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La società opulenta
Se l'economia, grazie al rapido sviluppo industriale, è divenuta una delle scienze fondamentali di questo secolo, John Galbraith è di conseguenza una delle menti più brillanti del nostro tempo. Professore universitario ad Harvard, consulente di Roosvelt e Kennedy, Galbraith nel 1958 scuote il mondo accademico con la pubblicazione di questo libro, il testo economico più discusso degli ultimi anni. Con encomiabile spregiudicatezza teoretica, che nulla toglie al rigore e alla chiarezza dell'analisi, il volume propone un'acuta e articolata critica alla "dittatura della produzione" nelle contemporanee società ipersviluppate, volte a indurre bisogni fittizi tramite la pubblicità e a invadere di prodotti di consumo un mercato ormai saturo, a discapito dell'offerta di beni di pubblica utilità. Questi temi - i più scottanti e scomodi dell'economia - sono qui esposti in uno stile brillante e lucido che li rende accessibili anche ai neofiti della materia, ma soprattutto vengono osservati da un'insolita angolazione che relega in secondo piano redditi e profitti per lasciar spazio a un ben più importante protagonista: l'uomo.
348 pages, Hardcover
First published January 1, 1958
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About the author
John Kenneth Galbraith
205 books506 followersJohn Kenneth Galbraith was a Canadian-American economist. He was a Keynesian and an institutionalist, a leading proponent of 20th-century American liberalism and democratic socialism. His books on economic topics were bestsellers in the 1950s and 1960s. A prolific author, he produced four dozen books & over a 1000 articles on many subjects. Among his most famous works was his economics trilogy: American Capitalism (1952), The Affluent Society (1958) & The New Industrial State (1967). He taught at Harvard University for many years. He was active in politics, serving in the administrations of Franklin Roosevelt, Harry Truman, John Kennedy, and Lyndon Johnson. He served as US Ambassador to India under John F. Kennedy.
He received the Presidential Medal of Freedom twice: one in 1946 from President Truman, and another in 2000 from President Clinton. He was also awarded the Order of Canada in 1997, and in 2001, the Padma Vibhushan, India's second highest civilian award, for strengthening ties between India and the USA.
He received the Presidential Medal of Freedom twice: one in 1946 from President Truman, and another in 2000 from President Clinton. He was also awarded the Order of Canada in 1997, and in 2001, the Padma Vibhushan, India's second highest civilian award, for strengthening ties between India and the USA.
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August 3, 2011
Contrary to the assumptions made in the history of economic theory (from Adam Smith, Ricardo, Mathus and Marx) that the development of the industrial base inevitably leads to the total impoverishment of the working class, we seem to be witnessing quite the opposite. The working classes in the advanced capitalist societies have never had it so good. We now live in an affluent society. Despite the more horrible predictions of these founding fathers of economic theory not coming to pass we have not moved on from many of their other predictions based on this idea. It is as if we have been unable to quite believe we are as affluent as we actually are.
Galbraith sees capitalism not as one economy, but two. There is the private economy, where goods are produced to be sold in the open market, and then there is the public economy, where governments raise taxes to support socially necessary functions – the military, police, schools, sanitation, roads, and so on. (Galbraith is very good on the waste and danger that is modern excessive military expenditure – as he ends his book, “And let us protect our affluence from those who, in the name of defending it, would leave the planet only with its ashes.”)
One of these economies is obscenely wealthy and the other is absurdly poor. Galbraith suggests that the most quoted part of this book in the forty years since it was first published is:
The family that takes its mauve and cerise, air-conditioned, power-steered and power-braked automobile out for a tour passes through cities that are badly paved, made hideous by litter, blighted buildings, billboards and posts for wires that should long since have been put underground. They pass into a countryside that has been rendered largely invisible by commercial art. (The goods which the latter advertise have an absolute priority in our value system. Such aesthetic considerations as a view of the countryside accordingly come second. On such matters we are consistent.) They picnic on exquisitely packaged food from a portable icebox by a polluted stream and go on to spend the night at a park which is a menace to public health and morals. Just before dozing off on an air mattress, beneath a nylon tent, amid the stench of decaying refuse, they may reflect vaguely on the curious unevenness of their blessings. Is this, indeed, the American genius?
The joke – if joke it is – is that the private economy actually needs to create our wants. So we get such absurdities as ‘Cherry Coke’ being relaunched every few years as if what the world really needs now is yet another sugar-filled drink flavour. Meanwhile, there are, I believe, serious questions about the structural integrity of many bridges in the US. Developed countries around the world are concerned with the shortage of funds available for healthcare, educations, policing – and the list goes on and on. Two economies – opposite problems facing each.
It is not that people find it difficult to identify the problem – but the solution seems completely beyond us.
In this book Galbraith first coined the phrase ‘conventional wisdom’ as that layer of prejudice that we cling to long after it has been discredited by circumstances (imagine being the person who came up with such a useful term). His major concern is to remove our obsession with production as the only criterion upon which we judge the success of our society. He talks of a particular US statesman defending the government of the day from an attack from the opposition by saying that it had provided the ‘second best year on record’.
His point here is that no one needs to be told in what sense this was the second best year. Not even the most fundamentalist Christian would think this statesman meant that there had been second highest church attendance of all time, for example. And no one would think that it was the year with the second lowest number of murders. And even if the point is taken that he clearly means economically – then why are we talking GDP and not, say, number of people employed? Where does this obsession with production come from?
The answer is not as easy as it seems – there was a time when a member of society being ‘unproductive’ might have meant a serious drag on society and a real risk to society’s ongoing viability – but those days are now long gone in advanced capitalist countries. Now we even pay farmers not to produce.
So, we have two economies. The wealthy economy of producers finding new and better ways to get us to buy their products – mostly today by also encouraging us in our extravagant borrowing (borrowing money we can’t afford so as to purchase goods we do not need). The other economy, the public economy, is one in which firstly a very large percentage of our taxes is wasted on the military and the rest thinly spread to those areas which do not lend themselves well to private production.
To fund this second economy better Galbraith suggests increasing sales taxes. Now, this is an interesting and courageous idea. My initial reaction was a knee-jerk and that was to oppose it. Sales taxes are highly regressive and therefore fall mostly on the poor. As such, it seems that those Galbraith is seeking to help the most will be those forced to fund this assistance.
The further problem is that there is no guarantee that the funds raised by this tax will, in fact, be used in better housing, education, etc, that will go to the poor. As he points out elsewhere, the general affluence of society leads to a culture of blame towards those who find themselves still poor. Clearly there must be attributes these people have that make them poor. Furthermore, these people tend to have no power in our society – so the idea that we would raise sales taxes so as to improve the lives of these people seems highly unlikely.
And experience has shown that this is the case. Conservative governments are repeatedly elected and they see it as their duty to cut progressive taxes (such as income taxes) and substitute these with regressive taxes, such as sales taxes. The poor are punished every which way.
I found the section on the relationship between monetary and fiscal policies in controlling economic growth and therefore inflation a brilliant exposition of the contradictions inherent in our major (if not sole) means of adjusting these key economic levers.
Inflation is a reflection of demand within an economy. If there is too much demand then prices go up. To tackle inflation one must first tackle demand. There are effectively two ways of doing this. One is to produce more stuff. If you do this then supply will eventually outstrip demand and prices will fall. Another way is to suck money out of the economy. If people don’t have any money they are unlikely to be able to buy stuff – so that will cut demand.
Both of these methods of controlling demand – and thereby inflation – are vexed. The problem with increasing production is that this first requires investment into the economy to build the new factories and so on needed to increase supply. But this immediately produces the opposite effect to what you wanted. Before the factory can start to meet the old demand you were trying to reduce you have created a whole group of workers who are being paid to build the factory, manage the factory and so on. These people are being paid and thus adding money to the already over-heated economy, thereby increasing demand. The exact opposite of what you wanted to achieve.
The other ways to address too much demand in the economy are rather ‘blunt instruments’. You can either increase taxes – fiscal policy – or you can raise interest rates – monetary policy. That is, suck money out of the pockets of those who were trying to spend it.
However, these levers are hardly delicate in their effects on the economy. The problem is that demand in the economy is not one single thing. Inflation may be affecting one part of the economy – housing, for example – but other parts of the economy might actually be in need of increased demand. Raising interest rates clobbers all sections of the economy equally. It is remarkable that people never seem to ask: “So, explain this to me again, how is giving massive profits to banks the most obvious way to decrease demand?”
It is clear Galbraith thinks the major problem is in creating artificial demand in the economy for goods and services we don’t actually need. But I’m not sure how this problem can be addressed under capitalism.
One of my favourite quotes from the text – which I shall leave you with – concerns the problem that our obsession with ever increased production is often at the expense of people – kicking people off farms or sacrificing jobs to third world countries where labour is so much cheaper. We do this all in the name of efficiency – and everyone knows efficiency is an unquestioned good – don’t we?
In the United States, as in other western countries, we have for long had a respected secular priesthood whose function it has been to rise above questions of religious ethics, kindness and compassion and show how these might have to be sacrificed on the alter of the larger good. The larger good, invariably, was more efficient production. The sacrifice obviously loses some of its point if it is on behalf of the more efficient production of goods for the satisfaction of wants of which people are not yet aware. It is even more tenuous, in its philosophical foundations, if it is to permit the more efficient contriving of wants to which people are not aware. And this latter is no insignificant industry in our time.
A fascinating attack on the neo-liberal nonsense that dominates our economic debate.
Galbraith sees capitalism not as one economy, but two. There is the private economy, where goods are produced to be sold in the open market, and then there is the public economy, where governments raise taxes to support socially necessary functions – the military, police, schools, sanitation, roads, and so on. (Galbraith is very good on the waste and danger that is modern excessive military expenditure – as he ends his book, “And let us protect our affluence from those who, in the name of defending it, would leave the planet only with its ashes.”)
One of these economies is obscenely wealthy and the other is absurdly poor. Galbraith suggests that the most quoted part of this book in the forty years since it was first published is:
The family that takes its mauve and cerise, air-conditioned, power-steered and power-braked automobile out for a tour passes through cities that are badly paved, made hideous by litter, blighted buildings, billboards and posts for wires that should long since have been put underground. They pass into a countryside that has been rendered largely invisible by commercial art. (The goods which the latter advertise have an absolute priority in our value system. Such aesthetic considerations as a view of the countryside accordingly come second. On such matters we are consistent.) They picnic on exquisitely packaged food from a portable icebox by a polluted stream and go on to spend the night at a park which is a menace to public health and morals. Just before dozing off on an air mattress, beneath a nylon tent, amid the stench of decaying refuse, they may reflect vaguely on the curious unevenness of their blessings. Is this, indeed, the American genius?
The joke – if joke it is – is that the private economy actually needs to create our wants. So we get such absurdities as ‘Cherry Coke’ being relaunched every few years as if what the world really needs now is yet another sugar-filled drink flavour. Meanwhile, there are, I believe, serious questions about the structural integrity of many bridges in the US. Developed countries around the world are concerned with the shortage of funds available for healthcare, educations, policing – and the list goes on and on. Two economies – opposite problems facing each.
It is not that people find it difficult to identify the problem – but the solution seems completely beyond us.
In this book Galbraith first coined the phrase ‘conventional wisdom’ as that layer of prejudice that we cling to long after it has been discredited by circumstances (imagine being the person who came up with such a useful term). His major concern is to remove our obsession with production as the only criterion upon which we judge the success of our society. He talks of a particular US statesman defending the government of the day from an attack from the opposition by saying that it had provided the ‘second best year on record’.
His point here is that no one needs to be told in what sense this was the second best year. Not even the most fundamentalist Christian would think this statesman meant that there had been second highest church attendance of all time, for example. And no one would think that it was the year with the second lowest number of murders. And even if the point is taken that he clearly means economically – then why are we talking GDP and not, say, number of people employed? Where does this obsession with production come from?
