Association for Public Policy Analysis & Management

Consumer debt in the U.S. has reached record highs amid an economy more robust than at any point since the end of the Great Recession. This troubling trend has been the subject of over a year of cross-disciplinary investigation by a network of experts. The research has resulted in a framework for identifying and understanding solutions to consumer problems related to non-mortgage debt. This paper shares a synthesis of original data from two waves of Delphi method surveys and one consumer survey. The Delphi process collected data from a panel of over 600 experts in the consumer debt field. The first wave measured which debt-related problems experts see as top priorities to solve and their detailed perceptions of effective solutions to them. The second wave followed up on themes that rose to the top from the first survey. Finally, a third survey probed a nationally representative sample of consumers about the accuracy and feasibility of solutions emphasized in Delphi results.

One category of interventions identified as most promising is the prevention of debt from getting to the stage of collections or bankruptcy. It has implications for all levels of government, financial services firms, and non-profit organizations. Another key solution stresses reform of the debt collection industry. Since 2008, creditors have increasingly used the courts to pursue millions of people over even small consumer debts – practices that have the greatest negative impact on low-income Americans, and disproportionately harm people of color. Overall this research points to a pathway forward for academics, policy-makers, and practitioners as they work to combat unsustainable levels of consumer debt in the U.S.