Last Updated on May 8, 2015, by eNotes Editorial. Word Count: 924
Perhaps the most widespread and lasting impact of The Affluent Society is the entrance of Galbraith’s phrase ‘‘conventional wisdom’’ into common parlance. The effect of conventional wisdom on attitudes about the economy is a key theme in this book. Galbraith explains that the conventional wisdom about the economy stems from nineteenth-century economic conditions and is, therefore, no longer relevant to the American economy in the twentieth century. However, he observes that many people in positions of power have a ‘‘vested interest’’ in the conventional wisdom in that it serves to maintain the status quo. He also claims that economists have a vested interest in conventional wisdom because it represents the basic assumptions upon which economic theory is based. Throughout the book, Galbraith asserts two main points about conventional wisdom. The first is economists, as well as the general public, must look beyond the outdated assumptions of conventional wisdom to formulate a more realistic assessment of the current American economy. Secondly, Galbraith points out that the conventional wisdom often functions as a cover for economic policies that in fact run counter to this ‘‘wisdom.’’ In essence, Galbraith views conventional wisdom as a mass delusion that must be dissipated to gain a clearer picture of the current status of the economy.
Galbraith’s title, The Affluent Society, refers to the economic conditions in the United States in the mid-twentieth century. He argues that American society represents a new level of mass economic prosperity never before seen. Because of this unprecedented prosperity, Galbraith argues, economic theory based on the conditions of a population whose great masses of citizens live at a subsistence level is no longer appropriate when applied to the United States in the twentieth century. Galbraith asserts that, given the status of American affluence, economic instability has ceased to be a real issue, either at the private or industry level. In other words, he claims that there is little reason for either the individual citizen or the corporate world to fear economic disaster.
Poverty and Economic Inequality
While Galbraith asserts that the United States enjoys unprecedented affluence, he does not deny the continuing issue of economic inequality. He criticizes current attitudes about the economy, which reinforce a habit of discounting the issue of economic inequality. Rather, Galbraith believes that poverty should continue to be at the forefront of national concerns with the economy. He advocates diverting greater sums of tax revenue into public services to compensate for the disadvantages of poverty. Galbraith is especially concerned with providing the children of poor families with the public services, such as education, health care, and proper nutrition, which would allow them to overcome the poverty suffered by their parents.
A central theme throughout Galbraith’s argument is the over-emphasis, according to the conventional wisdom, on the value of high rates of production to a healthy economy. He observes that the near worship of high production rates in the American economic attitude is a major hurdle that must be overcome. He provides a variety of arguments demonstrating the fallacy of the common belief that high production rates are the most significant factor in a prosperous economy. He points to a variety of examples of current and past economic conditions which, he argues, demonstrate that production is not the most important factor in the economy. Rather, Galbraith points out that the focus on production causes most people to overlook other values, such as the importance of public services and job satisfaction.
Consumerism and Advertising
In a discussion of the relationship between production and consumption, Galbraith points out what he views as a major fallacy in the conventional wisdom of economic thinking about the United States economy. He notes that according to conventional wisdom, production rates are determined by a society’s need for various products, as indicated by rates of consumption. However, he points out that economists continue to overlook the power of advertising in actively creating artificially high levels of consumer demand. High rates of production, he argues, do not simply satisfy preexisting needs or desires in the consumer; rather, the industries that produce consumer products simultaneously produce advertising campaigns designed to convince consumers of their need for this product. Galbraith argues that the factor of advertising has to be taken into account to accurately assess the real value of high rates of production.
Work and Education
Galbraith argues that yet another fallacy of conventional wisdom is the assumption that a primary benefit of affluence is the opportunity to work fewer hours per week. He asserts that working less is not necessarily the most greatly desired benefit of affluence; rather, he contends, the desire for enjoyable work is greater than the desire for less work. He claims that there is now a new class of workers who have the luxury of pursuing jobs that satisfy their own interests. He does not deny that income is an important factor in job satisfaction, but notes that interest and pleasure are of at least equal importance. Galbraith observes that the most important factor in membership to this new class of workers is access to higher education. It is primarily with education that citizens are allowed the opportunity to pursue a career that involves work that is enjoyable. He argues that greater expenditure in the area of public education would make it possible for a larger and larger portion of the population to find occupations doing work they like to do. Galbraith asserts that there is no reason an affluent society cannot afford to make this possible.