The answer is not as easy as it seems – there was a time when a member of society being ‘unproductive’ might have meant a serious drag on society and a real risk to society’s ongoing viability – but those days are now long gone in advanced capitalist countries. Now we even pay farmers not to produce.
So, we have two economies. The wealthy economy of producers finding new and better ways to get us to buy their products – mostly today by also encouraging us in our extravagant borrowing (borrowing money we can’t afford so as to purchase goods we do not need). The other economy, the public economy, is one in which firstly a very large percentage of our taxes is wasted on the military and the rest thinly spread to those areas which do not lend themselves well to private production.
To fund this second economy better Galbraith suggests increasing sales taxes. Now, this is an interesting and courageous idea. My initial reaction was a knee-jerk and that was to oppose it. Sales taxes are highly regressive and therefore fall mostly on the poor. As such, it seems that those Galbraith is seeking to help the most will be those forced to fund this assistance.
The further problem is that there is no guarantee that the funds raised by this tax will, in fact, be used in better housing, education, etc, that will go to the poor. As he points out elsewhere, the general affluence of society leads to a culture of blame towards those who find themselves still poor. Clearly there must be attributes these people have that make them poor. Furthermore, these people tend to have no power in our society – so the idea that we would raise sales taxes so as to improve the lives of these people seems highly unlikely.
And experience has shown that this is the case. Conservative governments are repeatedly elected and they see it as their duty to cut progressive taxes (such as income taxes) and substitute these with regressive taxes, such as sales taxes. The poor are punished every which way.
I found the section on the relationship between monetary and fiscal policies in controlling economic growth and therefore inflation a brilliant exposition of the contradictions inherent in our major (if not sole) means of adjusting these key economic levers.
Inflation is a reflection of demand within an economy. If there is too much demand then prices go up. To tackle inflation one must first tackle demand. There are effectively two ways of doing this. One is to produce more stuff. If you do this then supply will eventually outstrip demand and prices will fall. Another way is to suck money out of the economy. If people don’t have any money they are unlikely to be able to buy stuff – so that will cut demand.
Both of these methods of controlling demand – and thereby inflation – are vexed. The problem with increasing production is that this first requires investment into the economy to build the new factories and so on needed to increase supply. But this immediately produces the opposite effect to what you wanted. Before the factory can start to meet the old demand you were trying to reduce you have created a whole group of workers who are being paid to build the factory, manage the factory and so on. These people are being paid and thus adding money to the already over-heated economy, thereby increasing demand. The exact opposite of what you wanted to achieve.
The other ways to address too much demand in the economy are rather ‘blunt instruments’. You can either increase taxes – fiscal policy – or you can raise interest rates – monetary policy. That is, suck money out of the pockets of those who were trying to spend it.
However, these levers are hardly delicate in their effects on the economy. The problem is that demand in the economy is not one single thing. Inflation may be affecting one part of the economy – housing, for example – but other parts of the economy might actually be in need of increased demand. Raising interest rates clobbers all sections of the economy equally. It is remarkable that people never seem to ask: “So, explain this to me again, how is giving massive profits to banks the most obvious way to decrease demand?”
It is clear Galbraith thinks the major problem is in creating artificial demand in the economy for goods and services we don’t actually need. But I’m not sure how this problem can be addressed under capitalism.
One of my favourite quotes from the text – which I shall leave you with – concerns the problem that our obsession with ever increased production is often at the expense of people – kicking people off farms or sacrificing jobs to third world countries where labour is so much cheaper. We do this all in the name of efficiency – and everyone knows efficiency is an unquestioned good – don’t we?
In the United States, as in other western countries, we have for long had a respected secular priesthood whose function it has been to rise above questions of religious ethics, kindness and compassion and show how these might have to be sacrificed on the alter of the larger good. The larger good, invariably, was more efficient production. The sacrifice obviously loses some of its point if it is on behalf of the more efficient production of goods for the satisfaction of wants of which people are not yet aware. It is even more tenuous, in its philosophical foundations, if it is to permit the more efficient contriving of wants to which people are not aware. And this latter is no insignificant industry in our time.
A fascinating attack on the neo-liberal nonsense that dominates our economic debate.
August 3, 2011
Oh, for fuck's sakes, what the fuck is wrong with you people? Is this a never-ending revival of the Dunciad? This ain't rocket science, for Christ's sakes—we've cottoned a shitload of the green-googly-moogly in the decades since the Great Slump, so why can't we apply the lessons we've learned from this gigantic laissez-faire clusterfuck? Goddamn greedy, overly ripe, crumb-lipped mall-mutts, I'd love to crack your fucking spongiform shells together to let in some oxygen! A progressive system of taxation, social safety nets and impartially administered regulatory agencies, with targeted government expenditure upon boring shit like education, transportation and communication networks, skills development, and leisure opportunities are all steps in the right fucking direction: to find that sweet spot, always tweaking and adjusting as necessary, to spread that whoresonned wealth around, keep the disparity to a minimum, whilst always realizing that we are moving into a new form of industrialized capitalism where consumption is king; in other words, shitheads, our economy is in a perpetual state of evolution, and we must evolve our policies along with them, with an ultimate goal of having the vast, unimaginable wealth our productivity, resources, infrastructure, global position and considerable fortune have bestowed upon our short-term-memory-riddled heads spread as equitably as possible, fueling small business growth, avoiding creativity-killing and stagnant monopolies, and enlarging the middle-fucking-class, those roseate, nauseous butterballs whose very size indicates the fucking health of a nation's economic state. Fucking assholes, wake the fuck up and figure out what the fuck is going on. Jesus H. Fucking Christ, I keep pointing this shit out and you tosspot pickle-ticklers, you thick-witted, cross-eyed Mary's, you tube-glued, gelatinous fuck-weevils keep screwing the goddamn pooch. I'm getting by-Christly fucking tired of spinning this particular mother-loving record, numbnuts. Wake up!
Read
March 4, 2017Bother! I thought I had already written most of this review, but no, I must toil and type to lay it out here in black and white.
Galbraith's book is a slightly awkward subject, written in 1958, went through four editions before the revised version that fell into my hands. I wonder if he was prescient for 1958, for example in the role of debt in sustaining a consumer society, or simply astute when it came to updating each edition?
It is an elegantly written essay, slightly too elegant with it's swan's neck phrasing to be easily quotable, but a pleasure to read in this and in its content it reminded me of Veblin's The Theory of the Leisure Class, that sets out that the economic thinking of Smith and Ricardo among others became the conventional wisdom that informed a whole host of ideas not just about economics, but politics and society more generally, this however in the face of the actual economic reality in which we live.
in Galbraith's telling the conventional wisdom changes over time - absorbing elements of Marx or Keynes - but remains dominant even though the starting point of many of the ideas embedded in the conventional wisdom was a basic conception of the world as a place of scarcity. In the world of scarcity goods were in short supply and people might have to be compelled to work to avoid starvation - not just their own, but in society generally.
This Galbraith points out is not true of our own times. By and large, we live in affluent societies. There is an excess of goods. People need to be persuaded, through marketing, to desire and purchase goods which due to the inequitable social division of income will be increasingly paid for with credit.
Problems that we face, in Galbraith's opinion, looking at the decline in standard working hours, is not maintaining production, but sustaining employment, addressing the poverty that we have in the midst of a prosperous society, and caring for the environment. Unfortunately aspects of the conventional wisdom lead us into trouble, we can blame the poor for being the authors of their own problems, the environment is a resource ripe for abuse, and apparently we are politically able to tolerate a substantial level of un-and-underemployment which in previous decades might have been considered catastrophic.
In short, we've got a model of a world of scarcity in our heads while we live in the midst of abundance. And that means this is one of those books that reminds us how artificial and unreal much of the world around us is. Economic thinking, Galbraith shows, runs considerably behind the actual workings of the economy, potential by several hundred years.
It is an essay that is focused on the experience of the USA and one of the most striking points there, at least for me as a foreigner who has only heard of that country from afar, is the contrast between private wealth and public poverty. Roads may be pot-holed, schools falling apart, and public bodies will struggle to be able to finance repairs, yet individuals and corporations may be fabulously wealthy.
In ending the other, in hindsight obvious, point that he makes is that those who are strongest in their support of monetarism or any other economic theory are those who will benefit most from it. Follow the money once more.
Galbraith's book is a slightly awkward subject, written in 1958, went through four editions before the revised version that fell into my hands. I wonder if he was prescient for 1958, for example in the role of debt in sustaining a consumer society, or simply astute when it came to updating each edition?
It is an elegantly written essay, slightly too elegant with it's swan's neck phrasing to be easily quotable, but a pleasure to read in this and in its content it reminded me of Veblin's The Theory of the Leisure Class, that sets out that the economic thinking of Smith and Ricardo among others became the conventional wisdom that informed a whole host of ideas not just about economics, but politics and society more generally, this however in the face of the actual economic reality in which we live.
in Galbraith's telling the conventional wisdom changes over time - absorbing elements of Marx or Keynes - but remains dominant even though the starting point of many of the ideas embedded in the conventional wisdom was a basic conception of the world as a place of scarcity. In the world of scarcity goods were in short supply and people might have to be compelled to work to avoid starvation - not just their own, but in society generally.
This Galbraith points out is not true of our own times. By and large, we live in affluent societies. There is an excess of goods. People need to be persuaded, through marketing, to desire and purchase goods which due to the inequitable social division of income will be increasingly paid for with credit.
Problems that we face, in Galbraith's opinion, looking at the decline in standard working hours, is not maintaining production, but sustaining employment, addressing the poverty that we have in the midst of a prosperous society, and caring for the environment. Unfortunately aspects of the conventional wisdom lead us into trouble, we can blame the poor for being the authors of their own problems, the environment is a resource ripe for abuse, and apparently we are politically able to tolerate a substantial level of un-and-underemployment which in previous decades might have been considered catastrophic.
In short, we've got a model of a world of scarcity in our heads while we live in the midst of abundance. And that means this is one of those books that reminds us how artificial and unreal much of the world around us is. Economic thinking, Galbraith shows, runs considerably behind the actual workings of the economy, potential by several hundred years.
It is an essay that is focused on the experience of the USA and one of the most striking points there, at least for me as a foreigner who has only heard of that country from afar, is the contrast between private wealth and public poverty. Roads may be pot-holed, schools falling apart, and public bodies will struggle to be able to finance repairs, yet individuals and corporations may be fabulously wealthy.
In ending the other, in hindsight obvious, point that he makes is that those who are strongest in their support of monetarism or any other economic theory are those who will benefit most from it. Follow the money once more.
March 28, 2022
This book was terrible.
I read it senior year in High School or Freshman year in College while I was taking intro economics courses and was amazed at how Galbraith violated the most basic concepts in economics and logic.
The most ridiculous quote I remember from this book (or his follow-up book, The New Industrial State) was his statement that "that's the exception that proves the rule."
Think about that for a second.
Exceptions do NOT prove any rules. They don't do anything, except perhaps DISprove a rule. Yet here is an eminent prof. of econ. at Harvard, in his "classic" (best selling) work on American Capitalism telling people that the exception to his "rule" about American big business being able to control their markets. He said it was due to their size, and advertising power, such as Ford and it's stable "control" of 22-25% of the US auto market. He said they could foist on the American public whatever new car model design it wanted, and the public would just buy it, regardless. The exception to his rule that he was trying to not just belittle, but actually literally make into an extra reason why his "rule" was true, was of course the too obvious to ignore case of Ford's Edsel model, which flopped. People would not buy it. It was a huge loss for Ford. Everyone knew about it back then. It is a classic case of how big companies can FAIL and lose lots of money when some of their investments go bad.
