The Affluent Society After Ten Years

One of the creatively conlroirrsial books of the late 1950s and early 1960s in America teas John Kenneth Galbraith’s THE AFFLUENT SOCIETY. It brought wit and charm into the usually forbidding discussion of economics and contributed numerous words and phrases to the language of that inexact science. The book helped to pel the country thinking about the true nature and disposition of its wealth. Note, ten and a fraction years after, when tee have come to see the irony of its title, THE AFFLUENT SOCIETY is appearing in a revised edition. In this introduction to the new edition, to be issued in May by Houghton Mifflin Company, the Haul M. Warburg Professor of Economics at Harvard, and former Kennedy Ambassador to India, looks back on the origins of the book, discusses its relevance to the contemporary scene and the instances in which deirlopmenls hair impelled him to change his mind.

THE Atlantic

FOUNDED IN 1857

HY JOHN KENNETH CALBKMTH

FOLLOWING World War II, in the United Slates there was something that could he tailed the free enterprise or market revival. It deeply engaged the conservative mind. Our conservatism is normally thought to depend on self-interest, moral indignation, vehement expression, and something approximating religious revelation. This is unjust. The influence of ideas is ubiquitous and cannot he excluded anywhere.

The source of the ideas was a rediscovery of the Benthamite world of the nineteenth century as it was applied to economic policy hy the classical economists and to sociology and politics hy Herbert Spencer and William Graham Sumner. In 1944, it derived a new scholarly sanction from F. A. von Hayek’s The Road to Serfdom, an alarming tract against socialism and the state which, as the name implies, it identified extensively with servitude. And in the years following, it achieved considerably more academic reputability from an energetic group of evangelists and scholars who gathered, along with von Hayek, at the University of Chicago, with intellectual outriders in other academic centers.

As I shall notice presently, the academic proponents of the market revival were not imagined by most economists to have a large measure of practical relevance. But they had a strong and even impressive command of the economic theory to which the market (unlike public action) lends itself. And they were solidly in descent from the oldest tradition in Western economic thought that of Adam Smith, David Ricardo, John Stuart Mill, and Alfred Marshall. Economics, like the law, has a sense of its prophets. Also, as a consequence of its rapid growth, it includes a considerable number of pariit ipants who are, inteller tually, a trifle insecure, who secretly doubt the depth of the scholarship which, lor professional reasons, they must avow. Being in an old tradition, the proponents ol the market revival had no such doubts. They were reassuring company, men to be treated with respect hy those who disagreed. In economics, it is often professionally belter to be associated with highly respectable error than uncertainly established truth,

The market revival spread rapidly outside the acadenin world. It was warmly embraced by the editors of Fortum’, the Wall Street Journal, and othei business journals, and Hy editorial writers for whom it was an admirable way of placating socially backward publishers in an unexpectedly sophisticated way. In those years also, numerous socialists were in retreat from Joseph Stalin, For John Chamberlain, William Henry Chamberlin, James Burnham, and many others, it meant that the important social decisions would he taken, not by fallible, cruel, and egotistical men, but by a wholly impersonal mechanism. Anything that so effectively excluded a cult of personalits was ohvioush an instrument of freedom. From these sources, the market revival went on into politics.

In its academic manifestation, the market revival stressed the social efficients of the unmanaged market. It distributed resources labor, capital, managerial. and technical talent to various uses in accordance with the ultimate control of the consumer. Am interference was damaging to this allocative efficiency; the most dangerously intrusive agents was the state. The state could interfere with the free movement of prices; it could also intrude services of its own which had not survived the market test. The test of faith in the market, it followed, was the rigor with which one sought to minimize the role of the state.

Not that the efficiency of the market cruel at times but worth suffering—was the only basis for the academic opposition to government. Here too there was moral and political concern. Here too all who suspected authority, either its competence or its motive, were urged to align themselves with the impersonal market against the state.

