Debt supposedly helps us take part in the free market, allowing us to buy homes and enjoy goods and services while driving prosperity. But debt is also taken on by many in order to survive, with ruinous consequences. The rational actor is a myth. Instead, Chrystin Ondersma proposes a new taxonomy of debt and argues for a dignity-based approach to eradicating the conditions that drive it.

Americans rely on debt for everything from homes, to cars, to educations, to medical care, but the perceptions and policies around debt are radically inadequate.  Like many Americans, my parents believed that if they only took on “good debt” and avoided “bad debt” they’d be financially secure. But then my sister fell ill, insurance didn’t cover her treatment, and my family ended up losing their home in foreclosure and having to seek bankruptcy relief. My family is far from alone. Over a quarter of adult Americans have at least one debt in collections, and over 40% carry medical debt. 

___