So, again, I urge you to think about the tactic that Galbraith used to turn this obvious contradiction to his bogus theory, into a rhetorical flourish that looked like it backed up his theory and turned logic and facts on their heads.
The other thing I remember about the book, was the main thesis that because America was already so "affluent" (his term for wealthy), it could not only afford, but had a moral duty to, and would greatly benefit from, having the government spend more money on all sorts of public works (and "welfare" programs) projects, such as roads, public (government) education, etc. He claimed that the "public" sector (that is GOVERNMENT) was "starved" compared to the private sector.
His total disregard for the reason why America was so relatively wealthy - that it taxed and regulated the private sector less, not more, than most other countries - was a main reason for my rating of this book. And think about this too, do you feel like you pay too SMALL an amount in taxes? Do you feel that you get more than your coerced to pay in taxes, what you get out of them?
But that was, I believe, his purpose - to deceive people, or at least try to convince them of the "truth" he thought he knew, that government is the fount of most all good things (at least in his mind) and that leaving people the freedom to discover their own values, talents, dreams, and security was not worth talking about, let alone giving any credence to.
I read it senior year in High School or Freshman year in College while I was taking intro economics courses and was amazed at how Galbraith violated the most basic concepts in economics and logic.
The most ridiculous quote I remember from this book (or his follow-up book, The New Industrial State) was his statement that "that's the exception that proves the rule."
Think about that for a second.
Exceptions do NOT prove any rules. They don't do anything, except perhaps DISprove a rule. Yet here is an eminent prof. of econ. at Harvard, in his "classic" (best selling) work on American Capitalism telling people that the exception to his "rule" about American big business being able to control their markets. He said it was due to their size, and advertising power, such as Ford and it's stable "control" of 22-25% of the US auto market. He said they could foist on the American public whatever new car model design it wanted, and the public would just buy it, regardless. The exception to his rule that he was trying to not just belittle, but actually literally make into an extra reason why his "rule" was true, was of course the too obvious to ignore case of Ford's Edsel model, which flopped. People would not buy it. It was a huge loss for Ford. Everyone knew about it back then. It is a classic case of how big companies can FAIL and lose lots of money when some of their investments go bad.
So, again, I urge you to think about the tactic that Galbraith used to turn this obvious contradiction to his bogus theory, into a rhetorical flourish that looked like it backed up his theory and turned logic and facts on their heads.
The other thing I remember about the book, was the main thesis that because America was already so "affluent" (his term for wealthy), it could not only afford, but had a moral duty to, and would greatly benefit from, having the government spend more money on all sorts of public works (and "welfare" programs) projects, such as roads, public (government) education, etc. He claimed that the "public" sector (that is GOVERNMENT) was "starved" compared to the private sector.
His total disregard for the reason why America was so relatively wealthy - that it taxed and regulated the private sector less, not more, than most other countries - was a main reason for my rating of this book. And think about this too, do you feel like you pay too SMALL an amount in taxes? Do you feel that you get more than your coerced to pay in taxes, what you get out of them?
But that was, I believe, his purpose - to deceive people, or at least try to convince them of the "truth" he thought he knew, that government is the fount of most all good things (at least in his mind) and that leaving people the freedom to discover their own values, talents, dreams, and security was not worth talking about, let alone giving any credence to.
March 2, 2023
TAS, first published in 1958, is not only a classic in the field of public policy and political economy, but a brilliant piece of social analysis as well. TAS is also something of a time capsule as Galbraith struggles with a relatively novel question-- now that societies have found affluence (at least some, he is careful), why are 'we', as policy makers and citizens, still laboring under the 'conventional wisdom' that more consumer goods are the prime importance for society. Indeed, both 'the affluent society' and 'conventional wisdom' are two terms Galbraith introduced into our vocabulary.
The book is broken down into several chapters, each dealing with a specific issue-- history of economic thought (where our 'old' conventional wisdom arose), economic security, poverty, inequality economic public policy and so forth. The optimism of the text is striking as well; Galbraith compares life prior to and during the depression with the 'Golden Age' of American capitalism, which unfortunately came to a crashing end in the late 1970s to devolve into today's neoliberalism. Galbraith argues convincingly how most of our material wants are just that-- wants-- and these wants are generated via advertising and so forth. Americans, by and large by the time he wrote this, had solved the problem of poverty and meeting our basic needs. The question therefore is why are we still preoccupied by this and not thinking about how else we can turn our energies? Why, for example, in the richest nation on the planet, are we still plagued by poor social services and public goods? Why are our schools falling apart and our cities blighted by slums? After all, we now have the means to easily eradicate poverty all together and provide a decent standard of living for everyone.
Galbraith paints a picture where our conventional wisdom is still a product of a time when simple survival was a pressing issue, where economic depressions and loss of jobs could imply a death sentence, which was largely the case prior to the New Deal. He almost proudly acclaims the great strides we have made in America since the Great Depression (he was, after all, a player in New Deal policies). We now have, for example, secure jobs (thanks to unions), a stable economy (thanks to prudent public policy), ever expanding consumer goods like no other society on Earth. Couple with this our (still rather sparse) public entitlements like unemployment insurance and social security and we have a society on the cusp of doing so much more!
The question that really animates the book is what we can do now, or what challenge we should tackle next? Galbraith heavily leans toward what may be deemed today a democratic socialist society on line with the Nordic nations, who, unlike the USA for the last 40 years, have invested heavily in public goods and their 'human capital' to provide their citizens with greater opportunities to live a good life. He argues forcefully that we have the means to improve our schools, really eradicate poverty, provide clear air and water to everyone alongside anything else we could imagine. Yet, we still put our thought and energy into creating and expanding the field of private consumer goods.
Reading this book today not only leaves one with a great deal of nostalgia for the era when it was written, but also a sense of tragedy. How can our society have moved from where good jobs were secure and plentiful for everyone, income inequality was lessening each year, and great strides were being made to really tackle the thorny issues of racism and poverty to where we are today. Neoliberalism has become the conventional wisdom of our public policy makers in the US, and this is largely a revival of the old conventional wisdom prior to the New Deal. Galbraith must be rolling in his grave!
Nonetheless, while TAS may be a time capsule, the questions is raises are still important today, as are many of the specific issues he addresses. The economic history of thought is excellent, as is the concept of 'conventional wisdom' driving our public policy. During the New Deal era, for example, both parties were on board with the program (at least publicly) or they would never be elected. FDR won four elections and his VP won the next. The American government had seemingly finally tamed big corporations and Wall street to make them serve the interests of the public rather than their CEO's pockets. So much has changes, but then again, that does not mean that we are trapped at the end of history.
The book is broken down into several chapters, each dealing with a specific issue-- history of economic thought (where our 'old' conventional wisdom arose), economic security, poverty, inequality economic public policy and so forth. The optimism of the text is striking as well; Galbraith compares life prior to and during the depression with the 'Golden Age' of American capitalism, which unfortunately came to a crashing end in the late 1970s to devolve into today's neoliberalism. Galbraith argues convincingly how most of our material wants are just that-- wants-- and these wants are generated via advertising and so forth. Americans, by and large by the time he wrote this, had solved the problem of poverty and meeting our basic needs. The question therefore is why are we still preoccupied by this and not thinking about how else we can turn our energies? Why, for example, in the richest nation on the planet, are we still plagued by poor social services and public goods? Why are our schools falling apart and our cities blighted by slums? After all, we now have the means to easily eradicate poverty all together and provide a decent standard of living for everyone.
Galbraith paints a picture where our conventional wisdom is still a product of a time when simple survival was a pressing issue, where economic depressions and loss of jobs could imply a death sentence, which was largely the case prior to the New Deal. He almost proudly acclaims the great strides we have made in America since the Great Depression (he was, after all, a player in New Deal policies). We now have, for example, secure jobs (thanks to unions), a stable economy (thanks to prudent public policy), ever expanding consumer goods like no other society on Earth. Couple with this our (still rather sparse) public entitlements like unemployment insurance and social security and we have a society on the cusp of doing so much more!
The question that really animates the book is what we can do now, or what challenge we should tackle next? Galbraith heavily leans toward what may be deemed today a democratic socialist society on line with the Nordic nations, who, unlike the USA for the last 40 years, have invested heavily in public goods and their 'human capital' to provide their citizens with greater opportunities to live a good life. He argues forcefully that we have the means to improve our schools, really eradicate poverty, provide clear air and water to everyone alongside anything else we could imagine. Yet, we still put our thought and energy into creating and expanding the field of private consumer goods.
Reading this book today not only leaves one with a great deal of nostalgia for the era when it was written, but also a sense of tragedy. How can our society have moved from where good jobs were secure and plentiful for everyone, income inequality was lessening each year, and great strides were being made to really tackle the thorny issues of racism and poverty to where we are today. Neoliberalism has become the conventional wisdom of our public policy makers in the US, and this is largely a revival of the old conventional wisdom prior to the New Deal. Galbraith must be rolling in his grave!
Nonetheless, while TAS may be a time capsule, the questions is raises are still important today, as are many of the specific issues he addresses. The economic history of thought is excellent, as is the concept of 'conventional wisdom' driving our public policy. During the New Deal era, for example, both parties were on board with the program (at least publicly) or they would never be elected. FDR won four elections and his VP won the next. The American government had seemingly finally tamed big corporations and Wall street to make them serve the interests of the public rather than their CEO's pockets. So much has changes, but then again, that does not mean that we are trapped at the end of history.
August 16, 2025
Wealth is the relentless enemy of understanding.
Re-read Aug 2022:
Sixty-five years later, Galbraith is still eminently apropos, while--even 10 years from now--everyone will see Krugman, Summers, Greenspan, Roubini, Friedman and many others around today (excepting Wolff and Kuttner) as the total buffoons they are/were. Anyone that cares to examine him will still see that Galbraith was and still is the last great economist-scholar-philosopher of the developed democratic West (yes, that is rather narrow geographically, but these are the small group that have HEAVILY guided the western democratic west to where we are today, and as we go unfortunately goes most of the world. His career was not perfect of course, but Galbraith--with empathy and experience--iteratively became the author of this fine essay.
If only more politicians had the courage of conscience to enact some of Galbraith's elegantly simple policy suggestions in full. Yes, his recommendations would not be politically popular in the short run (e.g. price controls; a "planned" shift away from the production of plastic garbage, ultra-luxury goods and other wastes of capital to provide, for free, all the basic needs of life to everyone, for no reason other than we are all human and in this existence together).
I guess there are quite a few people out there that just don't give a shit about other people. Except perhaps the poor that "take some responsibility for their actions" or are amongst "the DESERVING poor" or other such bullshit that right-wingers and many/most so-called liberals (e.g. Clinton, Obama) use to soothe their own guilty consciences.
Highly recommend a close read of this and Galbraith's other works to anyone interested in an examination of the socio-economic contract we all behave as if we have with each other (which we can change at any time). Galbraith can go a bit deep in his popular texts, but never terribly technical; and the man could write--his prose is often beautiful even in his examination of asymmetric economic arrangements that are certainly not.
Original notes:
In his long intro, Galbraith takes us through the views of Malthus, Ricardo, Spencer and Marx, highlighting the close similarities of each as it pertains to their views of the economic prospects of the ordinary person: It's quite dire. The key differences lie in the "so what".
Malthus and Ricardo agreed that the ordinary person inevitably must live on the edge of starvation as progress would only enhance the wealth of those already wealthy. Nothing can, or ultimately should, be done about this for the sake of progress.
Spencer took this even further, coining the phrase "survival of the fittest" not applied by Darwin to lower animals as many may think, but to mankind. Spencer's Social Darwinism, which holds that the unfortunate commoner should be forever immolated by the genetically superior economic winners -- effectively the one unchanging core tenet of the U.S. Republican Party -- found great success in the U.S. and unfortunately continues to pervade modern capitalistic economic thought. Milton Friedman and Alan Greenspan are two of the better-known disciples.