In the academic world, there was a certain additional concern, often obeisant, on occasion actual, with private interference with the market. General Motors or General Electric, it was known, enjoyed no slight power as regards the prices they charged —a power that no prophet of the market economy could tolerate if exercised by the state. For here was authority, and here also were both the power and the incentive to impose the restrictions on output (the inferior allocation of resources) associated with monopoly. So, in principle, such firms should be broken up. In principle, also, the ban on government intervention should he comprehensive. It should fall not alone on minimum-wage legislation and public housing and support to collective bargaining, of which conservative businessmen and politicians naturally disapproved, but also on the Federal Reserve System, subsidies to air transportation, and the tariff of which, often devoutly, they approved. However, the academic doubts about General Motors and the government services, needed, and hence approved, by the businessmen, were not, on the whole, damaging to the market revival. Its proponents managed to convey the impression that this part of the program was liturgical, that the deeper enthusiasm lay with the defense of the market and the attack on the more iniquitous forms of government interference such as the welfare system or support to public education. In any case, professors are inconvenient people; it was inevitable that they would exact some rhetorical price for so great a doctrinal blessing. Accordingly, as it moved out into the less literal world of journalism and on into politics, the market revival hardened into a simple prescription against government services Fhe only exception, apart from those that conservatives needed and heme approved, was action to light or resist Communism. To exclude the war on world Communism from the general ban on government activity, a most important matter, seemed wholly logical. The Communists were the greatest exponents of precisely the opposite system. One eighth invoked a lesser evil against the greater one. considering the eflects of defense expenditures on the economy, there were many reasons for being glad that this could he so.

If one is rich, or even well-to-do, and self-regarding, any doctrine that makes public services (and therewith taxes) uneconomic , politically regressive, and possible immoral is hound to seem benign. Anything so convenient must he tight. But though proof was not needed, exegesis was welcomed, and hence there was a considerable demand for prophets of the market. These quickly became available. and in the late forties and into the fifties, service clubs, sales conventions, even suburban ladies’ clubs listened to the gospel as revealed by John Stuart Mill, Herbert Spencer, William Graham Sumner, Friedrich von Hayek, and Ludwig von Mises. The list two defenders of the market they could hear in person. Some of the consequences were not without charm. In 1948, Hubert Humphrey won elec lion to the United States Senate over a man who had become enchanted by Jeremy Bentham. Over the length and breadth of Mimic sota, he proclaimed his commitment to Bentham’s doctrines until, it was said, some citizens looked for the philosopher’s name on the ballot. Humphrey was able to persuade the farmers of the state, quite rightly, that Bentham would have opposed farm price support. So they those him instead.

HISTORICAL circumstance supported the market revival. The thirties had been a miserable lime. Mam had losi confidence in the economic, system; many more had come to assume that it could endure only as the result of more of the government intervention that had been the hallmark of the New Deal. This was grim news for conservatives. Then came the lurther great expansion in government controls during World Wat II Many of the controls were annoying and even onerous, not alone on businessmen, Equally oppressive, without question, were many of those responsible for their improvisation and administration, of whom I was one. Additionally, shortages of goods and houseroom and restrictions on production and consumption resulting from the war were blamed on the controls. Without price ceilings, rationing, the allocation of scarce materials and restrictions on their use, the discomfort resulting from inflation and shortages would have been worse and the war would have been longer. But this was not easv to see. Mans people were open to the argument that an obtrusive and intrusive state was deliberately making life difficult.

Meanwhile, with more skill than they have normally manifested in such matters, business spokesmen took credit fot the superior industrial performance of the economy during the war. Output had greatly increased. Production ol munitions and other requisites of war had been impressive. Not the strong demand, coupled with an impro vised but highly rational planning design, but the natural virtuosity of American enterprise and of the American market system was given credit for this success. If, after the war, the restrictive hand of the state could be dispensed with, things would be even better. The public, bedeviled by the regulations and regulators, was again in an excellent mood to listen. The 1946 elections were an indication of the attitude. Almost everywhere men ran in opposition to the state. The resulting Congress was the most conservative in modern history. Its more primitive members, so it is said, left behind in Senate closets, washrooms, and in the distant recesses of forgotten basements bronze tools, dubiously symbolic wall paintings, and pottery shards that are still shown to wondering visitors. The market revival could not have been better timed. Or, more accurately, at any other time it couldn’t have occurred.

