According to a very interesting article by Atlantic by Derek Thompson (a senior editor). Yes, credit cards are making you a bad person. The article is quite blunt in spots, thus I appreciate the candour of the writing.
The first interesting statement was that in the 1970s, less than 20% of adults had credit cards, whereas now 70-80% have credit cards. I am not sure if that is due to great marketing by the Credit Card companies, but it is more likely due to a wholesale change in the way credit is viewed and used in society. That many people have credit available—is that a good thing? My opinion is no, but I am also pretty old school on the topic.
I have already complimented the statement, “With savings we pass today’s earnings to the future. With credit, we pull expected future earnings into today.” the author goes on to elaborate an elementary truth (OK, it’s really my opinion, but to me it is a truth):
Credit cards have made us Fat, Lazy and Stupid
Let me clarify: Mr. Thompson does not say that (he says, “… Dumber, fatter, poorer…”). Let me dissect the statement I just made
Credit Cards have made us Lazy
It is far too easy to buy things that before might have been “out of our budget”; we put it on our credit card and worry about paying for it at some later date and time (or better still, forget about it until our Credit Card statement shows up and worry about it then). It is very hard to be Frugal if you can simply buy whatever you want without worrying about whether you have the cash to pay for it.
Credit Cards have made us Stupid
More of an extension on the Lazy statement, but credit cards create an "illusion of liquidity" (wrote Dilip Soman prof at the University of Colorado at Boulder) and we end up confusing the fact that just because we CAN buy a deluxe electric home cheese straightener, it does not mean we have the ABILITY to pay for this useless home appliance. Since we can buy it, it must mean that we need it? OK, a stretch, but still how many times have you bought things and later wondered why?
Credit Cards have made us Fat
Mr. Thompson contends that folks buying with credit cards buy more unhealthy food (backed up by a Journal of Consumer Research white paper), and that is an excellent point, however, going back to the ability to quickly purchase means going out to dinner or getting fast food (which now accepts credit cards too) it is simpler to go out and eat more (and sometimes really unhealthy) prepared meals as well.
A very interesting article, and it is refreshing to see someone speak clearly about the dangers of credit cards. The best quote in the article is from a group in MIT writing about credit cards : "Always Leave Home Without It."
In very recent years, I think online shopping has created a new demand for credit cards. This may change, though, as online debit and e-payment options increase.