In the long run we are all dead

The famous economist John Maynard Keynes once said: In the long run we are all dead.

While people debate on the meaning of this quote, it stands pretty well on its own as a description of a mentality that flourishes today. Why save up for the future? Why suffer difficult times now for better ones in the future? Why prepare for old age? Why have kids? Why maintain a family? Why move out from your parents? Life is too short, right? And in the end, we are all dead. So, lets just enjoy the here and now, spend money when we have them and travel the world.

In my mind, this mentality is not something that organically sprung from the minds of young people today. Rather, I think it is a consequence of public policy.

Take recent recessions as an example (the dot-com bubble in 2000, the financial crash of 2008). They were the consequence of lose monetary policies that produced cheap money that flowed into faulty investments, resulting in major crashes. How did public policy respond to them? By doing everything possible to re-inflate the economy so that consumption and borrowing could continue. Bankrupt banks were kept alive. Money was printed so that people could borrow. Economists urged authorities to create new bubbles. Voters voted for those who promised most spending. No wonder young people don't know how to prepare for an uncertain future! If they make mistakes, they will be saved!

This is somewhat contrary to the mentality of earlier generations. The United States suffered a severe crash in 1920 that resulted in a depression the following year. What did the authorities do? Mostly nothing. Those who were bankrupt were not saved. The authorities didn't push for more consumption and borrowing. And the result was a very fast recovery.

Young people today have been poisoned into thinking only about the short term. In the end, they are all dead, but worse off than they could be.