence, so my theorizing can only be considered as an initial sketch. Even so, the rough sketches of the attitude itself can be revealing with respect to personal responsibility and other people.

The attitude, which I have observed on number of occasions, includes the decision not to utilize self-discipline in the face of instant-gratification, which in turn may be felt as coming all-at-once as if overwhelming once a paycheck is received. Self-discipline may simply be dismissed as if it were an exogenous bad odor. In actuality, that odor comes from the attitude itself. The ensuing behavior is to spend too much of the paycheck without concern for money that will be needed before the next paycheck arrives (not to mention any concern to put some money aside in case of unemployment or an emergency).

In 2019, I listened more to the jobless poor who received government checks. I found that in many cases, they most or almost all of a check all at once. In many cases, they would turn to selling drugs and going to food-banks (and selling food stamps) to have money well into the month. That the mentality in spending virtually all of a check can point to an underlying mental illness suggests just how problematic the underlying mentality is. In retrospect, the consequent increase in serious delinquencies of credit-card debt can be viewed as a symptom rather than as the problem. Another “red flag” concerning the seriousness of the mentality occurred to me when I realized that the non-working poor are so very poor they are the most vulnerable financially, and a significant number, at least from my observations, displayed such flawed judgment in spending recklessly, as if they could offer no resistance to the instinct for immediate gratification. The mentality may thus be oblivious to external context and even the internal context of the mentality’s own bad judgment.

Regarding the working poor, people who display a failure of judgment concerning how much credit-card debt to add or have given the amount of the pay may also 1) have an implicit assumption that money is rightly for free (the extreme being conducive to theft), 2) believe that society owes them so they can rightly assume debt without any intent to pay it back, and 3) feel little or no responsibility to people they don’t know, including the owners of the credit-card companies and others. This extremely narcissistic attitude is entirely comfortable in violating Kant’s ethical notion of the Kingdom of Ends, by which other people are to be treated not only as a person’s means, but also as ends in themselves. Accumulating credit-card debt as if the companies’ concerns were of no significance turns the rational beings running and owning the companies into mere means to the person’s flawed decision that such money is and should be free, without obligation on the person’s part. If the counterparty is hurt, it is easily dismissible as “not my concern.” The mentality is thus not conformable to society and its implicit social contract.

I submit that the impact of the sordid mentality is evinced in not only the taking on of credit-card debt either recklessly or without any intention of repaying it, but also the increase in prison populations and drug use, and the general declining trend of civility toward strangers in public. In other words, the records in credit-card debt may be a few data points that together with other data may suggest the underlying mentality whose baleful manifestations running through American society are broader than generally thought.

---

1. Yuka Hayashi, “Credit-Card Debt in U.S. Rises to Record $930 Billion,” The Wall Street Journal, February 11, 2020.

2. Ibid.

3. Aviva Aron-Dine, Richard Kogan, and Chad Stone, “How Robust Was the 2001-2007 Economic Expansion?,” Center on Budget and Policy Priorities, August 29, 2008. (accessed February 11, 2020)

Uncovering the Root of Poverty: An Addictive Habit

Addictive pain-killers killed 64,000 residents in the U.S. in 2016, in part because physicians tended to rely on patients’ self-determined ratings of pain on a scale of 1 to 10.[1] Such subjective ratings were of course vulnerable to self-seeking motives willfully negligent or even reckless in terms of health. A habit or marked tendency in favor of choices at the expense of a person’s own long-term well-being stems, I submit, from weak impulse-control. This factor can explain a lot about why poverty exists and goes on. 

Poverty, it has been said, is the cruelest form of war, for such war can go on and on and wreck subtle though tremendous damage on the afflicted. Yet the mentality that can get a person into such a war and associated bad choices can be easily overlooked by elites that deign to study the problem of poverty.

Attempting to explain escalating rates of suicide, overdoses, and alcoholism among uneducated Americans, Angus Deaton and Anne Case, who spoke at the CEO Council sponsored by The Wall Street Journal in November, 2017, pointed to the diminishing number of jobs “with a ladder up, with on-the-job training, with benefits.”[2] With less incentive to focus on doing well at work and less opportunity to get involved in a union, a person can easily feel despondent, especially given the breakdown of the nuclear and extended family and the decline of mainline Christianity. Drugs, including nicotine and alcohol, and ultimately even suicide, can remove the resulting sense of nihilism.

