A more cynical view would be that the government is backed into an economic corner and need an ever growing level of consumer debt to prop up the markets and/or currency.
One is that a "healthy" level of inflation at 2-3% per year is needed.
Another is that our money supply is based on debt, meaning that growing the money supply (the original definition of inflation) requires new debt to be created faster them existing debt is paid off.
We can't have 2-3% inflation without creating more debt. Consumer debt is one of the forms of debt that creates new money, so I think its safe to assume we need that debt to be growing at a similar pace to keep up. If consumer debt disappeared entirely we would still need other forms of debt to pick up the slack, meaning on average we would still have the same level of debt per person to keep the system afloat.
And the monetary system doesn't depend on inflation per se, it's just that aiming for slight inflation is the easiest way to avoid deflation.
The monetary system itself does actually depend on inflation. Inflation creates an incentive to spend and invest your money, and without both our system of money would collapse.
Fiat currency and fractional reserve banking mean that the money requires flow through the system. The velocity of money is a bit of a controversial measure, though personally I don't understand why. Ignoring the specific measure though, our money must have velocity at some level and the system would collapse if velocity fell too low or increased too high.
Creating a buffer only needs to happen once. So if debt increased faster than inflation 30 years ago, and then on average kept pace since then, we'd still have the buffer. That kind of buffer is sustainable.
It's a fiat currency based system that persists simply on the belief that it's too big to stop (i.e., fail). Just keep your head stuff in the sand, keep pushing forward and pretend there's no cliff ahead.
Any social contract operates on that principle.
Government only exists because most people believe in its legitimacy. Law only works because most people follow most of it. Property rights only exist because most people respect them most of the time. Contracts only work because most signatories follow them most of the time.
It's weird how fiat money is the one thing that gets singled out, here, when all the social agreements that actually make our society work are also artificial.
All money is a social contract as far as I can tell. They're always based on the expectation that we as a society will continue to value an intermediary at a predictable price relative to things we may want yo buy or sell later.
Real money would likely look like gold, or perhaps Bitcoin.
Fiat money would be strictly social contract based, in a Bernie Madoff sorta way.
Why would it look like bitcoin, and not any one of a trillion near-identical forks of bitcoin?
(Because there's an social contract, that by fiat decides which one is the 'real' one, just like how vkoubux aren't considered legal tender.)
Bitcoin isn't real money and no one actually tries to use it as money today. At best its a security, though realistically its more of a gambling chip than anything else.
Bitcoin fundamentally won't work as money, even if it can be a store of value. Second tier networks like lightning are required, but those only work by abandoning core pieces of the bitcoin protocol and avoiding actually using bitcoin at all.
What that poster outlined was not being "backed into an economic corner". Rather it is how our system is built. If everyone stopped spending and started saving we'd be in a world of hurt.
I'll even go a step further and say that the entire world would get into trouble if consumer spending stops in the lead economies. So don't get me wrong, it doesn't have to be the US that provides the spend-y consumers, but somebody has to provide them.
It can be China.
It can be Europe.
Whatever. But somebody has to spend.
At a whole-of-society level, that doesn't really work and "saving" had to take the form of warehouses full of stuff.
I do actually think the cynical explanation is more likely, but the government isn't going to tell is they're limiting late fees to make sure we keep racking up more consumer debt.
You're spot on. Don't belittle your insights.
Definitely mincing semantics here though, and probably giving too much leeway to those making these regulations.