To an angry man--a passionate man--the Ricardian conclusions are a call to revolution. Marx shared the views of the state of the working person of Ricardo and Malthus, under feudalism and capitalism, but saw that wages need not always lose to profits to achieve aggregate economic progress (when they are one and the same or when the former comprises a majority of the latter).
Galbraith argues they were all mistaken in their prescriptions--to a degree:
Democracy can crack the code. The common working person need not live on the margins of economic viability after all.
Some old and new problems remain, however.
A core thesis is: As a society becomes increasingly affluent, wants are increasingly created by the process by which they are satisfied. Wants come to depend on output. This is, in part, the "bullshit jobs" thesis. Since the demand for many of the goods and services our economy presently produces would not exist, if the demand were not contrived by advertisers, etc., the utility of these goods and services--ex contrivance--is zero. And, clearly, war is amongst the worthless things foisted on us by corporations and media.
The dangers of manufacturing wants as capitalist economies do are multiple:
1. Consumer debt driven up by demand for worthless things contributes to instability, exacerbates inequality and exaggerates the impact of inflation (particularly asset inflation) on the common person.
2. It takes resources away from needs in the public domain - every bomb produced, every battleship launched takes food from the mouths of the hungry, clothes from the backs of the naked, etc. Galbraith notes, American capitalism incentivises the allocation of research resources to the least important things. We have sacrificed much on the altar of more efficient production. Much cruelty on our fellow humans for their own good - or, rather, the social good. The secular priesthood of production is a higher power than religion, kindness, compassion. All for the more efficient contriving of wants of which people are not [yet] aware. This threatens to return us to the Ricardian/Malthusian/Spencerian/Marxist outcome for the 99%.
3. Makes perpetual inflation the norm. For the wants (most of them) that do not have an origin independent of production, increasing production does not lessen want and does not ameliorate inflation. If production is at capacity (as it is currently in August 2021), higher production incurs higher short term costs and thus makes inflation worse.
4. Monetary policy has become a form of economic escapism. No other economic policy has ever shown such capacity to survive failure to be hailed as a success. This is the "Larry Summers" effect... In fact, monetary policy is dangerous to the degree it is effective.
It used to be that monetary measures were exclusively the instruments of conservatives and fiscal policy the instrument of liberals. Liberals stupidly bought into the monetary policy fraud since the early 80s, but, hopefully, the infrastructure bill now crawling through Congress signals a long-term correction.
A couple more choice quotes from the author that coined the term "conventional wisdom":
We should have as a central economic goal of our society to eliminate toil as a required economic institution.
To furnish a barren room is one thing. To continue to crowd in furniture until the foundation buckles is quite another. To have failed to solve the problem of producing goods would have been to continue man in his oldest and most grievous misfortune. But to fail to see that we have solved it and to fail to proceed thence to the next task would be fully as tragic.
This UK first edition hardcover (VG+) is one of the gems of my physical collection, I say with only a touch of irony.
Re-read Aug 2022:
Sixty-five years later, Galbraith is still eminently apropos, while--even 10 years from now--everyone will see Krugman, Summers, Greenspan, Roubini, Friedman and many others around today (excepting Wolff and Kuttner) as the total buffoons they are/were. Anyone that cares to examine him will still see that Galbraith was and still is the last great economist-scholar-philosopher of the developed democratic West (yes, that is rather narrow geographically, but these are the small group that have HEAVILY guided the western democratic west to where we are today, and as we go unfortunately goes most of the world. His career was not perfect of course, but Galbraith--with empathy and experience--iteratively became the author of this fine essay.
If only more politicians had the courage of conscience to enact some of Galbraith's elegantly simple policy suggestions in full. Yes, his recommendations would not be politically popular in the short run (e.g. price controls; a "planned" shift away from the production of plastic garbage, ultra-luxury goods and other wastes of capital to provide, for free, all the basic needs of life to everyone, for no reason other than we are all human and in this existence together).
I guess there are quite a few people out there that just don't give a shit about other people. Except perhaps the poor that "take some responsibility for their actions" or are amongst "the DESERVING poor" or other such bullshit that right-wingers and many/most so-called liberals (e.g. Clinton, Obama) use to soothe their own guilty consciences.
Highly recommend a close read of this and Galbraith's other works to anyone interested in an examination of the socio-economic contract we all behave as if we have with each other (which we can change at any time). Galbraith can go a bit deep in his popular texts, but never terribly technical; and the man could write--his prose is often beautiful even in his examination of asymmetric economic arrangements that are certainly not.
Original notes:
In his long intro, Galbraith takes us through the views of Malthus, Ricardo, Spencer and Marx, highlighting the close similarities of each as it pertains to their views of the economic prospects of the ordinary person: It's quite dire. The key differences lie in the "so what".
Malthus and Ricardo agreed that the ordinary person inevitably must live on the edge of starvation as progress would only enhance the wealth of those already wealthy. Nothing can, or ultimately should, be done about this for the sake of progress.
Spencer took this even further, coining the phrase "survival of the fittest" not applied by Darwin to lower animals as many may think, but to mankind. Spencer's Social Darwinism, which holds that the unfortunate commoner should be forever immolated by the genetically superior economic winners -- effectively the one unchanging core tenet of the U.S. Republican Party -- found great success in the U.S. and unfortunately continues to pervade modern capitalistic economic thought. Milton Friedman and Alan Greenspan are two of the better-known disciples.
To an angry man--a passionate man--the Ricardian conclusions are a call to revolution. Marx shared the views of the state of the working person of Ricardo and Malthus, under feudalism and capitalism, but saw that wages need not always lose to profits to achieve aggregate economic progress (when they are one and the same or when the former comprises a majority of the latter).
Galbraith argues they were all mistaken in their prescriptions--to a degree:
Democracy can crack the code. The common working person need not live on the margins of economic viability after all.
Some old and new problems remain, however.
A core thesis is: As a society becomes increasingly affluent, wants are increasingly created by the process by which they are satisfied. Wants come to depend on output. This is, in part, the "bullshit jobs" thesis. Since the demand for many of the goods and services our economy presently produces would not exist, if the demand were not contrived by advertisers, etc., the utility of these goods and services--ex contrivance--is zero. And, clearly, war is amongst the worthless things foisted on us by corporations and media.
The dangers of manufacturing wants as capitalist economies do are multiple:
1. Consumer debt driven up by demand for worthless things contributes to instability, exacerbates inequality and exaggerates the impact of inflation (particularly asset inflation) on the common person.
2. It takes resources away from needs in the public domain - every bomb produced, every battleship launched takes food from the mouths of the hungry, clothes from the backs of the naked, etc. Galbraith notes, American capitalism incentivises the allocation of research resources to the least important things. We have sacrificed much on the altar of more efficient production. Much cruelty on our fellow humans for their own good - or, rather, the social good. The secular priesthood of production is a higher power than religion, kindness, compassion. All for the more efficient contriving of wants of which people are not [yet] aware. This threatens to return us to the Ricardian/Malthusian/Spencerian/Marxist outcome for the 99%.
3. Makes perpetual inflation the norm. For the wants (most of them) that do not have an origin independent of production, increasing production does not lessen want and does not ameliorate inflation. If production is at capacity (as it is currently in August 2021), higher production incurs higher short term costs and thus makes inflation worse.
4. Monetary policy has become a form of economic escapism. No other economic policy has ever shown such capacity to survive failure to be hailed as a success. This is the "Larry Summers" effect... In fact, monetary policy is dangerous to the degree it is effective.
It used to be that monetary measures were exclusively the instruments of conservatives and fiscal policy the instrument of liberals. Liberals stupidly bought into the monetary policy fraud since the early 80s, but, hopefully, the infrastructure bill now crawling through Congress signals a long-term correction.
A couple more choice quotes from the author that coined the term "conventional wisdom":
We should have as a central economic goal of our society to eliminate toil as a required economic institution.
To furnish a barren room is one thing. To continue to crowd in furniture until the foundation buckles is quite another. To have failed to solve the problem of producing goods would have been to continue man in his oldest and most grievous misfortune. But to fail to see that we have solved it and to fail to proceed thence to the next task would be fully as tragic.
This UK first edition hardcover (VG+) is one of the gems of my physical collection, I say with only a touch of irony.
June 24, 2018
Essential reading for anyone interested in economics or public policy. The book takes on and dismantles the "conventional thinking" (he made up that phrase first) in economics. Some of it is outdated, but unfortunately for us, most of it is not. Economists still see the private sphere as the only relevant measure of the economy and not public works. They are also still only obsessed with production of goods and then production of desire for goods and the production of more goods. In this, I think book like Doughnut Economics are a good update because they link this concern with the depleted environment. Galbraith is an excellent writer and thinker and this book is a must-read.
February 8, 2016
I read this for the Capitalism/Democracy/Socialism course taught under the aegis of Loyola University Chicago's Philosophy Department in the first semester of 1981/82. The teacher, a Ph.d. in both Philosophy and Mathematics, ran the course as an ongoing debate between three orientations. The first, the free market capitalist, was primarily represented by Milton Friedman. The second, the Keynesian capitalist, was primarily represented by J.K. Galbraith. The third, the market socialist, was primarily represented by David Schweickart, our instructor.
I decided to take the Keynesian position simply because I figured most of the students would adopt the more extreme views either out of conviction or to suck up to the professor. Besides, I'd long been a democratic socialist and had read some stuff not only about syndicalism but also about council socialism and the experiments with markets in Yugoslavia (a hot and much idealized topic with some old high school friends) and wouldn't have found arguing that position very challenging, particularly since Schweickart's model was so attractive. Finally, Galbraith was far and away the stylistically best, wittiest and most influential writer of the lot. Understanding him would help me understand the arguments of liberal orthodoxy and it would be fun.
It was fun indeed.
I decided to take the Keynesian position simply because I figured most of the students would adopt the more extreme views either out of conviction or to suck up to the professor. Besides, I'd long been a democratic socialist and had read some stuff not only about syndicalism but also about council socialism and the experiments with markets in Yugoslavia (a hot and much idealized topic with some old high school friends) and wouldn't have found arguing that position very challenging, particularly since Schweickart's model was so attractive. Finally, Galbraith was far and away the stylistically best, wittiest and most influential writer of the lot. Understanding him would help me understand the arguments of liberal orthodoxy and it would be fun.
It was fun indeed.
September 17, 2025
Very interesting and well written little book about societal excess and social welfare, and the fundamental issues with the American liberal (and conservative) views of the economy which are still relevant today.
Galbraith makes a case for state power and welfare, pointing out the excess production and false demand for consumer goods in an affluent society which is combined with a failure to meet basic needs (housing, food, education) and also dissects policies such as progressive taxation and the rhetoric around them. Highly recommend!
Galbraith makes a case for state power and welfare, pointing out the excess production and false demand for consumer goods in an affluent society which is combined with a failure to meet basic needs (housing, food, education) and also dissects policies such as progressive taxation and the rhetoric around them. Highly recommend!
September 23, 2023
This book had been sitting on my shelf for many years. I have always enjoyed economics. I considered making it my focus of study when in college. Since college I have enjoyed reading various economics-related texts. I think this was written before the time when there was more emphasis placed on making non-fiction at some level entertaining. I imagine I am spoiled by that trend, but this read more like a textbook and not a very exciting one. I did find the high-level survey of the development of economic thought instructive. The ideas presented were interesting but were hurt somewhat by arguments that have only been updated through the 1980’s: they felt dated. I did appreciate Galbraith’s discussion of the societal implications of economic decisions; this gave the content a more humanistic element. Unless you have a special interest in economics, though, I would not recommend this.
