Humans hate going backwards. We all do. Forward progress is something that we universally value and share a motivation for. The issue comes when setbacks happen, and they will. It doesn’t matter how diligent we are; we will all experience setbacks in our lives. Our finances, health, career, and lifestyle will all have times when they are not ticking up on the graph, and we hate it. We beat ourselves up, rally, try harder, or give up. The step backwards is not something humans have evolved to handle gracefully.
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The Metrics That Set The Tone
It is hard to say if this mentality today starts or ends at the top, but there is a very allergic reaction to regression that happens at the leadership level in almost every government in the world. We have set the highest metric for a country’s performance as the Gross Domestic Product (GDP). If you have only heard the term and never looked it up, here you go:
Gross Domestic Product (GDP) is the total monetary or market value of all finished goods and services produced within a country’s borders in a specific time period.
If you want a little more info, here is an article breaking down the basics straight from the International Monetary Fund (IMF).
Now, for most developed countries, it is widely accepted that 2–3% growth is the target and signals a “healthy” economy. Endless growth, not improvement or wellbeing, just growth. Anytime that GDP numbers creep back, economists, markets, politicians, and banks get a bit worried. That worry isn’t completely unfounded, since we have based the majority of our grading on that single number. This is why they do an awful lot to polish it up before publishing it. There can be some creative accounting that takes place to keep public sentiment at ease, because going backwards is not an option.
The problem with growth being the only focus is that it doesn’t account for well-being, especially at an individual level. We could use a number of better metrics that may signal the health of a population and economy much better than simply GDP. There is the Gini Coefficient, which measures inequality, the Consumer Price Index (CPI), which measures the changes in consumer goods pricing, or even the Gross National Happiness (GNH) index, which measures nine different domains of happiness and well-being; all of which would be better to track how humans, not businesses, are doing and could be used to create a better overall econonomy, even within a capitalist framework. However, since we do not value these types of metrics, they continue to decline to ensure GDP continues to increase. Your metrics define your priorities, and when a metric becomes a goal, it ceases to be a good form of measurement.
A Step Back Can Be Painful If You Sprinted Forward
It isn’t as easy as a simple change; the market can’t easily bear setbacks in their current form. We can use housing as a painful example here. Housing prices have increased drastically in the last decade or so to the point that it is now unhealthy. Imagine a correction, though, and the impact on people. If you bought a house in the last 5–10 years for $200,000, and there was a sweeping correction of 20%. That means you are $40,000 under your mortgage and/or equity. That is a real loss to real people. That is about what the average student loan debt amount is per person, and we see the crippling effects that can have on a population. However, imagine how sentiment would be different if it affected all people who opted to purchase a house instead of those who opted for an education. Still, we would hate to take a step back, because it would not be comfortable. Forward progress only.
When was the last time that you thought, “Wow, things used to be more expensive?” Outside of a few things that we are used to heavy fluctuation, like gas, the price of goods doesn’t come back down, no matter if what originally caused the increase in the first place is still present. This is what I am bracing for with the tariffs in the US. Tariffs did increase the cost of goods, and thus the price. However, people paid anyway. Spending didn’t skip a beat, so the new price is anchored. When a 10% tarriff goes away, the market has shown that they will pay that price, so that means 10% more profits for companies when that expense goes away.
Even before tariffs, I saw an interview with the president of Pepsico, Ramon Laguarta. In that interview, he said it loud and proud that they were playing with price increases to see what the market would bear. In 2022 and 2023, they touted how they were looking to offset inflation and see where the consumer limit was on the pricing of their products. It never happens in a bubble, though, because as they raise prices, their competitors do, leading someone like Laguarta to be the first to start an increase in food and beverage prices across the board. It may be worth saying that it seems they found that limit as they stated that in 2026, they will be “tempering prices to meet consumer affordability limitations.” Great job, Pepsi, your greed broke your customer base: ordinary people. To be fair (though they may not deserve that cordiality), their competitors quickly followed suit. Coca-Cola, for example, could have easily not raised prices, operated at the same margins, though lower than other times in their history, and dominated the market simply by being lower priced. Despite what they say, I don’t think many people see soda as a luxury, and one where they are not willing to compromise preference over cost to any real extent. No, this was a collaborative price increase that had real downsides for customers and upsides for the brands.
The Hardest Part For People Is Pride
Culturally, we have completed the transition to an individualistic society. Whether it is fashion, finances, or faith, the emphasis is on the self. The worst thing we can think of is to be forced into a one-size-fits-most framework. This isn’t because we want freedom, no, that is too much work; we want options. We want the ability to choose our outcomes with as little responsibility as possible. For a while, we got more of that than we should have been allowed.