The job/family/religion explanation strikes me as overly formalistic, even external, however. For example, the rise of individualistic evangelical Christianity, which Deaton and Case claimed does not allow for a sense of community because of the theological emphasis on an individual's relationship with Jesus, can nonetheless provide social opportunities for people. A visit to any megachurch can demonstrate that “extra-curricular activities” go on in spite of the individualistic theological bent. Megachurches typically have coffee shops and fitness rooms, and even put on plays (e.g., at Easter). 
Similarly, not being able to get involved in a union does not exhaust the things a person can do with others in a group; political activism, for example, is open to workers outside of the work context (e.g., working on a political campaign).
I also take issue with the claim that uneducated workers do drugs because a promotion into management is no longer as easy as it may have been in the past. The work ethic is not predicated on advancement; rather, hard work itself is valued as a virtue. To be sure, the technologically and off-shore based relative loss of manufacturing jobs and the lack of satisfaction from working in a fast-food restaurant, for instance, have made it more difficult for uneducated people to find fulfilling jobs or jobs at all. Faced with loads of empty time--rather than trying to start an enterprise (e.g., a site online) or volunteer--drugs and alcohol are easy apparent fixes, or fillers. Yet the decision to have empty time is a course of least resistance rather than a fait accompli. The willingness to be lazy is itself significant, for it gets us closer to the underlying problem, which is internal. 
I submit that drug use, including alcohol and nicotine, does not stem from having lots of time from being unemployed. Rather, people who succumb to drug addition can be said to have weak impulse control; they do not have or use the strength of will to resist the urge to take another hit, or to try some drug in the first place. I've never tried heroine or cocaine even just to see what they are like because I know they are highly addictive so I have resisted offers to try them. So I'm surprised when I hear people who use those drugs treat them so casually, so conveniently, without any hint of impulse control. 
The lack of a college education is a contributing factor, for a surprising phenomenon of ignorance is its presumption to not being able to be wrong with respect to itself. So presuming to know all about heroine or cocaine and being able to manage them as if a physician fits with being uneducated. In college, students think through critiques of theories rather than taking them at face value; the professors model this. Being accustomed to critiquing other people's theories can get a person in the thought-habit of critiquing even one's own, even implicit, theories. In contrast, the assumption of ignorance that it must be right goes unchallenged by the uneducated. Interestingly, the difference is not just cognitive, for attitude is impacted by whether or not a person turns reason on oneself. The arrogance of ignorance contrasts with the humility that is ideally in putting one's own assumptions and beliefs about oneself and the world under the proverbial knife. Such an orientation necessitates the use of impulse-control, which in turn implies valuing it rather than conveniently assuming that it is not worthwhile. 

I submit that the “Two Americas” are separated by two trajectories of habitual thinking and values that stem from whether or not a person values and has good impulse-control. People who value such control loathe being around people who don't. Put another way, evading impulse-control is acceptable in some quarters while looked down on in others. The two respective cultures are each self-reinforcing, and social distance between those cultures naturally widens and is not just a matter of being educated or not. Unfortunately, I have been exposed to three "ghetto" apartment complexes, complete with "ghetto property-managements" whose mentality goes beyond garden-variety incompetence to reflect the lack of impulse-control evinced by many of the residents with respect to each other (e.g., being inconsiderate with noise late at night, and having a tendency to lie--failing to resist to impulse to take the easy out).  
Speaking once with a security guard whose company covered one such “ghetto complex” in addition to other, “non-ghetto” complexes, I was struck by how he distinguished the “ghetto” residents. “They think they live in houses, playing their music as if people are not on the other side of the wall. We don't have this problem at the other complexes we handle. The people in that area of town are not so inconsiderate.” I could see why uneducated poor people live together and other people avoid them; the difference is not merely monetary. People who resist the urge to play music or movies loud at night so not to disturb neighbors also resist the urge to lie when doing so would get them off the hook. In apartment complexes populated by poor, uneducated people, the mentality is exactly the opposite, and such a sordid mentality based in a convenient refusal to engage in impulse-control (for selfish reasons) is anathema to other people, who thus keep their distance and even perhaps urge public policy that hurts the poor. Regardless of how sordid the attitude is, I contend that poor people's human rights to sustenance should be respected and protected. This is particularly so because of how intractable the attitude truly is. A person who is used to dismissing impulse-control (i.e., not valuing it) is not likely to go down the other track, unless the motive comes from sustained suffering. 
In terms of not being employable, the lack of a college education again does not tell the whole story. A low-level employee interacting regularly with customers gets heat from a manager if the attitude is, "I can't be wrong about X." Lying about the customer is also not acceptable. Impulse control is vital to virtually any vocation. 
A day after Thanksgiving in 2017, I faced a middle-aged cashier who insisted that people could refuse to recognize that it was Thanksgiving and instead validly select another holiday to celebrate that day, including Christmas and even July 4th.  I countered that Thanksgiving and the other two holidays are set by the U.S. Government, and so are on determined days.  She dismissed this out of hand, which was insulting, and repeated, "It can be any holiday you select." She refused to resist her impulse that she must be right even though she was wrong. "No, yesterday was Thanksgiving and this is Thanksgiving weekend--not another holiday," I insisted, but she rigidly held on to her ignorance as if it could be right. Rather than use self-discipline even to consider that she may have been wrong, she failed to resist the impulse of the presumption of being right and being dismissive.

