Some time ago I heard the phrase "debt trap". A nation falls into the debt trap when they get into debt so far that they are borrowing more to service their old debt. Pretty quickly their lenders realize things are getting bad and jack up the interest rates. With the huge amounts of money we are talking about a point or two is a real problem and beyond that. A nation can then choose to deflate their way out (Argentina and Russia), default on the debt (pretty much every country in Africa and Central/ South America at some point or another), go to war (Germany) or do some combination of the three.
I think there is a debt trap of sorts for individuals. This trap is when you have so many payments that it is basically impossible to pay cash for anything. All your income is going to basic life expenses (food, shelter, etc) or to payments. You can't buy a damn toaster without financing it. How does it end? One option is that something happens and the whole apple cart is knocked over. When you have no savings and the whole paycheck has to go to pay for junk you already have it doesn't take much to have a real problem. The good news is that there is another way out. Go to the library and get a copy of Dave Ramsey's book and read it. Check out Suze Orman's stuff also. Make your own decisions about what is important. Get some discipline and come up with a plan that gives your finances some order, cuts expenses drastically and improve your situation.
Don't fall into the debt trap. If you are closer to the debt trap than you care to admit then start improving your situation. If you are in a good place then do not become complacent and continue to improve.