It had some reverberations in other countries. In Germany in the late forties, weariness with wartime privation and controls was also extreme and with rather more reason. Ludwig Erhard made the recovery of German industry after 1948 the product of the unaided market. This was a remarkable feat of oratory, for it coincided with the Marshall Plan, a vastly publicized effort in public intervention, and took place in a country where industry is extensively regulated and where pet capita government expenditures are much higher, and those for welfare about twice as high, as in the avowedly socialist state of Norway (as it then was), where the level of individual income is about the same. The message of the market revival was also carried to other countries by American businessmen who frequently revealed an enthusiasm for exuberant and unfettered price competition that they never displayed at home. In Japan, as also in Germany, it led to the dismantling of the great business trusts in the interest of a more effectively functioning market a remarkable gift, in many ways, by a victorious to a defeated power, (The Japanese later reassembled the pieces.) And for a number of years, the prophets of the revival gathered in international congresses to proclaim and thus to reinforce their faith. Still, the market revival was mostly an American phenomenon.

The market revival, even under the Eisenhower Administration, brought no very drastic action. Desirable as sharp curtailment of federal regulation or civilian spending might he in principle, it was something to be approac hed with circumspection in praetiee. Only much later, in the presidential campaign of Barry Goldwatrr, did the ideas of the market revival the elimination of social security, an end to thelatm programs become a program, and many wiser men were prompt to want theii candidate that action was never intended. lhc revival was meant to he rhetorical. Such market evangelists as Professors Milton Friedman and George Stigler of the University of Chicago were not taken seriously in practical matters.

They were meant to he studied hut not believed, and even in the Eisenhowet Administration, their counsel was shunned by those who were entrusted with real tasks But the market revival unquestionably had a restraining influence on new federal activities. And in statehouses, city halls, and school districts across the land, it made the case for public spending the case against freedom. This added powerfully to the otdei arguments about the terrible burden of taxes. In the deeper intellectual wastes of Orange and Harris counties, attitudes were more severe. To be for new schools, against air pollution, or in favor of stronger zoning laws was to be in support of the first and awful step down the steep, slippery path to Communism.

Meanwhile, and remarkably, these ideas were meeting no very effective attack from liberals. The main thrust of liberal economic thought flowed in difletcni channels, And it was able, in one important aspect, to find common cause with the market revival.

IN THE years following World Wat II, Keynesian fiscal policy became the summum bonum of liberal economic policy. An adequate level of output and employment in the economy was assumed to solve nearly all economic and most social problems. Inade quale ptoduclion and employment made all other problems insoluble. So not without a sense of strategy, liberal economists concentrated on policies de signed to ensure an adequate level of demand and therew ith of output and employment. This did not cease to be so when the Eisenhower Administration appeared. President Eisenhower’s advisers denied that they were Kevnesians and fully accepted the kevnesian tests of accomplishment.

Acceptance of the Keynesian ideas involved, as regards conservatives, one of those strange combinations of misapprehension and paradox which make the otherwise tedious study of economics so fascinating. In the broadlv liberal view of those who first introduced the Keynesian system to the United States, the regulation of aggregate demand the total of all spending at am time required no lundamental revision of the role of the state in the economy. When there was unemployment or an inadequate rate of growth, the government would increase its expenditures for useful purposes without a parallel increase in taxes. When this support to the econotnv was not needed, it would deter or even reduce expenditures and therewith the deficit. This regulation would he supplemented and reinforced by the automatic increase in some expenditures, notably those lor unemployment compensation, welfare, and farm price supports, in periods of unemployment and inadequate growth, and by the counterpart reduction in periods of high employment and rapid expansion. Over time, the scope and functions of the state would not be appreciably changed.

Since it made the private economy function better without greatly enlarging the role of the state, this model of the Keynesian system should not have too profoundly aroused conservatives. But it did. It required deficit financing on occasion. This, always a symbol of fiscal sloth, became affirmatively wicked. It was seen also as an excuse for a soft policy on public spending. The name of Keynes thus became mildly coordinate with subversion. The Keynesian ideas came to the United States in the thirties primarily by way of apostles at Harvard, most notably Professors Alvin I lansen and Seymour Harris. Following World War II, conservative members of the Harvard governing hoards conducted an investigation of the Harvard Department of Economics to see it Keynes’s influence there was excessive and found it was. (James B. Conant, then president, rejected the finding.) Elsewhere, too, circumspect scholars were careful to explain that their commitment to Keynes was subject to cautious and intelligent reservations. And then the Keynesian system became respectable and accepted, not through the above-cited balancing measures, which left the state small, but by a luntlamental enlargement of the role of the state. And this, and this is the paradox, was highly acceptable to conservatives.

