A combination of escalating student loan and credit-card debt, rising costs, slow wage growth and underemployment have accumulated debt "unmatched in modern history" undermining the economic security and financial health of young Americans aged 18-34, according to a new study.
The report, "Generation Broke: The Growth of Debt Among Younger Americans," was released by Demos, a nonpartisan, public policy group, based on the Federal Reserve's Survey of Consumer Finances as well as dozens of other sources.
“If you’re out of work for a long time, you have difficulty paying your bills,” says Amy Traub, coauthor of a June report from the think tank Demos that calls for reform of the credit reporting industry. “If potential employers are looking at credit scores, how on earth are you going to pay your bills then?”
What’s more, the credit bureaus themselves acknowledge there is no proof of a link between a person’s credit report and their suitability as an employee.
"College graduates are less likely to get a job," said Anna Pycior, a spokeswoman for Demos. "If you do manage to get a job, it is getting less and less likely you will be provided with health benefits and you will face the increasingly bleak prospect of a retirement plan.
"All of it while trying to address your $27,000 on average in student debt."
As tuition costs and enrollment rose through the 1990s, grant money did not keep pace, meaning students have been shouldering an ever-increasing share of their education costs. While before, most were able to finance their studies with grants and part-time work, loans are now inescapable for many.
"This generation is the first to shoulder the costs of their college primarily through interest-bearing loans rather than grants," Draut said.
Senior Policy Associate Javier Silva examines the new financial insecurities created as more Americans refinance their homes.
That's the short version of a new and disturbing study by Silva called "House of Cards: Refinancing the American Dream." It shows how millions of U.S. households are falling into a vicious cycle of tapping their credit cards and then refinancing their mortgages to extract needed cash from the equity in their homes.
7) Unions are one of the few institutional bulwarks against a corporate dictatorship over all of us: I mentioned their role in the ballot initiative and electoral process, but how are people organized in society? Into factories and electronics assembly shops and big-box stores. They wake up in the morning and - even with strong unions - much of their life is dominated by the company: what time to show up, what time to break (and do we get one?), how fast to work.
According to the consumer advocacy group Demos, from 1992 to 2001, the youngest adults (18 to 24 years old) saw the sharpest rise in credit-card debt-104 percent-to an average of $2,985. The second-highest increase-55 percent-was among young adults (25 to 34 years old), who also had the second highest bankruptcy rate, just after those ages 35 to 44.
According to the educational lender Nellie Mae, incoming college freshmen will amass $1,500 in credit-card debt before the end of their first term.
Women make up almost half of all workers in America and working mothers are the primary breadwinners in 40 percent of the nation’s families, so economic equality would make an immense difference for families and the economy as a whole.
The demonized banking industry must make the case it is morally noble. That may jar some ears, but surely enabling retirees to earn a return on their savings and funding business expansion creating jobs and wealth, improving Americans’ quality of and opportunities in life is morally noble. — Eric Glover, the Washington Times, September 24, 2015
The hyperactivity of the presidential election has raised the level of discussion of financial regulation, at least in terms of noise if not enlightenment. Mr.
The most likely consequence of the sequestration will be be slower growth and lower tax revenues, and it’s a distinct possibility that the sequestration could actually increase the deficit.
Washington is in its usual state of hysteria this week -- now over the Obamacare rollout -- so, as usual, few people in power are talking about the biggest problem facing the country: a still-stagnant labor market that has stranded millions in a jobless hell, with real unemployment rates for some groups at Great Depression levels.
It's no secret that wealthy Americans have enjoyed low taxes since the dawn of the Reagan era—even as they have scored huge income gains thanks to changes in the economy. A less well-known fact, though, is that middle and low-income earners have seen far bigger cuts in their federal taxes, which has helped offset stagnant incomes for these groups and may explain why there hasn't been a bigger revolt against income inequality in America.
Public investment is crucial to future growth. The economic boom in the 50s and 60s relied on government investments in education (G.I. Bill), infrastructure (National Highway System) and science (NASA).
The third quarter GDP numbers were released this morning, which show a GDP increase of 2.8 percent, an increase from the 2.5 percent reported for the second quarter. Among other factors, increases in personal consumption and state and local government spending helped contribute to the increase in GDP. Of course, the state and local spending was offset by a negative contribution from federal government spending.
