The Debt Crisis And How It Correlates To The Rise Of Anxiety and Depression.

Jerome Rogers was a 20-year-old courier who was found dead in London on March 8th, 2016. He had decided to commit suicide due to his swelling debt. Debt collectors started to threaten Rogers after four months when traffic fines that he got went from 65 euros to over 1,000 euros . After the constant threat from debt collectors, threatening that they would take all of Rogers assets and charge additional fees, he could not bear it any longer, he took his own life. The burden of debt is becoming deadly all over the world, especially the U.S where suicide rates have risen by 30% since 1999 due to debt. Debt is causing large amounts of anxiety and depression within our nation. People die with debt which in turn could even be passed down to family.

Studies show that severe debt correlates with 78.5% of bad health. An analysis was made and showed significant relationship between mental disorders, depression, suicide completion and attempts, problem drinking, drug dependence, and even psychotic disorders. It’s also clear that debt impacts a substantially large group of people. The United States has gone through five different debt crises’ already. The Great Recession was the second largest debt crisis and the only debt crisis that primary scarcities still continue six years after and are expected to carry on until 2026. The COVID-19 pandemic is also adding further implications to further the debt crisis. Debt also impacts the U.S economy drastically. The country itself is in debt, majority of it being with China. According to the Treasury Bureau of the Fiscal Service of the United States, the country is $23 million in debt to other countries and this number is continuing to rise. If this continues as a pattern, China will be the leading country in the world and the U.S status as a whole will suffer.

An article from the U.S National Library of Medicine shows the following about how debt truly affects people mentally all over the world. “The Psychiatric Morbidity Survey for 2000 indicates one in 11 British adults is in debt (being ‘seriously behind’ with at least one bill or commitment). Further, one in two British adults in such debt has a mental disorder, and one British adult in four with a mental disorder also reports debt.”. I chose this quote because it shows how debt is affecting people worldwide, not just in the U.S. It is clear that mental disorders can be caused by debt and it’s becoming very common. It is an important aspect for U.S citizens to be homeowners, giving social benefits, yet it can also cause a lot of anxiety or burden on households. “While homeownership is associated with positive social outcomes, mortgage indebtedness associated with negative health outcomes. Indebted homeowners precommit to timely payment of principal and interest for up to thirty years regardless of prevailing economic conditions. As a result, indebted homeowners are more likely to experience financial stress. Stress can lead to unhealthy behaviors such as drinking, smoking, or substance abuse, or may cause sleep problems and eating disorders”. Cassie Lau and Leigh Ann Leung from the Department of Economics at CUNY Graduate Center referenced Schneiderman’s findings in their study, which found that high levels of debt within the U.S is causing mental problems and substance abuse. All together they found that there is a strong correlation between debt and the overall wellbeing of others; this includes high blood pressure, obesity, emotional stress, and depression. The quotes above indicate that debt is negatively affecting people all over the world and is causing health issues.

The average debt for people in the U.S itself is $38,000, excluding home mortgages, this is the case for more than the population of the country alone. “At the end of 2008, UK households owed over £1220 billion in mortgage debt and £230 billion in unsecured consumer credit. Compared to 2007, there had been a 70% increase in the number of households with mortgage arrears of three months or more.”. Debt clearly not only is affecting the United States greatly but also other countries. Europe currently is having a debt crisis and the United States should learn from it, yet debt is becoming more normal although it is causing many problems. A study on the Sage Journals found “In Miami-Dade County, FL, 64% of adults are indebted to a bank, credit-card company, store, or other lending source. Just under half (46%) carry balances forward on a credit card, and some at very high levels. Thirteen percentage report having more than $5,000 on their credit cards after making the monthly payment. In turn these statistics show how just a county in Florida alone is suffering from debt; most states are comparable. Debt within countries all over the world are growing and becoming a problem.

The debt crisis has an overall large impact on the economy. “In October 2009, virtually every aspect of existing financial troubles intensified when Greece revised its deficit projection upward from 3.7 per cent of GDP to 12.5 per cent.” Europe has been struggling with a debt crisis which has been hurting country’s economy’s drastically. The more people get into debt, the more the country suffers and also falls more into debt, this was the case for Greece. “Growing debt also has a direct effect on the economic opportunities available to every American. Based on data provided by CBO, income per person could increase by as much as $5,500, on average, by 2049 if we were to reduce our debt to its historical average of 42 percent of GDP.” “High levels of debt also reduce our government’s flexibility to respond to future emergencies, unanticipated challenges, wars, or recessions.”. It’s clear that the continuing debt is hurting economies and there needs to be change nationwide.

Overall, debt is a necessity, it is not avoidable, but it needs to see a shift. Growing convention of debt is causing a lot of mental and physical problems within populations worldwide. Debt is causing people mental disorders, health issues, and even a high increase in suicide. It is causing people worldwide to grow depressed and full of anxiety. Our economies are suffering, the United States is the leading power now, but soon it will no longer be the land of opportunity. The U.S has already faced a recession which continues and now grows with the unemployement rates rocketing due to COVID-19, but soon it will get much worse. All countries need to work together in building effective ways in helping people reduce debt.

References

Drentea, P., & Reynolds, J. R. (2012, June 1). Neither a Borrower Nor a Lender Be: The Relative Importance of Debt and SES for Mental Health Among Older Adults — Patricia Drentea, John R. Reynolds, 2012. Retrieved from https://journals.sagepub.com/doi/10.1177/0898264311431304.

Dyvonne Body & Financial Security Program. (2018, August 2). The Burden of Debt on Mental and Physical Health. Retrieved from The Aspen Institute: https://www.aspeninstitute.org/blog-posts/hidden-costs-of-consumer-debt/

Jenkins R, Bhugra D, Bebbington P, et al. Debt, income and mental disorder in the general population. Psychological Medicine 2008;38:1485–94

Lau, C., & Leung, L. (2011). Effect of mortgage debt on health. Department of Economics, CUNY Graduate Center, NY

Pénet, P. (2018). The IMF failure that wasn’t: Risk ignorance during the European debt crisis. The British Journal of Sociology., 69(4), 1031–1055.

Peter G. Peterson Foundation. (n.d.). The Fiscal & Economic Impact. Retrieved from Peter G. Petersom Foundation : https://www.pgpf.org/the-fiscal-and-economic-challenge/fiscal-and-economic-impac

Mendoza, E. (2017). The Public Debt Crisis of the United States. Manchester School, 85(S1), 1–32.

Neil Schneiderman, Gail Ironson, S. D. (2008), ‘Stress and health: Psychological, behavioral, and biological determinants’, Annual Review of Clinical Psychology 1, 607–628.

Richardson, T., Elliott, P., & Roberts, R. (2013, April 3). The relationship between personal unsecured debt and mental and physical health: A systematic review and meta-analysis. Retrieved from ScienceDirect: https://www.sciencedirect.com/science/article/pii/S0272735813001256

TreasuryDirect. (2019). Monthly Statement of the Public Debt (MSPD) and Downloadable Files . Retrieved from TreasuryDirect: https://www.treasurydirect.gov/govt/reports/pd/mspd/mspd.htm

University of Chicago Press Journals. (2011, May 9). How did debt and credit become the ‘American way’?. ScienceDaily. Retrieved December 9, 2019 from www.sciencedaily.com/releases/2011/05/110509113733.htm