Editor's Note: James Quinn is a senior director of strategic planning for a major university. James has held high-level financial positions with a retailer, homebuilder and a university in his 22-year career. He can be found online at www.theburningplatform.com.

'Cause we all just wanna be big rockstars
And live in hilltop houses driving fifteen cars
"Rockstar," Nickleback

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Americans love their cars. Americans are their cars. There’s a strange belief rampant in the US, a belief that cars are a measure of status and achievement. If you want your neighbors, friends, and perfect strangers to think you’re a success, just tool around in a Mercedes SUV.

But this recession is forcing these status-conscious auto-worshippers to forego their beloved cars. The result is that auto sales have plummeted from an annual rate of 16 million to a current rate of less than 10 million. These short-sighted people have allowed the temporary psychological benefits of driving a car they can’t afford to outweigh their long-term financial future. Millions have made this choice. Now that the debt bubble has imploded, and the government is pouring billions of taxpayer funds into the auto-financing companies like GMAC (GM) to re-inflate the bubble.

The American consumer has changed their car-buying habits over the decades. In the 1970s, they saved up the 20% down payment, then financed the remaining balance over 3 or 4 years. With an average loan of $4,000 to $8,000, the burden wasn’t great. After 4 years, they owned the car, free and clear. They would then drive their American-made car until it fell apart, usually at around 90,000 miles. In 2008, the average new-car loan topped out near $30,000. In comparison, the median home price was $17,000 in 1970.

The $30,000 average car loan was made manageable by the “creative” auto financing arms of the Big 3 (GM, Chrysler, and Ford (F)) extending loan periods to 6 or 7 years. This worked fine for the trader-uppers; they wouldn’t be caught dead driving a 7-year-old car. Car buyers told themselves that debt didn’t matter; car companies told themselves the loans would be repaid. A perfect combination to sell 16 million cars annually for all eternity.

When the return customer came into the dealership to trade up after 2 years, the dealers were perfectly happy to roll the unpaid loan balance into the new deal. Presto! Millions of people driving cars with a loan-to-value ratio of 140%. According to JD Power, there are now 6 million people who are underwater on their car loans. When this Ponzi scheme collapsed, car sales plummeted 40%, and GM and Chrysler have been revealed as bankrupt.