April 30, 2006
Off To The Great University in the Sky
RIP, John Kenneth Galbraith, 97, and one of the giant's of modern liberalism. I still think his countervailing powers theory is the single most powerful and illuminating concept for those seeking to understand the nature of the modern economy and the reasons we need an activist government coupled with a vibrant labor movement.
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» J.K.G. R.I.P. from Minipundit
We've lost a giant: John Kenneth Galbraith, the iconoclastic economist, teacher and diplomat and an unapologetically liberal member of the political and academic establishment that he needled in prolific writings for more than half a century, died yest... [Read More]
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many of the legendary intellectuals and gifted thinkers of the kennedy years have gone now.
...for those of us who remember, there was a cultural and intellectual vibrancy in that particular time...elegant writers and brilliant thinkers...
galbraith, sorenson, salinger, shriver...just to remember a few.
so much has happened since then....it feels like a very long time ago.....
Posted by: jacqueline | Apr 30, 2006 1:31:52 AM
A giant, indeed.
Rarely do we see an economist with a heart as well as a brain, and an economist whose breadth of vision extended well beyond the what others have viewed as the dismal science into the fabric of what makes a modern democracy worth fighting for and preserving.
A man of the world, in the best sense, and a liberal in the classical sense as well in the practical vein.
The NYT obit is well beyond the quality of their usual fare, as befits a noble man with realistic insights like this: One of my greatest pleasures in my writing has come from the thought that perhaps my work might annoy someone of comfortably pretentious position. Then comes the realization that such people rarely read."
As true today as in 1958 (The Affluent Society):
"The Affluent Society" appeared in 1958, making Mr. Galbraith known around the world. In it, he depicted a consumer culture gone wild, rich in goods but poor in the social services that make for community.
The closing quote of the obit would be a very suitable epitaph for this man's memorial:
"Let there be a coalition of the concerned," he urged. "The affluent would still be affluent, the comfortable still comfortable, but the poor would be part of the political system."
Posted by: JimPortlandOR | Apr 30, 2006 2:30:31 AM
whether it be the explanation of a tilde, flying machines, theology, politics, the economy or the eulogy for a great man, you are always articulate, incredibly knowledgeable, with a deep understanding of many subjects. i, for one, learn much from your comments, and wish to thank you for all that you share and contribute to this site.
Posted by: jacqueline | Apr 30, 2006 7:48:30 AM
I loved to read Galbraith. However, his defense of the labor movement was great for his time. In today's world, organized labor has had as devistating effect on today's businesses as it did beneficial in the past.
Name one large company that is in deep trouble today that isn't unionized.
Posted by: Fred Jones | Apr 30, 2006 8:53:50 AM
Name one large company that is in deep trouble today that isn't unionized.
Enron. Just about every tech firm in the 90s. I'm sure we can think of more.
Then there are all the unionized sectors that aren't in deep trouble.
Galbraith, along with Friedman, is one of those scholars from another era whose work you read and, years later, realize, "Wow! These people are still alive! They're living legends!"
Posted by: Constantine | Apr 30, 2006 9:13:16 AM
thank you, jacqueline. i also learn, here and elsewhere, from others who comment, and appreciate the interaction.
Posted by: JimPortlandOR | Apr 30, 2006 10:24:02 AM
Name one large company that is in deep trouble today that isn't unionized.
Right, but more to the point, the fundamental insight of liberalism here is that keeping large companies out of trouble is only good insofar as they can do it without abusing workers. There are certainly cases of unions gumming up the works (NYC teachers' union, anybody?), but this idea that corporations could do well if only actual human beings would get off their backs is bizarre. It's just the kind of attitude that has led to today's economy, where Bush has managed the astronomical feat of decoupling general economic growth from the prosperity and security of the middle class.
Posted by: Daniel A. Munz | Apr 30, 2006 10:43:32 AM
Enron. Just about every tech firm in the 90s.
Fair enough, Dean. However, I could make a very good argument that each of these examples is an anomaly. Enron went down, not because of economic environment, but because of thievery. The tech firms were so badly overbuilt because of the need for business to convert to the internet age, a very large, but discrete event.
Posted by: Fred Jones | Apr 30, 2006 11:21:22 AM
Reminiscences:much of my political education in the 60s and 70s was watching "Firing Line" every week for a hour:Galbraith, Vidal, Friedman, Muggeridge, Mailer, Morgenthau. Buckley was funny and fair, and above all smart. I remember it as lightweight and shallow relative to the importance and difficulty of its questions, but compared to Matthews or McLaughlin or Charlie Rose or Nightline...there is no comparison.
