Category: Financial Philosophy

Saving for Retirement – How to Practice Future Preference in a Culture Focused on the Present

In his book Tragedy and Hope, Carroll Quigley argues that for a civilization to prosper, two key conditions must be met: individuals delaying gratification and their having unlimited material desires. He refers to the former as “future preference,” which will be the focus of this article in relation to personal finance.

The Role of Future Preference in Early American Culture and its Decline

According to Quigley, early American settlers, many of whom adhered to the Puritan faith, exhibited a strong future preference, which contributed significantly to the development of the United States. The values they cultivated during the 17th century including hard work, self-discipline, and cooperation, continued to shape American culture well into the late 19th century.

However, since the 20th century, cultural shifts have eroded these values. Such changes are evident in literary works like The Sun Also Rises by Ernest Hemingway. The novel centers around a group of American expatriates in Paris who, disillusioned after World War I, spend their time drinking expensive wine day after day and living leisurely. Although the book was published in the 1920s, this culture of “living for the moment” persists today.

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Knowing What’s Enough – Economic Lessons from Tolstoy’s War and Peace

As Napoleon’s army approached Moscow in 1812, the city’s residents hastily evacuated, taking with them whatever belongings they could manage. Leo Tolstoy’s masterpiece, War and Peace, vividly captures Russia’s tumultuous struggle against the invading French army. Its key characters are inspired by the Romanovs, the ruling family of Russia, and one of the wealthiest in the world. In one scene, Natasha Rostova, the central heroine, shows a keen discernment amidst chaos, selecting only the most valuable fine china, while relinquishing those of lesser value.

What makes this seemingly trivial action from Tolstoy’s epic notable today, more than 200 years after the Napoleonic Wars, is that our post-industrial society has an abundance of items of all kinds, making consumption a significant part of the economy. While we need to purchase goods that are indispensable in conducting our daily lives, we are inundated with non-essentials, the majority of which are imports that substitute domestic counterparts. There is a danger in the continuation of this trend, as it greatly undermines the integrity of maintaining manufacturing capacity at home, and foster a culture of mindless consumption.

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