Bruce Helmer and Peg Webb

As we turn the calendar to a new year, many people revisit familiar resolutions like getting healthier, getting organized, or simply getting a fresh start. But one resolution deserves a place at the top of the list in 2026: reducing or even eliminating “bad debt.” And that begins by understanding that not all borrowing is created equal.

We’ve all heard that famous advice from Hamlet, “Neither a borrower nor a lender be.” In the real world, however, few Americans can pay cash for a home, a car or an education. Some forms of debt are not only unavoidable, but they can actually support long-term financial stability. The key is knowing the difference between efficient debt that improves your financial life and inefficient debt that quietly drains it.

And with the state of borrowing today, the stakes are higher than they’ve been in decades. Back in 2015, total U.S. household debt was about $11.9 trillion. Ten years later, it has climbed to $18.6 trillion, roughly a 50% increase. The average American household now carries around $105,000 in total debt. Credit card APRs hover above 22%, mortgages sit near 6%, and auto loans generally have become more expensive. And the average federal student loan borrower today carries just over $39,000 in outstanding debt.

In short: the cost of borrowing has significantly changed. Our financial habits need to change too.

Good debt vs. bad debt—reframed for today

Good debt helps build long-term value (think reasonable mortgages, education that enhances earning power, or amortizing loans tied to an asset). In some cases, such as mortgage or a home-equity line interest, it may also come with tax advantages.

Bad debt, on the other hand, typically takes the form of high-interest credit card balances; Buy Now, Pay Later (BNPL) purchases without a clear payoff plan; and lifestyle spending that doesn’t create future value. Those dollars don’t just disappear; they take tomorrow’s income with them.

Know what you owe before you act

If controlling debt is your New Year’s goal, visibility is your first step. Create a simple inventory that lists each balance, interest rate, minimum payment, remaining term, and the purpose of the debt. Seeing the numbers in one place moves you from vague unease to meaningful control. It also highlights which debts are hurting you most (such as the 24% credit card that should take priority over a low-rate mortgage).

Tackle high-interest and low-balance debt first

Once you have the full picture, address the high-interest balances first. These are the ones quietly compounding against you every month. Some people prefer the Debt Avalanche method (pay down debt with highest annual percentage rate, or APR, first); others respond better to the Debt Snowball method (dispatch the smallest balances first for quick wins and a psychological boost). Neither is necessarily better than the other. The best method is the one you’ll stick with.

Debt-management options such as zero-balance transfers or consolidation loans can help, but only if you manage them with discipline. They’re tools, not magic-wand solutions.

Use good debt sensibly

If you were fortunate to lock in a 3% percent mortgage before rates rose, accelerating payments may not be the most effective use of your cash today. But if you’re buying a home or car in today’s rate environment, stricter budgeting and right-sizing your purchase becomes essential.

Turn a January resolution into a 12-month plan

Big financial change can happen through small, consistent decisions. Try focusing on one primary and attainable goal, such as reducing credit card balances by 30% this year. Break that into monthly targets and automate payments above the minimum. Redirect raises, bonuses or tax refunds toward your highest-interest balances. These small actions compound in your favor.

Protect your progress

Once you begin paying down debt, it’s important to avoid sliding backward. Create a short “no-go” list: vacations on credit cards, unnecessary store cards and casual use of BNPL for non-essentials. Begin to build an emergency fund and pull your credit report annually.

If you’re relying on credit cards for groceries or minimum payments are crowding out your budget, consider reaching out to a nonprofit credit counselor or a certified financial planner. Avoid for-profit “debt relief” offers that promise quick fixes, as they often create bigger problems down the road.

A better year begins with one step

Debt isn’t inherently good or bad. It’s simply a tool with pluses and minuses. But in today’s high-rate world, using that tool wisely matters more than ever. We suggest starting small: pull a credit report, list your debts and APRs, or automate a single payment. A year from now, you’ll be glad you did.

Bruce Helmer and Peg Webb are financial advisers at Wealth Enhancement Group and co-hosts of “Your Money” on WCCO 830 AM on Sunday mornings. Email Bruce and Peg at yourmoney@wealthenhancement.com. Advisory services offered through Wealth Enhancement Advisory Services LLC, a registered investment adviser and affiliate of Wealth Enhancement Group.

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The number of disruptive passengers on airplanes continues at a pace well above pre-pandemic levels. While the midair dustups are trending down after the Federal Aviation Administration adopted a zero-tolerance policy and increased fines almost five years ago, the incidents will end up close to double the three-year average before the pandemic.

Why are so many people still going bonkers during flights? There’s no lack of culprits.

One obvious one is access to alcohol as kiosk bars spring up across from boarding gates. Airline seats are shrinking while most Americans are getting larger. Another is social media: The unruly get 15 minutes of infamy and the recorders of such displays get the clicks.

