The experience of the Depression influenced my parents for life.
They spent moderately and saved well.
The idea of borrowing for something that wasn’t an absolute necessity or incurring a debt they couldn’t repay would have been anathema too them.
There was nothing unusual in that for them or their contemporaries.
It is no longer the norm, for many individuals and countries as Theodore Dalrymple ruminates:
. . .But to call the attempt to balance a budget ‘austerity,’ in other words to say living within your means implies ‘rigorous abstinence, asceticism,’ a kind of killjoy puritanism, is to suggest that it is both honest, just and decent to do otherwise. And this is indicative of a revolution in our sensibilities.
In fact, it is grossly dishonorable to live beyond your means, at least when you transfer to the cost to others, as is inevitable when borrowing becomes an entire, chronic way of life – as it has in many countries. Then repayment becomes impossible and is known in advance to be impossible; you continue to borrow so that you may continue to live at a higher standard of living than your earnings justify, in the full knowledge that you will either eventually default or, metaphorically speaking, pay back in tin the weight of what you borrowed in gold. Perhaps those foolish enough to lend to you in these circumstances deserve to lose some or all their money; but there is no disguising the fact that, at least according to traditional standards of morality, your conduct has been dishonorable, immoral and fraudulent.
If an individual owes money, the honorable thing for him to do is to restrict his spending in order to repay it, and not to borrow more merely so that he may maintain his current standard of living until such time comes when he must declare his bankruptcy. And I am old enough to remember the time when poor people refrained from borrowing for fear of not being able to repay the debt, and thus lose their self-respect. Their self-respect was more important to them than their level of consumption of inessentials. . .
Of course, countries are not individuals. . . Our individual sense on honor is not engaged when the borrowing is done by the government and the proceeds trickle down into our pockets.
It is in these circumstances that the moral corruption of living permanently on borrowed money that will never be paid back can be hidden from those who do so, though only vicariously. Their sense of responsibility is attenuated to the degree that they do not realize that they have any. The people in Greece, understandably but nevertheless wrongly, experience the lowering of their standard of living as unjust; they do not see it as a consequence of their undeservedly high previous standard of living, because that undeservedly high standard of living came to them via what for them was an abstraction, the government. In Spain, by contrast, it was private debt that was the culprit; but the population did not experience their high standard of living as economically unjustified either.
The idea that living within your means is a form of austerity, and not (other than in exceptional circumstances) the elementary moral duty of people of honor, shows that, underlying the economic crisis is a profound moral crisis in western society.
Living within your means was not just normal but right for my parents and their generation.
They endured an economic depression but not a moral one.