Last Updated on June 1, 2019, by eNotes Editorial. Word Count: 2112
Henry Charles Carey
Henry Charles Carey (1793–1879) was an American economist and sociologist, who is considered to be the founder of the American school of economics. His major works include: Essay on the Rate of Wages (1835), Principles of Political Economy (1837–1840), Principles of Social Science (1858–1860), and The Unity of Law (1872). Galbraith refers to Carey as one of the three ‘‘distinctly American figures’’ in the history of economic theory. Of these three, Galbraith notes, Carey was the exception in that his views were optimistic as to the economic future of society. In contrast to earlier theorists, Galbraith observes, Carey argued that wages had increased over time. Galbraith points out, however, that Carey was not a particularly influential figure in economic theory. He concludes that Carey’s work is not a significant factor in the ‘‘tradition of American economic thought,’’ and that his books, receiving little serious attention, ‘‘moldered and died.’’
Henry Ford (1863–1947) was an American entrepreneur who founded the Ford Motor Company. His early success was due to his development of the assembly line as the most efficient means of manufacturing a product. Galbraith mentions Ford as an example of the cultural status enjoyed by early industrialists based solely on their success in the realm of business and regardless of their level of education or intellectual sophistication. Galbraith points out that in modern America successful business entrepreneurs no longer hold such celebrity status unless they have distinguished themselves in other realms.
Henry George (1839–1897) was an American economist who advocated various measures of tax reform. His major work is Progress and Poverty (1879), subtitled ‘‘An Inquiry into the Cause of Industrial Depressions and of Increase of Want and Increase of Wealth.’’ Galbraith mentions George as one of the three significant American economic theorists of the last century. He describes George, along with Veblen, as a ‘‘prophet of gloom’’ in his pessimistic outlook on the evolution of economic conditions. Although George did suggest a remedy to these conditions, Galbraith observes, he predicted ‘‘continuing poverty combined with increasing inequality and increasing insecurity.’’ Galbraith further notes that the ‘‘mood’’ of those who advocated George’s theories ‘‘was often one of misanthropic and frustrated radicalism.’’
Herbert Hoover (1874–1964) was the thirty-first president of the United States, holding office from 1929–1933, during the first few years of the depression. Hoover had earned a widespread reputation for his humanitarian efforts during and after World War I. However, his inability to successfully stem the tide of economic devastation in the early years of the depression caused him to lose public favor, and he lost a second term election to Franklin D. Roosevelt. Galbraith observes that Hoover, in his attempts to address the problem of the depression, subscribed to the conventional wisdom that a balanced budget at the federal level was the most important factor in achieving national economic
John Maynard Keynes
John Maynard Keynes (1883–1945) was an English economist whose theories became known as Keynesian economics. His major work, The General Theory of Employment, Interest and Money (1935–1936), argues that widespread employment of the masses is one of the most important factors in attaining national economic stability and affluence and that, conversely, widespread unemployment spells economic devastation. During the 1930s, his theories had a revolutionary effect on economic thought. Keynes was the most influential economist of the twentieth century. Economists and political leaders from all ideological spectrums were quickly, if reluctantly, convinced of the wisdom of Keynesian economics. Galbraith was greatly influenced by Keynes and mentions his work throughout The Affluent Society for its powerful influence in altering the conventional wisdom of economic theory. Galbraith argues that Keynesian economics has become the new conventional wisdom.
Thomas Robert Malthus
Thomas Robert Malthus (1766–1834) was an English economic theorist whose ideas centered on the effect of population growth on economic stability. His major work was An Essay on the Principle of Population as it Affects the Future Improvement of Society, with Remarks on the Speculations of Mr. Godwin, M. Condorcet, and Other Writers (1798). Malthus’s theories were largely pessimistic, arguing that widespread poverty is an inescapable reality of human economic conditions. Galbraith refers to Malthus, along with Smith and Ricardo, as one of ‘‘the founding trinity’’ of economic theory in English-speaking nations. Galbraith observes that Malthus was extremely influential in spreading an attitude of pessimism throughout the field of economic theory. He further notes that although Malthus proclaimed massive human poverty to be inevitable, he showed no great concern for the suffering of the masses and proposed no possible solution for their economic condition.
