Historians Look at How Things Actually Are, Rather Than Economists Who Are Interested in How Things Aught to Be

"People approach their checkbook not from a math point of view, but from a moral point of view. I think that’s really a key to understanding all of this. It is shocking how commonplace debt is today, but another difference between then and now is the financial infrastructure of debt. We are told that our grandparents didn’t borrow. That’s not true. People borrowed in the 19^th century, they just did it surreptitiously, illegally, or at the margins. It was always stigmatized. That stigmatization arose out of the belief that a mortgage or a debt could easily bankrupt you, or the economy would change, and you would lose everything. In the 1930s, ’40s, and ’50s the atmosphere around debt changed: New federal programs and financial institutions, from the FHA to department stores, enabled people to borrow more safely. So that fear that everything could be lost went away in the middle of the 20^th century. In the last 30 years that changed again. Those institutions born in this era of growth have persisted into our era of stagnation."

Hannah Tepper in Salon interviews Louis Hyman, author of Borrow: The American Way of Debt.