J.K. Galbraith Dies

J.K. Galbraith died today at 97.

Galbraith Obit.

 

I had no idea who that was till I read the article.

 

I didn't want to comment on it, preferring folks to draw their own conclusions at his passing.

 

And soon enough, his entire mixed-up social group will follow-him.

Galbraith was the worst economist since John Maynard Keynes.

He was a political animal with no concern for the science of economics.

 

Galbraith was a poet, not an economist.

 

Hmm, another Canadian who came to America, got rich off the country, and then spent his life criticizing it. Yup, sounds like the Perfect Liberal, alright. No wonder the New York Times is all weepy over him.

 

Hahahaha. Well, at least you boys are a vocal lot. I had hoped for a considered discussion. Perhaps it may yet be so.

Capitalism never was, and never will be, a system that plays in reality what it purports to play as an economic model. There is no such thing as economics stripped of politics, as all economic motives subtend, and are subtended by, power; by politics. Twas ever thus.

We don't have to reach that far. In the U.S., our capitalist paradise, government aligned with heavy capital at our industrial explosion, aggregating power and money to aid a perceived national need. The loser in that equation was labor, and lose it did, brutally. In the classical sense, there was never a capitalist economy in the United States; nor the world. And if that is the case, enter politics into the equation. Politics do not move by the neat calculus of economics. Pods of power become entrenched, unfair market advantages exist, and the cover is blown on any pretense to a benign, invisible hand.

I think this quote by Galbraith is spot on:

"In making economics a non-political subject, neoclassical theory destroys the relation of economics to the real world. In that world, power is decisive in what happens. And the problems of that world are increasing both in number and in the depth of their social affliction. In consequence, neoclassical and neo-Keynesian economics regulates its players to the social sidelines. They either call no plays or use the wrong ones. To change the metaphor, they manipulate levers to which no machinery is attached."

Another quote. This one from Donald Trump:

"I see everyone as my competition. When you're on the top, someone is always there to knock you off. You've got to fight back. You've got to destroy them. Maybe it's not the greatest life. But you've got to do it. You've got to stay at the top."

So, I ask, and this is my principal problem with unbridled capitalism: Why? To what end does staying at the top serve, absent some valued end in sight? Why the hell are we running so fast - and where are we running? We churn out more crap in a day today than we did in the millenia past. And it is crapped out, discarded, and more, bigger, faster is made to replace it - all with absolutely no larger questions being asked.

Galbraith earned his honorable place in history.

 

That's exactly what a patritician like Galbraith would say. He believed that he knew better what people should have than the people themselves.

I say Hogwash! The people are the final arbiters of what makes them happy.

If you don't want to work to stay on top -- don't. There are plenty of people who work less and deal with the economic consequences of their choices.

There is nothing dishonorable in choosing that path -- there is only dishonor in trying to control others into accepting your value system through economic coercion.

That is the essence of Galbraith, that he knew better and that the government should use economics to achieve political ends -- his political ends.

JKG made the world a worse place. He used his power for evil. That is not honorable. I should salt his grave.

 

northpointaiki, you said:

and

Okay, I am lost. If we never had a capitalist economy in the world, how can you point to any "unbridled capitalism"?

 

You know Will, your capacity to swing between reasoned discourse and unthinking vitriol astounds me. Salt his grave? Evil? This is, sadly, right up there with Yo-Yo's avatar, for me.

You have never answered my most basic question, on this and on other threads: There never was capitalism in America. What there was, historically, was an aggressive design to national development, in which the power of the state fully and completely sided with heavy capital to birth American industrial might - and did so, absolutely obstructing a market solution to labor's growing mobilization.

Given that, your invisible hand is but a wispy dream from neoclassical texts. How can you say you believe in American capitalism, when there has never been such a thing as capitalism in America?

 

Here's my view.

Capitalism among the western industrialized nations was birthed with the market intrusion of state power. Yet the putative notion of the "invisible hand" of atomized, pluralist players still acts as some kind of validating ideology, though it never existed. And this veneer has given rise to what I see, now - the rallying cry for neoclassicism means, in reality, a society that continues to produce goods and services based on nothing but the desire for more; feeding a rapaciousness I see making the world a worse place for my children and their children. Like a rabid horse with no rider, "unbridled capitalism" is the evil, not the thoughts of Galbraith. At the heart of it, for me, remains the questions - why are we running so fast? And where are we running to?

