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Developing debt in Canada

Broadcast Date: Nov. 16, 2008

Forty years after the credit card was introduced, Canadians have had plenty of time to learn about the perils of credit and reckless spending. But consumer debt remains staggeringly high, and a recent report from CIBC World Markets shows that our personal debt continues to outgrow our income by an alarming rate. Not only is the global economy hurting, but many Canadians are finding their own households sliding deeper into the red. In this 2008 report, CBC News: Sunday asks: how did things get this bad?

Developing debt in Canada

• A common statistic used to gauge financial solvency is the debt-to-income ratio, or DTI, which measures one's income against how much they owe. In 1955, the average Canadian household ran a DTI of 55 per cent, meaning that debt - from credit, mortgages, alimony and other costs - ate up 55 per cent of one's income. By 1983, the percentage remained the same. But by 2007, the average Canadian DTI had jumped to 131 per cent, meaning Canadians were spending $1.31 for every dollar they earned.

• Guest Margaret Atwood joined this discussion as a newly minted expert on personal debt, having recently written Payback: Debt and the Shadow Side of Wealth, which is part of the CBC Massey Lectures series. The non-fiction work, which explores debt in history, literature and society, was published in October 2008, less than a month after this broadcast.

Developing debt in Canada

Medium: Television

Program: CBC News: Sunday

Broadcast Date: Nov. 16, 2008

Guest(s): Margaret Atwood, Colin Boulton, Lesley Scorgie, Gail Vaz-Oxlade

Host: Evan Solomon

Duration: 7:57

Last updated:
Jan. 30, 2009