Thrift

Historical Context

In the Western world, classical liberalism from the late-eighteenth century onward understood liberty as the freedom to choose how to manage one's life while not causing harm to others. As François Ewald has shown, such an idea of freedom led, simultaneously, to emphasize its reverse side: individual responsibility. Prudence and foresight emerged as the main virtues in liberal thought. Instead of living only in the present moment, one should plan for the future. Consequently, thrift was understood to be a key economic practice corresponding to liberal virtues. At the same time, a need for new forms of thrift emerged as a result of urbanization and industrialization, as ever more households started to earn their living through salaried work. Indeed, thrift in the contemporary understanding of the word is more linked with the specific ways of using—or not using—money than with the aims of prolonging the useful lives of objects.

Savings banks and private insurance companies were among the institutions that aided in making the ethos of thrift concrete. The aim was to master time through regularly putting aside some money and thus create additional room for maneuver for individuals and families. Pat O'Malley claims that by the end of the nineteenth century in Great Britain, “industrial life insurance had become the principal institution for governing working class thrift, and few households were not enlisted in this regime” (2002, 100). As working-class and middle-class families engaged in private life insurance, this business started to be encouraged by public powers as well, despite early ambivalence and moral reticence (due to the potential connection with gambling) toward a form of governing life that relies on calculations of probability (Zelizer 1983).

The establishment of social security during the twentieth century transformed the idea of thrift at the level of governmental practice. Similarly to the original liberal ideas, welfare politics placed an emphasis on being prepared for future risks with respect to life's necessities. Yet the expansion of welfare policies was based partly on a new distinction, first made by Sir William Beveridge, between “compulsory” and “voluntary” thrift. According to O'Malley, Beveridge emphasized that thrift was so important from the point of view of the public good that it would be irresponsible to rely on private initiative on this matter. Instead, state technocrats should take care of the compulsory part of saving through taxation and with the help of scientific forms of governance. An extreme case of modern public intervention on practices of thrift is measures taken in wartime, when a population may be submitted to intensive pressures to save, either voluntarily or involuntarily, to finance the costs of fighting. Of course, it has remained a hot topic in political debates throughout the twentieth century to determine how much of the total saving should be accomplished by statutory regulation. Indeed, the so-called neoliberal turn in Western politics from the 1970s onward was backed by the contestation of the state apparatuses' major role in saving; instead, claimed the neoliberals, private persons and households should have the freedom to [Page 1455]decide what and when to consume, save, and invest and how to be prepared for the future.

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