Everyday Debt and Credit

Finance and Society, 9(2): 21-38, 2023

The quest for social status is usually considered one of the main drivers of the demand for consumer credit. This article provides a nuanced take on consumer credit by exploring the interaction between consumption, borrowing, and class identity. To do so I pursue a cultural class analysis inspired by the work of Pierre Bourdieu. Drawing from 26 semi-structured interviews, the article has two main findings. First, it shows that people engage in borrowing not only to gain prestige, but also to assert their belongingness to symbolic groups, which embody the values of imagined communities. Second, against the idea that borrowing is undertaken mainly for conspicuous consumption, the article's findings show that middleincome families in Chile borrow to consume 'ordinary' goods. Through the consumption of these goods, the Chilean middle classes seek to stabilize their class identities through their life trajectories, thereby achieving a sense of place in a changing environment. These findings lead me to focus on the normalization of credit and the process through which borrowing practices turn consumer goods from wants into needs, ratcheting up the demand for credit. The article argues that this is an overlooked way in which competitive dynamics drive the demand for credit, which is a missing link in the explanation for the rise of household debt.

Ever larger parts of life and nature are integrated in our socioeconomic system as future cash flows, augmenting obscure, unstable and unsustainable debt structures. The larger and deeper these debt structures grow, the larger, more multifaceted and destructive the inequality divide in our societies becomes. It is now normal for people to live indebted, as it is normal for young students to have their future monetised through student loans, the debt implications of which may never escape. What forces normalise these abnormal and unsustainable patterns and our rather admissive/submissive response to them? How our lives and future have been monetised and where have our social consent and agency been in these processes? Is there a way out, before crossing the boundary of social sustainability and environmental collapse? The three books examined here offer refreshing and complementary perspectives on these 'big questions' on which our monetised future depends.

Journal of Consumer Culture (forthcoming)

Existing research on how increasing household debt becomes seen as normal by consumers focuses on the shifting moral meanings of debt. Examining the rapid escalation of mortgage debt in post-socialist Hungary, we propose a different approach. We use practice theory to identify credit use as 'ordinary consumption' (Gronow and Warde, 2001), undertaken not for its own sake but to enable other meaningful practices. We find that mortgage debt grew due to the co-evolution of norms of a normal life centred on the home and credit instruments that facilitated and, eventually, locked in these norms. This 'naturalization' process (Wilk 2009) did not so much shift the meaning of debt but rather stripped it of meaning, making it increasingly unreflected. The process relied on mortgage instruments that served as invisible background infrastructures providing access to credit. This invisibility, however, is not a natural characteristic of mortgages, we argue, but a contested quality, and it was achieved by particular selling devices and discourses. Our analysis stresses the politics of invisibility and highlights the commercial interests at play in relegating highly risky, foreign-currency denominated mortgages into the background. Emphasising the socio-material structuring of this process, we conclude by situating both meaning-based and unreflected naturalization processes in a common framework, as contingent qualities of credit consumption. 2

Þjóðarspegillinn 2010, Rannsóknir í félagsvísindum XI, 2010

The considerable and sustained boom in personal debt recently has in many countries around the world led to experiences of over-indebtedness that are associated with very considerable distress and suffering. This article explores critical perspectives that situate personal debt, material deprivation and suffering, and specific ways of knowing and acting, within the context of recent political and economic practices. There is a need to focus on positioning people’s experiences of debt within a broader matrix of factors of national and international practices and policies, including globalisation, changing labour markets, and poorly regulated financial industries. These factors appear to have allowed a network of international financial institutions to adopt practices that have proved successful in creating personal debt. Yet, an individualised discourse of financial capability has been propagated, configuring personal debt as a problem of irresponsible individual consumption. In order to explore ways of resisting reactionary and individualised modes of addressing personal debt, proposals will be made of alternative paradigms for responding to personal debt, defined by two dimensions of community psychological practice, with examples. This article aims to increase collective awareness of the systemic character of debt and the collective responses required.

2015

This article published in Phàsis, European Journal of Philosophy, Νο 3, 2015, "La Dette", 115-128 http://www.inschibbolethedizioni.com/la-dette/ The first part of this paper narrates this genealogy of the subject-man of modernity (Locke, Kant, Nietzshe), which will help us see that already from the beginning it was simultaneously a cognitive and moral subject, often actually the subject of indebtedness. The second part will briefly present an interesting contemporary theory about the “indebted man” as a condition of the current situation. The third part, which serves also as a conclusion, offers some elements towards an alternative direction, drawing once more from the history of philosophy with the example of Spinoza.

2020

Without the remarkable explosion of the credit industry since the early 1990s it’s almost inconceivable that late capitalism, in its neoliberal mode, could have maintained the vibrant and multifaceted consumer markets of the last few decades. Its capacity to create payment means by attaching contractual claims to prospective futures has allowed capitalism to transcend the decline of its material productivity, sustaining consumption against the upward concentration of wealth. In this chapter we consider both the source and the implications of that transcendence, tracing it from the rarefied confines of the financial industry into the lives of consumers to explore the implications of distributing payment means as a kind of ‘systemic luxury’ running counter to the material productivity of prevailing systems and processes.

Credit, debt and indebtedness are key terms for understanding contemporary social and economic life. In many recent accounts of debt, however, debt is largely an ahistorical category that remains constant throughout time, or seen simply in terms of a quantum of interest accrued over time that can then serve as a proxy for both the accumulation of profit and measurable oppression and exploitation. This forecloses analytical investigation of contemporary shifts in the everyday articulations of credit and debt and the specificity of creditor-debtor relations, including important changes in the nature of debt itself. In contrast, this paper focuses on the redefinition of debt as 'leverage', a dynamic, productive force that can have unpredictable effects. Alongside other developments that have transformed debt into a tradeable asset, such as financial securitization, debt as 'leverage' involves the anticipation of speculative excess and possibility. Addressing the contemporary transformations of credit/debt also requires acknowledging the multiple ways in which ordinary households are now expected to embrace the potentialities afforded by 'leverage'. This is a symbiotic relationship that is evolving and persistent, and it demonstrates a much larger expansion of financial power, in which the biopolitical terrain of individual subjectivity, aspiration and forms of conduct at a micro-level is directly linked to macro-financial global structures. As the paper suggests, the contemporary consumer-citizen increasingly relies on debt-fuelled and frequently asset-based consumption that necessarily depends on some kind of leverage.

The considerable and sustained boom in personal debt recently has in many countries around the world led to experiences of over-indebtedness that are associated with very considerable distress and suffering. This article explores critical perspectives that situate personal debt, material deprivation and suffering, and specific ways of knowing and acting, within the context of recent political and economic practices. There is a need to focus on positioning people’s experiences of debt within a broader matrix of factors of national and international practices and policies, including globalisation, changing labour markets, and poorly regulated financial industries. These factors appear to have allowed a network of international financial institutions to adopt practices that have proved successful in creating personal debt. Yet, an individualised discourse of financial capability has been propagated, configuring personal debt as a problem of irresponsible individual consumption. In order to explore ways of resisting reactionary and individualised modes of addressing personal debt, proposals will be made of alternative paradigms for responding to personal debt, defined by two dimensions of community psychological practice, with examples. This article aims to increase collective awareness of the systemic character of debt and the collective responses required.