January 28, 2023
Galbraith's writing functions better as cultural criticism rather than economic analysis. I found the book to be quite slow for the first 190 pages, but the last third of the book was far more engaging, as the focus shifted to deconstruction of "the affluent society" and its priorities.
I recognize the profound impact this probably had, as it lambasts American decadence in the midst of the most prosperous time in history to that point (1958). And I think the ideas hold up well. But the chapters on inflation, unemployment, and other economic discourse I thought quite dry.
Nevertheless, the balance of private versus public goods in the public forum remains incredible food for thought. Still would recommend this book.
I recognize the profound impact this probably had, as it lambasts American decadence in the midst of the most prosperous time in history to that point (1958). And I think the ideas hold up well. But the chapters on inflation, unemployment, and other economic discourse I thought quite dry.
Nevertheless, the balance of private versus public goods in the public forum remains incredible food for thought. Still would recommend this book.
September 16, 2014
Written in 1958, this book proposed that America had achieved a level of affluence that made core prevailing modes of thought regarding economic and social progress obsolete. Galbraith was a liberal economist who forthrightly stated that the purpose of economic life is greater than for the simple manufacture of ever greater aggregate wealth. That is, he also tackled the issue of how and why poverty persists along beside plenty, and the economic, social and moral consequences of simply accepting it as a given.
Galbraith is an extraordinary writer - sophisticated yet reasonably accessible, with a dry and biting wit.
I was also struck by a perception that the world be describes (repeating something I said during an earlier update) - in terms of security of employment, popular concern regarding inequality, the existence of a growing middle class - is less like that of today than was the world of Henry George's "Progress and Poverty" - written in 1879. that is, it feels to me that in many ways our political economy has regressed.
Much of his book deconstructs what he describes as the myths that underlie "current" popular conceptions about the realities of economic life - the "conventional wisdom". For example, the economists's obsession with "production" as the reason for existence, when in fact, much of what is now produced meets "needs" that rely on the power of advertising to "manufacture" demand for products and services that people hadn't previously "realized" they wanted. Sound familiar? With formidable logic he eventually makes a case for reducing poverty and investing in under-resourced "public" goods (schools, infrastructure, etc) using counter-cyclical unemployment insurance benefits and deliberate use of consumption taxes DESPITE their apparent regressive burden or lower income earners.
That said, this book is very much an artifact of its age. In addition to being a work on economics, it reads like a time capsule from 1958, with many references to the memory and lessons of the Greeat Depression, commentary on an American society wading hip deep into conspicuous consumption while confronting the shock of a Soviet Union that not only has the Bomb but has beaten the USA into space.
Finally, it is also an interesting insight into the thinking of a man who became an important member of the Kennedy administration.
Galbraith is an extraordinary writer - sophisticated yet reasonably accessible, with a dry and biting wit.
I was also struck by a perception that the world be describes (repeating something I said during an earlier update) - in terms of security of employment, popular concern regarding inequality, the existence of a growing middle class - is less like that of today than was the world of Henry George's "Progress and Poverty" - written in 1879. that is, it feels to me that in many ways our political economy has regressed.
Much of his book deconstructs what he describes as the myths that underlie "current" popular conceptions about the realities of economic life - the "conventional wisdom". For example, the economists's obsession with "production" as the reason for existence, when in fact, much of what is now produced meets "needs" that rely on the power of advertising to "manufacture" demand for products and services that people hadn't previously "realized" they wanted. Sound familiar? With formidable logic he eventually makes a case for reducing poverty and investing in under-resourced "public" goods (schools, infrastructure, etc) using counter-cyclical unemployment insurance benefits and deliberate use of consumption taxes DESPITE their apparent regressive burden or lower income earners.
That said, this book is very much an artifact of its age. In addition to being a work on economics, it reads like a time capsule from 1958, with many references to the memory and lessons of the Greeat Depression, commentary on an American society wading hip deep into conspicuous consumption while confronting the shock of a Soviet Union that not only has the Bomb but has beaten the USA into space.
Finally, it is also an interesting insight into the thinking of a man who became an important member of the Kennedy administration.
July 2, 2010
Galbraith wrote this entire book as a protest against the growth economy, as if it was an economic law that once men's most basic material desires are met, they are fed, clothed and housed, then their fundamental purposes in life have been fulfilled. He therefore assumes that any material consumption beyond this base level is unnatural and is created somehow by forces extrinsic to the individual, moreover this consumption is a historical aberration that is being fostered by erroneous attitudes and insidious advertising. In his view since these mistaken or malicious factors can not prevail for long, eventually people will realize that they are consuming beyond their needs and they will stop. Therefore, since man, in his view, does not need more than the minimal requirements of existence and since modern society produces enough to satisfy these basic needs for every citizen, it is foolish to keep our focus on expanding the economy. Instead, we should concentrate on redistributing the existing wealth.
This is one of the books that helped form my economic thinking. My study of Galbraith in this and The New Industrial State demonstrated for me the wrong direction in economic thought during the 1960s.
This is one of the books that helped form my economic thinking. My study of Galbraith in this and The New Industrial State demonstrated for me the wrong direction in economic thought during the 1960s.
August 9, 2011
This book is as important when Galbraith first published it. A giant of a man - 6'9"!! - Galbraith still towers over a humane, practical and honest stream of economic thinking and writing.
Arguing that conventional economic thought was not only the child but the captive of a time when scarcity was an everyday reality for most of the European and American 'world', he puts an elegant but passionate case for looking at things as they actually are, rather than as theorists insist that they must be, in order to address the real poverty that continues to haunt the few, amid the extraordinary and novel affluence of the many in the developed world.
The book is incredibly prescient - Galbraith updated it in 1998, so that he refers to the crises of the 1970's, which nonetheless fit neatly into the scenario he had written about decades before. He acknowledges where he got it wrong and takes a quiet pride in where (as so often) he got it right, including a wonderful dig at Hayek, the Nobel Laureate.
This book is also a pleasure to read, in a manner that few economic texts will ever be. Heads of government trying to work out the current economic chaos could do worse than turn to the wisdon of J K Galbraith.
Arguing that conventional economic thought was not only the child but the captive of a time when scarcity was an everyday reality for most of the European and American 'world', he puts an elegant but passionate case for looking at things as they actually are, rather than as theorists insist that they must be, in order to address the real poverty that continues to haunt the few, amid the extraordinary and novel affluence of the many in the developed world.
The book is incredibly prescient - Galbraith updated it in 1998, so that he refers to the crises of the 1970's, which nonetheless fit neatly into the scenario he had written about decades before. He acknowledges where he got it wrong and takes a quiet pride in where (as so often) he got it right, including a wonderful dig at Hayek, the Nobel Laureate.
This book is also a pleasure to read, in a manner that few economic texts will ever be. Heads of government trying to work out the current economic chaos could do worse than turn to the wisdon of J K Galbraith.
May 7, 2022
Hmm. There were certainly aspects of this which I found very interesting, dated and US-centric as it was by virtue of the author and the publication/revision date in the 1960s/70s. I often drift towards a pretty free market economics type Darwinism frame of mind with my own assumptions to this kind of thing - favouring lower taxation, lower state involvement, more personal responsibility and self-reliance - and this made some convincing arguments against those laissez faire principles. However, subtracting from all this.. plenty of it I actively disagreed with (again, no-one has really explained why those who earn/accumulate wealth should be expected to redistribute it to those who haven't/won't) and in truth I didn't engage fully with what's quite a dry subject. Quite a lot of it feels irrelevant to me (time, disconnection with the subject) and.. hey ho.
Amusingly, I read half the book thinking that the image on the front was some kind of African drum. It was around the midway point that it occurred to me that it was a champagne cork. Yes. You can even see writing on it. Dumbass.
Amusingly, I read half the book thinking that the image on the front was some kind of African drum. It was around the midway point that it occurred to me that it was a champagne cork. Yes. You can even see writing on it. Dumbass.
December 23, 2017
This is a highly commendable book and should be of interest to anyone who has ever walked under the sun. It deals with great clarity with the economic and financial myths our affluent society surrounds itself in every day - from the inefficiency of monetary policy to the shortcomings of fiscal policy - Galbraith easily and masterfully shows us how esoteric and irrational most of the acclaimed economic axioms actually are. Despite being written in 1958, everything this book talks about is of great relevance, at least to anyone who has ever even remotely heard of the financial crunch of 2008 or anyone who has held a job, for that matter.
"The greater the wealth, the thicker the dirt."
"The greater the wealth, the thicker the dirt."
February 24, 2016
This book published in 1958 was a great manifesto for Lyndon Baines Johnson's Great Society. Galbraith argued that America was a rich society capable of caring for all its members. Left to its own, capitalism would simply try to stimulate consumption by the financially privileged through advertising. What was needed was increased taxation of the rich to finance social programs for the poor.
Galbraith's argument was treated with great seriousness by the majority of North Americans throughout the sixities and seventies. Today it has fallen out of favour as Americans have begun to fear that through the process of globalization they have lost control of their own economy and destiny.
Galbraith's argument was treated with great seriousness by the majority of North Americans throughout the sixities and seventies. Today it has fallen out of favour as Americans have begun to fear that through the process of globalization they have lost control of their own economy and destiny.
August 23, 2016
So I kind of agree with what Galbraith has to say, but it doesn't read so easily. It felt more like a piece of social science academia, than a non-fiction book. If you're okay with that, then it's an insightful look at economics and capitalism, from a 1950s American viewpoint.
March 12, 2022
This book has stood up amazingly well with time. True, it was updated several times but it was first published in 1958 and can't have changed that much. According to Wikipedia, the last edition was in 1984. Yet much of what Mr. Galbraith describes as the conventional (and often incorrect) wisdom remains the same on both sides of the political spectrum. His criticisms remain apt and his suggested remedies, such as basic income, are still under discussion and still unimplemented.
His thesis is that in an affluent society where we may still have poverty but where the basic needs of the majority of people for food, clothing and shelter have been addressed, the rules change. The affluent are motivated to protect their position, and the truly poor who have become a minority lose even the small power that they once had by dint of their numbers. Once basic needs are satisfied, we have advertising and marketing to create new "needs," and corporations with surpluses, market power and governmental protections manage to avoid the rigors of the free market. From Mr. Galbraith's perspective there is both good and bad in all of this. The only definite conclusion is that things are more complex than they used to be, so traditional solutions may no longer work or may produce unintended results.
His other principal thesis is that the conventional wisdom on both left and right is wrong in making increased production the principal economic goal. In the old days it was all about increasing industrial production; by the time Mr. Galbraith was writing, ever increasing efficiency of services was added to the mix, and now we can layer on top of that the goal of generating and efficiently using more and more data. Instead of arguing about the best way to achieve a neverending march of growth, maybe we should be looking at ways to improve human flourishing in ways that could be inconsistent more growth all the time. More is not always better. Maximum growth is often inconsistent with stability, fairness, compassion, happiness and maintaining the environment. Sometimes spending more on public goods will produce better results for society as a whole than more private enterprise. These are serious questions that certainly have not been seriously addressed by my generation. I have some hope that my children and their age cohort may have a better perspective, but only time will tell.
His thesis is that in an affluent society where we may still have poverty but where the basic needs of the majority of people for food, clothing and shelter have been addressed, the rules change. The affluent are motivated to protect their position, and the truly poor who have become a minority lose even the small power that they once had by dint of their numbers. Once basic needs are satisfied, we have advertising and marketing to create new "needs," and corporations with surpluses, market power and governmental protections manage to avoid the rigors of the free market. From Mr. Galbraith's perspective there is both good and bad in all of this. The only definite conclusion is that things are more complex than they used to be, so traditional solutions may no longer work or may produce unintended results.
