Experts say ideas of “good debt” have shifted over time, but access to affordable borrowing has never been equal. The story argues that wealth still shapes who can use debt to build assets and who gets trapped by it.
01Summary
- 01CNBC spoke with experts in philosophy, history, theology, sociology and financial psychology about who gets to have “good” debt.
- 02Frederick Wherry said the “Matthew effect” means those who already have much are more likely to gain from debt, while people in distress are more likely to face bad debt.
- 03Graham Hubbs said Plato’s “Republic” shows debt has been tied to questions of justice since ancient Greece and that good debt is linked to happiness and future income.
- 04Louis Hyman said American attitudes shifted in the 1920s towards instalment lending, and mortgage debt became widely viewed as respectable in the 1930s, 1940s and 1950s.
- 05Hyman also said the New Deal-era credit system was built mainly for white middle-class married men, while Black Americans and single women had far less access.
02Why it matters
The story shows how borrowing is not just a personal choice but also a question of class and access. That matters because it helps explain why some households can use debt to build wealth while others pay much more for the same basic needs.
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