Wednesday, April 3, 2013

#93 / Debt

I almost always put an "image credit" listing at the bottom of these blog posts, to let anyone reading my blog know where I obtained the images and illustrations I use. That's true today, and looking up the site where I obtained today's image will provide you with some interesting information on mortgage debt in Canada. I have a very strong suspicion, however, that the image above did not originate with "The Coming Depression" website. In fact, this looks like an Anne Taintor to me. If you are not familiar with the work of Anne Taintor, click on the link. She is really good!

Of course, when I began typing this post, I didn't actually intend to produce a commentary on the works of Anne Taintor, but to make some observations on the topic that Anne Taintor is illustrating here: debt! 

My son Philips has made a conscious decision to go into debt to pursue additional education. This is a person who has been educating himself, more than anything else, in how to live a simple and self-sufficient life. I am nervous on his behalf. He had a unique way to think about debt, however, which I hadn't heard before: "Actually, Dad, I am looking forward to going into debt, because I think that by lending me money, society is telling me that I am worth investing in, and that makes me feel good, and makes me feel happy that I will be working to repay that investment."

I am proud of my son for lots of reasons, including for this observation, but I am still worried about the pressures that personal debt generates. Whether in the context of individual debt, or in the context of social debt, debt is a burden. Debt is better when incurred to finance investments in something that will have long term benefits (either personal or social), and that will increase our individual or collective  productivity. Debt is worse when it is incurred simply to  allow us to consume more than we make, and to "kick the can down the road," as the current expression goes. 

Even "good debt" constrains our freedom, however, and my advice to all young friends, and to our society in general, is to minimize debt, no matter how good the investment may be that the debt is intended to finance. 

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