U.S. Production and Real Needs

...The obsolescence has occurred because what is convenient has become sacrosanct...

...And this book will be one of many influences on their behavior and their consciousness of its implications...

...This is known as "consumer credit" so that, within limits, no one can say he cannot "afford" to buy the new car, or even summer vacation...

...Advantage of numbers no longer lay with the "proletariat...

...Neither of these propositions is true...

...Anticipating some of the controversy his thesis will engender, Galbraith observes that a man who makes his entry by leaning against an infirm door gets an unjustified reputation for violence...

...They fell, really, under the Marxian pall, swallowing whole his theory of class, of inevitable class conflict, and his belief that in the end a violent depression would destroy the capitalist system...

...Conventional wisdom" fought every social advance from trade unions to the New Deal...

...Economists have not yet reckoned with the fallacy of two propositions they assume without argument: (1) that urgency of wants does not diminish appreciably as more of them are satisfied...

...Fiedler's fault...

...The bill collector thus becomes a central figure, if he is accepted...

...But the conventional wisdom assumes that strengthening public services is revolutionary in itself...

...In considerable measure, Galbraith observes, it is not to fill wants but to create jobs...

...Indeed, Galbraith thinks, parties and governments cannot go on "inventing" new kinds of security...

...To make this clear, Galbraith sets up as his dialectic opponent "conventional wisdom," which is primarily adherence to the familiar...

...Are there things, indeed, which a human being should not do...

...by which resources are always available for the most important functions of society instead of for the least...

...Few people at the beginning of the 19th century needed an adman to tell them what they wanted...

...So great store of money and ingenuity is expended on creating wants which commercial heroes thereupon satisfy by selling comic books, mouth washes or vanity-satisfying frivolities...

...Fiedler's anthology so acutely describes, or will they effectively oppose them...

...But has anyone attempted to apply like standards to social services—let us say schools, or adequate pay for teachers, or additions to human knowledge...

...In any objective or systematic way, these questions are extremely difficult to answer...

...they will have to take actions which involve justice to others...

...It is not, Galbraith thinks, likely that those who esteem this world will enjoy his essay...

...There is a way to do this: To the sales price of goods there may be added a sales tax destined for the social services...

...Breaking barriers in any field of knowledge is a dangerous occupation and John Kenneth Galbraith, professor of economics at Harvard, has elected to live dangerously...

...In fact, most private production is possible only because parallel social investment or expenditure protects, facilitates, assists or perhaps subsidizes it...

...There is some psychology, by brilliant non-psychologists, and much sociology, by brilliant non-sociologists, but no ethics at all...

...Will they accept the horrors and vulgarities which Mr...

...Then comes a square look at the real cause for "production...

...What all this comes to is that ways and means should be found—credit and taxation are two avenues—by which production is steered where it really is needed, and not merely into satisfying Madison - Avenue - created wants...

...the want itself must be engendered...

...In an earlier book, American Capitalism: A Study of Countervailing Power, he began by challenging Say's Law...

...To repeat, this is an important book...

...There is no need of it...

...Fiedler's book offer no guidance, no models...

...It is a sign of the times—or at least of the American times, for there is a good deal of European existentialist writing which he might have included...

...Revolution," "Tides of Crisis" Here the essays in Mr...

...poverty at the base of the income pyramid continued, but it was a "voiceless minority...

...Is this all additional wealth...

...Every corporation and every individual was making himself as secure from risk as he possibly could, and taking no risks that could be avoided or insured against...

...Thereupon he lets loose...

...it had better be attributed to the weakness of the door...

...Are there things which an American should not do...

...This leads to a hereto unexplored field in economics: the relative valence of wants...

...Galbraith thinks that "conventional wisdom" recently has been suffering some heavy blows and this may perhaps give new ideas an inning...

...Our hope for survival, security and contentment returns us to the problem of guiding resources to the most urgent ends...

...There was plenty of inequality but it had declined in urgency...

...He thought the economic problem of supply was not the paramount problem—other considerations would be more pressing...

...The danger of not having jobs for half of Detroit is, however, met by this system of organized waste...

...And yet the students who read this book will have to make decisions which are selfish 01- unselfish...

...So much do we fear that people will not want, therefore will not buy things, that we have reorganized a substantial sector of our credit machinery to assure that they do continue to buy...

...Suave irony, some barb of which strikes all of us, will be irritating...

...but our people discriminate, according superior prestige to private goods and an inferior role to public production...

...Meanwhile, the accepted theory that efficiency and economic advance will not occur without economic insecurity actually has already gone by the board...

...There are, of course, other ways...

...Well, the balance must be redressed...

...Their growth is "an intrinsically evil trend...

...by which those things which only the community can do are done, not merely talked about...

...It was "part of the system...

...Its enemy is not so much ideas as the march of events...

...Economic theory based on this assumption does not apply when change in productive capacity makes possible the satisfaction of most human desires: "So great has been the change that many of the desires of the individual are no longer even evident to him...

