Americans are falling behind on their bills at rates not seen in years. Car payment delinquencies are at their highest point in decades, credit card defaults have climbed to levels last reached in 2010, and student loan delinquencies have surged since repayment resumed, with nearly one in three borrowers at risk of default. Total household debt has hit an all-time high of $18.4 trillion in the second quarter of 2025, and the average household now owes more than $100,000—a 13 percent jump between 2020 and 2024.
The transformation didn’t happen overnight. In the last half-century, real wages have stagnated while the costs of housing, health care, and higher education have soared. Where steady, unionized jobs once offered a path to stability, today’s economy leans on low wages, gig work, and eroded benefits. Borrowing has become the safety net—one that comes with interest rates and late fees.
Braxton Brewington, a spokesperson and organizer with the group, recalled one renter facing $90,000 in eviction debt. The actions of corporate landlords follow a clear pattern, Brewington said. “They evict people incredibly fast. They’re doing it with surgical precision. It’s highly racialized across the country.” And of course abortion debt wasn’t even a term people were using before Roe was overturned.
The spread of BNPL into routine spending, more than just shifting consumer preferences, suggests mounting financial strain. And while the popular option—the interest-free “pay-in-four” plan—is often marketed as a no-stress solution, it may soon carry more weight. In June, FICO announced it would begin including BNPL loans in credit reports, a move that could turn even a short-term splurge into a long-term mark on a borrower’s financial record.
In his book Debtor Nation: The History of America in Red Ink, Hyman explains that, over the course of the twentieth century, debt shifted from a marginal practice to a central feature of American life. In the post–World War II economy, Hyman says, “People borrowed for their cars, and houses, and socks, and furniture, but their wages grew immensely.”
That shift didn’t just change how people borrowed. It reshaped the safety net. As public benefits remained weak or eroded, policymakers leaned on private credit to fill the gap. Today, nearly 40 percent of Americans can’t cover a $400 emergency expense. The strain is worse for women: 49 percent report having no emergency fund, compared to 36 percent of men.
Few examples capture this trade-off more vividly than medical debt, a roughly quarter-trillion-dollar burden that, by some estimates, contributes to over 60 percent of bankruptcies. Nearly one in five Americans now has medical debt listed on their credit reports, while more than half of all items in collections on credit reports are medical bills. This burden is not evenly distributed either: 28 percent of Black Americans and 22 percent of Hispanic Americans carry past-due medical debt, compared to 17 percent of white Americans, according to U.S. Census Bureau data. In the United States, where health care is neither universal nor affordable, the credit system turns illness into a lasting penalty that lands hardest on the poorest and those who are not white.
Consumer debt is a crisis without a cliff. It’s also a story that the news media has struggled to cover adequately. In 2008, massive financial institutions were collapsing—now credit card companies and other lenders are thriving. The victims are ordinary people dealing with a suffocating problem that doesn’t produce the kind of inflection point that drives much of mainstream media coverage.
But even without a mass debtors’ movement, affordability has started to emerge as a potent political rallying cry. In New York City, Zohran Mamdani won a decisive primary victory in the mayoral race with a campaign promise of “A New York You Can Afford,” a slogan shaped by conversations at doors in neighborhoods (including some that backed Donald Trump) where residents kept naming the same problem: Everything costs too much.
In the meantime, the next wave of financial strain is already taking shape. New tariffs threaten to raise the price of everyday goods. States are moving to cut Medicaid. The White House fired the chief of the Bureau of Labor Statistics after an unfavorable jobs report, stoking fears of political meddling in economic data.
“We end up in a situation where every problem becomes a financial problem—a problem to be fixed with financial technologies and credit markets—because it’s hard for Americans to imagine the proper levels of taxation for redistribution,” Quinn said. “And this was even before the tax cuts.”
For now, Americans are struggling to stay afloat. But the current is moving in one direction, and it’s not toward shore.
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