Book Review: How much is enough?
Board: Macro Economics
Robert and Edward Skidelsky examine a the question "What is enough... and why and what are we gearing our civilization towards achieving?"
They make a strong case that a particular set of ideologies has overtaken both public and private discourse about money- the ideology of maximum growth, profit, and efficiency. This in turn has led towards a society which no longer attempts to do something good.
They acknowledge that increasing material prosperity and increasing GDP have some ramifying positive aspects. However, much like adding butterflies to a garden already full of butterflies- it is overlooking the necessary question of- to what purpose?
They point out that over the past fifty years, the increase of happiness of the industrialized nations has barely budged, while the typical worker who is employed labors for longer and longer periods.
In 1928 Keynes predicted that material prosperity would increase due to increased efficiency and production- he showed that if capital equipment grew at 2 percent a year and efficiency at 1% "the standard of live in progressive countries one hundred years hence will be between four and eight times as high as it is today". This would mean humans would be able to satisfy all of their needs with a fraction of a work week- only a few hours a day.
Startlingly, Keynes prediction held true- with regards to the increase in capital equipment and efficiency. The predicted rate of GDP growth forecast by Keynes took place.
The reduction of hours worked took place in a way- we have 12.8 million unemployed. Those who do work however work typically long hours, not at all a fraction of a work week.
What went wrong?
The authors propose that maximizing GDP growth and efficiency is a form of economic paternalism focusing on a specific psychological slice of human behavior- that of consumption, and omitting the rest of the important aspects of what make us human.
They posit that instead of maximizing efficiency and GDP, the economy should be structured around maximizing the ability for humans to achieve their utmost. They break this down into these parts:
Health: including food, absence of bodily pain, and focusing on curing those who are ill rather than enhancing the already healthy.
Security: living free of war, crime, revolution, and economic upheaval. They point out that "creative destruction" is an active threat to personal security.
Respect: where individuals are all raised to be worthy of consideration, and being "taken account" of. This speaks to eliminating the preferential "taking account" that today occurs in political spheres and that inequality in society leads to a decline of the moral fabric of the society.
Personality: the ability for one to frame and execute a plan of life reflective of one owns taste. Private property is an essential safeguard of personality. "Stable fortunes.. are an invisible asset on which every kind of culture is more or less dependent" wrote Marcel Labordere. Free market capitalism fails in the acquisition of property in the current implementation because many people do not have property and are thus denied the ability to execute their life fully. The goal of personal property in this view is not to maximize capital production, but rather increasing individuals ability to have freedom. Concentration of property then violates its essential function, and should be distributed boradly.
Harmony with nature: Living a life with more fresh seasonal foods and less time locked in an urban struggle.
Friendship: time devoted to cultivating relationships which are not purely utilitarian in nature (as many work relationships are).
Leisure: not relaxing- but rather time spent away from labor on activities we do for their own sake, such as education, playing instruments, discussing things, etc.
They aim to lay out a framework which no longer picks on maximizing efficiency or GDP growth as the highest good, but rather picking policies which allow the greatest ability for humans to maximize their own virtue (as represented with the themes above).
A society with a dispersed ownership of assets which maximizes personal freedom and self determination would be their goal to aim towards. Reduced income, and reduced labor are also part of their aim along with a decrease in overall consumption.
It is a thought provoking book full of lots of history of the philosophical underpinnings of economic thought. Very interesting read and recommended for any armchair philosopher.