Somehow I feel I'm being conned when I read old men who, looking back over history, give a cheerful appraisal. I trust the cynics. And so, up to a point, I trust John Kenneth Galbraith, who in this account of what he "saw or learned of the central core of economic life" during his 65 years, sets the tone of the book with this observation:
"Ignorance, stupidity, in great affairs of state is not something that is commonly cited. A certain political and historical correctness requires us to assign some measure of purpose, of rationality, even where, all too obviously, it does not exist." Later he writes of "the primal role of stupidity in shaping the course of history."
Ignorance and stupidity are often encountered in "A Journey Through Economic Time," and not least among some of Galbraith's fellow economists, particularly those who believe in the "classical" boom-bust, government-hands-off, competition uber-alles kind of capitalism and who seek to balance the budget by ignoring human misery.
By Galbraith's reckoning, these pious bunglers misinterpreted the cause and importance of the 1929 stock market crash; ruined the first blip of economic recovery during the Great Depression of the 1930s; assumed the United States would sink back into a depression after World War II; and gave all recent presidents extremely inhumane advice on how to handle the economy.
Perhaps the biggest ongoing mistake of that crowd is its faith in the ability of the economy always to bounce back--that after every bust there will be another boom. Galbraith argues, to the contrary, that high unemployment and economic stagnation can reach an equilibrium and just hang there. Such an equilibrium was reached in the 1930s, and it took a war to break it. He believes that such an equilibrium could be developing again.
So just where, as an economist, does Galbraith stand? If I read him correctly--and I sometimes doubt I can read any economist correctly, even this one who claims "there is no economic process or problem that cannot be put in plain language"--Galbraith's philosophy is about 80% John Maynard Keynes (from whom he borrowed the just-mentioned equilibrium theory), 10% Karl Marx and 10% ad hoc.
Galbraith was one of the many bright young guys who swarmed into the New Deal bureaucracy. Some, not many, were Communists. He recalls them with something better than tolerance, and why not? In his opinion, "no one of any sensitivity could look on capitalism in those years (of depression in the 1930s) and think it was a success. There was, accordingly, a choice between repair and revolt."
He was among the influential, and ultimately dominant, clique who chose Keynesian repair. The British eccentric had only recently rocked the world's economics establishment with his argument that the path to recovery from depression was for governments to stop worrying about deficits and spend, spend, spend their way out of the pits.
Galbraith writes, with what I imagine is a pleased grin, that to classical economists this proposal seemed almost as subversive and certainly as dangerous as communism, and yet every President since then has been forced to follow Keynes' piping even while some of them chant the ritualistic mantra of the balanced budget.
In the United States, Marx's communist doctrines have been used mainly as a bugaboo to rationalize monstrous military budgets during the Cold War. At the same time, Galbraith notes, our chief economic competitors, Japan and Germany, were studying Marx's theories seriously and often with good results, particularly in the way they made their governments serve as a kind of executive committee for their capitalist class.
Most liberals in this country find such close cooperation between government and the captains of industry to be dangerously undemocratic, just as they consider it a prime duty of government to use antitrust laws to break up anything that looks even suspiciously like a cartel. Not Galbraith. This lifelong liberal believes cartels can be useful, even necessary, in global competition, and he thinks the antitrust hang-up is typical of the "devoid liberal mind."
Clearly, Galbraith is not just another economist. This transplanted Canadian Scot is a man of many hats and moods. While he is best known as a practitioner and professor of the dismal science of economics, he has also been a journalist (Fortune magazine); an official appraiser of the results (very disappointing) of strategic bombing; a speech writer (for, among others, presidential candidate Adlai Stevenson); a high-level bureaucrat, and an adviser (often as dissenter) and trouble-shooter for various Presidents.
This is his 30th book. He has ranged over such varied topics as art, anthropology, social criticism, travel and, of course, money. One just naturally roots for an intellectual adventurer of Galbraith's sort, but I don't think "A Journey" will add much gloss to his reputation.