By the end of this article, the future will be here. In fact, it’s just at the end of this sentence.
It’s easy to predict that the future will arrive, but it’s far harder to predict what it will look like. By the end of this article, will you be bored? Asleep? Crying? Regretful? Inspired? Hungry? Maybe you wont finish it, because maybe, just maybe, an asteroid is approaching the earth unexpectedly, ready to hit… just… about… now. Still reading? Good, that means that it probably didn’t happen.
Some people, like William Gibson, believe that the future is already here – it’s just not evenly distributed. The technology probably already exists, the jobs created, the products being used- except they’re being used by a certain elite, doing the early testing work for the rest of us. Or it exists in a form we don’t recognise, in the same way those clever NASA people in the 1970s didn’t realise they were, in fact, inventing the new iPhone and a whole bunch of other cool stuff.
One thing is clear. As Gaston Berger said, ‘we only study the future in order to disturb the present’. Or as Patrick Harris wonderfully translated for me, ‘to make better decisions today.’
If you’re like most people, you rely on information from the past and the present to help make your decisions. What did you do when you were in this situation before? What happened last time? What happened to other people you know? This is a behaviour that Dan Ariely refers to as ‘self-herding’. Essentially, his belief is that most people don’t really know what they want and, combined with the plethora of choices we’re faced with every day, expending the psychological energy to try and figure out the right answer is pretty hard. Even trying to decide what to have for dinner can be a challenge. So, the way most of us answer that is to think about what we did before, presuming that it was a good decision, and just repeat that. That’s why we all tend to go to the same coffee shops, eat similar lunches, drink in the same pubs, and watch the same TV channels. It turns out that consulting our memory is easier than thinking through what our preferences might be and making a decision based on those.
The problem this creates is that people think they can predict the future because they think they can explain the past, leading to over-confidence in decision making. This can be seen in a common bias that most of us suffer from: ‘Hindsight bias’ (also known as the ‘knew-it-all-along’ effect), ’the inclination to view events that have already occurred as being more predictable and obvious than they were before they happened’. You can see this all the time in history books, parliamentary inquiries, and courts of law trying to attribute responsibility for incidents and accidents. This bias is often accompanied by ‘self-attribution bias’ – a tendency for people to attribute their successes wholly to their own ability, whilst blaming any failure on bad luck or some kind of external, mitigating factor…
As well as these inherent biases which affect our view of the past, and therefore the future, our decisions may also be being driven by the subtleties in our language. Professor Keith Chen conducted a fascinating study on the impact of speaking a future-orientated language such as English, Greek, or Italian, as opposed to one with weaker references to the future, for example Chinese or German. He discovered convincing evidence that speakers of languages that don’t rely on the future tense tend to make more future-focussed decisions – saving more money, retiring with more wealth, and making better health decisions such as smoking less.
Confused? Here’s an example… When discussing the weather in English (which we often do), we talk about the future as different from the present (‘It will rain tomorrow). However, our EU bedfellows Germany speak about the future as though it is the present (‘Morgan regent es’ = ‘It rains tomorrow’). He found that speakers with this weaker distinction between the present and the future were 31% more likely to save, were 24% less likely to smoke, and 29% more likely to be physically active. And more than that, it had an effect on the national savings rate, with present-focussed languages saving on average 6% more of their GDP per year. Think about those countries again – Greece, the UK, Italy – anyone spot the correlation…?
As well as having to compete with our natural self-herding and language-based biases, we also have a bit of an issue with self-control when it comes to planning for the future…
Ever signed up to a gym in January, but then chosen to go out for a delicious (unhealthy) meal instead of working out? Ever thought really hard about saving money for a holiday or wedding, only to find yourself filling up your virtual cart on Amazon or standing in the familiar scrum at your local bar on a Friday night about to hand over your credit card for yet another round? Although people know it’s coming, they always seem to think the future is just a little bit further away than it really is. This leads people to focus on today rather than think about what tomorrow could bring when making choices, often responding to urges for immediate gratification over longer-term goals.
This is caused by ‘Hyperbolic Discounting’, identified by Daniel Kahneman, where people value the benefits that are reaped in the present much more than the benefits reaped in the future. For instance, when offered the choice between $50 now and $100 a year from now, many people will choose the immediate $50. However, given the choice between $50 in five years or $100 in six years almost everyone will choose $100 in six years, even though that is the same choice seen at five years’ greater distance. As a result, the impact of money that is due to be paid out in the future is not as strong as money that has to be paid in the present, hence the success of ‘buy now pay later’ and the super / awful impact of credit card spending. The implications of this go far beyond fitness and furniture, as it suggests that what we want very much depends on when you ask us – ‘time-inconsistent preferences’ – which often leads to us regretting the choices we make. Why did I say yes to going out for a drink or two after work?
Because of this, people struggle to save enough for retirement, not appreciating that their preferences and circumstances may change as they get older. Consumers struggle to save, overspending on credit cards and failing to pay debt off as quickly as planned. Procrastination is a familiar experience, caused by people postponing tasks indefinitely even if they only require little effort (such as switching energy suppliers, or taking some crutches back to the NHS). It’s not just individuals, either – the list of companies who saw the future, but were too focussed on the present to do anything about it (and then subsequently failed) is growing all the time (Blockbuster, Kodak, I’m looking at you). You might see it in your company, too – people focussed on doing their bit of the job well for the couple of years they’re in the role, leaving the big changes that need to be made to the next guy or girl, because that will probably be around the time the future arrives…
So there you have it; as promised, the future is here. Maybe it’s as you expected based on your past experiences. Maybe you regret the rash decision to read this rather than write the emails you’re meant to be writing. Or maybe you’ve decided now really is the time to revisit your school days, and learn German properly.
Either way, one thing is guaranteed. You better decide fast, as the future will be here much quicker than you think…
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