While these potential sources of bad behavior are disparate and complex, the FAA’s solution was spot-on: Its zero-tolerance policy forgoes warnings and is backed up by fines up to as much as $43,658 for each violation. That should be effective, but the message hasn’t sunk in fast enough. While efforts have been made to spread the word, such as an airport ad campaign, they haven’t been enough to break the cycle and push the outbursts down to pre-pandemic levels.

Transportation Secretary Sean Duffy took a stab at cajoling passenger to behave themselves by harking back to the “golden age” of air travel when passengers wore suits and dresses and were better behaved. This was also an era when only the well-heeled could afford to fly. The industry now reaches the masses, as it should, and that comes with more dustup potential.

As much as Duffy — and many fellow passengers — would prefer travelers not show up at the airport in flip-flops and midriff tops, that’s unlikely to change. Flyers aren’t going to give up their comfortable sweatpants for a suit. Can you imagine the fights that would break out if an airport or airline attempts to enforce a dress code?

The FAA and airports need to be more aggressive about warning passengers. A good place for a sign that highlights the fine would be right above the kiosk bar among the gates. How about on the jet bridge, which would give passengers something to read while standing in line to board? Perhaps after flyers check the box agreeing not to bring on hazardous items — such as lithium batteries and ammunition — they would have to acknowledge reading a warning about proper behavior and the fact that passengers must follow orders from the flight crew.

The spike of violence on aircraft was ignited by Covid-19 restrictions and hassles — mostly fueled by masking requirements. Flight attendants turned into drill sergeants, barking at passengers who flouted mask rules or dawdled too long eating that snack with the mask off. Undoubtedly, there are lingering effects on both flight attendants and passengers from that intense period. Then there’s just the societal polarization that has intensified in the past decade and has more people on edge and coiled to lash out. Add a few drinks from the kiosk bar, and the smallest spark can unleash the rage.

Certainly, the number of incidents has dropped from a peak in 2021, when there were 720 altercations in March alone, according to FAA data. There were 104 unruly passengers last month, the lowest monthly tally since 2020. In the first 11 months of this year, 1,480 altercations were reported, down 23% from the period a year earlier. Still, that level is much higher than the 889 incidents in all of 2018 and 544 in 2017.

Continuing the crackdown on unruly behavior and publicizing it widely is the only way to get passengers to shape up. The financial incentive for airports and airlines to serve alcohol precludes temperance as a solution. Airlines aren’t going to give up precious cabin real estate with larger seats and more legroom at the back of the plane. There’s no controlling social media nor how the incidents go viral and inspire more bad actors. It’s futile to wait for the country to heal its polarizing politics.

Airlines don’t discuss the problem publicly much. The violence isn’t good for brand image and it’s not good business to disparage customers. Although an incident can be costly, especially if a flight is diverted to an unscheduled airport, they aren’t that common. Last year, U.S. airlines operated almost 10 million domestic and international flights. Since the end of 2024, reported incidents occurred at an average of 1.5 times per 10,000 flights, according to the FAA.

Flight attendants are trained to de-escalate potentially explosive situations. Who knows how many fights didn’t break out in a melee because the flight crew spotted off-kilter passengers and knew how to listen and empathize to defuse a disruption?

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A messaging bombardment should make it clear to passengers that they must follow instructions from flight crew and can file a complaint later. The job of flight attendants is safety first and later to serve beverages or bring a blanket. The viral videos of fisticuffs make headlines, but the resulting fines are too anticlimactic to garner much news coverage — even a record fine of $81,950 for a passenger who shoved and punched flight attendants and tried to open the plane door while in flight.

While the number of unruly passengers is trending down, it hasn’t been quick enough. Let the warning spread far and wide: Disruptive behavior in a metal tube crammed with hundreds of people is simply unacceptable — and there will be consequences.

Thomas Black is a Bloomberg Opinion columnist writing about the industrial and transportation sectors. He was previously a Bloomberg News reporter covering logistics, manufacturing and private aviation.

Edward Lotterman

Need some last-minute gifts but unsure what to buy?  Well, cases of tuna and Spam are good, dry rice and beans, matches, maybe a 50-pound sack of flour – don’t forget a pound of yeast. Oh, and maybe Sterno cans for stocking stuffers.

What’s the emergency, you ask?  Well, our president just told us the economy is in fine fettle, Everything would be hunky dory if not for Joe Biden. And recent headlines like “Treasury Secretary Bessent calls for looser regulations for the U.S. financial system” should strike fear into every heart. Anytime our nation’s top economic officials brag about how things are going and how the rules should be reduced, things soon go south.

There are historical precedents.

