'Borrowing to live' weighs on families, firms, nation
Tom Siems, a senior lecturer in SMU's Department of Engineering Management, Information and Systems in the Lyle School of Engineering, talks about people, companies and the nation having too much debt.
By JIM LANDERS
The Dallas Morning News
In a children's book called The Dangerous Pet, Dallas economist Tom Siems writes:
"Be on your guard if you borrow to live.
"For Debt will take over with nothing to give!"
The lesson is apt. Rich and poor, North Texans have too much debt. The Texas Rangers are in bankruptcy. The Four Seasons Resort at Las Colinas was sold in a foreclosure auction. Dallas consumers have some of the highest debts and lowest credit scores in the country.
A debt hangover is apparent across the country. Eight million remain without work in the aftermath of the mortgage meltdown.
In the last decade, American household, business and government debts doubled to $39.2 trillion. We did not double the size of the economy. And that's the problem.
"The U.S. has been on a spending binge for about 25 years now," said Siems, who works at the Federal Reserve Bank of Dallas and teaches at Southern Methodist University. "Consumers need to rebalance their balance sheets and get debt levels back to more manageable levels."
# # #