Countervailing Powers: On John Kenneth Galbraith

JohnKennethGalbraithOWI Kim Phillips-Fein in The Nation:

In a 1930 essay titled “Economic Possibilities for our Grandchildren,” John Maynard Keynes ridiculed economists for having a high opinion of themselves and their work. As the Great Depression engulfed the world, Keynes looked back at historic rates of economic growth, arguing that the real problem people would face in the future was not poverty but the moral quandary of how to live in a society of such abundance and wealth that work would cease to be necessary. The “economic problem,” as he put it, was technical, unimportant in the larger scheme of things. “If economists,” he wrote, “could manage to get themselves thought of as humble, competent people, on a level with dentists, that would be splendid!” John Kenneth Galbraith—the Harvard-based economist whose books shaped the public conversation on economic matters for a generation in mid-twentieth-century America—would have agreed.

Today, given the rise of mathematical methods and computer modeling, economics is if anything even more labyrinthine, esoteric and inaccessible to the layman than it was in the days of Keynes and Galbraith. It is also more intellectually and politically ascendant than it was in the 1930s. Its methods now dominate much of the social sciences, having made inroads in law and political science. Its central theme of the superiority of free markets is the gospel of political life. This makes the publication of the Library of America edition of four of Galbraith’s best-known books—American Capitalism; The Great Crash, 1929; The Affluent Society and The New Industrial State—a cause for celebration. (The volume is edited by Galbraith’s son James, also an economist.) Galbraith delighted in puncturing the self-importance of his profession. He was a satirist of economics almost as much as a practitioner of it. He took generally accepted ideas about the economy and turned them upside down. Instead of atomistic individuals and firms, he saw behemoth corporations; instead of the free market, a quasi-planned economy. Other economists believed that consumers were rational, calculating actors, whose demands and tastes were deserving of the utmost deference. Galbraith saw people who were easily manipulated by savvy corporations and slick advertising campaigns, who had no real idea of what they wanted, or why. In many ways, our economic world is quite different from the one Galbraith described at mid-century. But at a time when free-market orthodoxy seems more baroque, smug and dominant than ever, despite the recession caused by the collapse of the real estate bubble, his gleeful skewering of the “conventional wisdom” (a phrase he famously coined) remains a welcome corrective.