...If the vigor of the race is not in danger, liberty is...

...Not influence but explosion is the danger here, and Galbraith places the problem squarely before his fellow social scientists...

...But the problems Galbraith raises require either a reasoned answer or adoption of his main thesis...

...and (2) that wants originate in the personality of the consumer...

...The imbalance between public and private services becomes great, and is accentuated when influence pushes up the level of the industrial workers and leaves public employment at a level of genteel poverty...

...The word essay means to assay, to test out, to try, precisely in those areas which mean most to us humanly, and yet in which objective and determinate answers cannot be given...

...Only through the will of perceptive individuals who believe that significant action is still possible is there any hope of lessening the inhumanity which this book so thoroughly anatomizes...

...Emphasis now turns not on prodding individuals through fear but on increased production, the carrent shibboleth...

...One result of that, Galbraith grimly notes, is the rough correlation between the strength of Communist parties in indigenous revolution and the persistence of inflation...

...His conclusions demand either to be accepted or to be answered: They simply cannot be ignored...

...but with impeccable logic Galbraith points out that it is one of the ways, and not the worst, by which the imbalance between private and public service, between non-statist and statist production can be worked out...

...and they will be tempted, either through lack of imagination or incitement by the imagination, to be cruel...

...The vested interest in output is solid enough in the conventional wisdom—but if one asks whether the output is really useful, or the public relations industry which artificially creates a want for the output is useful, the foundations of great industries suddenly begin to rock...

...Still worse, the acceptance of risk, considered a dynamic force in America, in fact proved to be an illusion...

...They are established by government, and therefore must be regarded as a burden...

...Then our American "liberal tradition"—which also gets rough handling—adopted as a general premise that only the softheaded would accept the notion that reform or advance under capitalism would change the situation...

...Insofar as he is being representative, this omission is not Mr...

...At this point the American economic scene changes rapidly...

...Its apostles, honored at present, may be devastated later by events—but by that time they are dead...

...Once that fact is recognized, economists must squarely pass judgment not merely on the volume but upon the qualities of the goods with which they are concerned...

...The want of cars with high tail fins is so dim that it has to be fanned...

...The great depression of 1933 lent credibility to all this—and then the change...

...In The Affluent Society, he questions a number of basic tenets of current economic theory...

...But, today, spontaneous "wants" apparently are insufficient to call production into existence...

...Your economist, trying not to be a moral philosopher, assumes that production which satisfies wants or fulfils desires is a net addition to the sum total of wealth...

...The marginal patches of poverty have to be attacked now not on the level of social phenomena but by the case system...

...He uses as the fulcrum of his powerful level the fact that all economic theory is based on a condition in which poverty—inability to meet needs—is an immutable condition...

...Enjoyment of physical possession of things, formerly a prerogative of wealth, became possible to a considerable majority of society in America...

...Nevertheless, the students who read this book will inevitably have to act in ways which seem to answer them...

...Companion expenditure for social services, on the other hand, is not regarded as wealth and does not enter into gross national product...

...They become so only as they are nurtured by advertising and salesmanship...

...So, for that matter, thought Karl Marx— though he built a different state as his projected solution...

...The conventional wisdom of liberalism (the liberals, Galbraith thinks, are nearly as ossified in their ways as are the conservative groups) outlaws sales taxes...

...And yet here, if anywhere, the art of the essay is required...

...they will find opportunities for self-transcendance...

...The domi-nantly sociological tone of the collection, however, makes this sound like trying to sweep back the sea with a broom...

...Both social manners and economic fact contributed...

...A disgrace to the system...

...Malthus, Ricardo and John Stuart Mill accepted as iron law that poverty was built into all economic life...

...Keynes, it is true, thought otherwise...

...Once we reach (as America has) the point in which production is marginal, "meaning that it supplies only contrived wants instead of spontaneous consumer needs"—then the marginal utility of aggregate output diminishes...

...The lower income brackets moved up by comparison...

...Economic security requires a high level of production—hence, productivity and its increase becomes the order of the day...

...Neither in affluence nor in depression can we leave a plate-glass window with production on one side and unfilled needs on the other...

...Poverty,' Pitt exclaimed, 'is no disgrace but it is damned annoying.' In the contemporary United States it is not annoying but it is a disgrace...

...Nor can we allow the highest satisfaction in terms of sale of goods while no satisfaction is accorded the demands for education, for social investment, and for community services and their like which fall into the public domain...

...Escape, therefore, from obsolete preoccupations based on the assumption of poverty now becomes necessary...

...by which, in a word, those great areas which fall into the public domain are allocated an adequate portion of resources of an evolving society...

...Some fields are uncovered but the greatest have been met...

...The great remaining problem is that of preventing depressions...

...So far as production is concerned, clearly it can be done...

...This is a very important book...

...The shortcomings of economics are not original error but uncorrected obsolescence...

...Schools, judges, police, municipal swimming pools are suspect...