The decisive application of Keynesian policy came about in the postwar years as the result of a large and ostensibly permanent increase in public spending supported by a large and similarly permanent increase in taxation. This spending was reliable with a tendency to increase in periods of inadequate employment and growth. And the personal and corporation income taxes by which it was sustained fell with special force on those revenues—corporation profits and surtax incomewhich increased most in periods of expansion and diminished most with stagnation or contraction. In consequence, the tax system increased its vield more than in proportion in periods ot economic expansion and diminished its yield more than in proportion with contraction. The role of the state being large, these effects were quantitatively adequate. And this large iole of the state was acceptable to conservatives because it served a lime lion of which conservatives strongly approved, the maintenance of a strong military defense against Communism.

And here, also, was the basis for a coalition, or at least a tacit working arrangement, between conservatives ami liberals. Liberals did not entirely forget their earlier commitment to the public services, so long a distinguishing feature of American liberalism. But this was now secondary to a successful Keynesian policy. In consequence, the conservative warnings that public education, public housing, better sanitation, control of water and air pollution, improvement of environment were threats to liberty evoked only a modest liberal challenge. Meanwhile, large defense expenditures were underwriting the Keynesian policy and thus accomplishing the major liberal goal. In the early postwar years, first the Stalin European polity and then the Korean War made these expenditures seem essential. Thereafter, they rapidly became habitual. Even the man who argued for more domestic outlays piefaced his case by conceding the higher priority of national defense. Liberal uneasiness over the role of defense expenditures in the Keynesian system was assuaged by observing that outlays for domestic purposes would serve just as well, although this elided the fact that the use of defense expenditures avoided a bruising conflict with conservative doctrine. Defense expenditures also subsidize and underwrite the market lot tec It nologit al development.

Often the role of the defense budget was not recognized. As late as 1964, Barry Goldwater, in his campaign for Ihesident, was thought by most Keynesian liberals to he assaulting theit position flip and thigh. Without question, he thought so himself. In fact, he was not. He strongly advocated a larger Air Force and a bigger defense establishment generally. Accordingly, he would have expanded that part of the federal budget, with space research and technology something over half of the whole, which In its increase over pre-Keynesian times had contributed most to a kevnesian policy. Since it is a reasonable assumption, some earlier attacks on the progressive income tax to the contrary, that he would have left the tax system basically the same, he would have come to office with all the apparatus of Kevnesian policy intact but strengthened In the prospective increase in military outlays.

Such to ere the ideas here writ slightlv largei than life that were contending for public attention and belief in the United States in the nineteen fifties. They were ideas, both the market revival and the Keynesian preoccupation with employment qua employment and production qua production, that seemed to me damaging. As the Fisenhovvet Administration ensconced itself in Washington after 1953, I set to work on the opposing case. Among the largely unnoticed contributions of Republican Administrations is that to scholarship or anyhow writing. It comes about from not employing scholars or scribes.

I HAD been considerably a part of the environment I was examining. Take others of my generation, I was, in the late thirties and carls forties, an aggressive evangelist for the Keynesian svstem in its standard form. The writing, accordingly, involved a heavy effort to detach myself from my own past beliefs. I discovered how difficult this could he. I have read often in the journals that I find a perverse pleasure in attacking the conventional myth, I do not, and on the contrary, it is very hard work. Some day for recreation I intend to write a hook affirming fully all the unquestioned economil truths.

I was kept going by the conviction that, in starving our public services and in placing so much of our faith in the general curative powers of increased production, we were inviting grave social ills. It is unwise to reflect excessively on ones past writing and especially on one’s foresight, lor to do so is to invite critical attention to those other forecasts which bring one’s score hack to normal. But while there have been many explanations of om urban disasters of recent times, some designed, not without thought, to direct attention away from remedies that would cost money, few can doubt that persistent anti continuing underinvestment in needed services is one. Further, while something must he attributed to the fact that some citizens are black and some white, no one has yet shown how to overcome this condition. Hut we can have good schools and well-paid teachers and ample and attractive housing and clean streets and sufficient and welltrained policemen and plenty of parks and wellsupervised playgrounds and swimming pools and adequate divertissement on hot summer nights. These will help, even if they will not completely cure, and they require onh a willingness to tax and pay. Not mam would now challenge the efficiency oi morality of such outlays, And even the most stalwart conservative who dares not venture out in the street at night and hesitates on occasion to ch ink the water or breathe the ait must now wonder if keeping public services at a minimum is really a practical formula for expanding his personal liberty.