Alfred Marshall (1842–1924) was an English economic theorist who was one of the founders of the school of neoclassical economics. His major work was the Principles of Economics (1890). Galbraith mentions Marshall as a significant influence on the prevailing conventional wisdom of economic thought.
Karl Marx (1818–1883) was a German-Jewish economist, historian, and sociologist, whose extraordinarily influential analysis of political and economic history is known as Marxist theory. His major works include The Communist Manifesto (1848), which was written with Friedrich Engels, and Das Kapital (translated as: Capital). Galbraith refers to Marx throughout The Affluent Society in terms of his profound influence on modern political movements.
John Stuart Mill
John Stuart Mill (1806–1873) was an English economic theorist and philosopher known as an influential exponent of Utilitarianism. Mill was an early advocate of women’s suffrage and was one of the founders of the first women’s suffrage society, later known as the National Union of Women’s Suffrage Societies, in 1867. In 1869, he published the now classic pamphlet, The Subjection of Women. Galbraith mentions Mill as one of the economists whose ideas formed the basis of American economic theory.
J. P. Morgan
See John Pierpont Morgan
John Pierpont Morgan
John Pierpont Morgan (1837–1913) was an extremely powerful American industrial magnate of the early twentieth century. His banking house, J. P. Morgan and Company, organized in 1895, became one of the most powerful in the world. Morgan eventually controlled most of the railroad industry in the United States and was head of one of the most powerful railroad businesses in the world. Morgan organized a variety of mergers and consolidations in major industries, heading such powerful corporations as United States Steel, General Electric, and the International Harvester Company. His industrial empire included banking and insurance companies. Galbraith mentions Morgan among several American business magnates of the early twentieth century. He points out that industrial moguls such as Morgan once held celebrity status and that their business ventures were associated in the public mind with the men who headed them. Galbraith observes that successful business magnates are no longer such visible public personalities in the eyes of the American people.
David Ricardo (1772–1823) was an English economic theorist credited with systematizing economics as a field of scientific inquiry in the early nineteenth century. He is known for his theory of the ‘‘Iron Law of Wages,’’ which asserts that the working wages of the masses of humanity will never rise above subsistence level. Galbraith lists Ricardo, with Smith and Malthus, as one of the ‘‘founding trinity of economics.’’ He refers to Ricardo as ‘‘the man who first gave economics its modern structure.’’ Galbraith observes that Ricardo, like Malthus, subscribed to the pessimistic theory that massive poverty was an inevitable condition of human economic systems. This conviction became a part of the conventional wisdom of economic theory, formulated in the nineteenth century, which continued to dominate economic thought in the early twentieth century. Galbraith notes that, like Malthus, Ricardo asserted that there was no possible remedy to the condition of subsistence level poverty suffered by the majority of the human population. Galbraith states that, from the mid-nineteenth century, Ricardo’s central ideas remained dominant in economic theory but faced competition from the theories of Karl Marx which offered a remedy to conditions of mass poverty.
John D. Rockefeller
John D. Rockefeller (1839–1937) was an American industrial magnate who founded the Standard Oil Company. His successful business conglomerations led to legislation against monopolies in industry, known as the Sherman Anti-Trust Act of 1890. Later in life, Rockefeller became a philanthropist, and his generous contributions, totaling some $500 million, financed the founding of such institutions as the University of Chicago in 1892, Rockefeller University in 1901, and the Rockefeller Foundation in 1903, among others. Galbraith mentions Rockefeller as an example supporting the theory that in capitalist society the rich get richer and richer, thus exacerbating economic inequality between rich and poor. He cites Rockefeller’s justification of his extremely aggressive business practices as based on the theory of ‘‘survival of the fittest,’’ which suggests that it is the natural order of things for certain people to become financially successful at the expense of many others.
