Consumer Debt Per Capita
Total household debt per person in inflation-adjusted 2023 dollars
“Americans were forced into debt after 1971 because fiat money eroded their purchasing power.”
Per-capita household debt (inflation-adjusted) grew from ~$9,600 in 1960 to ~$54,800 in 2023. The fastest growth came from 2000-2007 during the housing bubble. Mortgage debt accounts for ~70% of the total. The growth correlates with credit deregulation, housing financialization, and rising costs outpacing wages.
Perspectives
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Deregulation, rising costs, and easy credit created a debt trap
Consumer debt growth reflects credit deregulation, costs outpacing wages, housing financialization, and cultural shifts — with low interest rates from monetary policy enabling the borrowing.
Easy monetary policy did make borrowing cheaper and more attractive. But the specific mechanisms — credit card deregulation, mortgage securitization, student loan expansion — were policy choices. The debt burden is a real problem, with mortgage debt, student loans, and credit cards all at record levels.
Causal Factors
Credit market deregulation
30%The 1978 Marquette decision, deregulation acts, and financial innovation enabled credit cards, subprime mortgages, and student loans to expand rapidly.
Housing financialization
25%Mortgage debt accounts for ~70% of household debt. Government-backed mortgage programs, tax deductibility, and securitization enabled massive mortgage expansion.
Rising costs outpacing wages
20%Healthcare, education, and housing costs rose faster than wages, forcing households to borrow to maintain living standards.
Student loan expansion
15%Outstanding student loan debt grew from nearly $0 in 1970 to $1.77 trillion in 2023, driven by rising tuition and expanded federal lending.
Cultural shift toward credit use
10%The shift from 'save then buy' to 'buy now, pay later' reflects both financial product availability and changing cultural attitudes toward debt.
Data Source
Federal Reserve, G.19 Consumer Credit; NY Fed Household Debt & Credit Report
View original dataLast updated: 2024-12
Key Events
Truth in Lending Act
Standardizes credit disclosures, indirectly expanding consumer credit access
Marquette decision
Supreme Court allows banks to export interest rates across state lines, enabling credit card expansion
Gramm-Leach-Bliley
Financial deregulation enables new consumer lending products
Bankruptcy reform
Makes it harder to discharge debt, emboldening lenders to extend more credit
Housing bubble peak
Per-capita debt peaks at ~$50,000 as mortgage borrowing reaches unsustainable levels