Here’s To Future Days

As far as people go, I am fairly interested in the long-term. Even if I am occasionally driven to act based upon short-term urgent actions, I prefer to think with a longer view in mind, and work towards larger goals incrementally. I often reflect with some sadness that long-term thinking appears to be very rare among most of what I see around me. Nonetheless, mathematics does help us gain some understanding of our own view of the future.

As a graduate student in Engineering Management, I had to take a course in finance where one of our frequent assignments (which I must admit to enjoying) was determining the present and future value of projects. Despite the fact that these numbers are admittedly a bit arbitrary, because they are based on imaginary interest numbers, our attitude toward the future can be closely tied to economics and our behavior today. The difference between Esau and Jacob is a difference of worldview, and there is a strong economic basis to that worldview even if someone is (like myself) not particularly obsessed with money.

Let us at least speak in generalities. If we assume a high rate of interest (or profit or inflation) in the future, then we can justify just about any expenditure here and now on account of the fact that the future value of any kind of money rapidly decreases to zero. Assuming a high rate of growth therefore discourages savings and encourages consumption, especially capital expenditures that are expected to yield some result. It appears that regardless of what sort of explicit mathematics (or lack thereof), there has been for some time within our society the assumption of a high rate of interest, with all of its consequences.

If we assume a very low or negative rate of profit or inflation or interest, then our response is quite different. The lower or more negative the rate, the more we want to hoard our capital, and the less we want to spend or give away money because our capital retains or gains in money. As I commented on earlier [1], having currency that discourages spending by making for a more “rigid” supply tends to encourage miserly behavior and hoarding. There is really very little middle ground between conditions that encourage hoarding and conditions that encourage wasteful spending in the thought that the future is not worth anything.

And, of course, neither such behavior is really all that useful. After all, if we are long-term thinkers we have to examine the future results of our behavior on the world around us. Right now we are engaged in behavior that is wastefully indulgent, especially concerning education expenses (I speak from personal experience), as well as our societal attitude toward debt and entitlements. We are spending money now that we don’t have in unsustainable ways, making promises about entitlements we cannot keep to present generations, much less future ones, and we seem unconcerned about the consequences, as if we are just going to find some magic way to grow our way out of the problems. This suggests that our mindset is a high rate of inflation and profit, one that does not seem to be borne out by recent experience.

On the other hand, we have many obligations for good reason. If we want to avoid great social tragedy [2] concerning scandalously cruel treatment of the sick and elderly because we cannot afford as a society to take care of them, we have very few options and very little time to waste. First of all, we require a more family and community minded worldview that looks after each other instead of shoving off our duties of charity and hospitality on the government. To take responsibility for such matters as helping those in need on a local and small-scale level would be vastly more inefficient, but also require our own effort and concern, and these appear to be in short supply within our society. If we do not manage to replace our fraying social net with a more local and less expensive alternative, there will be no good options before too long.

That requires, though, that we act with the future in mind. If we continue on our present path we will all suffer greatly, with the probable consequences of hostility between generations about what scraps of social benefits are left. The only way to avoid this sort of divisive and destructive conflict is doing what we can to build our own social net within families, communities, and churches, and I do not see that effort even beginning, given the debt loads that are increasingly burdening even our states (as well as our nation). If we do not think about the future days or how we are going to fulfill our obligations, we are probably not going to have a pleasant future to toast. Let us hope it is not too late for us to change our behavior and change our destiny.



About nathanalbright

I'm a person with diverse interests who loves to read. If you want to know something about me, just ask.
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