I can't mourn Galbraith. A great life, personal and public. Maybe not a great thinker or scholar, but I bet there are a lot of Harvard grads thinking about him today. Maybe one of the best teachers of the 20th century.
Posted by: bob mcmanus | Apr 30, 2006 2:03:28 PM
I never had Galbraith as a teacher, but I read some of his popular books on economics, and, for the most part, what he wrote was crap, and, largely plagiarized crap, at that. I say that as a liberal in good standing and a one-time working economist.
As a writer on economics, he was very, very good at capturing a general impression, a wisp of the zeitgeist, but absolutely terrible at actual facts or logical analysis. Very little held up to even the slightest critical examination, even if you were inclined, as I was and am, to endorse the general political sentiment and outlook.
When I knew more about the economic thought underlying his later books, I realized that he was stealing many of his ideas from a couple of creative Marxists teaching in obscrurity at U-Mass-Amherst.
I did have the pleasure of once taking a class from a Galbraith critic, Harold Demsetz, a Chicago school scholar at UCLA. I did not agree with Demsetz's reactionary world view, but I appreciate his committment to rigorous thought. (Demsetz wrote what is probably the best theoretical rationale in existence for public utility regulation, a remarkable achievement for someone whose tempermental worldview would oppose such a thing.) The contrast between Galbraith and Demsetz, confirmed me in my view that Galbraith represented and embodied the kind of sloppy, lazy "thinking", which has very nearly done liberalism in.
Posted by: Bruce Wilder | Apr 30, 2006 2:27:29 PM
Dan Muntz :
"Decoupling general economic growth from the prosperity and security of the middle class"
Whither the consumers ? Temporary aberration.
The Democratic genius was recognizing the power of a "we're all in this together" attitude to "lift all boats".
These days it's more like "Banana Republic, here we come".
When Americans abandoned the concept of having a measure of domestic security for the illusion of extreme peril (compared to whom ?) they made themselves look pretty silly to the likes of Israelis ( for instance ) who know what it is to contend with the threat of imminent extinction.
This "Rule of Bush" instead of Rule of Law has broken the back of the American Dream.
Posted by: opit | Apr 30, 2006 2:29:59 PM
Stanley Brue on JKG ...via Mark Thoma at the Economist's View
Going to Bruce's comment:
"In conclusion, Galbraith's volleys at economic orthodoxy, like those of Veblen before him, could be said to have forced neoclassicists temporarily to halt their march, to have required them to acknowledge and even engage the opposition. Galbraith elicited much return fire. This very fact-that he could not easily be ignored-is a testament to his powers of intellect, wit, and pen. Nevertheless, orthodox economics has experienced few casualties and even fewer defectors; put bluntly, it marches on. For institutionalism to reemerge as a major force in economic thought, it must win the minds of a future generation of economists. Its best hope for doing this is to develop a unified set of theories, readily understandable and teachable, that hold up to careful intellectual and statistical scrutiny. To date, say its detractors, it has not accomplished this." ...Stanley Brue
What can I say? What do I know? I remember reading a couple JKG books, but don't remember much. OTOH, I have a greater affection for Michael Harrington. JKG was a nice guy, probably too nice. The boomers aren't to blame, the Hayeks and Friedmans and Laffers should have been stomped into the dust in the 60s and 70s by an older generation. To mix my metaphors, the waters of liberal economics was allowed to stagnate and the scum rose to the top in the Reagan years and now covers everything with a fetid, rancid film.
Galbraith may not have had the temperament or tools to keep the waters roiling. I think he had the intention and insight, and I will value that over any quantity of Nobel-winning number-crunching neo-classicists.
Posted by: bob mcmanus | Apr 30, 2006 2:41:40 PM
"Parker also has an explanation -- also a relatively convincing one -- for the eclipse of Galbraith's economic thought. The story here is of the blindness of an academic establishment steeped in Paul Samuelson's Foundations of Economic Analysis. Economists, Parker believes, have sold their birthright for a tasteless pottage of mathematical models. As a result, they can say much about theory but little about reality. And they ignore Galbraith because he is a guilt-inducing reminder of how much broader and more relevant economics can be." ...J B DeLong
I think I have my reason to be pissed off today. Laputans like Wilder complaining that the streets are muddy, and those who would clean them have dirty and ragged brooms.
Posted by: bob mcmanus | Apr 30, 2006 3:37:18 PM
DeLong cites his own review of the Parker biography, and deserves a link. JDB also demonstrates the contemptible and servile hackery of the NYT obituary, may they burn in hell with their Republican masters.