I love watching The Apprentice. It's good entertainment. But then I get saddened to watch people who were, likely, born like all of us - now tap dancing to please the Don, coming up with lyrics devoid of a damn thing for a tune pumped out by Burt Bacharach (god - did anyone see this tonight?). It's just all so goddamned empty. Marxists would call it alienation, I suppose.

 

Red Queen - Evolution - Nature - Reality. You must run faster and faster to keep up.

 

I'm a capitalist pig, myself

 

I believe this is a facile, and false, paradigm. And believing in it is destroying our planet.

 

Gtech - by that definition, as history shows, capitalism has never existed.

 

Vitriol is the result of years of reasoned discourse. However, one of my many character flaws is to show my conclusions without showing how they were derived. As you may surmise, I did not do well in Algebra.

I have not addressed this point, because I believe it to be wholly irrelevant. I apologize, I should have addressed this earlier.

...

First, let is please remember that America didn't invent capitalism. Whether or not you agree that capitalism is a natural state of man (Locke vs. Hobbes anyone?), you must agree that Adam Smith was Scottish. Hell, Locke wasn't an American either!

Second, capitalism is not currently a purely American virtue. Many other countries allow their citizens the freedom to make economic decisions.

[Note: Ughhhh... we keep using that "Capitalism" word, which is completely wrong. We are really talking about "Free Market Economics."]

Third, it is completely irrelevant that America does not have a 100% pure and clean track record concerning economic freedom. For Christs sake -- we once had slavery in this country! How is that for a violation of free markets? In slavery, you don't even own yourself!

Fourth, there is no justification for applying a black and white methodology to this analysis. No country has ever had any pure economic system. This is true even for Russian after the Communist revolution where you would be summarily executed for non-conformance with the official economic system.

...

The invisible hand has been the primary actor creating good in this world for thousands of years. During that time, it has always been shackled by government beauracracy. Each group of beaurcrats believing that they could outperform the invisible hand by shackling it and forcing it to work towards their purposes. The most common result of this meddling has been simple starvation.

Business and government are natural enemies. Each of them seeks resources from the same pools (labor and wealth). Business, in a free market economy, must compete fairly for these resources. Government gains these resources through force of arms.

To my mind, anyone that competes for my resources by giving me more stuff (money, benefits, goods, services, etc...) is unambiguously ethically superior to anyone that takes my resources by force of arms (conscription, taxation, etc...)

The distinction between business and labor is an artificial one. Labor is business. Each of us are our own little companies and anyone who behaves otherwise is not acting rationally. The "Labor Movement" was and is an attempt by one group of businesses to unethically harness the power of government (force) to enable them to compete unfairly with other businesses.

The distinction between government and labor is a less artificial one, because although free market economics gives each of us the power to act individually -- no workable political system has yet been designed which gives individuals that same level of power.

The working model is really one of business and labor against government. Unfortunately, both business and labor contain a percentage of unethical and short-sighted men who would attempt to utilize government to unfairly influence the free market. And, equally unfortunately, government also contains a percentage of unethical or short-sighted men who would willingly interfere with the free market -- either due to graft or idealism. Historically, graft has been much less of a danger to the economic system than idealism.

In a free market economy, we must prevent collusion between elements in government and elements in any specific business or industry. That means that we must be constantly on-guard against price controls, subsidies, and organized labor.

But that is very difficult to do, because we humans are very weak. Hell, I would vote today for an enormous gasoline tax in an effort to subsidize the development of alternative fuel technologies. And I'm one of the good guys! If I can convince myself to shackle the invisible hand "just a bit", it is no wonder that people who believe they know what is best for others (Marx, Lenin, Stalin, Hitler, Keynes, Galbraith, Nixon, Pol Pot, etc...) can justify beating the invisible hand to a bloody pulp.

 

OK, thanks Will. I know you to be a thinker, and appreciate your reasoning.

I have two main problems. The first is that capitalism (let me call it that), as it was played out in the western industrial democracies, clearly was anything but an open, unimpeded market. And rather than enemies, business and government were absolutely friends. So, labor - previously, unorganized, a truly market phenomenon as it mobilized - was competing with a historically entrenched and collusively aligned state, and capitalist class.

