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The Fragile Middle Class: Americans in Debt
Why have so many middle-class Americans encountered so much financial trouble? In this classic analysis of hard-pressed families, the authors discover that financial stability for many middle-class Americans is all too fragile. The authors consider the changing cultural and economic factors that threaten financial security and what they imply for the future vitality of the middle class. A new preface examines the persistent and new threats that have emerged since the original publication. “[A] fascinating, alarming study. . . . [This] chilling diagnosis of middle-class affliction demonstrates that we all may be only a job loss, medical problem or credit card indulgence away from the downward spiral leading to bankruptcy.”—Publishers Weekly "A well-designed and carefully executed study."—Andrew Greeley, University of Chicago "The Fragile Middle Class, a well-written work of social science that is about as gripping as the genre gets, forces us to reevaluate notions about consumerism."—American Prospect
406 pages, Kindle Edition
First published March 11, 2000
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Displaying 1 - 4 of 4 reviews
March 30, 2013
This team of researchers (two sociologists and a law professor) has done very interesting empirical work on consumer bankruptcies in America using thousands of files from several jurisdictions (maintaining research protocols to protect privacy).
(Yes, Prof. Warren is now Sen. Warren.)
April 16, 2022
I listened to the unabridged 12-hour audio version of this title (read by Suzie Althens, Yale U. Press, 2020).
This is a re-issue of a 2000 book, with a new preface that examines the persistence of old threats and emergence of new threats to the American middle-class in the two decades since the book's original publication. The fragility of the title refers to people being crushed by heavy debt burdens and thus being forced to declare bankruptcy. Bankruptcy laws were introduced to allow people who get in serious financial trouble, whether as a result of uncontrollable circumstances (such as job loss or serious illness) or because of unwise personal decisions, to have a chance at a fresh start.
The personal-bankruptcy crisis in the US is viewed as a natural consequence of a free-market approach to getting rid of bad debts. Taking credit-card debt as a case in point, all users of bank cards share in losses from those who are unable to repay what they owe, by being burdened with a high interest rate, typically around 18%. In Europe, and to a lesser extent in Canada, credit isn't as easily granted, but strong safety nets (such as generous unemployment benefits and free healthcare) constitute a social approach to dealing with the inability to pay back debts.
Personal bankruptcies are handled according to Chapter 7 or Chapter 13 of the bankruptcy law. Chapter 7, the more common option, is often used by people with substantial unsecured debt, such as medical and credit-card bills. Chapter 13 liquidates the assets to pay off one's liabilities. Because Chapter 13 only reorganizes the debts and provides more time for paying them off, it is a good option for people who earn enough money to cover an adjusted repayment schedule.
Almost all borrowers defaulting on credit or declaring bankruptcy are middle-class. The poor don't have enough income to get loans. Amazingly, people at the bottom tier of the middle-class are too poor to go bankrupt, given rising attorney fees, courtesy of Congressional "reforms" that have made the bankruptcy process, entailing $750-$1500 in attorney fees at the time of the book's original publication, much more complicated and, thus, quite expensive.
After two chapters entitled "Americans in Financial Crisis" and "Middle Class and Broke: The Demography of Bankruptcy," the book's next 5 chapters focus on main reasons for bankruptcies in the US (un-/under-employment, credit cards, sickness/injury, divorce, housing), before ending with Chapter 8, entitled "The Middle Class in Debt." Two appendices present the data used in the study and list other published studies in this area.
This is a re-issue of a 2000 book, with a new preface that examines the persistence of old threats and emergence of new threats to the American middle-class in the two decades since the book's original publication. The fragility of the title refers to people being crushed by heavy debt burdens and thus being forced to declare bankruptcy. Bankruptcy laws were introduced to allow people who get in serious financial trouble, whether as a result of uncontrollable circumstances (such as job loss or serious illness) or because of unwise personal decisions, to have a chance at a fresh start.
The personal-bankruptcy crisis in the US is viewed as a natural consequence of a free-market approach to getting rid of bad debts. Taking credit-card debt as a case in point, all users of bank cards share in losses from those who are unable to repay what they owe, by being burdened with a high interest rate, typically around 18%. In Europe, and to a lesser extent in Canada, credit isn't as easily granted, but strong safety nets (such as generous unemployment benefits and free healthcare) constitute a social approach to dealing with the inability to pay back debts.
Personal bankruptcies are handled according to Chapter 7 or Chapter 13 of the bankruptcy law. Chapter 7, the more common option, is often used by people with substantial unsecured debt, such as medical and credit-card bills. Chapter 13 liquidates the assets to pay off one's liabilities. Because Chapter 13 only reorganizes the debts and provides more time for paying them off, it is a good option for people who earn enough money to cover an adjusted repayment schedule.
Almost all borrowers defaulting on credit or declaring bankruptcy are middle-class. The poor don't have enough income to get loans. Amazingly, people at the bottom tier of the middle-class are too poor to go bankrupt, given rising attorney fees, courtesy of Congressional "reforms" that have made the bankruptcy process, entailing $750-$1500 in attorney fees at the time of the book's original publication, much more complicated and, thus, quite expensive.
After two chapters entitled "Americans in Financial Crisis" and "Middle Class and Broke: The Demography of Bankruptcy," the book's next 5 chapters focus on main reasons for bankruptcies in the US (un-/under-employment, credit cards, sickness/injury, divorce, housing), before ending with Chapter 8, entitled "The Middle Class in Debt." Two appendices present the data used in the study and list other published studies in this area.
December 19, 2017
You want to buy a brand new Mercedes car. It is not that you are a mindless puppet forced by the marketers to buy it. That car is excellent! Still, you would afford a new smaller Ford. But that would mean eating less or getting a smaller home. But that is doable. Now, a 15 year old Crysler would be what you can afford. This book tells you how you are entitled to make others "more fortunate" to pay for your Mercedes and at the same time that you are an idiot who needs their protection to navigate the troubled waters of Life. And, of course, nobody is going to pay a new Mercedes for you. Mostly you will get a better deal on the smaller Ford. Because all this is a scam. A scam to pay hordes of bureaucrats a good wage.
December 27, 2019
An explanation of the gradual eradication of the middle class, the evils of credit cards, and why we need Liz Warren in the White House.
Displaying 1 - 4 of 4 reviews