I submit that a culture exists in the poor America that involves not only a difference in wealth and even education-level, but and most crucially in the attitude toward and practice of impulse-control. That is, being inconsiderate, lying, and feeling entitled in being infallible about what a person thinks one knows can become salient norms where enough uneducated poor live. The attitude thinks it receives confirmation because other people in a similar way also have it. The poor are very susceptible to being rude, lying, and using drugs because of ill-used or perhaps impaired impulse-control. Viewing such restraint as of nugatory value, it is easy to be inconsiderate, rude, even highly aggressive (given the overblown or even imagined slights or provocations).
Biking in poor areas near universities, I have noticed the extreme “road-rage” that is distinct among poor drivers. Today in fact, I witnessed one driver get out of his car to shout at the driver in front of him at a red light. The aggressor showed absolutely no impulse-control; his emotions were out of control. Similarly, I've seen poor drivers much, much more than other drivers lose complete control of themselves emotionally and because apparently I had no right to bike on the side of the roads along the curbs! The sheer aggressiveness, outstripping any rational basis in the context itself, has both amazed me and formed in my mind an image of the typical poor driver. My reaction in observing such drivers has been that such people must surely live in a very different world. I couldn't imagine anyone with such pathetic impulse control being in college or holding a job. Clearly, another America exists, with its own mores and values that retain the inhabitants from entering (and being accepted in!) polite society. Being in the habit of evading impulse-control is so different than valuing such internal control that “Two Americas” can be so explained. Both in terms of wealth and, if the stats on drug and alcohol abuse are correct, impulse-control, the America that is expanding is not the one that should be.

If I am correct in my analysis here, simply providing more and better jobs, creating labor unions and other ways for poor people to “get involved” or be in a group only touch the surface, and thus cannot get the job done in eliminating poverty. Even if "ghetto" apartment complexes are "broken up," with the very poor being disbursed such that they cannot form a culture of least resistance, the internal attitude with respect to impulse-control is surely very difficult to change. So study of precisely how such a feat may be accomplished is needed. 

---

[1] Gregory Korte, “U.S. Waging Tech War against Opioid Epidemic,” USA Today, November 24-26, 2017.

[2] Janet Adamy, “’Two Americas,’ Updated,” The Wall Street Journal, November 20, 2017.

An Anti-Obesity, Anti-Poverty Philanthropist Joins PepsiCo.’s Board: A Case of Reform from Within

In October 2016, Darren Walker, president of the Ford Foundation, became the newest member of PepsiCo’s board of directors. Whereas Walker worked at the time for a more just and equitable society, Pepsi was making the bulk of its money by selling sugary drinks and fatty snacks and there being a well-established link between obesity and economic inequality. Would he be working at cross-purposes? “There’s a risk that he will be viewed as inconsistent,” said Michael Edwards, a former Ford Foundation executive at the time.[1] The company itself could also be viewed as being inconsistent—lobbying against anti-obesity public-health legislation while putting Walker on the board of directors.

To be sure, the Ford Foundation had not funded organizations working to combat obesity or diabetes, so there does not seem to be a direct conflict of interest for Walker.[2] Yet he did acknowledge, “I know that my own credibility and the credibility of the Ford Foundation is tied to this decision. Those of us in philanthropy have to be discerning about the corporate boards we join, and be discriminating to ensure that our service on a board is aligned with our values.”[3]

So rather than there being a conflict of interest, the issue for Walker was whether he could act as a reformer from within. Even though he planned bring the perspective of a social-justice organization and his own perspective “as someone who is deeply concerned about the welfare of people in poor and vulnerable communities,” he would still bear responsibility should PepsiCo’s board go in another direction.[4] He would not, in other words, be chairman of the board. That the company had just pledged to further reduce the amount of sugar, fat, and salt in its products by 2025, however, suggests an appetite for accommodation with Walker’s perspective. Additionally, Walker would not be responsible for the company’s past unethical lobbying against anti-obesity legislation, use of unethical suppliers of palm oil, and deceptive marketing, and the company had since taken steps to remedy these ethical problems.[5]

As in politics, the matter for Walker and the other board-members concerning would be whether together they could wield compromises taking into account both Walker’s vantage-point and the legal and ethical fiduciary duty to act as faithful stewards of the stockholders’ capital. Reform from “the inside,” moreover, can be more productive than merely staying in the philanthropic sphere. In terms of American politics, the analogue would be moving from the Green Party, for instance, to the Democratic Party so as to work toward reform that could actually manifest in legislation. Admittedly, idealism is tested in such a strategy, but consequentialism tells us that even 50% of 10 is more than 0% of 10.

---

1. David Gelles, “An Activist for the Poor Joins Pepsi’s Board. Is That Ethical?,” The New York Times, October 28, 2016.

2. Ibid.

3. Ibid.

4. Ibid.

5. Ibid.