That some balance must he maintained between the public and private sectors of the economy be tween increased private expenditures and the facilities for removing the waste that results is now widely agreed, at least in principle. Few economists would now argue that a sufficiently expanding economy will sweep away other social problems. We have had many years ot expansive gross national product. Social tension has increased, not lessened. If the expenditure that produces this expansion is for military purposes for example, for a war in Vietnam-not mam will suppose that it will do much to relieve the agony ol the urban ghetto. throughout the Kennedy Administration, there was a friendly but vigorous battle ovet whether to reduce taxes in order to expand private income and expenditure and therewith employment and economic growth. The alternative was to keep tip the level of taxes and press instead lor more public spending for social purposes-education, urban te newal. and improved welfare standards. Since Congress would he reluctant, this would be slower, so a larger allocation ot resources to public purposes would he won at the price ol a slowei rate ot total growth. While I argued the second case, not with out some encouragement from the President, the weight fl reputable economic opinion was solidly on the other side. The outcome was never really in doubt, and in 1964, taxes were reduced. But, under similai circumstances in a liberal Administration, they would not he so readily reduced today. The needs of the public sector would now he strongly pressed. To ignore them would now seem irresponsible. I lie case lot first meeting social needs would now evoke the reputable applause.

The error in The Affluent Society, and it was considerable, was in understatement. A large movement of the poorer rural population to the great urban centers, a still continuing population in crease, the enormous public costs of affluencefrom managing its automobile traffic to removing its detritus-and the desire, howevet frustrated, for improved quality in education, public older, public health and sanitation, and other public services have all joined to make the modern city, if it is to BE agreeable and not just tolerable, an almost unbelievably expensive tiling. I did not see how expensive it would be or that the reaction to social imbalance would be far from peaceful. However, this does not matter too much. It, ten years ago, one had foreseen and described the disaster that lay a heat! for our urban communities, he would have been dismissed as a sills alarmist.

rJur main inducement to this book was the market revival and the kesnesian conviction that nearly all social ills could be cured by more production. But it had another source which, though reflected in the book, was, to my discomlort. extensively overlooked. For quite a few years prior to publishing The Affluent Society, I had been concerned with the problems of agriculture. This had led me to wonder, as it hail others, why year in and year out, decade after decade, islands of egregious poverty persist in the rural United States. Many have difficulty in imagining the depth of this deprivation. I recall in subsequent years the surprise of Jawaharlal Nehru when I once told him that in substantial areas of the United States—in mountain counties of West Virginia, eastern Kentucky, eastern Tennessee, the Ozark plateau—the standard of rural living is almost certainly lower, and life by any test more meager, than in the comparatively prosperous Punjab. In the early nineteen fifties, I obtained a small grant from the Carnegie Corporation to study the causes of this continuing poverty in the United States. In the strictest sense, this was the begitilling of The Affluent Society; the title I hail then in mind was Why People Are Poor,

In a world where everyone is poor, there is nothing very remarkable about poverty. It becomes remarkable, and also less forgivable, in a community where the great majority of people are well-to-do. And the explanation for poverty in the well-to-do society must be sought in the general and not the particular aspects of the case—not in the nature of the society of the poor, but in the nature of a society of the rich which allows or requires some to stay so poor. This also led me to our preoccupation with production and to our neglect of the government services—education, health, welfare, and urban existence generally—by which the poor (or their children) might hope for escape from their plight.

I never explained this transmigration of my thoughts. And as the book progressed, the specific conclusions on how the affluent society excludes some from its endowment were, with conclusions in general, pushed along to the end. A considerable number of readers, including a fair number of reviewers, never got so far. They complained that, carried away by the sight of affluence, I ignored the fact that there were still a great many poor people in the United States. Some, more censorious than others, said that I was hardhearted. All used my seeming oversight as an excuse tor continuing with their accustomed beliefs and preoccupations. “It will BE time to slop worrying about production when there aren’t so mam poor people who need it. It is my impression, confirmed by such as Michael Harrington, that The Affluent Society helped direct attention to the continuing siandal of great deprivation amidst the great wealth of the United States and to the eventual decision, alas more rhetorical than real, to mount a direct attack on poverty. I could, however, have protected myself. and saved less diligent reviewers from error, by hinting somewhere near the beginning that this subject did come up.