His other principal thesis is that the conventional wisdom on both left and right is wrong in making increased production the principal economic goal. In the old days it was all about increasing industrial production; by the time Mr. Galbraith was writing, ever increasing efficiency of services was added to the mix, and now we can layer on top of that the goal of generating and efficiently using more and more data. Instead of arguing about the best way to achieve a neverending march of growth, maybe we should be looking at ways to improve human flourishing in ways that could be inconsistent more growth all the time. More is not always better. Maximum growth is often inconsistent with stability, fairness, compassion, happiness and maintaining the environment. Sometimes spending more on public goods will produce better results for society as a whole than more private enterprise. These are serious questions that certainly have not been seriously addressed by my generation. I have some hope that my children and their age cohort may have a better perspective, but only time will tell.
June 21, 2025
Easy to read for a non-economist and could be popular non-fiction back in the day. The book traces out a history of economic thought and criticizes how the U.S. has carried forward a scarcity mindset, built during times when production determined human survival, to its post WWII era of abundance. The key ideas in the book are still relevant today - experiencing poverty in the public sphere and affluence in the private sphere, taking advantage of consumer theory to manufacture wants, hyperfocusing on production, etc. - though I think much of these ideas may already be in the public consciousness. What I find most interesting is the solutions Galbraith presents. I'm curious about what further empirical research has been done in, for example, the proposed scheme of unemployment benefits, or the impact of increased access to high-quality public services on multi-generational poverty.
July 13, 2025
witzigerweise hat tooze diese Woche nen Podcast über Galbraith gemacht, das war als Kontext gut, aber dass er ein vorzeige-liberaler (auf die gute und nervige weise) ist, liest man auch so heraus. einige Teile des Buchs sind offensichtlich Kinder der 50er und spannend als historisches Dokument, aber erstaunlich viel ist immer noch relevant für heute
June 19, 2018
This book rocks, given it was written in 1958.
At the time of the writing it was a huge discourse between capitalism vs. communism and the net effect on society. Galbraith notices that the production capacity that arose through the period does in fact lead to a type of abundance, but that two unexpected things happen.
First, the economy splits in two between a working class and an affluent class. There is a a need by the latter to inspire the former to want more. This in term drives the engine to increase accumulation. Still, he realizes that overall, the production increase itself results in all individuals being better. It's just that the working class in affluent areas feel their sense of not having far more. Whether he's got that right or not, he's identifying a certain psychological symptom that just exists. As a result, a whole mess of people start writing about this sort of thing.
Second, he notes that there is a tendency for the affluent to have undue power in a way that does in fact exploit those that do not have. He's not trying to re-enter the whole Communism argument which he thinks is punk because it's just not as simple as make everyone equal. Instead, it's more like.... how do we create systems that do this right. The haves have. The have nots really, particularly when you look globally and not just nationally, DO NOT have a thing. Not a thing. If you read his other notes, the dude starts to travel far and abroad and is seriously made even more aware of this issue.
As a solution, he initiates some ideas that others than take off and to the races. The first is, maybe we can make people not want rando stuff. There are people that now help individuals with minimizing and thinking about real things they want vs. the material things they want. Good on ya, though it's still got a way to go. The second thing he explores is maybe we just make people work less. Some people are naturally not going to work at all, that's not what he means and there is something slightly wrong with just abusing others that tend to work, but maybe... he's saying... maybe there is a way we can do this, reduce work hours and let people try this living thing.
See, the key thing that Galbraith sees is that we have idealized, made somewhat a virtue, work in and of itself. The problem is that work = accumulation. We do not speak of work = joy, work = personal satisfaction. Work = money = satisfaction. That's messed up, because it's not true. But that's how we incentivize society. His deal is.... how do we change that up?
Seriously cool stuff and it's quite amazing that over 70 years, we've started to find some innovations and there are mental transformations that are transitioning. But his question and the solutions he was trying to inspire dialogue in.... super valid, still today, albeit updating is sort of needed in the framing, phrasing, etc.... but hey... it's lasted going on 60 years... and that's baller....
At the time of the writing it was a huge discourse between capitalism vs. communism and the net effect on society. Galbraith notices that the production capacity that arose through the period does in fact lead to a type of abundance, but that two unexpected things happen.
First, the economy splits in two between a working class and an affluent class. There is a a need by the latter to inspire the former to want more. This in term drives the engine to increase accumulation. Still, he realizes that overall, the production increase itself results in all individuals being better. It's just that the working class in affluent areas feel their sense of not having far more. Whether he's got that right or not, he's identifying a certain psychological symptom that just exists. As a result, a whole mess of people start writing about this sort of thing.
Second, he notes that there is a tendency for the affluent to have undue power in a way that does in fact exploit those that do not have. He's not trying to re-enter the whole Communism argument which he thinks is punk because it's just not as simple as make everyone equal. Instead, it's more like.... how do we create systems that do this right. The haves have. The have nots really, particularly when you look globally and not just nationally, DO NOT have a thing. Not a thing. If you read his other notes, the dude starts to travel far and abroad and is seriously made even more aware of this issue.
As a solution, he initiates some ideas that others than take off and to the races. The first is, maybe we can make people not want rando stuff. There are people that now help individuals with minimizing and thinking about real things they want vs. the material things they want. Good on ya, though it's still got a way to go. The second thing he explores is maybe we just make people work less. Some people are naturally not going to work at all, that's not what he means and there is something slightly wrong with just abusing others that tend to work, but maybe... he's saying... maybe there is a way we can do this, reduce work hours and let people try this living thing.
See, the key thing that Galbraith sees is that we have idealized, made somewhat a virtue, work in and of itself. The problem is that work = accumulation. We do not speak of work = joy, work = personal satisfaction. Work = money = satisfaction. That's messed up, because it's not true. But that's how we incentivize society. His deal is.... how do we change that up?
Seriously cool stuff and it's quite amazing that over 70 years, we've started to find some innovations and there are mental transformations that are transitioning. But his question and the solutions he was trying to inspire dialogue in.... super valid, still today, albeit updating is sort of needed in the framing, phrasing, etc.... but hey... it's lasted going on 60 years... and that's baller....
September 15, 2016
Many of the claims about income inequality, class warfare, and the like were discussed in this classic by Galbraith. Unfortunately, his explanations for the causes of these are based on his view of a failed system of capitalism and solutions based on government action through fiscal policy were misguided then and are today. The underlying factor driving these concerns is most often government itself that then makes the problem worse with more government intervention.
He does get some of it right by noting the costly effects of inappropriate Federal Reserve actions by manipulating the money supply and therefore interest rates. However, his claim to run up massive deficits and for large transfers of income and wealth through redistributionary taxes are similar to the recent claims by Pickety, which both fail to see the error of believing that a small group of people has sufficient information and knowledge to turn the right wheels of an economy or that government created the environment for these ills to occur.
The less we focus on voluntary exchange (i.e. Free markets), the more problems there will be. Most of the problems Galbraith noticed then and we see today are not caused by free market capitalism but rather crony corporatism in a socialist-dominated economic system.
Overall, I'm glad I read this book to get another perspective on Keynesian-types of economic thinking. I was not convinced that there was much credibility to the views offered, as I believe strongly that voluntary exchange of humans to satisfy their desires given scarce resources with minimal government has been historically proven to be the best path towards greater economic opportunity to prosper.
Check it out for yourself.
He does get some of it right by noting the costly effects of inappropriate Federal Reserve actions by manipulating the money supply and therefore interest rates. However, his claim to run up massive deficits and for large transfers of income and wealth through redistributionary taxes are similar to the recent claims by Pickety, which both fail to see the error of believing that a small group of people has sufficient information and knowledge to turn the right wheels of an economy or that government created the environment for these ills to occur.
The less we focus on voluntary exchange (i.e. Free markets), the more problems there will be. Most of the problems Galbraith noticed then and we see today are not caused by free market capitalism but rather crony corporatism in a socialist-dominated economic system.
Overall, I'm glad I read this book to get another perspective on Keynesian-types of economic thinking. I was not convinced that there was much credibility to the views offered, as I believe strongly that voluntary exchange of humans to satisfy their desires given scarce resources with minimal government has been historically proven to be the best path towards greater economic opportunity to prosper.
Check it out for yourself.
August 4, 2021
The Affluent Society is one of the few books I've read that I definitely plan to reread. The book meanders, covering a lot of material only loosely related, and my biggest problem is that - like most books of this kind - it makes too many points, a lot of them you're already familiar with (effects of interest rates, public debt, and public spending), and a lot of them the book doesn't do a good enough job making the point convincing (how politics are exacerbating the problem).
What I really appreciated about this book is the shear amount of ideas I hadn't encountered before - it felt like reading something fresh from a free thinker. In particular, Galbraith makes a lot of different points in the final third of the book about politics. The "conservative" parties in the West don't even try to pretend that they're helping the poor - while the "liberal" party pretends to be the party for the poor. However, a lot of the "liberal" party's mandates guarantee that nothing ever passes to actually help the poor: not wanting any sales tax increases because their regressive, demanding that income tax increases primarily affect only the rich, keeping property taxes low (under the guise of keeping poor people from being priced out of their homes), etc...
First published in 1958 - the material in this book has aged quite well. However, there were a lot of comments that didn't. In particular, Galbraith makes a lot of comments about race - which are true - like African Americans, generally, live in neighborhoods with high property taxes, low property values, and yet still not enough funding for their local services - all of which is kind of "by design". However, he also seems to make sweeping generalizations in ways that just aren't really okay to do anymore - in particular - there's a line where he talks about the growing amount of people that aren't employable in the West, and he groups "the blacks" with the uneducated and mentally disabled.
There wasn't anything in the book that made me think Galbraith was a racist. And I think these comments were all about how society mistreats "the blacks" - not that there's anything actually wrong with them. Still, there were several things I read, and then reread, and could not believe my eyes!
There's a common analogy for the economy to be a pie - some people say that we have enough pie (money) for everyone, and we just aren't sharing it fairly. Others say - sure, we could share it better, but also there simply is not enough pie (money) for everyone.
I picked up The Affluent Society because - from the blurb - it sounded like Galbraith was making an argument that we had entered "The Age of Abundance". He talks a lot about how much of what we produce and buy - nobody actually wants or needs - as is obvious by the amount of effort you need to put into advertising, marketing, and selling these things.
As someone who has very few material possessions, this really piqued my interest. I started working at Google because I independently arrived at this idea - thinking that marketing and advertising would play increasingly important roles in the economy as the majority of people have all of their needs and most of their wants met. More and more effort will be spent convincing you to waste your life working for things you don't need or want!
Taken a step back, the book does not talk much about what life could be like if we didn't artificially synthesize these wants. Could we live in something close to a utopia in the near future?
I used to believe this strongly for a long time - but recently have become convinced that there is nowhere near enough money for everyone (globally).
The global average income per capita is less than $17,000. And while, sure, you can technically survive on this - even in expensive places like The Bay and Los Angeles and Paris - life is certainly not comfortable or luxurious.
Importantly, the average person would still need to work >40 hours per week for this life.
One could argue that prices in The Bay and Los Angeles and Paris are artificially inflated (in part due to abundance) - and while this is in part true - it should be clear that we definitely could not life in some utopia where no one needs to work and we all cruise around on yachts and drink umbrella drinks out of a coconut all day.
But as Galbraith mentioned - is that really the type of life the average person wants? Or is that just some desire that's been synthized in us by massive marketing and advertising campaigns - costing us to toil our life away to produce profits for other rich people - just so we can maybe get something we don't even really want that much?
The book is less about pie sharing - and more about how much of the pie is us producing and consuming things that are ridiculous. Importantly, it's about how much of government policies are to keep this process humming along.
