Economic Upheaval: Maxed Out

from the September 18, 2007 eNews issue

"The rich ruleth over the poor, and the borrower is servant to the lender." - Proverbs 22:7

Do you dread paying the bills? Have you got more than one credit card? Do you struggle each month just to make the minimum payments? Are you overwhelmed with student loans, medical bills, car loans, and mortgage payments? Do you sometimes feel like you're being crushed by the weight of your financial obligations? If so, you're not alone.

The United States has truly become a nation of debtors. In recent years the level of household debt in America has surpassed the level of household income, so for the first time in our collective history we owe more money than we make. Consumer debt in America (credit cards and other consumer lending not including mortgages) has risen to a record high of about 2.5 trillion dollars. Today the average US household has more than $9,000 in credit card debt and spends more than $1,300 a year in interest payments. Meanwhile, the national debt (the amount of money owed by the US government) has surpassed 9 trillion dollars – and is increasing at a rate of about $1.40 billion per day.

"Debt is so ingrained into our culture that most Americans can't even envision a car without a payment, a house without a mortgage, a student without a loan, and credit without a card. We've been sold debt with such repetition and with such fervor that most folks can't conceive of what it would be like to have no payments," says Dave Ramsey, a well-known talk radio host and financial counselor. While many Americans have become accustomed to making monthly payments, the truth is that debt is contrary to God's plan for our lives. The scripture clearly says the borrower is slave to the lender - God would have us free of that kind of bondage.

Last year over 1.6 million Americans declared bankruptcy. Furthermore, economists estimate that for every family that officially declares bankruptcy, there are seven more that are in severe financial difficulty. Elizabeth Warren, a professor at Harvard Law School and the author of several books on debt and personal finance, wrote the following about the number of US consumers who are going broke: "Bankruptcy has become deeply entrenched in American life. This year, more people will end up bankrupt than will suffer a heart attack. More adults will file for bankruptcy than will be diagnosed with cancer. More people will file for bankruptcy than will graduate from college. And, in an era when traditionalists decry the demise of the institution of marriage, Americans will file more petitions for bankruptcy than for divorce." When put into perspective, the numbers are daunting.

The statistics are indeed staggering, and they paint a very vivid picture of our current dilemma. So if the United States is indeed facing a financial crisis, what should we do about it? How can we prepare for times of economic uncertainty? What does the Bible say about our financial stewardship? Chuck tackles these tough questions in his new briefing titled The Vortex Strategy.

It is impossible to predict what exactly the coming months will bring, yet we need to be prepared both practically and spiritually: "Anyone that presumes that the coming 12 to 24 months are going to be smooth sailing just hasn't done their homework…It is clear we are facing turbulent times ahead. Those times are going to be challenging for us as stewards, but they are also going to be incredible opportunities. Because many people who are complacent today, who are deaf to things of the Gospel, are suddenly going to be open – asking questions, looking for answers. You and I need to be prepared to respond to that opportunity (excerpt from The Vortex Strategy)."

This is the final installment in a three part series on the state of the economy in America. If you missed the beginning of this series, the articles "Economic Upheaval: The Decline of the Dollar" and "Economic Upheaval: The Mortgage Mess" are available to read on our website (see links below).