The financial crisis has exposed the shortcomings of America’s ‘debt safety net’

While debt has been an acceptable component of economic life for many decades, the bubble of the early 2000s and the subsequent financial crash took debt burdens to entirely new levels. Johnna Montgomerie argues that the contemporary model that social protection will come from asset-based welfare and easy credit has led to massive financial insecurity, especially for the young and old, who have found rising debts to have far outpaced their incomes. Already high debt levels for young people and senior citizens mean that any falls in income through unemployment or rising healthcare costs will leave them to face debt repayments of 25 to 49 percent of their income.