Living in a World with Less Credit

The debts Americans have piled up are due. That means a lot less consumer spending and a lot more pain for everyone

David Bowman for TIME

At ByDesign Financial Solutions, a debt-counseling service in Modesto, Calif., they're working overtime these days. "Our call volume went up 97% in the past five weeks, which has left us scrambling," says Martha Lucey, president of the nonprofit agency. "[The callers] are close to the max on their credit cards, and they just can't figure out how to manage. We've seen credit-card companies decreasing lines of credit, and the [debtors] don't have any room left. They just can't juggle things like they used to."

At Keller's, a popular Modesto housewares store,...

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