The Affluent Society is an excellent but dense, book about the evolution of the American economy. In it, Galbraith covers how the US economy has evolved since colonial times, and what modern developments mean. He covers all aspects of the economy. Monetary policy, poverty and relative poverty, taxes, capitalism and socialism, and other aspects are all discussed in depth. Through that depth, Galbraith is able to help the average reader understand problems with the economy and potential solutions to those problems.
Also, Galbraith covers the difference between how many conservatives view the economy and how many liberals view the economy. He states that conservatives are generally attached to monetary policy and liberals are generally attached to fiscal policy. Although I hadn’t thought of that dichotomy before, I found it quite illuminating as to why neither side can ever seem to agree on an economic policy.
As part of that discussion, Galbraith also describes the limited influence that central banks can have. Given the current debate over monetary policy and central banks, especially interest rates and stimulus from central banks, Galbraith’s view on central banks and their limited influence is quite relevant to the modern day.
Finally, Galbraith discusses how the private sector is booming, but the public sector has fallen apart over the past few decades and the negative effects that has had on society.
Galbraith is an obvious supporter of Big Government economic policies; he certainly wouldn’t agree with the ideas found in Free Market Revolution. That support is obvious throughout The Affluent Society but is especially obvious when he discusses the need for better public services.
However, he is otherwise able to remain objective and fact-based. His objectivity is particularly refreshing when he discusses the difference between conservatives and liberals when it comes to how they think the economy should be fixed. I found that section fascinating.
It was such an objective view of the economy, central bank, and political interference in the economy that I remained interested throughout it. Additionally, in The Affluent Society, Galbraith does an excellent job of describing why the US economy has been so successful in the past and how that has turned the US into an “Affluent Society.” I thought it was just the right mix of history, economics, and analysis to be interesting and highly informative.
However, I thought his thesis that the economy has changed so much after WWII that traditional economic policies are no longer suitable is not fully convincing. I will be the first to admit that he knows far more about the subject that I do.
However, I think he should look more about economic policies need to evolve rather than be completely shifted. Nixon taking us off of the Bretton Woods gold standard was a huge economic shift. America transitioning to a service based economy was a huge shift. Women entering the workforce in huge numbers was a dramatic shift.
Despite those shifts, past laizzes-faire economic policies as advocated by Adam Smith in The Wealth of Nations are still useful. Capitalism and the free market will continue to lead to freedom and prosperity. Big Government will be a morass as it always is. Those shifts in the economy, while large, do not justify a shift in American economic policy away from free-market capitalism.
In my opinion, they show the need for more of a free market. It will lead to more economic opportunities for those entering the workforce. Big Government will lead to more spending, less innovation, and less prosperity.
Despite my disagreements with Galbraith’s proposed Big Government-based solutions, I really liked “The Affluent Society.” While it was a bit dense at times, it was highly informative and generally quite interesting. I’m not a huge fan of economics, but I thought this book gave me a better understanding of the American economy, how it has evolved, why it was so successful, and what modern challenges for it are.
I would not recommend The Affluent Society for the light of heart, it is a bit dense reading. But, if you are at all interested in what I described in this post, then give it a try. It will leave you better informed.
By: Gen Z Conservative
Get The Affluent Society here: https://amzn.to/2uFDdz8
Read more about it here: https://en.wikipedia.org/wiki/The_Affluent_Society
Read about an opposite viewpoint of economic success: https://genzconservative.com/the-magic-formula-of-economic-success/