Large Number Fatigue
Large number fatigue is the condition when a number ceases to become a numerical count and instead become an item, a term of description. There are two interactions with debt which lead to large number fatigue; debt despair and debt casualness. Our political, government, and Federal Reserve leaders are revealing serious cases of large number fatigue.
“Won’t your car be paid off soon?” I inquired positively; trying to bring some hope to the debt mired, pro bono counselee. His reply was similar to others in debt snared condition, “I don’t know if I’ll ever get that car paid off.” The details of his loan were not known to him. They had never been important. He was unsure of the loan length and how many payments she had remaining. An acquaintance told a similar story, frustrated by the frequent breakdowns of a new car he drove into the dealership of a competing brand and told the salesman to get him out the door in a car with the same payments that he currently had. Length of loan, final price, and total debt amount were not issues. The connection between despair over ever getting out of debt and freely adding more debt to the pile are well known to debt counselors.
As despair over existing debt deepens the amount of new debt being added becomes meaningless. The amount of new debt ceases to be a calculated number. Instead it becomes a necessary item. Counting the debt is no longer considered. This leads to “large number fatigue” where the size of the number is no longer an obstacle or a part of the decision to borrow or not. Large number fatigue brushes aside budgeting constraints which guide us in making spending choices. The mental journey is now complete; a large number is a new term, not a countable entity.
Debt casualness results from the successful use of debt in the recent past. Debt casualness ignores the experiences and wisdom of previous generations. The mind is soothed, lulled, and comforted by the fact that the debt has not been a large hindrance so far. Debt casualness takes a quantum leap forward when the mind realizes that debt can be rolled over instead of being paid off. The debt is not a tyrant but a family pet that needs to be cared for but not paid off. As long as interest payments can be maintained the fangs and claws of the pet tiger cub will not be bared.
For the last century Federal government and Federal Reserve bailouts were reserved only for traditional banks. In the last year our Presidents, politicians, Treasury officials, and Federal Reserve staff have expanded bailout money to include investment banks, auto manufacturers, auto parts suppliers, and insurance firms. A commitment to spend over $1 trillion on consumer debt held by the “shadow banking” system was made just after the President’s 2009 budget deficit was announced. We are told that these spending items are necessary and urgent but there is no discussion about how or when this money will be paid back. The size of the numbers being discussed do not appear to shock or slow down the national leaders involved. Ben Bernanke reminds us that with a computer large numbers of government money are much easier and faster to fashion than with the printing press of old. There has been no debate over how much the foreign and local debt markets can reasonably provide. The actions, attitudes and words of our Washington leaders in these matters reveal that they are suffering from large number fatigue; but on a national level. The national consequences of large number fatigue leads to Federal borrowing and spending without constraints which leads to inflation and/or currency devaluation.
Return
|
|