The effects of these changes are manifest in every part of the global economy. Individuals fail to plan adequately for their retirement; they simply don't care about their future selves as much as they ought to. They're also happy to push their debts into the future, in forms ranging from credit cards to government bonds. Essentially, they are stealing from future generations to fund their lifestyles today. In the long term, however, their actions could be disastrous: a rash of debt crises, perhaps, or tax rates high enough to stifle even the fastest-growing economies.
The corporate sector is suffering too. Managers focused on hitting their quarterly targets may ignore profitable long-term investments if the upfront cost is too great. This may be especially true for so-called social investments, whose benefits may not occur until several years have passed. For instance, what executive would spend extra money to help the quality of education in his company's community if the benefits in terms of higher-skilled workers and wealthier consumers might not appear until after he retired?
Governments are also passing up valuable opportunities to help their economies grow. Infrastructure, scientific research, and education cost a lot in the short term, and their benefits can take years or even a generation to accrue. Yet these benefits, in terms of higher wages, enhanced competitiveness, and economic growth, are enormous. The question is: How can you get a politician to focus on these investments, when she may be long gone from office by the time they pay off? For that matter, how could you get her to spend money today to fend off global warming or some other apparently far-off calamity?
The answer in both cases, of course, is for voters -- and shareholders, in the private sector -- to send a strong message that will punish short-term thinking. For this to happen, we need to change our preferences. We have to take responsibility for our own excesses. We have to teach our children to delay their gratification, to work hard even when the results might not come right away, and to use all the tools at their disposal to understand all the complications of an uncertain world.
If we do not, we risk an enormous disappointment of expectations that will be catastrophic in both economic and psychic terms. Already, living standards for the younger generation in wealthy economies are starting to fall short of those their parents enjoyed. The response among the young has been to borrow more, earlier, and the oceans of cheap money supplied by the world's central banks have only served to enable them.
They are just accelerating the catastrophe. The time to stretch out our time horizons at home, in business, and in government is right now, before our future disappears altogether.
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