The book focuses mainly on the West - where Galbraith makes a convincing argument for this. he talks a lot about how our society is designed around being employed to have income, and the reasons why we have 40 hour work weeks, even though not many people are doing 40 hours of work. He also talks about how a lot of people making a lot of the money - are working a lot more than 40 hours, and how there's a shortage of those people and an abundance of unskilled people. He makes arguments for why this isn't the dire problem so many people make it out to be. And as mentioned before, he talks a lot about how governments manipulate prices, to prevent us (in the West) from seeing how clearly we do live in abundance.
Anyway - it was interesting that Galbraith talked about all of this - but did not mention how, globally, we are nowhere near abundance. Maybe this is because the book predates much of "globalization" - but it seems weird that we should "share the pie" more fairly amongst ourselves - while still being dependent on >50% of the world living in poverty and exploiting them for cheap labor.
It's interesting that you can care so much about poor people within your border, but poor people right outside the edge (literally in our case where a lot of cheap labor comes from Mexico) - well who cares about them?
When it boils down to it - it just seems like the same thing you always see - people only wanting more pie for themselves.
Fortunately, if you live in the West, there's a lot of pie. Unfortunately, if you don't, there isn't.
What I really appreciated about this book is the shear amount of ideas I hadn't encountered before - it felt like reading something fresh from a free thinker. In particular, Galbraith makes a lot of different points in the final third of the book about politics. The "conservative" parties in the West don't even try to pretend that they're helping the poor - while the "liberal" party pretends to be the party for the poor. However, a lot of the "liberal" party's mandates guarantee that nothing ever passes to actually help the poor: not wanting any sales tax increases because their regressive, demanding that income tax increases primarily affect only the rich, keeping property taxes low (under the guise of keeping poor people from being priced out of their homes), etc...
First published in 1958 - the material in this book has aged quite well. However, there were a lot of comments that didn't. In particular, Galbraith makes a lot of comments about race - which are true - like African Americans, generally, live in neighborhoods with high property taxes, low property values, and yet still not enough funding for their local services - all of which is kind of "by design". However, he also seems to make sweeping generalizations in ways that just aren't really okay to do anymore - in particular - there's a line where he talks about the growing amount of people that aren't employable in the West, and he groups "the blacks" with the uneducated and mentally disabled.
There wasn't anything in the book that made me think Galbraith was a racist. And I think these comments were all about how society mistreats "the blacks" - not that there's anything actually wrong with them. Still, there were several things I read, and then reread, and could not believe my eyes!
There's a common analogy for the economy to be a pie - some people say that we have enough pie (money) for everyone, and we just aren't sharing it fairly. Others say - sure, we could share it better, but also there simply is not enough pie (money) for everyone.
I picked up The Affluent Society because - from the blurb - it sounded like Galbraith was making an argument that we had entered "The Age of Abundance". He talks a lot about how much of what we produce and buy - nobody actually wants or needs - as is obvious by the amount of effort you need to put into advertising, marketing, and selling these things.
As someone who has very few material possessions, this really piqued my interest. I started working at Google because I independently arrived at this idea - thinking that marketing and advertising would play increasingly important roles in the economy as the majority of people have all of their needs and most of their wants met. More and more effort will be spent convincing you to waste your life working for things you don't need or want!
Taken a step back, the book does not talk much about what life could be like if we didn't artificially synthesize these wants. Could we live in something close to a utopia in the near future?
I used to believe this strongly for a long time - but recently have become convinced that there is nowhere near enough money for everyone (globally).
The global average income per capita is less than $17,000. And while, sure, you can technically survive on this - even in expensive places like The Bay and Los Angeles and Paris - life is certainly not comfortable or luxurious.
Importantly, the average person would still need to work >40 hours per week for this life.
One could argue that prices in The Bay and Los Angeles and Paris are artificially inflated (in part due to abundance) - and while this is in part true - it should be clear that we definitely could not life in some utopia where no one needs to work and we all cruise around on yachts and drink umbrella drinks out of a coconut all day.
But as Galbraith mentioned - is that really the type of life the average person wants? Or is that just some desire that's been synthized in us by massive marketing and advertising campaigns - costing us to toil our life away to produce profits for other rich people - just so we can maybe get something we don't even really want that much?
The book is less about pie sharing - and more about how much of the pie is us producing and consuming things that are ridiculous. Importantly, it's about how much of government policies are to keep this process humming along.
The book focuses mainly on the West - where Galbraith makes a convincing argument for this. he talks a lot about how our society is designed around being employed to have income, and the reasons why we have 40 hour work weeks, even though not many people are doing 40 hours of work. He also talks about how a lot of people making a lot of the money - are working a lot more than 40 hours, and how there's a shortage of those people and an abundance of unskilled people. He makes arguments for why this isn't the dire problem so many people make it out to be. And as mentioned before, he talks a lot about how governments manipulate prices, to prevent us (in the West) from seeing how clearly we do live in abundance.
Anyway - it was interesting that Galbraith talked about all of this - but did not mention how, globally, we are nowhere near abundance. Maybe this is because the book predates much of "globalization" - but it seems weird that we should "share the pie" more fairly amongst ourselves - while still being dependent on >50% of the world living in poverty and exploiting them for cheap labor.
It's interesting that you can care so much about poor people within your border, but poor people right outside the edge (literally in our case where a lot of cheap labor comes from Mexico) - well who cares about them?
When it boils down to it - it just seems like the same thing you always see - people only wanting more pie for themselves.
Fortunately, if you live in the West, there's a lot of pie. Unfortunately, if you don't, there isn't.
December 31, 2023
Beginning was a good recap and it’s nice to read a comprehensive essay on the economics of affluence. Makes me mad and does not solve the existential dread but I’m glad there’s literature on this.
Crazy that seventy years later, this is still relevant. In some cases, even more relevant. While I’m not afraid of the nuclear annihilation Galbraith is preoccupied with, I do fear climate disaster.
It’s occasionally repetitive but that’s my only real complaint.
Crazy that seventy years later, this is still relevant. In some cases, even more relevant. While I’m not afraid of the nuclear annihilation Galbraith is preoccupied with, I do fear climate disaster.
It’s occasionally repetitive but that’s my only real complaint.
August 8, 2015
This book is well written and has extraordinary explanatory power. Galbraith speaks about our culture's economic priorities within the context of historical economic theories and critiques the logic and accepted ideas that create these priorities. Worthwhile and thought-provoking.
Read
January 12, 2014
HOLY COW I FINALLY FINISHED! This took forever for multiple reasons. But first things first, if you are looking for a book to be your first venture into economics, this isn't it. Well, he wasn't a good match for me at least.I felt like I might as well have been reading sentences with continuous use of double negatives. I often found myself re-reading a sentence about 5 times to understand what he was saying. Not to mention the frequent use of Latin phrases and words no one uses any more. And usually I am all for that, but not when he's already made the book hard to understand. The amount of focus this took me usually resulted in my taking a nap within about 5 or so pages. And after all that, am I able to hold a decent conversation on this topic? Probably not. I've retained enough to have a general feeling, but that's about it. I do need to say that this is not a bad book. It has good information. Maybe it has to do with the generation? Or maybe it's just I'm not used to the words and phrases that usually make up those conversations? Who knows. I just couldn't help but wonder if he was trying to keep it all a secret by trying to make the information as confusing as possible. lol! But now I am done and I can move on in my reading life. It just meant a lot to me that I finish it. I'd hate to miss out on thoughts I wouldn't have other wise.
"These are the days when men of all social disciplines and all political faiths seek the comfortable and the accepted; when the man of controversy is looked upon as a disturbing influence; when originality is taken to be a mark of instability; and when in minor modification of the scriptural parable, the bland lead the bland. Those who esteem this world will not enjoy this essay. Perhaps they should return it to the shelf unread. For there are negative thoughts here, and they cannot but strike an uncouth note in a world of positive thinking."
-Pg. 4
"The number of people who can live in the world is obviously limited by the number that can be fed(Where else have I read this??? A Daniel Quinn essay?). Any increase in they supply of food would bring, in Malthus's view, an increase in the number of people to consume it. Nothing but stark need limits the the numbers who are propagated and who endure. As a result, men will forever live on the verge of starvation."
-Pg. 23
"Like Malthus, Ricardo regarded population as a dependent variable - it regulates itself by the funds which are to employ it, and therefore always increases or diminishes with the increase or diminution of capital. Advancing wealth and productivity thus bring more people; but they do not bring more land from which to feed these people. As a result, those who own the land are able to command an ever greater return, given its quality, for what is an increasingly scarce resource. Meanwhile, in Ricardo's view, profits and wages were in flat conflict for the rest of the product. An increase in profits , other things being equal, meant a reduction in wages.; an increase in wages must always come out of profits. "Every rise of profits," on the other hand, "is favorable to the accumulation of capital, and to the further increase of population, and therefore would, in all probability, ultimately lead to an increase in rent." The effect of these compact relationships will be clear. If the country is to have increasing capital and product, profits must be good. But then as product expands, the population will increase. The food requirements of the population will press on the available land supply and force up rents to the advantage of the land owner. In other words, capitalists must prosper if there is to be progress and landlords cannot help reaping its fruits. The victims of this inescapable misfortune are the people at large."
-Pg. 25
"There was a short but severe depression following WW1. Then came the vast disaster of the nineteen-thirties. What was the meaning of these recurring misfortunes for the future of the system? Perhaps men might not starve amidst Malthusian scarcity, but might it not still be their fate to starve amidst an abundance of goods that they could not buy? Was it not a fair conclusion that by whatever means they were predestined to poverty?"
-Pg.37
"The trouble was that the purchasing power of the workers did not keep abreast of what they produced. As a result, goods accumulated for which there were no buyers. A crisis became inevitable....However Marx stressed other causes too. As capital accumulated, the rate of return would fall. This would weaken incentives and lead to periods of torpor and stagnation. Also, in boom times, the industrial reserve army - the unemployed - would be reduced, and the resulting competition for labor would force up wage rates, and hence costs of production, and this would bring the boom to an end. Nothing so well suggests Marx's intransigent pessimism on the outlook for the worker under capitalism as this. A temporary betterment of his position is the cause of a prompt worsening of it."
Pg.- 57
"The development in the labor market is similar. As the real wage of the worker increases and also as employment becomes more certain, unemployment and the absence of income acquires its contrasting horror. With increasing income, it also becomes possible to think of old age; the individual expects to survive, and old age without income is differentiated, as it was not before, by the prospect of discomfort. And as health hazards and the dangers of accident decline, men come to think of them as abnormal rather than normal afflictions. It is not the poor, but the well-to-do farmers who find onerous the uncertainties of the market. In the mountain country of Kentucky and Tennessee, a depression is not a grievous hazard. Farmers have little to sell; their property has small value.They are therefore little affected by declining prices and not much concerned about declining property values.In the well-to-do regions, things are different."
Pg.- 89
" The great depression has, in fact, often been cited as evidence of the growing insecurity of modern industrial life. There was, it is said, no comparable hazard before the Industrial Revolution. This it will now be clear, is a superficial view. The great depression was severe partly because there was so much wealth and income to loose. The hazard was greatest in the United States and Canada where the per capita was the greatest. And the depression stimulated concern for economic security in precisely the same way that a conflagration stimulates an interest in fire insurance and a flood in flood control. These also have an effect on individuals which is roughly proportionate to the amount of their property that lies in the path of the flames or the water."
