'Doom Spending': Why Bidenomics Is to Blame for America's Crippling Spending Obsession
President Joe Biden’s catastrophic administration has left many Americans feeling so fatalistic that they cannot stop hemorrhaging money. And they see no point in trying.
Young people, in particular — Gen Z and millennials — have decided that the state of the world at present offers them no hope, so they might as well spend what they have and live in the moment. Call it the “YOLO approach” to personal finance.
In November 2023, a poll of 1,004 adults conducted on behalf of Intuit Credit Karma showed that 27 percent of Americans engage in “doom spending,” which the pollsters defined as “spending money despite concerns about the economy and foreign affairs to cope with stress.”
That overall figure of 27 percent, however, concealed the poll’s deeper and more troubling result. In short, 35 percent of Gen-Z respondents and 43 percent of millennials admitted to doom spending as a coping mechanism.
Thus, in Biden’s America, the people who have had the least amount of time to amass personal savings have also decided that the future offers them nothing worth saving for, so they have spent their money, often on luxury items, for what amounts to therapeutic reasons.
Indeed, nothing but fatalism could explain such behavior. After all, the poll also revealed that 48 percent worried most about not having enough money for necessities, such as food, clothing or rent. And a whopping 56 percent expressed concern over inflation.
Courtney Alev, a Credit Karma consumer financial advocate, compared the phenomenon to obsessive, robot-like consumption of negative news online.
“Much like doom scrolling, we’re seeing people mindlessly shop to soothe concerns about the economy and foreign affairs, which could take a toll on their financial well-being,” Alev said.
Maria Melchor, a 27-year-old New York City-based financial content creator on social media, explained why young people buy expensive items.
“When older people ask me how younger people are affording nice things … I tell them it’s because we can’t afford anything else,” Melchor told her TikTok audience of 1.1 million, per the New York Post.
“Homeownership or starting a family is so out of reach,” she added. “We’re using that down-payment money or kid money … to give our dogs the most enriched puppyhood they can have.”
Of course, Fido should have the best puppyhood possible. But does any of this make sense? Are the angst-filled young shoppers making much ado about nothing? Or have they stumbled onto some important truths?
The evidence suggests that while they might have some foolish ideas about the world and their place in it, they have not entirely imagined the immense obstacles that now confront them as they navigate early adulthood.
Possible Peripheral Causes of Doom Spending: Narcissism and Nonsense
For people of older generations, nothing comes more naturally than to accuse “kids these days” of exaggerating their relative hardships. After all, they never walked to school uphill in the snow, etc.
And to a certain extent, the kids have brought it on themselves. Through overwrought expressions of anxiety over imaginary crises, they have made themselves ridiculous.
For instance, one explanation for doom spending involves despair over — you guessed it — climate change.
“The economy sucks, there’s global warming, there’s constant political and social unrest globally,” 24-year-old grad student Nia Holland said of her decision to purchase a vintage Chanel bag, according to Bloomberg. “It’s just easier to spend money on things that will bring you immediate fulfillment.”
Emily Chan of British Vogue cited fear of the “looming climate crisis,” though Chan took things even one step further.
“In many ways, it’s similar to the more familiar concept of retail therapy,” Chan wrote of doom spending, “although the fears that we’re trying to quell are arguably of a much greater scale than in the past.”
A much greater scale than in the past? Surely the generation that endured both the Great Depression and World War II would have something to say about that.
Thus, while we should avoid the grumpy, get-off-my-lawn approach to addressing young people, their eagerness to believe in climate change as an existential threat, coupled with their tendency to overrate their own importance in world history, provides at least a partial explanation for their irrational spending behavior.
The Central Cause of Doom Spending: Bidenomics Has Failed Them
Having made all possible allowances for silliness, one must concede that younger Americans have good reason to expect doom.
According to the Federal Reserve Bank of New York, Americans’ total household debt surged to $17.5 trillion in the fourth quarter of 2023. That marked a $212 billion increase from the previous quarter.
Mortgage balances, which rose by $112 billion, accounted for $12.25 trillion of that total household debt. But credit card balances, $1.13 trillion of the total, rose by $50 billion.
Thus, while total credit card debt stood at less than ten percent of total mortgage debt, credit card balances increased by nearly half as much as mortgage balances.
In other words, people with credit cards ran deeper into debt much faster than did people with mortgages. This certainly might suggest that younger people, who own fewer homes than their elders, have made extensive use of credit cards.
Nor did the spending spree begin in Q4. Credit card balances also increased by a comparable $48 billion in the third quarter of 2023, per the NYFED.
Moreover, thanks to worsening economic conditions under Biden, more young people have had to rely on those high-interest plastic cards.
In the fourth quarter of 2023, 22- to 24-year-olds held an average credit card balance of $2,834, according to the New York Post.
Remarkably, in the fourth quarter of 2013, that same age group held an average inflation-adjusted balance of only $2,248.
John Sedunov, a finance professor at Villanova University’s School of Business, blamed inflation for eating into household savings.
“People have to deal with this somehow,” Sedunov told ABC News. “After blowing through savings to buy essentials, they do what’s next: Find sources to borrow.”
Mary Hansen, an economics professor at American University, offered a bleak outlook.
“Consumer spending, which we all know is the base of GDP, is really being held up by credit card debt, and maybe it’s not sustainable,” Hansen told ABC.
One wonders, of course, if Gen Z and the millennials know Biden’s history with the credit card companies.
