The time preference of a society is important to understand because if there isn’t much future oriented activity, then the future is going to be worse than the present. There are many ways to look at the time preference of a population. The rate of interest, the savings rate, survey data, or even trying to gauge the propensity of the population to engage in short term unproductive activities. Some people point to the obesity rate as a measure of inability of the average American to think about the future. One interesting and underappreciated method of looking at the time preference of society as a whole is to see how many people have life expectancies lower than twenty years. Life expectancy is a better measure than pure age because an aging healthy population is more likely to look to the future than a young population that dies early. The population data was taken from the UN World Population Prospects 2008 database* and the life expectancy data is from U.S. Decennial Life Tables at the US Census Bureau. For the life expectancy data, I used basic linear interpolations and projections to create estimates of life expectancy in 2010 and 2030 and created the following chart.
If people with kids are more future oriented than people without children, then the situation is actually much worse than it appears. The below chart doesn’t adjust for the change in average household size, but it does show that the amount of children in society is dropping.
By both of these metrics and assuming that there isn’t any breakthrough in life extension technology in the near term, the U.S. is going to become more short term oriented in the future. On a demographic basis, the US is in a better position than Japan and much or Europe, so the problems there can be assumed to be even more severe. Compared to Europe, the US even has a higher life expectancy after the age of 65. The pattern of developed countries using short term solutions that only address the symptoms of actual long term problems is going to get worse.
* The population data has age groups in 5 year increments, and when the cut off for 20 year life expectancy was between these 5 year increments it was assumed that each year contained one fifth of the total in that age group in order to simplify the calculations. Voting age was assumed to be twenty and up to both simplify the calculation and to partially adjust for the lack of participation of younger voters.