Compulsive borrowing from loan and finance companies is rapidly becoming a national addiction.
Dr. Lucio E. Gatto, who recently completed a 10-year study of the problem, terms such compulsive borrowing a finance neurosis.
He said when a man is having trouble with his wife or his employer he may start borrowing money as a defense mechanism against his worries.
Soon the borrowing becomes a habit, added Dr. Gatto, who is associate clinical professor of medicine at the Louisiana State university medical school.
"And here's an interesting phenomenon," said the psychiatrist. "Even though the man could get out of debt, he probably won't. Why? Well, the minute he makes an effort in that direction, his initial worries start cropping up again. So once more he retreats into the world of debt as an escape from underlying worries." SELF PUNISHMENT
Dr. Gatto said that in such a case, ' 'displacement to such unrealistic behavior is used as a coverup for marital troubles; as a coverup for inner frustrations; as a coverup for. feelings of active rejection.
"Becoming involved in financial difficulties seems the only way such a person can relieve his underlying tensions," the psychiatrist explained. "Actually such an individual wants to punish himself because of his inner conflicts. £o he inflicts self-punishment by paying out excessively large amounts of money to individuals or groups that originally played no active part-in his real problem."
The psychiatrist said finance neuroses can multiply endlessly. He said at first they affect a couple, then a family, finally even an entire community. "In 1945 installment credits in
this country totalled $2,500,000,000 a year/' he explained; "by. 1960 they had zoomed to over $36,000,-000,000 a year."
Dr. Gatto said that William McChesney Martin Jr., chairaian of the board of governors, Federal Reserve System, recently stated that such uncontrolled borrowing promises only trouble for the future.
NO COLLATERAL 'Martin termed such an unproductive form of borrowing the newest and greatest form of slavery under which burden people may break their backs," the psychiatrist added.
Dr. Gatto said in today's era of borrowing on the cuff, many finance companies are only too willing to lend money without collateral.
i "But when there's no collateral," he added, "they tend to charge exorbitant' rates. I know
of one poor fellow who borrowed
$500 and because of his compulsion to remain in debt as a coverup for his real problems, ended up owing the finance company over $1000 on his initial loan."
Dr. Gatto said that in some areas persons must pay as high as 30 to 40 per cent on small loans.
"In some states," he added, "there are protective laws against such practices. Louisiana is working on that now."
AIR FORCE VETERAN
The psychiatrist said that in his opinion the finance companies should become more aware of the compulsive borrowers.
"I'm sure there are men of conscience in this field, who wouldn't want to be responsible for assisting these compulsive borrowers in wrecking their homes and even their lives," added Dr. Gatto.
The psychiatrist said that some of these poeople may be driven
to attempts of self-destruction.
whether economic, social or physical.
For 20 years prior to his retirement as a colonel; about a year ago, Dr. Gatto served in the United States Air Force. During these years he directed the entire psychiatric services of first one Air Force hospital then another. Often he served as psychiatric consultant to various Air Force commands. His tours of duty took him to every comer of the globe.
During these years he became increasingly interested in the problem of the compulsive borrower. And for the past 10 years, including one at the LSU medical school, he has ' been making study of persons suffering from a finance neurosis.
REAL PROBLEM
Dr. Gatto recalled the case of the young airman who was having trouble with his wife. Soon the wife began spending a lot of money as her way of getting back at her husband for real or imagined grievances. The husband countered by also spending lots of money. Gradually the couple became deeply involved with the finance companies. In time, borrowing for them became an addiction like taking dope or drinking.
Another case, recalled the psychiatrist, involved a young Air Force sergeant of Nordic descent who married a Japanese girl.
"When the big, blond sergeant brought his Japanese wife back to the US," Dr. Gatto explained, "his family did not approve of her. So, unable to handle his real conflicts, the sergeant started borrowing money. After a while he was deeply involved and in danger of being discharged from the Air Force. But, we got at the root of the matter, explained to him what had happened to him and helped him resolve his real problems in a much more suitable way."
Dr. Gatto said "it is not enough to make the compulsive borrower aware of his neurosis,"
"Very often such an individual needs psychiatric help," he added, "only then will he be aW* to resolve his conflicts." PHOTO: PSYCHIATRIST REPORTS ON BORROWING HABIT
Dr. Lucio E. Gatto recently completed 10-year study of borrowing problem.
