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Prescient Overview 2009-09-10

Reviewer: R. Bono

Galbraith's last book reviews the economic landscape of several years ago...before the meltdown. He's quite open about the failure of liberalism...i.e. the "countervailing power" of the state....to be a balancing force for the public interest against the overwhelming reality of the corporate dominance of the US and world economy. That the corporation spends all of its waking hours, insuring that competition is eliminated, he reminds, is reflected in the fact that Paul Samelson, the Nobel dean of free market analysts, comments that neo-classical economics no longer is able to describe the economics of our times...and hasn't for a generation, so extensive has been the continuing consolidation of economic power.

It is this old American mythology of "free" markets that leads to the compliance of the electorate. Galbraith posits this as THE enduring illusion of American politics...that has yielded the weakest "social contract" of any advanced nation.

I had read this book when it first was published, and it has proven to be prescient. It's very short and to the point book...an easy read...and intended as a review of his major observations, at life's end,...while "sitting in the peanut gallery". Galbraith's point was not to predict, it was to underline that the corporate state...which ensues when the interests of the corporation and that of the state are deemed to be identical...is the dominant economic reality of our times. It's easy to propose that this is an exaggeration...and that what we really have is a hybrid system...and I can accept some of these arguments...for there are many good people in government doing their jobs as intended...and as allowed under law. However my take is that, Galbraith's perspective provides the best explanation for what happens every day, when Americans get up in the morning and go to work.

He also stresses that the power of the mega-corporation to politically influence outcomes is potentially enormous. As is its power to get its way...through the power of mass advertising. Just today, the Supreme Court is reviewing an important case regarding corporate money in politics. Today the Supreme Court with its bevy of "country club" justices, has fully enunciated its clear empathy towards corporate money in campaigns...as a matter of "free speech". It even countervails a century of settled law on the subject. This only further proves Galbraith's point, that the "countervailing power" of the state is not at all seen as a check and balance on the mega-corporation...but as "big brother", dictating outcomes inimical to the corporations "who know what's best"...according to Justice Scalia. To these "conservative" justices, the state is to be tamed to the purposes of the mega-corporations.

All of this supports Galbraith's realistic conclusion that the Corporate State is not likely to be significantly altered in our epoch of world economic history. We can fight for a better social contract...and make some reforms, but the structure of economic reality will remain the same.

Scathing analysis of fraud and corruption 2009-05-15

Reviewer: William Podmore

This book by the great American economist John Kenneth Galbraith is a scathing critique of modern society. In it, he wittily demolishes the myths that the market and big business are benign, that minimal intervention, inequality and greed are best for the economy, and that there can be accurate economic forecasts.

He writes, "What prevails in real life is not reality but the current fashion and the pecuniary interest." But in the longer run, reality defeats conventional wisdom.

He describes "the effort to accord the owners, stockholders, shareholders, investors as variously denoted, a seeming role in the enterprise" (and now `stakeholders'). Yet, "the myths of investor authority, of the serving stockholder, the ritual meetings of directors and the annual stockholder meeting persist, but ... corporate power lies with management - a bureaucracy in control of its task and its compensation. Rewards that can verge on larceny." So stock markets and corporate sales fall, yet bonuses soar.

He denounces the folly of relying on cuts in interest rates to bring recovery. As he notes, "Business firms borrow when they can make money and not because interest rates are low." The Federal Reserve Bank's actions were irrelevant, through World War One, the depression, World War Two, and since.

He writes, "The one wholly reliable remedy for recession is a solid flow of consumer demand. Failure in such a flow is a recession. In the United States, especially with stagnation and recession, the lower-income citizen has an acute need for education, health care, a basic family income in one form or another. State and local governments, under the pressure of enhanced demand, cut social outlays. ... The overall effect has been reduced personal and family income and well-being - recession without effective curative action."

Galbraith points out that private firms, massively subsidised by the public, dominate `defence'. He observes, "As the corporate interest moves to power in what was the public sector, it serves, predictably, the corporate interest. That is its purpose. It is most important and most clearly evident in the largest such movement, that of nominally private firms into the defense establishment, the Pentagon. From this comes a primary influence on the military budget. Also, and much more than marginally, on foreign policy, military commitment and, ultimately, military action. War."

Of the attack on Vietnam, Galbraith writes, "During all this time the military establishment in Washington was in support of the war. This, indeed, was assumed. It was occupationally appropriate that both the armed services and the weapons industries should accept and endorse hostilities." So also of the attack on Iraq.

Galbraith shares his vast experience in commenting about the current state of the American society 2009-05-09

Reviewer: Charles Ashbacher

Galbraith has long been one of the leading authorities on world economics; having served in several government positions all the way back to Franklin Roosevelt's New Deal. This book is his response to many of the events in the first years of the twenty-first century, including the debacle of Enron. Drawing on his decades of experience, he puts forward a series of philosophically retrospective comments about the current state of the American political and economic structure.
One of the main points that he makes is one that should be made repeatedly and forcibly. Galbraith was part of the team that evaluated the consequences of the Allied carpet-bombing of Germany in the last years of the Second World War. The inescapable conclusion was that the bombing did not shorten the war by a single day; German war production actually went up throughout the bombing campaign. Therefore, the brutal deaths of hundreds of thousands of German civilians did very little to win the war. Galbraith also points out that the military went to great effort to suppress the report.
Galbraith then notes that the same tactics of massive bombing were also used in Vietnam and with the same results. The only significant consequence of the heavy bombing of North Vietnam was to strengthen their resolve to continue the fight. As reports of significant numbers of civilian casualties in Afghanistan continue to appear on the news, it seems clear that the lessons repeated here by Galbraith have not yet been assimilated.
Although short, this book contains some valuable philosophical wisdom regarding the history of the United States and what lessons should be drawn from it. It is well worth reading.

unsatisfying 2008-12-27

Reviewer: avid reader

This is supposed to be 62 pages, but 5 of those are blank and several more are partially or almost totally blank. This is essentially a pamphlet, but with a hard cover. I don't think it's worth more than $4.

The ideas probably needed expressing, but they are not fleshed out at all, and in at least one case, he wandered away from his point and left me up in the air.

I've enjoyed several of his other books, but this was not one of them -- an unsatisfying read in my opinion.

Economics isn't real science 2008-11-29

Reviewer: Ryan Costa

Galbraith remains the best 20th century economist because he understood that Economics isn't real science. Economists occupy a role that the Catholic Church occupied in Medieval Europe. Most clergy are corrupt or useless or filling some office of prestigious busy work with high qualifications and little talent. But there are a few good ones. Galbraith was one of the good ones.