It may be a day for JKG quotes, may his pithy brilliance illuminate the blogosphere. Like lighting a candle as prelude to McMansion bonfires:
"We can safely abandon the doctrine of the eighties, namely that the rich were not working because they had too little money, the poor because they had much." ...JKG
"George Bush's political, intellectual and other shortcomings cannot be restricted to a single sentence or two. He presides over a context far more complex and authoritative than he could possibly understand." ...JKG
"One of the largest and most important questions facing the governments of the industrial countries is that the economics profession--I choose my words with care--is intellectually bankrupt. It might as well not exist." ...JKG
Posted by: bob mcmanus | Apr 30, 2006 4:06:26 PM
"Partly, the Russian system succeeds because, in contrast to the Western industrial economies, it makes full use of its manpower."
— John Kenneth Galbraith (1984)
"There is no unemployment in Soviet Russia or in Dartmoor Prison - and for the same reason."
— Winston S. Churchill
Galbraith was a better social commentator on capitalist society than an economist, and a relentless apologist for Communism in all its fetid glory.
"The evil that men do lives after them,
the good is oft interred with their bones."
Posted by: Mastiff | Apr 30, 2006 4:13:39 PM
William Polley, conservative, admires with class and links and links to a WSJ linklist.
Posted by: bob mcmanus | Apr 30, 2006 4:21:02 PM
Brad DeLong comments that the NYT did not correctly capture his (DeLong's) critique of JKG in their obit. The comments there are excellent too, including this Galbraithian quote:
The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.
I like this JKG quote: (oh so appropriate in Bu$hCo world)
All successful revolutions are the kicking in of a rotten door
Posted by: JimPortlandOR | Apr 30, 2006 4:37:47 PM
And what are your examples, Fred? The auto industry? Which has lost market share for its cars because the execs made a conscious, and wring, decision to concentrate on the light truck/suv market and move excess power into speed rather than efficiency and now no one wants to buy their cars? Vegas, with its heavily unionized service industry, is doing all sorts of fine. Costco too. American automakers are dying, but blaming it all on the unions -- particularly considering Toyota and Nissan pay similar wages and benefits -- is silly.
Posted by: Ezra | Apr 30, 2006 4:46:11 PM
Having read his comment over at DeLong's, maybe I should apologize to Wilder. Maybe. If Galbraith didn't do the heavy mathematical lifting required, perhaps it is because, and JKG said so, too many economists are persuaded too easily by those pretty crystal models.
Posted by: bob mcmanus | Apr 30, 2006 11:59:40 PM
American automakers are dying, but blaming it all on the unions...
Yeah, you're right. Unions have nothing to do with the expenses of the business....
As defined by the current United Auto Worker contract negotiated with the "Big Five" (GM, Ford, Chrysler, and top parts makers Delphi and Visteon), an auto "production worker" is a job description that covers anything from mowing grass to cleaning the toilets. In the real world, these jobs would be outsourced to $8 an hour, no-benefit wage earners, but on Planet Big Five, these jobs get the same wages as any auto line-worker: an average $26 an hour ($60,000 a year) plus benefits that bring the company's total cost per worker to a staggering $65 an hour.
But at least the grass cutters are working for their pay. The UAW contract also guarantees that 12,000 autoworkers get full wage for doing nothing. On the heels of Miller's straight-talk, the Detroit News reported that "12,000 American autoworkers, instead of bending sheet metal, spend their days counting the hours in a jobs bank." These aren't jobs. And they certainly aren't being "lost" to China.
"We just go in (to Ford's Michigan Truck Plant) and play crossword puzzles, watch videos that someone brings in or read the newspaper," The News quoted one UAW worker as saying. "Otherwise, I've just sat."
For Delphi, this idled labor cost $400 million in the second quarter of this year alone. Facing similar numbers until the contract's end in 2007, Delphi took refuge in bankruptcy. "The jobs bank must be eliminated," says Miller. "Paying people not to work is just not sustainable."
Posted by: Fred Jones | May 1, 2006 1:22:04 PM
Non-unionized firms in trouble? Pfizer's stock is down ~45%(IIRC); the CEO has been handsomly rewarded for his excellent leadership. Merck's suffering from fraud in the testing of Vioxx; the senior executives who approved of it, to the best of my knowledge, haven't suffered. The stockholders, employees and customers have.
As to unionized firmss, GM and Ford are largely in trouble because they thought that the late 90's were going to last; they should have known that, sooner or later, a Republican president would be elected.
Posted by: Barry | May 1, 2006 3:56:02 PM
Yeah, pay no attention to the post above you, Barry. Those unions probably have no effect on costs whatsoever, eh?
Posted by: Fred Jones | May 1, 2006 6:30:32 PM
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