Some Say Americans Should Stop Debt-Funded Shopping, Return To Thrift

Washington, D.C. (AHN) - Americans somehow shifted from taking pride in being thrifty to taking pride in consuming goods and services, but with the nation in recession and many people lacking enough money to shop some want to make being thrifty popular again.

A group of scholars have launched an initiative to bring back being thrifty in America, which was once so popular that there was even a National Thrift Week until 1966.

Proponents say they want to make it cool to save.

But with 70 percent of the nation's gross domestic product comprised of consumer spending, opponents say that if Americans don't shop that more people will lose their jobs.

However, shopping has become almost a moot point for many Americans who have already lost their incomes and for other Americans who find their incomes inadequate to pay for rising costs on life's basic necessities and find themselves without any discretionary income to spend.

Supporters of thrift argue that Americans really haven't been spending discretionary income to begin with, but had been fueling the nation's GDP by going into debt to make purchases using credit cards or what was once the equity in their homes.

And with all that debt straining American's budgets, New Thrift organization supporters would like to see a cap on usury interest rates for small loans again.

Here are some facts on American's debt from the New Thrift and its parent organization, American Institute for American Values:

• For the first time since the Great Depression and amid historically low unemployment, Americans spent more than they earned in 2005 and 2006.
• Debt payments eat up about 15 percent of the average U.S. family's income.
• More than 20 percent of lower-income families spend at least 40 percent of their income in debt payments.
• A typical graduating college senior has about $20,000 in student debt, up from $9,000 a decade ago.
• One in seven families is dealing with a debt collector.
• Nearly half of all credit card holders have missed payments in the last year.
• Forty-four percent of college students carry a balance on their credit cards, with an average outstanding balance of more than $2,000. Almost a quarter of undergraduates carry balances in excess of $3,000.
• More than 40 percent of college graduates who don't pursue graduate school blame student loan debt.
• One in seven Americans reports that at some point in their lives they experienced debt problems serious enough that they filed for bankruptcy or used a credit consolidator.
• More than one-third (36 percent) of Americans say they have felt at some point that their financial situation was out of control. People ages 30-49 are more likely than others to have felt this way (45 percent); so are parents of children under age 18 (41 percent), and African Americans (46 percent).
• Nearly two-thirds (63 percent) of Americans say that they do not save enough.
• The United States saves less than nearly every other advanced industrial nation and much less than France, Belgium, and the Czech Republic, among others.