I must pause here to settle another score. The thrust ol this book is that increased production is not the final test of social achievement, the solvent for all social ills. Thus, it challenged the very foundation of Keynesian policy with its nearly total emphasis on the expansion of economic output and income. A common Keynesian reaction was: How can Galbraith be so callous when 25 percent of out people have a disposable personal income of less than blank amount? When everyone has an income of at least blank amount, it will be time to worts about the problems ol social balance. Everyone then entered the minimum income levels which reflected either the state of his personal generosity or the statistics he had at hand. A few especially percipient critics added that my own social vision was being clouded by an excess of personal income of my own.

In retrospect, I have some difficulty in seeing why this reaction caused me such annoyance, though it did. In social matters, critics are an interim phenomenon. Given a little time, circumstances will prove you either right or wrong. Perhaps it was the obtuseness of the argument that was annoying. To suggest that we cannot consider how we use our wealth until everyone or nearly everyone reaches a certain minimum is to say that such consideration should be postponed forever, for the seemingly decent minimum will rise along with the increase in wealth. And anyone who wants to postpone the discussion can do so by raising the minimum standard that must Inst he reached. But most important, to ret use to eonsidei how we use our wealth is to fail to see why some people remain permanently poor. Ten underinvestment in education, housing, health, recreation, community decency and order is, as we have now come largely to agree, a prime cause of this deprivation. The critics were asking that we postpone consideration of the causes of poverty until no one was poor.

A variant was to point to the millions of needy people elsewhere in the world as the case tor continuing to emphasize production. This argument was advanced, I believe, onh In those who did not read the book. The book shows that wants are expanded by the very process that increases production. This being so, more production does not create a larger surplus over domestic need for dispatch to India or Bolivia, And in recent vears, although output (even after the investment in Vietnam) has increased rapidly, it has. in fact, become progressively more difficult to spare more products for the poorer countries.

Let me now turn to slightly less portentous matters.

I HAVE been asked hundreds of times where I got the eventual title, The Affluent Society. And I have received no slight applause for inventing a phrase which, as it is said, has passed into the language. The truth is less grand, f or a long while after I discarded Why People Are Poor as undescriptive, I called it The Opulent Satiety, Opulent has a greasy, unattractive sound. Presently I could stand it no longer. One morning in Switzerland, while seeking as all writers do to postpone the moment when the typewriter faces you and asks for intelligent response, I looked up the synonyms. The first was affuent. It is wrong to attribute to inventive genius what is properly explained by the possession of Webster’s Collegiate. I remember wondering if I could sell so dry a title to my publisher.

For a year or so before the book appeared, I found myself giving thoughtful consideration to its eventual reception. I had no high hopes; in the climate of the time, I feared it would be dismissed as another semi-socialist case for public spending and by my Keynesian friends as apostasy. Then in the autumn of 1957, the Soviets sent up the first Sputnik. No action was ever so admirably timed. Had I been younger and less formed in my political views, I would have been carried away by my gratitude and found a final resting place beneath the Kremlin Wall. I knew my book was home. A vastly less productive society had brought off a breathtaking and also, who could tell, very alarming achievement. It eouldn’t be because they had more wealth more automobiles, more gasoline, more elegantly packaged loocl, or anything tomparable in depilatories and deodorants, Surely they were using their more meager resources more purposefully. So people would be asking what of their education? What of their ability to concentrate then leaser scientific and engineering resources mote effectively to their chosen ends? Could anyone now be sure that either the Benthamite or the Keynesian world had the answer? Certainly no one could say that it was because the socialist Soviets eschewed public spending.

In any case, the Sputnik meant we were in for one of those orgies of anguished soul-searching which are a recurrent and distinctive feature of out social history, Whether they lead to action is uncertain, but then immediate and incontrovertible effect is to cause people to read, or at least to buy, books. Except when dealing with his publisher. modesty, combined with the deepest pessimism about the ability of people to apprec iate his work, is the only acceptable posture of an author. After the first Sputnik, I was able to sustain this pose onh with effort, I expected, in fact, that it would be a major success.

