For a recent interview with the French language publication Usbek & Rica, Liliana speaks about the concepts discussed in her new book, Discounting the Future: The Ascendancy of a Political Technology. Click here to learn more about the book. Click here to read the full article. A translated excerpt appears below:

“Discounting is a very old principle, which comes from finance and whose first applications outside this field date from the 19th century, particularly in the forestry and mining sector. At the beginning of the 20th century, the economist Irving Fisher formalized this principle by asserting that the value of all wealth depends solely on the future and not on the past or the present.

In the 1950s, discounting is then transformed into a real product, allowing managers to maximize the value of their company for shareholders. This repositioning goes hand in hand with a very significant change in the content and definition of the discount rate. The return that investors demand in return for the money they give to companies becomes central. The discount rate is then defined as the cost of capital. The question is no longer ‘How much is the future worth?’ but ‘What price are investors willing to put for the future compared to the present?’. However, defining the discount rate as the cost of capital amounts to increasing it. This is what happened in the 1950s and since. The effect of devaluing the future is amplified.”