The issue with such individuality isn’t meritocracy and fairness; it is exactly the opposite. It capitalised on life’s unfairness and leaves us as the only person to blame. Try as we may to blame others. We fully own and embody each decision, even if it is one made out of desperation or lack of better choices. Walking back decisions means admitting we were wrong, uninformed, taken advantage of, or simply unfortunate. All those options don’t make us feel empowered or good. In an age where no one forgets, so they can’t forgive, those choices have a way of coming up again, and it feels easier to identify with the mistake than learn from it and move on.
Taking a step back requires humility, and it can look like public humiliation. Imagine you are that person who bought more house than you needed and could really afford, then the market tanks 20%. You were expecting an increase in value and equity, so based on the information you had on hand at the time, it made sense. You were up for a promotion, and that would close the gap on the mortgage. No big deal. You put real thought into that decision and identified with the outcome: the manager with a nice house. Then it hits—layoffs, and then a correction in the housing market. You have a few choices here. Let the house continue to strangle you because you can’t admit that you are down 20% in this house, or you can take a downgrade and manage. That isn’t a logical financial decision; it is emotional.
Many people in their careers are facing this right now. When layoffs started hitting at historical levels, I talked to colleagues and watched horror stories on LinkedIn as people experienced extremely long periods of unemployment to find something comparable to where they were in title and salary. I heard stories of “lowball offers” and how they turned down jobs because they were at levels below where they wanted to be. It makes sense if you look at your career as a progression. A step back means that you have to ramp back up to get to the life you were accustomed to. It doesn’t make sense when you think about it as “a lower-level job beats no job.”
Our work is our identity. Our house is our identity. We see ourselves more in what we do and have than we do in our thoughts, talents, and communities. It makes that step back feel like a personal and moral failing rather than simply a stroke of bad luck that was uncontrollable. That uncontrollable aspect alone feels like a personal attack that we couldn’t see it coming or prevent it from happening. We identify having options with the ability to control outcomes.
Giving Room To Step Back Is A Responsibility
We, as ordinary individuals, have little say in the economic and political landscape. We don’t choose the metrics for how things are graded, and we don’t get a choice in how things are priced. We do control our own trajectory to a large extent, however.
If you are budgeting based on the good times, you are setting yourself up for failure. When your budgeted income is based on your best years, when your entertainment budget is based on the times when you exhibited the most restraint, or when your car budget was based on two-dollar gallons of gas, you are going to run into some setbacks.
We have to budget based on the bad times. The lowest salary to keep us employed and in our fields, the times that we just need to pamper ourselves, because life has abused us, or when gas hits $5… again. This can make steps back feel like a breath of fresh air. It can turn bad times into tolerable inconveniences and normal times into the best lives. That career setback can add hours to your day and lower your blood pressure, and that $80 tank of gas can be just the excuse you needed to rearrange your living space for a cozy weekend in. That is where the happiness lies, flexibility in security.
To do this for ourselves, we must encourage it in others. That can be as simple as honoring others’ decisions to go down a rung on the social ladder and not change a thing about the relationship. It can also mean simply showing some compassion and forgiveness when people mess up. You extend these courtesies because setbacks are a part of life. You also extend the courtesy, because you could easily be in the spot of backward momentum or making mistakes yourself, and wouldn’t it be nice to have that same grace?
So Let It Happen
Leave room for setbacks. They are going to come whether you do or not; it just makes it a lot easier if you hold some space for them.
Like many things in life, where something works for citizens, it doesn’t for governments. This is one of those things. We are not going to collectively agree on setbacks, but we may be able to agree on new metrics. That is what to look out for. When there is a chance to shift a focus away from profits and to people, that is worth a listen. When someone talks about a better world and not just a better economy, give it a thought. When someone suggests a difficult change to a positive and sustaining outcome, hold off the inclination to recoil immediately.
Your actions hold more power to influence your outcomes than you may believe. If you show resistance to participating in some of the materialist nonsense, you influence others to do the same. The life most people envy isn’t one full of possessions; it is one of peace. When things go bad, and you can be minimally affected while others are in chaos, you have exercised the richest lifestyle available. When you can take two steps back and not even flinch, you become the strongest person in the room. That sort of peace and security is hard to hide. People see it and are attracted to it.
So, yeah. Humans hate going backwards, but bring on the hard times anyway. That is when you will get ahead. Unfortunately, change is painful. Watching it cause devastation will never get easier. Step back and observe.