The Globe and Mail's series about Canada's borrowing binge explores the impact of rising debt levels. Readers, print and digital, offer insights and arguments about 'good debt' – and bad – and what should be done
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Rob Carrick is mistaken in dismissing house mortgages as worthwhile debt (There Is No Such Thing As Good Debt – Report on Business, May 11). His figures suggest that, based on the purchase of a $400,000 house with a $360,000 mortgage, the shortfall between what you put into your house and its value after 30 years is $146,000.
But what about the rent you save by living in your own home? At $1,000 a month, that would be $360,000 over 30 years. This means you would save $214,000, plus you are the proud owner of $800,000+ house. No delusional thinking there.
Robert Hatfield, Nepean, Ont.
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Re One House-Poor Family's Struggle – Report on Business, May 12: It's difficult to feel bad for people who intentionally spent above their means by buying a $747,000, four-bedroom, five-and-a-half bathroom house and are now feeling the financial impact.
The most troubling part was that the wife's retired father has offered to chip in $500 a month from his pension to help the couple pay their mortgage.
Bethann McLaren, Ottawa
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Why would this couple leverage themselves to this extent? As a real estate agent, I warn clients all the time to calculate how large a mortgage they can really afford if interest rates were to rise by even one percentage point.
Randy Stevenson, Toronto
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The husband and wife in Mississauga, Ont., are having a problem meeting their mortgage obligation on their home, and may have to put off installing a backyard pool and doing landscaping. They both work in financial services – I hope they properly advise their clients on the merits of living within your means.
Robert Duffy, Brampton, Ont.
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Dear couple in debt: How can making more than $100,000 on two incomes not be enough? Management, not money, is the problem here. You can't have it all. Don't spend what you don't have. Buy only what you need. Be disciplined.
The debt issues in this country stem from overindulgent, conspicuous consumption. How many of us grew up in a large house with granite counters, designer kitchen and more than one bathroom?
Our parents focused on caring for children, community involvement, pay as you go. Now look: What has happened to us is our own fault.
Please run some responsible articles about responsible people making $40,000 a year who are able to manage their finances. And don't forget about pensioners, disabled people, caregivers looking after elderly or ailing relatives, the working poor, and the perennially temporary workers.
Shelby Shepherd, Toronto
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Re Is Debt Making You Sick? Life & Arts – May 11: Keep your debt down. Don't get a mortgage – rent instead. Unlike a mortgage, the obligation to pay your rent for the rest of your life is not considered statistical debt. Your monthly payment is merely an expense.
Patrick MacKinnon, Victoria
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I had to take major steps after an illness ended my ability to work and the stress of dealing with my debt (all of which would have been manageable if I had any income) was horrible.
Christine Didur, Okotoks, Alta.
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Re 'It's Dream Crushing': University Of Ottawa Law Student On Being $150,000 In Debt (online video, May 8): For years, this law student kept borrowing more and more money and now that it's time to honour her commitment, she balks. She was not forced to take the loans and agreed to the terms to repay them.
My greater concern, however, is that her attitude is a reflection of society's eroding values. I wonder how she will respond when, as a practising lawyer, a client tells her he doesn't want to pay her fees?
Dov Vinograd, Westport, Ont.
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Re Low Rates, High Risk – Report on Business, May 11: The part played by the real estate industry in creating Canada's serious household-debt problem was all but glossed over in this article.
Certainly the Bank of Canada and the banking industry were prime players in fostering this perilous state of affairs, the former by instituting unprecedentedly low interest rates, and the latter with irresponsible lending practices. But the real estate industry has played – and continues to play – a large part by promoting bidding wars among house and condo buyers, helping to drive prices to unjustifiable highs.
Marvin Schiff, Toronto
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Secured lines of credit make a lot of sense for a lot of people (Growing Lines Of Credit Spur Warnings – Report on Business, May 12). They are great for emergencies and debt consolidation. If you can borrow at prime, then paying any higher rate of interest is a waste of money. But lines of credit shouldn't be used to finance a lifestyle you couldn't otherwise afford.
Thomas Glover, Edmonton
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The Bank of Canada says its low interest rate policy is not the cause of the increase in housing costs in this country, but it is difficult to resist that conclusion (Remember When? – May 13).
The data appear to present a picture of vastly larger sums of money (from inexpensive credit and, it seems, a growing appetite for debt) chasing a limited supply of housing.
It would be simple to test this by starting to raise interest rates, but there is the rub: The deeper we get into debt, the bigger the risk when borrowing costs rise.
Douglas Campbell, Vancouver
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ON REFLECTION Letters to the editor
Letters to the Editor should be exclusive to The Globe and Mail. Include your name, address and daytime phone number. Try to keep letters to fewer than 150 words. Letters may be edited for length and clarity. To submit a letter by e-mail, click here: letters@globeandmail.com
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Video value
Employment Minister Pierre Poilievre's department has a five-person "creative production team" to produce videos and photography (Poilievre Video Spurs Fresh Criticism – May 15). If the team has annual expenses of $50,000 plus salaries (let's estimate them at $50,000, conservatively, not including benefits) and the two videos of Mr. Poilievre posted this month each drew about 300 online views as of Thursday, then the department is spending about $500 per hit.
Joel MacDonald, Saskatoon
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Testing the tests
Cancellation of Ontario's public elementary testing could be a real opportunity (Standardized Testing A Casualty Of Teachers' Work-To-Rule Action – May 15). Currently, these tests happen just in time to close the barn door after the failing horses are gone. If tests were given in September and results shared with teachers, they would have eight months to help students who did poorly. As it stands, the system is rigged to embarrass school systems and tailor teaching to standardized tests, rather than to the needs and skills of students.
Wayne Nickoli, London, Ont.
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Maybe Mercer's free
Re The Debate Debate – letters, May 14: A better idea than a reader's suggestion that an absent Prime Minister Stephen Harper be represented by an empty chair in the televised leaders' debates would be to have his party represented by satirist Rick Mercer. Viewership, and possibly voting, would likely go through the roof and a really fun time would be had by all.
Rod Yellon, Winnipeg
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Oh, what times
How sad it is to reflect that 10 years ago, the most that could happen to a reporter doing a live broadcast would be that a crowd of goofy youngsters would gather, shouting, "Hi, Mom!" and making bunny ears behind the person standing next to them (Calgary Police Charge Man For Hurling Obscenity At Reporter – May 15). Today, we have men shouting obscenities, hoping for their 15 minutes of fame. O tempora, o mores!
Fiorenza Hawryluk, Toronto