That state and capital were aligned was a political choice among alternatives, a nationalist priority to industrialize for the nations to be considered among the "big boys," whether for domestic passivation or legitimate foreign policy concerns. And if that is the case, it is inescapable that politics did have, and continue to have, a role in capitalist economies. We can disagree over politics - but let's not disagree that politics do have a hand in obstructing the invisible hand; more, I at least believe the historical record bears it out that politics, and the economies that sprang from those polities, screwed the labor class. If I were a British miner, c. 1919; or an American farmer, 1934, I'd be looking for some kind of answer outside the rarefied texts of Adam Smith's philosophy. This is where I think Galbraith's "countervailing powers" comes into play. Abuse is rampant, as you point out. But I believe the need is nevertheless real.

My second problem is with the consumerist economy as I just see it, today. I truly do appreciate your hatred for some idealist bureaucrat wishing to constrain your choices. On the other hand, I can't help but rage against the storm of what I talk about above. Quick example. Years ago (prior to Perestroika years ago), my Romanian friend's parents visited us while at Berkeley. These parents went into the grocery store and saw the plethora of choices among toilet tissue. They ran from the store in, from what I could gather, a panic attack.

This is a true story. What I get from that is this: do we really need more and more variations on the theme? Do we need more? Do we need it faster?

At any rate, thanks for laying your thoughts out. I do appreciate them.

 

I beg to differ. My grandfather always said a turd dressed in a tuxedo is still a turd (a far fetched idea disquised in eloquent wording). He was a wise man

 

I visited communist countries when they still were communists and haven't met even one communist as portrayed by the capitalist world.

I live in a capitalist society and do not know a single person being a capitalist as portrayed by communists.

I keep it with the Dalai Lama and what he said yesterday in Argentina.

"We have to transform our societies, not by governments but by the grassroots from inside of us" - words of wisdom indeed.

 

Ah, but the countervailing powers are countervailing one business against another. This is not "fairness", this is the legislated prevention of fairness.

This is government saying "these citizens are better or more important than those citizens.

The "countervailing" is countervailing what the people want (as displayed by the invisible hand) with what a few powerful beauracrats want. It is an abuse of government power and John Kenneth Galbraith is a proponent of such abuse to serve his own personal agenda.

I had a similar feeling when I returned to the American Midwest after living in Europe. Wow -- more than fifty different kinds of toothbrushes! What the hell? How are they all different? Are they all different?

However, I am sure that I would have a similar reaction if I won the lottery, and I would not see that as a bad thing.

That's not up to me. Those fifty different kinds of toothbrushes would not be there if people did not want them. Why? Because toothbrush manufacturers are in business to make money and they make money by making their customers happy.

Personally, I don't seem to buy a lot of stuff. However, it is not my right to control other people. Let there be five thousand types of toothbrushes if it makes people happy.

I am shopping for a rifle. It should be .308, .30-06, 300 Winchester Magnum, or possible .300 WSM. It is going to have to be left-handed. I have about a dozen choices. It's taking me forever to pick. It could be Elk season by the time I buy a damned rifle. All of these rifles will meet my minimum requirements. But! One of these rifles will meet my requirements best. In a state controlled economy, I would have one rifle choice, if I even had the right to buy a rifle. That would not make me happy.

Heck, if we had a state run economy, I wouldn't have the money for a new rifle even if they would let me legally buy one. And if I had the money and was able to legally buy one, there would be none manufactured and so I wouldn't be able to buy one anyway!

My rifle is another mans toothbrush. I am pretty sure that my wife could tell me the differences between all of those toothbrushes. You should see the wacky toothbrush she just bought. If I were in charge of deciding what should be manufactured, that toothbrush would not have made the list.

I own over 300 DVD's and thousands of books. My home library is larger than some school libraries. No well-meaning beauracrat would approve the production of two books on the same topic, and yet I have dozens of books on the same topic. Worse, many of my books and movies have no redeeming social value. Those certainly would not be produced in an economy which was managed by an idealistic man such as JKG.

So yes, I do have to take the extra effort to walk past fifty different kinds of toothbrushes every time my wife drags me to the grocery store. But I consider that a small price to pay to be able to read Robert Heinlein.

You're fun to argue with.