The New York Times last Sunday featured an article about people who blog about their debt. What made the topic most interesting was the post at Credit Slips which describes itself as a blog on all things about credit and bankruptcy. We are six academics who will use this space to do what we like to do when we get together--discussing and debating what does happen and what should happen when consumers and businesses borrow money. From Angie Littwin, who is writing a law review article on the topic:
For those of us who are interested in debt, a few interesting points emerge. First, for these bloggers, stigma is alive and well. They are using the Internet as a clever way to circumvent it and still obtain the help they need. Many of these bloggers are revealing private information they conceal from their families and friends....Second, these bloggers have developed a self-control mechanism that aligns perfectly with cutting-edge research in behavioral economics. Just yesterday, I read an article by economists George Lowenstein and Ted O’Donoghue in the Chicago Law Review's Winter 2006 Symposium. In "We Can Do This the Easy Way or the Hard Way": Negative Emotions, Self-Regulation, and the Law, Lowenstein and O’Donoghue explain that people use negative emotions to help resist temptation. When the benefits of a decision will be realized immediately, but the costs will not occur so soon, people experience temptation, because we tend to weigh present costs and benefits more heavily than future ones....A final point is to notice what an extreme measure this is. People are revealing information they find humiliating to strangers in order to prevent themselves from spending and accumulating more debt. Perhaps these bloggers and other debtors like them could use a little help....Credit-card issuers don’t need to continue giving these borrowers enough rope to hang themselves. At least one blogger's credit-card debt exceeded her annual income. That seems like a reasonably extreme point to cut off somebody’s credit. Another option is to create easy ways for credit-card users to decline credit raises. If some debtors are resorting to blogging to resist temptation, I’m willing to bet that plenty of others would welcome less dramatic willpower reinforcements.
Some of the most difficult divorces involve division of debt.