Pg.- 90
"The immediate although not the ultimate cause of depression is a fall in the aggregate demand - meaning in the purchasing power available and being used - for buying the output of the economy. Unemployment insurance means that a mans purchasing power is partially protected when he looses his job. It falls, but no longer to zero. Thus a measure designed to reduce the insecurity associated with unemployment also acts to counteract the loss of output - the economic inefficiency - of depression. And to the confusion of the conventional wisdom, it acts on a central cause of inefficiency, one that is far more important than isolated malingering which unemployment insurance might conceivably have encouraged. This effect, of course, is not peculiar to unemployment insurance. Farm support prices, which force compensatory public outlays when farm prices, income and purchasing power fall, have the same effect. So do public welfare payments. Old age and survivors insurance ensure a modest but steady flow of purchasing power from those who are no longer able to work. This flow is unaffected by an ebb in economic activity and thus acts as a stabilizing influence."
Pg. -96
"We do not manufacture wants for goods we do not produce."
Pg.- 113
"So it is that if production creates the wants it seeks to satisfy, or if the wants emerge pari passu with the production, then the urgency of the wants can no longer be used to defend the urgency of the production. Production only fills a void that it has itself created."
Pg.-125
"A man who is hungry need never be told of his need for food. If he is inspired by his appetite, he is immune to the influence of Messers, Batten, Barton, Durstine and Osborn. The latter are effective only with those who are so far removed from physical want that they do not already know what they want. In this state alone, men are open to persuasion."
Pg.- 129
"The greatest threat to the conventional wisdom is always its own irrelevance, not the appeal of a relevant alternative."
Pg.- 210
July 28, 2022
Let me plainly state that I am neither an economist nor a person who ever reads about economics. Econ 101 was one of the few classes in college that I came close to failing. None of it past the first lecture on the syllabus made any sense.
But I want to understand economics. And I do grasp that it’s one of the most important drivers of contemporary civilization. That’s why I read The Affluent Society by 20th-century progressive economics theorist John Kenneth Galbraith.
The first half of the book was a bit confusing for me. In it, Galbraith reviews economic history from the past two hundred years. Since I have so little background knowledge in this arena, I struggled to follow what he was getting at, and no doubt, a lot of what he said went over my head.
However, when he started getting into the division between the conservative and liberal ideas about the economy, mainly after World War II, I found myself on much better footing. So while there is no doubt a lot of this man’s wisdom ultimately failed to penetrate my inhospitable brain, here’s what I did get from his book. Keep in mind that things have changed a lot since 1976, when the book I read was published.
First, most people have basic needs met in an affluent society like ours. Since our economy depended on production (especially before we began sending so many manufacturing jobs to cheaper labor in foreign countries), the manufacturing of wants to fill production demands was crucial. With our government’s help, American businesses have been ingenious and wildly successful at manufacturing these artificial wants.
Second, there is a divide between personal needs and public needs. Since our private needs were largely met by the mid-20th century, surplus monies could have been spent on shared needs, like infrastructure, schools, police protection, and healthcare. However, these areas were chronically underfunded, even then, due to campaigns to convince citizens that taking care of public concerns was ripping them off instead of helping them out. With more significant funds spent for public services for everyone, individuals lost private money through taxes that could have been spent on alternative, private pleasures like fancier cars, clothes, and entertainment.
Finally, while most of us suffer from poor funding for things like schools and highways, the poor are the big losers. Galbraith spends a great deal of time explaining that it’s not possible, and never has been, that everyone will be able to hold down a job to increase our production. The elderly, the disabled, and the mentally ill are often incapable. And he admits that every society contains a few people who refuse to work, whether from laziness or whatever reason unknown to the rest of us. But he asks, is forcing these people to work for a living helping business at all? He argues that it’s not; it’s more expensive to force people to work at jobs due to their lack of output and absenteeism. Instead, he argues that it’s better to pay a living through negative taxes (like the earned-income credit) to keep such people and their children from homelessness and starvation.
He dispassionately outlines the differences from the conservative perspective and makes a case for his own liberal view. However, he also acknowledges the missteps and wrong turns common among liberal thinkers and politicians of his day.
It was an enlightening but disturbing book for me. I would recommend it to anyone like me who wants a clearer understanding of the principle drivers of the insanely gigantic and intricate economic system we are all entangled in today.
But I want to understand economics. And I do grasp that it’s one of the most important drivers of contemporary civilization. That’s why I read The Affluent Society by 20th-century progressive economics theorist John Kenneth Galbraith.
The first half of the book was a bit confusing for me. In it, Galbraith reviews economic history from the past two hundred years. Since I have so little background knowledge in this arena, I struggled to follow what he was getting at, and no doubt, a lot of what he said went over my head.
However, when he started getting into the division between the conservative and liberal ideas about the economy, mainly after World War II, I found myself on much better footing. So while there is no doubt a lot of this man’s wisdom ultimately failed to penetrate my inhospitable brain, here’s what I did get from his book. Keep in mind that things have changed a lot since 1976, when the book I read was published.
First, most people have basic needs met in an affluent society like ours. Since our economy depended on production (especially before we began sending so many manufacturing jobs to cheaper labor in foreign countries), the manufacturing of wants to fill production demands was crucial. With our government’s help, American businesses have been ingenious and wildly successful at manufacturing these artificial wants.
Second, there is a divide between personal needs and public needs. Since our private needs were largely met by the mid-20th century, surplus monies could have been spent on shared needs, like infrastructure, schools, police protection, and healthcare. However, these areas were chronically underfunded, even then, due to campaigns to convince citizens that taking care of public concerns was ripping them off instead of helping them out. With more significant funds spent for public services for everyone, individuals lost private money through taxes that could have been spent on alternative, private pleasures like fancier cars, clothes, and entertainment.
Finally, while most of us suffer from poor funding for things like schools and highways, the poor are the big losers. Galbraith spends a great deal of time explaining that it’s not possible, and never has been, that everyone will be able to hold down a job to increase our production. The elderly, the disabled, and the mentally ill are often incapable. And he admits that every society contains a few people who refuse to work, whether from laziness or whatever reason unknown to the rest of us. But he asks, is forcing these people to work for a living helping business at all? He argues that it’s not; it’s more expensive to force people to work at jobs due to their lack of output and absenteeism. Instead, he argues that it’s better to pay a living through negative taxes (like the earned-income credit) to keep such people and their children from homelessness and starvation.
He dispassionately outlines the differences from the conservative perspective and makes a case for his own liberal view. However, he also acknowledges the missteps and wrong turns common among liberal thinkers and politicians of his day.
It was an enlightening but disturbing book for me. I would recommend it to anyone like me who wants a clearer understanding of the principle drivers of the insanely gigantic and intricate economic system we are all entangled in today.
January 2, 2025
Galbraith’s work got a lot of stick from the “real economists” of both today and the past (cough cough, Paul Krugman, ahem ahem, Bob Solow) for being too polemical and not empirical, therefore making his writing not “real economic theory.” I think that’s complete hokum. In reading “The Affluent Society,” I find a thinker with an extraordinarily analytical mind, one who puts forth an impressively ambitious and incisive economic argument that rests on an eloquent description of history and a rigorous interrogation of mainstream economic theory’s heroic assumptions. The former is a tradition that modern orthodox economics has replaced in favor of often dubious forms of “mathiness.” And the process of challenging theoretical assumptions is something that many working empirical economists will claim to be doing, but for some reason many of these same people try to gatekeep this practice for those that accept the value of the faulty classical models that govern conventional economic theory to begin with. In other words, challenging what Galbraith coins “the conventional wisdom” has ideological guardrails; it’s why New Keynesians like Krugman have a weightier say in policy discourse and mainstream academia than heterodox Post Keynesians who don’t accept the mathiness in the first place.
Due to the sheer readability and popularity of his books with the public, Galbraith was still afforded the academic and political respect that many of his successors in heterodox econ do not receive today. And it’s clear why: his writing is convincing because of its pointed clarity, clarity of the kind that is sorely lacking in the publications of heterodox researchers today.
Defenders of the conventional wisdom would do well to remember that Galbraith’s tradition—the application of non-mathematical, but still very deep, social analysis—was exactly the tradition that some of their economist heroes (Adam Smith and even John Maynard Keynes) participated in. And Galbraith’s conclusions here really seem to stand the test of time: America’s private sector is more affluent than ever, and yet our public sector indeed remains starved—crumbling roads, underfunded schools, an inefficient healthcare system. Both American policy and psyche have been geared around meeting a manufactured desire for individuals to consume luxury goods instead of the public goods whose health, in the long run, are signals of an affluent society’s ability to ensure the true wellbeing of its people.
Due to the sheer readability and popularity of his books with the public, Galbraith was still afforded the academic and political respect that many of his successors in heterodox econ do not receive today. And it’s clear why: his writing is convincing because of its pointed clarity, clarity of the kind that is sorely lacking in the publications of heterodox researchers today.
Defenders of the conventional wisdom would do well to remember that Galbraith’s tradition—the application of non-mathematical, but still very deep, social analysis—was exactly the tradition that some of their economist heroes (Adam Smith and even John Maynard Keynes) participated in. And Galbraith’s conclusions here really seem to stand the test of time: America’s private sector is more affluent than ever, and yet our public sector indeed remains starved—crumbling roads, underfunded schools, an inefficient healthcare system. Both American policy and psyche have been geared around meeting a manufactured desire for individuals to consume luxury goods instead of the public goods whose health, in the long run, are signals of an affluent society’s ability to ensure the true wellbeing of its people.
March 3, 2024
"Cet équilibre est une question du plus élémentaire bon sens pour un pays dans lequel les besoins deviennent si ténus qu'il faut soigneusement les entretenir quand ils existent, et les susciter quand ils n'existent pas. Nous devons, en vue de créer une demande de nouvelles voitures, imaginer chaque année des changements compliqués ne répondant à aucune nécessité fonctionnelle, et soumettre ensuite la consommation à d'impitoyables pressions psychologiques pour la convaincre de leur importance. [...] Pendant ce temps il existe, tout prêt, un grand besoin d'écoles, d'hôpitaux, de taudis à éliminer, de développement urbain, d'hygiène, de parcs, de terrains de jeux, de commissariats de police et mille autres choses encore.[...] L'économie est axée sur la catégorie la moins utile des besoins humains."
Ce livre, je suis contente de l'avoir lu, mais je suis contente d'être arrivée au bout. Écrit dans un contexte capitaliste de guerre froide, il est intéressant, mais parle d'une manière de voir le monde qui est, à mon sens, passée. Que dirait Galbraith s'il voyait le néo-libéralisme sauvage qui a cours aujourd'hui ? Le grand point fort de Galbraith, c'est qu'il remet l'église au milieu du village: à la base, l'économie étudie l'allocation optimale des ressources, et pas comment niquer les pauvres et la planète en engrangeant un max de fric. Il n'est pas révolutionnaire, et serait, dans un contexte suisse, un vieux PS un peu mou du genou, mais il a quelques idées vraiment chouettes, et se plaint des idées conventionnelles (aka ce qui ENSEIGNÉ cinquante ans plus tard dans les facultés d'économie), qui viennent d'un monde que les pays industrialisés ne connaissent plus depuis longtemps.
Ce livre, je suis contente de l'avoir lu, mais je suis contente d'être arrivée au bout. Écrit dans un contexte capitaliste de guerre froide, il est intéressant, mais parle d'une manière de voir le monde qui est, à mon sens, passée. Que dirait Galbraith s'il voyait le néo-libéralisme sauvage qui a cours aujourd'hui ? Le grand point fort de Galbraith, c'est qu'il remet l'église au milieu du village: à la base, l'économie étudie l'allocation optimale des ressources, et pas comment niquer les pauvres et la planète en engrangeant un max de fric. Il n'est pas révolutionnaire, et serait, dans un contexte suisse, un vieux PS un peu mou du genou, mais il a quelques idées vraiment chouettes, et se plaint des idées conventionnelles (aka ce qui ENSEIGNÉ cinquante ans plus tard dans les facultés d'économie), qui viennent d'un monde que les pays industrialisés ne connaissent plus depuis longtemps.
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