Once only was I mildly shaken. In the spring of 1958, the book was poised for publication, I accepted an invitation to let tine in Boland (and also Higoslavia). Medicine, botany, even pediatrics, are easy in these countries, but economics is a sensitive subject. I was, I was told to my delight, the first economist, with no avowed reputation as a Communist or socialist, to be asked to lecture in a Communist country, i returned to London on the day of publication and. at the newsstand of the hotel, searched for American journals with reviews. Time magazine, in a manner of speaking, favored me. It had relegated its comment to the business page_ “vague essay with the air of worried dinner-table conversation” was the conc luding line. The editors, had they known my reaction, would have been pleased. Perhaps the hook could be dismissed. As I was so reflecting, I became aware, to my horror, that someone was reading the same review over, or by, my shoulder. It was John Steinbeck. His comment cheered me greatly. “Unless a reviewer has the courage to give you unqualified praise, I say ignore the bastard.”Generally speaking, as I learned a little later by telephoning my wile, the reviewers had shown coinage:. On arriving in New York, I told my publisher it would almost immediately, at vvhatcvei professional cost, be on the best seller list. He told me, gently, I was insane:. Not a work on economies. We bet the most expensive procurable dinner on the subject. I won. Despite the fact that I drank willingly in t hose days, I was amazed to learn how difficult it is to spend any really important money on a meal. Publishers rarely lose.

Lite early chapters of the new edition remain almost unchanged. I have here or there corrected or sharpened the language, eliminated an obsolete reference, or added a footnote where the subsequent history has served me well or badly. The latter chapters, where I apply these ideas to the issues of the time, are much more extensively changed. Most of the issues, alas, are still relevant. But on some matters, there has been progress. Thus, when I wrote the book, the cold war was being fought with undiluted enthusiasm; and it was urgently proclaimed that nothing counted so much in this combat as our ability to sustain a greater rate of increase in production than the Russians The book attacked such doctrine. The affluent society increases its wants and therewith its consumption pari passu with ITN production. This consumption is not easily foregone in the event ot war; it is more vulnerable to attack than old-fashioned, less specialized production; the plant that supplies it is of little wartime utility; and in any case, these considerations apply to old-fashioned war, following a leisurely mobilization, and have nothing to do with the sudden and total oblivion ot nuclear conflict. All of this now seems obvious, Perhaps my book helped to make it so.

In other instances, I have changed my mind or have had it changed. Thus, when I wrote the book, I did not think we were likely soon to develop public measures for stabilizing the wage and price spiral as an alternative to this source of inflation. And the notion of a guaranteed income as a way of breaking the nexus between production and income for those who could not find a role in production was not even a glimmer on the horizon. Now both are more or less inevitable. In the first edition, I proposed that we he more tolerant of unemployment in order to take the pressure off wages and prices anil thus prevent inflation. And I suggested that we make unemployment more tolerable and also self-limiting by a system of unemployment compensation, Cyclically Graduated Compensation, in which benefits increased as unemployment increased. This is an inferior alternative to what is now politically feasible, and I have dropped it. I might add that it may well have been the only economic reform, good or bad, never to have enlisted a single active advocate apart from its author.

Before I had finished writing The Affluent Society. I had come to the conclusion that I had written only a part of a larger book. Back of affluence were itcauses technology, a large use ot capital heavily specialized to a particular product, a long gestation period in production and. withal, great specialization and vast organization. And from these tomes the need to control or plan the environment in which organization functions, beyond the ability to manage the market behavior of the affluent consumer here described was the need to make his market reaction reliable and thus to make him the instrument of the eunumm organizations that have been created to serve him. And beyond this are further questions. This economic system, by its nature, requires a large educational and scientific establishment. Will these people long he content with the rather mundane goal of ever-increasing affluence which the system espouses as the highest aim ol man? Might there not one day be discontent with a society in which there is single-minded concentration on the goal of economic success? Might there not one day be suspicion of leadership and prestige that is so universally associated with economic achievement? Might not one wish for such a revolt?

These were the questions, as I have said, to which The Affluent Society was as a window to a room. The room I inhabited for much of the next decade as I worked on The New Industrial State.