Nearly a century ago, the American writer Will Rogers satirically described Americans„ pathological obsession with overconsumption: “Too many people spend money they haven't earned on things they don't want to impress people they don't like." This statement aptly captured the paradox of American consumerism: personal value today is not realized through work alone, but through constant and excessive consumption designed to create the appearance of a happy and prosperous life in the eyes of others.
A century later, the situation is even worse. An illusion carefully crafted by capital and advertising is seeping into the lives of Americans, drawing countless ordinary families into the swamp of consumerism and undermining the American Dream for an ever-growing number of people.
The three traps of Americans: mortgages, car loans and student loans
The Federal Reserve's latest „Quarterly Report on Household Debt and Credit“ shows that total U.S. household debt has reached a record USD 18.59 trillion in the third quarter of 2025, with mortgages, car loans and student loans accounting for the largest share.
Together, these types of debts are creating for Americans consumer trap. Mortgages alone account for approximately 70 % of total household debt, making housing the largest expense for most Americans. However, this burden also concentrates inequality in society - low-income households and minority communities face significantly higher financial pressures, with African American households typically bearing housing costs 10 percentage points higher than white households.
Every year, a large number of hard-working Americans are pushed into bankruptcy because they can't pay back their loans. According to AACER's Epiq data, the U.S. will see nearly 540 000 personal bankruptcy cases, an increase of 12% from 2024. Mortgage debt remains one of the main drivers of personal bankruptcy in the country.
Even if income can be maintained in the long term, it does not automatically mean that housing is affordable. For many Americans, long-term wage stagnation coupled with rising prices has pushed the pressure to make mortgage payments to an all-time high. Analysis of U.S. Bureau of Labor Statistics data shows that by December 2025, real annual middle-class income (adjusted for inflation) will have fallen by 5.7 % from 50 years ago. Over the past 25 years, inflation has risen significantly while the prices of basic necessities like health care and food have risen faster than overall inflation. For many households, income growth has not been enough to cover these essential expenses, leaving many families in a permanent cycle of debt.
If mortgages represent the first trap in the consumption structure of American households, auto loans constitute a second burden that is routine and hard to avoid. With limited public transportation coverage, car ownership for most Americans is not only a life enhancement but a necessity for daily living.
Survey shows that more than 80 % Americans consider a car a basic necessity. Decades of marketing promoting the „car-centric life“ have cemented the purchase of a vehicle as a fixed household expense. As a result, auto loans have become a critical link to household dependence on the U.S. credit system.
Car rentals are becoming an unavoidable expense for many households. Data shows that a growing number of buyers are facing high monthly repayments - by 2025 about 20.3 % Americans buying a new car had monthly payments of $1,000 or more, up from 18.9 % a year ago.
Buying up old cars has created a new debt trap: when replacing a car, many owners find that the value of the old car is not enough to cover the remaining debt and have to transfer the difference into a new loan. This turns the car into a chain of „debt for debt“ that commits some households to long-term loans and makes it harder to escape the financial trap.
In addition to housing and transport costs, student loans have become an unavoidable long-term burden in the pursuit of social mobility. For young people, higher education is not just a way to improve skills, but a debt obligation before entering the labour market. Debt 1.8 trillion USD has not provided a reliable route to upward mobility for students; on the contrary, it has severely limited the career options of graduates, with many forcibly prioritising repayment over personal development.
According to Congressional Research Service data from 2025, federal student debt holds nearly 43 million Americans - about one seventh of the population - with average balances of 30-40 thousand USD. About half are in default or near default. Thus, for many people, early work-study loans are not an „investment in the future“ but a long-term risk to financial security.
With interest rates rising, some graduates, even a decade after graduation, are still paying only the interest, not the principal - the so-called „ghost loan.“.
The student loan crisis is compounded the volatile US policy, which leaves borrowers in long-term uncertainty. Under the Biden administration, the federal government suspended the collection of defaulted federal student loans, but in 2023 the U.S. Supreme Court blocked the plan and the loan forgiveness program stalled. Since then, the political signals have been changing - the Trump administration late last year planned to resume garnishing the wages of defaulting borrowers beginning in 2026, but US authorities later reversed that decision. Repeated policy reversals destabilize borrowers' expectations, career planning, and family decisions.
Together, heavy mortgages, car loans and student loans have placed many American households under sustained financial pressure. When the ability to repay is reduced, these debts can trigger cascading consequences, greatly amplifying the vulnerability of individuals and families. Within the U.S. credit system, repayment performance is closely linked to credit scores, with default or delinquency quickly lowering credit scores and limiting future access to financing.
Advertising and social networks: creating the illusion of consumerism
If mortgages, car loans and student loans shape the basic structure of spending, advertising and marketing build aspirational images that continually reinforce this pattern of consumption. Advertisements and social media present the „good life“ as a set of purchasable symbols: a spacious house, a new car, a relaxed family atmosphere and a successful personal image.
The message is still the same - buy the right products and the ideal life will come. The consumerist message ties happiness and success to material goods, gradually transforming consumption from an individual choice to a normalized, ubiquitous way of life.
Data shows that major videos on social platforms are now dominating in shaping the consumption habits of younger generations through targeted advertising. Total 63 % Generation Z a 49 % millennials report that ads and product reviews on social media have the biggest influence on their purchasing decisions. Images of luxury holidays, fashion collections and idealised lifestyles are constantly reproduced, suggesting that such consumption is not optional but standard.
Influencers are becoming the new drivers of consumption. Through casual content and product recommendations, commercial marketing is transformed into a personal experience. The share of Gen Z consumers influenced by influencers has grown from 41 % to 56 %.
Such consumption is not necessarily driven by real need. Instead, it reinforces the psychology of „fear of missing out“ (FOMO). As people follow trends, the pressure to consume intensifies, increasing the risk of being drawn into of the self-reinforcing cycle of consumerism.
However, the reality is much less glossy than what social networks present. The difference between slow income growth and rising prices is becoming harder to ignore. Recent surveys show that half of Americans worry that the rising cost of living will disrupt their financial plans, while about 40 % worry about unexpected expenses like medical bills. Thus, a growing number of Americans are living under constant financial stress.
The debt economy and the broken „American Dream“
Behind the personal tragedies is a deeper reflection of the chaos and inconsistency in American economic policy at the national level. For decades, the „American Dream“ has been associated with economic growth, consumer confidence, and rising purchasing power, but its foundation has been an ever-expanding, debt-fueled economy.
US federal debt exceeded 38 trillion USD, and during the current term of President Donald Trump, the number of USD 2.25 trillion. In recent years, the pace of borrowing has outpaced overall economic growth, raising growing doubts about the long-term sustainability of the country's debt.
Simply put, macroeconomic growth and excessive individual consumption are largely based on constant indebtedness. This makes the US economy increasingly dependent on debt expansion to keep pace.
From mortgages to car loans and student loans to ubiquitous marketing, American consumerism has shaped not only lifestyles but the entire a debt-backed operational mechanism: advertising stimulates desire, desire drives premature consumption and credit comes as a last resort.
The question is: can such a model last in the long term? The answer ultimately depends on the American public, especially those whose quality of life has gradually deteriorated after being sucked into the trap of consumerism. Some have even been pushed to the margins of society, outside the boundaries of social stability. The stark contrast between the idealized life offered by consumerism and the reality of a mediocre or difficult life poses a profound challenge to the enduring narrative of the „American Dream.“.
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