That “cozy” history included a lucrative relationship with the Delaware-based financial services company MBNA, which the left-wing news outlet ProPublica identified in 2008 as “Biden’s single largest contributor.”
Moreover, “Biden’s son Hunter was hired out of law school by MBNA and later worked as a lobbyist for the company.” Did Hunter Biden ever not profit from his corrupt father’s influence?
In any event, the elder Biden spent much of his Senate career carrying water for the credit card companies. He did everything in his power to ensure that consumers had to pay their debts.
Ironically, as president, he has told young people that they should not have to pay their student loans. That has led Rusty Weiss of The Political Insider to speculate on another possible explanation for the latest therapeutic phenomenon.
“Maybe it’s ‘doom spending,'” Weiss wrote, “and maybe it’s a narrative from the White House that, as with student loan debt, it’s not important to pay your bills.”
Either way, young people may thank Biden for their debt and despair.
The Real Psychology of Doom Spending
Skeptics might scoff at doom spending as a psychological phenomenon. But when it comes to dealing with money problems, the brain can work in funny ways.
For instance, according a WalletHub generational finances survey published in January, 57 percent of Gen Zers regarded savings accounts as the best way to invest their money, compared to 46 percent of Baby Boomers who preferred investing in stocks.
Of course, a comparative lack of financial knowledge could help explain that collective response from Gen Z.
Still, it suggests an aversion to risk that does not quite square with young Americans’ general profligacy.
And that would lend credence to doom spending as a complex psychological phenomenon. After all, risk-averse people tend not to incur risk as a conscious choice. Something else is at play.
According to financial journalist and author Iona Bain, doom spending unleashes the chemical equivalent of good vibes.
“When we buy something, our brain releases feel-good hormones like dopamine and endorphins,” Bain told British Vogue. “Shopping has always been an easy, low effort way to self soothe, and our consumer economy has long been predicated on making us believe new purchases will lift our spirits and solve our problems.”
Moreover, a study published in July 2022 in a leading Psychology journal urged practitioners to “focus on coping strategies for managing psychological issues related to financial problems” during the COVID-19 pandemic.
In other words, psychologists take the psychology of financial anxiety seriously.
Strategies to Curb Doom Spending
Since news outlets began reporting extensively on doom spending in late 2023, experts have offered no shortage of advice.
Alev, for instance, encouraged consumers to do a financial assessment, make a plan and use cash instead of credit cards. She also suggested “deleting stored card information through your browser to make shopping online less frictionless.” Convenience, after all, enables bad habits.
Bain, meanwhile, advised young people to pay attention to the different ways their smartphones shape their behavior.
“Observe which apps, influencers and activities are draining you and pushing you towards spending,” she said. “I don’t have any shopping apps on my phone and I don’t even have social media apps on my phone. If that’s a bridge too far for you, take those commercial influences off your feed and feed yourself with inspirational, mind-expanding content instead.”
Dr. Dion Terrelonge, known as “The Fashion Psychologist” on social media, recommended thinking less about ourselves and more about others.
“Doing things that help others will not only benefit those others, but also help get you out of your own head and generate pleasure in the form of eudaimonic happiness, which is known as the do-good-factor, rather than from spending,” Terrelonge said, according to British Vogue.
Ted Rossman, senior industry analyst at Bankrate, urged young people to automatically send a portion of their income to savings while also setting aside specific amounts for non-essential purchases.
“At least then you are not paying 20 percent credit card interest,” Rossman said, per CNBC.
Conclusion: Real Doom?
Unfortunately, the doom spending phenomenon does have unprecedented aspects.
As Tori Latham of the Robb Report noted, “historically, trends show that when economic times get tough, people save more,” and yet “younger generations are flipping that on its head.”
Paul Oster, CEO of the business and consumer credit services company Better Qualified, conceded that he has never felt more nervous on behalf of his fellow Americans.
“This is the first year where I’m actually panicking a little bit for the average consumer because we’ve never been down this road before,” Oster said, according to WNYW.
“Whether it’s a buy now, pay later program, a credit card. Don’t do it because it’s going to wind up putting you in a position where you might not be able to dig out of the hole,” he added.
In many respects, of course, such pessimism makes sense. After all, for the last four years, the world has felt darker than ever.
On the other hand, a long historical memory always helps.
Writing for contemporaries who despaired at how to live in a world menaced by the invention of the atomic bomb, legendary Christian author C.S. Lewis counseled perspective.
“[D]o not let us begin by exaggerating the novelty of our situation,” Lewis wrote in 1948.
“Believe me, dear sir or madam, you and all whom you love were already sentenced to death before the atomic bomb was invented: and quite a high percentage of us were going to die in unpleasant ways,” he added.
In the end, of course, no other perspective matters. The question of our finite existence and its purpose, which Christians have answered by surrendering to Christ, makes the very concept of financial doom — as well as its desired obverse in earthly security — seem ridiculous by comparison.
Thus, first and foremost, we must pray that angst-ridden millennials and Gen Zers will find peace in this truth. True peace, after all, comes from no other source.
In the meantime, we must tell the truth about what is and is not actually happening here on Earth.
For instance, the apocalyptic, climate-related predictions of the last 40 years have never materialized. Nor will they. Those fear-mongering forecasts serve authoritarian purposes only. So stop fretting and act instead as if the world will endure. It needs you, not to save it but to make it better.
Finally, rest assured that the long nightmare of the Biden presidency cannot last forever. God willing, in fact, that nightmare will soon come to a merciful end.
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