Alan Greenspan was similarly sunny in his sermonizing memoir, “The Age of Turbulence,” released on Sept. 17, 2007. In it, he waxed lyrical about how financial derivatives such as options, swaps, repos and reverse repos together with new credit default swaps would bring unprecedented stability and efficiency to financial markets. Uncertainty would be reduced, he argued, and risk would be assumed by those best able to handle it and the economy would grow briskly.

The Sept. 17 date was bitterly ironic because just a month earlier the European Central Bank had been forced to pump about $130 billion into short-term credit markets over one night. The U.S. Fed put in something around $55 billion. Its policymaking Open-Market Committee held two emergency teleconference meetings in a week with an unprecedented sharp division between the seven governors and the five district bank presidents.

From there, problems in markets for derivative securities worsened. Major investment bank Bear Stearns failed eight months later.  Greenspan’s publishers hurriedly rushed out an edition “with a new chapter on the current credit crisis, but his lyrical odes to derivatives, along with his successor Ben Bernanke’s statement that problems would be “well contained” will go down in the pantheon of cluelessness. When Lehman Brothers went bust on Sept. 15, 2008, exactly a year after Greenspan’s ode to unfettered financial jerry-rigging, the Fed was forced to launch an unprecedent bailout of financial markets. The aftereffects still plague our society today.

Such blindness was nothing new. Even though both President Herbert Hoover and Treasury Secretary Andrew Mellon had private qualms about the meteoric rise in stock prices in 1929, both issued statements describing “a great revival of prosperity” being ‘just around the corner” once the collapse began.

Moreover, one can dredge up similar blandishments by officials as crises unfolded in 1920-21, 1907 and 1873.  Moreover, in the 1980s and 1990s, as we progressively demolished decades-old government regulation of banking and financial markets, officials and politicians told us such deregulation would unleash economic growth.

Yet reality is that such promises were moonshine. The last two decades have had the poorest growth since 1940. And, leaving out WWII output boom years, inflation-adjusted growth of output from 1950 through 2000 averaged 3.7% a year, Since 2000, despite relatively deregulated financial markets and tax cuts for high earners in 2001, 2003, 2017 and 2025, annual output growth has been only 2.1% a year. Thus, despite Bessent’s cheery promises, the historical record of the stimulative effects of financial de-regulation has not proved out.

What does this all have to do with the gloom and doom predicted above?

— The answer is that financial markets have become both more complex and more opaque in this century.  Relative to overall complexity and the number of new financial institutions and financial instruments, government supervision and regulation of financial markets has shrunk.

— In successive steps after the 2007-09 collateralized debt debacle and the 2020-22 COVID-19 crisis, the Federal Reserve has increased the size of the money supply relative to output to the highest level since its inception in 1914.  More technical measures of the increase in liquidity such as the “monetary base” and “Factors Affecting Reserve Balances of Depository Institutions” tell the same story.  The textbook prediction of a rapidly increased money supply is that prices will go up. The emphasis is on inflation consumer and producer prices. That did occurr from 2020 into 2023, only not at a level historically commensurate with the increase in money.

— If, instead, one looks at prices of housing, farmland and financial assets, including stocks, cryptocurrencies and hedge funds, there has been an enormous runup in prices. Irving Fisher, a great economist a century ago, warned that inflation in asset values rather than goods-and-services prices was possible. Yet that has gotten little attention in contemporary economics. It is hard to read financial news over the last couple of years without concluding that a financial bubble mentality has set in for many.

— History shows that very rapid run-ups in real estate, stock and investment fund values seldom unwind in a gradual or orderly manner. There is no reason to expect things to be any different in the next year or two or three.

— All of this is taking place against a backdrop of exponential grown in federal deficits and debt manifesting itself into huge monthly borrowings. We are borrowing $1 trillion in additional debt every 60 days and we have to roll over at least $6 trillion in existing bonds that mature this year. The wolf has finally come after decades of warnings. I have slides from presentations I made on deficit and debt problems when I still worked at the Minneapolis Fed, a position I left in 1999. Former Treasury Secretary Peter Peterson was loudly banging that drum by the mid-1990s. Boston University’s Lawrence Kotlikoff and many other economists have been consistent voices, even if apparently in the wilderness. Why does this matter? Because in case of a full-blown financial crisis as in 1930-33 or 2007-09, the ability of the Treasury and Federal Reserve to act is circumscribed by these institutions already being tapped out.

— There are new and very imperfectly understood financial instruments.  Cryptocurrencies are one. Regardless of their long-term functioning in economies, recent years show all the land-office-rush mentality of a classic bubble. And then there is “private credit” and “private equity,” new and largely unregulated financial intermediaries whose size and potential for explosions are not apparent.

