John Kenneth Galbraith - too square to be hip

I just finished watching author Richard Parker on CSPAN2 talking about his new biography - John Kenneth Galbraith: His Life, His Politics, His Economics. I was eager to see the interview after reading this review of the book in Foreign Affairs by J. Bradford DeLong, an economics professor from the University of California at Berkeley.

Both Parker and DeLong are troubled by the fact that Galbraith’s legacy seems so tenuous given how great a figure they (and evidently, Professor Galbraith himself) consider him to be. They note with chagrin how the field of economics has dropped him from their list of luminaries, while the Democratic party has similarly abandoned the policies he espoused – a repudiation of both his politics and his scholarship. Parker blames weak resolve on the part of the Democrats and an ivory tower focus on mathematical models and quantifiable equations on the part of economists for this neglect. I think these are fair assessments.

I believe, though, there is another dimension he is missing: the radicalization of the academics and intellectuals who should be Galbraith’s natural constituency. As Parker noted in his talk today, Galbraith is basically a neo-Keynesian who believes in free markets and the intrinsic value of the capitalist system – he simply thinks there are ways to make it work better. Unfortunately for him, the people who would be most receptive to his economics and politics today have moved beyond that basic premise, and the last thing they want is for capitalism to work better.

My experience as an Econ undergrad at UT Austin (late 80’s early 90’2) tracks mostly with what DeLong describes in his review, but with some important differences. The basic theoretical models taught were Keynesian and Monetarist, but the Economics Department resided in the College of Liberal Arts, not in the Business School, which was in line with the basically non-mechanistic focus of the curriculum. After the basics, though, upper level courses that weren’t devoted to specific geographic regions or industries were explicit critiques of the free market system. The most well-known professor in the department was an openly Marxist economist who taught several courses in socialist and communist theory. If you were far enough to the left to believe in Galbraith-esque price controls and government intervention, you normally then slid right on down the slope to full-on socialism or further. Tinkering with the system was akin to making peace with violence.

I recently read an example of this attitude and a realization of its effect on the Left politically in this interview with a professor of economic sociology from Princeton. The academic here exhorts liberals to come to grips with their “lingering hostility toward market mechanisms” and use them to advance their political and social goals – a reasonable position. Even so, he retains a steadfastly anti-capitalist view by declaring that markets are not “free”, but social constructs. Command economies, he claims, aren’t merely perversions of natural-state markets, but equally valid alternative systems that simply produce different results. While he can see the benefits of using the market as a tool to reach his social goals, he still can’t quite bring himself to accept that they exist independently of government. I imagine that for him, Galbraith must seem like someone with good ideas, but lacking the courage of his convictions.

I see the same situation among liberal commentators. Being too big a booster for the wonders of the free market invites some rather pointed criticism from their colleagues. Note the drubbing Thomas Friedman is taking from the Left for his writing about the positive effects of globalism. This reviewer from The Nation of Friedman’s new book betrays a telling attitude when pooh-poohing claims of increased productivity:

"In fact, virtually the only industry in which information technology has made an unquestioned and substantial contribution to productivity is financial services. And that, from society's point of view, may well be no more beneficial than gains in the gaming industry would be--of which, arguably, the capital markets deserve to be considered a part."

That’s not hyperbole – that’s outright disdain for one of the central drivers of the capitalist system itself. At least once a week I see this kind of antipathy for markets in general in print, and the demise of the command economies in China and the Former Soviet Union have only seemed to make it more prevalent – perhaps because there are no concrete examples to ruin idealized, airy notions of socialism. These statements almost always come from people whose goals and values are closely aligned with Galbraith’s – but it seems he doesn’t cut close enough to the bone for them.

In his Foreign Affairs article, DeLong writes that Galbraith is “a guilt-inducing reminder of how much broader and more relevant economics can be.” If the reach and influence of academic economics were truly that limited, the work of others he names – James Tobin, Milton Friedman – would not have the impact they do today. Galbraith’s problem is that he’s preaching to an empty choir box – too far out to be mainstream, but not radical enough to be chic.