Franklin Delano Roosevelt
Franklin D. Roosevelt (1882–1945) was the thirty-second president of the United States, holding office from 1933–1945. Roosevelt’s New Deal policies were designed to bring the United States out of the depression that began with the 1929 stock market crash. Galbraith notes that at the beginning of the depression, the conventional wisdom of economic theory was that a balanced national budget was the most important factor in achieving economic stability. He points out that Roosevelt was elected in 1932, at the height of the depression, based on this theory. However, by the end of the depression, Roosevelt, reflecting a change in the conventional wisdom, announced that reducing unemployment was the most important remedy to the crisis of the depression.
Adam Smith (1723–1790) was a Scottish political economist and social philosopher of the Enlightenment. His major work, An Inquiry into the Nature and Causes of the Wealth of Nations (1776), put forth the first systematized theory of political economy. During his lifetime, Smith was internationally recognized for his influence on both social science and economic theory. Galbraith refers to Smith, with Ricardo and Malthus, as one of the ‘‘founding trinity of economics.’’ He describes Smith as ‘‘the first great figure in the central economic tradition.’’ Galbraith notes that Smith was the first influential economist to put forth the idea that the economic condition of the mass of humanity could never rise significantly above subsistence level. Galbraith asserts that this pessimistic economic view is ‘‘the most despairing dictum in the history of social comment.’’
Herbert Spencer (1820–1903) was a highly influential thinker of the English Victorian era. Spencer’s writing and ideas ranged from the fields of biology to psychology to philosophy to sociology. He was a vocal advocate of individualism. His major work was The Synthetic Philosophy (1896). Although Charles Darwin formulated a more accurate theory of evolution, Spencer had put forth an earlier, less developed, theory of evolution; he quickly accepted Darwin’s theory as superior to his own. It was Spencer, however, who coined the phrase ‘‘survival of the fittest’’ to describe the process of ‘‘natural selection.’’ Spencer applied evolutionary theory to social and economic competition, developing a school of thought that came to be known as Social Darwinism. Galbraith refers to Spencer in terms of the influence of Social Darwinism on American economic thought.
John Strachey (1901–1963) was a British Socialist writer and politician in the Labour Party. Strachey published many influential works on Marxist theory. Galbraith describes him as ‘‘the most articulate contemporary English Marxist’’ of the early twentieth century.
William Graham Sumner
William Graham Sumner (1840–1910) was an American economic theorist, influential as an exponent of Social Darwinism. His major work was Folkways (1907). Galbraith refers to Sumner as the ‘‘major prophet’’ of Social Darwinism in the United States.
Frank Taussig (1859–1940) was an American economic theorist whose theories of international trade were highly influential in the formulation of American policy during the tenure of President Woodrow Wilson. Galbraith describes Taussig as ‘‘the leading figure in the central tradition’’ of American economic theory.
R. H. Tawney
R. H. Tawney (1880–1962) was an English economic historian. He was a highly influential socialist in the British Labour Party during the 1920s and 1930s. He was also a social reformer, and many of his ideas were put into practice during his lifetime. His most influential works were The Acquisitive Society (1920) and Religion and the Rise of Capitalism (1926). Galbraith refers to Tawney in a discussion of the relative value of high levels of production to the social good.
Thorstein Veblen (1857–1929) was an American economic theorist whose ideas are based in the theory of Social Darwinism. His most influential work was The Theory of the Leisure Class (1899). He coined the now commonly used phrase ‘‘conspicuous consumption.’’ Galbraith describes Veblen, along with George, as a ‘‘prophet of gloom’’ in regard to his economic outlook. Galbraith notes that Veblen’s economic theory suggests that economic inequality is inherent to human society and that ‘‘there is not hope for change’’ in this fundamental structure.