— Just as warnings about the wolf of federal debt finally coming, so is that of Fed bailouts, not just of failing financial institutions but of entire markets. It’s a shame, but broad-ranging reactions after 2008 to a problem it was partially responsible for creating has negative outcomes that will become apparent in the next bust. The Fed took actions that stretched its statutory powers, lending enormous sums in ways that would have flabbergasted economists and Fed officers prior to 2005. A genie got out of the bottle and has not yet been forced back in.

St. Paul economist and writer Edward Lotterman can be reached at stpaul@edlotterman.com.

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You almost have to admire Defense Secretary Pete Hegseth taking the stage at the Ronald Reagan presidential library and immediately opening fire. “Most who invoke Ronald Reagan’s name today, especially self-styled Republican hawks, are not much like Ronald Reagan,” he said. “Donald Trump is the true and rightful heir of Ronald Reagan.” Who says the Gipper is irrelevant in Republican politics?

Mr. Hegseth aimed to locate the Trump project in Reagan’s mantra of peace through strength, and their slogans are the same. But the history of Reagan’s success is worth recalling as Mr. Hegseth accuses others of besmirching the 40th President’s legacy. Reagan rebuilt the U.S. military but also took political risk to negotiate with communists to win the Cold War, and Mr. Hegseth says President Trump is rerunning that playbook.

That doesn’t get the Reagan history right. Reagan negotiated from strength because he first built up that strength, both military and economic. He deployed midrange nuclear missiles in Europe despite ferocious Soviet opposition. The Soviets tried to break the U.S. alliance with Europe, and they only turned to serious negotiating when they concluded they couldn’t compete with the U.S.

Today the U.S. faces two nuclear peer adversaries, China and Russia, both global and ideologically hostile powers like the Soviet Union. And they are working together. Mr. Trump is so far making concessions to both and is spending less on defense as a share of the economy than Jimmy Carter did in 1979.

Mr. Hegseth said the defense budget is going up. “My kids and yours will someday talk about the Trump buildup,” he said. We’re ready to help the President make the case, and his one-time cash infusion in this year’s Republican budget bill was a start. But now what? Mr. Trump’s fiscal 2026 budget proposed a defense cut after inflation.

The defense secretary is right that Reagan hesitated to use military force abroad. But then Mr. Hegseth revived Reagan Defense Secretary Cap Weinberger’s test for U.S. intervention abroad. That doctrine prescribes force only as a last resort for a vital interest, and only if it’s popular, among other requirements. “This is sound stuff,” Mr. Hegseth said.

But Reagan and his administration never fully accepted those tenets. Bill Safire, the conservative columnist, described the doctrine in the New York Times at the time as “only the fun wars” and a vow not to defend ourselves until the stakes are dire. As Safire put it: “Our tradition has been to accept risks for a just cause.”

That point matters because you can’t reduce Reaganism to “out with utopian idealism, in with hard-nosed realism,” as Mr. Hegseth averred. The Reagan grand strategy blended idealism with realism — naming an evil empire, while arming even unpalatable enemies of communism across the world.

The Chinese Communists may not be fomenting revolution abroad the way the Soviets did — for now — but their ambitions are still to become the pre-eminent global power, and Vladimir Putin is their junior partner. Mr. Trump casually said recently that Ukraine is losing its war, but Reagan would understand that Ukraine’s defeat would be a loss for the West that makes the U.S. less secure.

Mr. Hegseth’s lines that the “unipolar moment” of American primacy “is over” and talk about “respecting” China’s massive military build-up — designed to defeat U.S. forces — is a call for detente. But Reagan rejected detente with the Soviets in the 1970s. He rejected the view, common at the time, that the best the U.S. could do was negotiate a balance of power. This also may not be the best week for Mr. Hegseth to denounce “globalism” as the Trump Team argues that America can trust Beijing with Nvidia ’s advanced AI chips.

Mr. Trump has made several policy choices worthy of Reagan, notably his Golden Dome homeland missile shield and enforcing his word that Iran can’t have a nuclear weapon. Both presidents evince a genuine hatred of nuclear weapons and the awful human cost of war. President Trump carries an instinct for U.S. primacy in the world, albeit without Reagan’s decades of arguments about freedom and the virtues of free societies.

America’s enemies are doubtless pleased that Mr. Hegseth is so focused on settling scores about the Iraq War and firing inside the GOP tent. But if there’s a silver lining to his historical rewrite, it’s that the Trump team understands that Reagan’s legacy is important to embrace. Some in the MAGA coalition have dismissed this as “Zombie Reaganism” and claim that the U.S. would be better off if Pat Buchanan’s isolationism had prevailed.

Don’t believe it. The Administration is associating with Reagan because Republican voters still see themselves in his tradition and coalition. Mr. Trump knows who is the standard bearer for Republican electoral and strategic success. We wish his policies were as similar to Reagan’s as his slogan.

— The Wall Street Journal

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