Debt is REQUIRED in the USA. How broken is that?

 As small banks are failing due to lousy management, I've been thinking a lot about why we need banks. We actually don't.

America is addicted to debt. We have to have a good credit score, in order to get a job, get an apartment lease, get a mobile phone, get cable TV service, etc. If you avoid debt in your life (as many of our immigrants do), you are significantly punished in the US. Having a good credit score has become proof that you are a reliable person in non-financial ways. Without debt in America, you are a lesser person. Think about that.

1. Isn't it interesting that a good credit score, which proves you are a trustworthy person, can only be obtained if we buy lots of stuff on credit? Meaning, if we buy lots of stuff. Hmm--I wonder if big businesses had anything to do with this system of compulsory borrowing? 
2. In most other countries, people have far less debt, or often, no debt at all. It's seen as a sign of poverty, of hopelessness.
3. And "cheap debt" sounds good to Americans until the value of the asset we purchased plummets in a recession, while we still owe payments on that debt. Then it doesn't feel so cheap.

If we ever reach a post-consumerism society, we'll pay for everything up-front. Or do without it. We'll buy a quarter of the stuff that we buy now. We'll expect "durable" products to last nearly forever. We'll use debit cards only (no cash; no credit). The sole funciton of the bank will be to run the debit card system, for a small fee. Will be interesting to see if we ever reach that point. 

Most people don't understand the downside of "leverage." It has a downside that's as steep as the upside of it in happy times. If we work to avoid debt in our lives, we gain much more freedom and predictability, and we stop funding the lousy bank managers' exorbitant paychecks. Think about that.