Friday, March 20, 2020
macrae last regular survey at the economist - extract next ages of man dec 1988
The 65-year-old Norman Macrae retires this week as deputy editor of The Economist. He will still be writing for the paper, but ends nearly 40 years of what has hitherto been his main job being partly responsible for what other people write, inside The Economist's college of opinion. His last survey as deputy editor contains his personal guesses about the main changes ahead, in ways that will be controversial. The first article discusses where the rich countries have got to, without most of them recognising it
Within a hundred years, guessed Maynard Keynes in 1928, the standard of living in Western Europe and America "will be between four and eight times as high as it is today". Since nobody could sensibly wish to consume four or eight times as much as he did in 1928, people would come to recognise the pursuit of money for “what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities which one hands over with a shudder to the specialists in mental disease”. “For the first time since his creation”, enthused the Arts-Theatre-founding Keynes, “man will be faced with his real, his permanent problem - how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live agreeably and wisely and well”.
From his observation of the very rich, who already had four-to-eight times the normal person’s income in 1928, Keynes did not think man would be very good at this, and he went on to one of his homosexual-chauvinist diatribes that women in the well-to-do classes looked to him like being even worse.
Sixty years on, in 1988, the real GNPs of the United States, the EEC and Japan are between 31/2 and 18 times what they were in 1928, although with awkwardly more people to eat those GNPs up. The United States, like Britain, is a relative slowcoach. See chart.
America's real GNP in 1988 is six times its 1928 level, but its population has doubled. The average American’s real personal disposable income has multiplied 2.9 times since 1928, and his consump-tion has increased slightly more. There is no sign of bored affluent people deciding not to spend too heavily, as Keynes had expected. Instead, all the rich countries’ peoples are borrowing like crazy to make the purchases they could most easily postpone. Americans now buy annually over ten times as many consumer durables as they did in 1928.
Where Japan differed
However, as in Western Europe, the most voracious rise since 1928 is that real annual expenditure by America’s central government has multiplied more than 19 times over. One might therefore suppose there has been an especial rise in the satisfactions that are traditionally the aim of government: less fear that America’s sons might be killed in foreign wars, more effective crime prevention, greater social cohesion. Things have moved exactly the other way round.
In Japan the rise in real GNP has been over three times as huge as in America (having multiplied nearly 18 times since 1930), but central-government expenditure has gone much less (multiplied under six times). Despite this image as “an appallingly low public spender”, the satisfaction in things provided by government in Japan has gone up much more than in America or Europe.
The average Japanese has much less fear than in 1928 that her or his son might be killed in foreign wars. The poorest three-quarters of Japanese 17-year-olds are startlingly better educated than their equivalents in 1928 Japan or in 1988 America or Britain, at a lower taxpayers’ cost per head. Japan has moved from a high Asian infant-mortality rate into the lowest infant mortality ever attained by woman anywhere. It has carried through the first industrial revolution in world history during which crime rates initially went down. It does still have a sense of community and social cohesion (low rates of divorce, juvenile delinquency and drug abuse, the unvarying re-election of a rather boring conservative government all through the past 40 years). Although left-of-centre people will find this appalling, it is more than conceivable that Japan shows the way that successfully governed countries will go.
In Western Europe there has been one strange similarity to Japan, because the areas most knocked about during the 1939-45 war surged most quickly above their 1920s income levels during the 30 years immediately after it. But in Western Europe (and especially Britain) there has been a clear drop in the quality of life for one group: among the sort of European women who in 1928 were cosseted domestic servants not just the leisured ladies against whom Keynes railed, but most upper-middle-class mothers of small children. There has therefore been a drop in upper-middle-class small children.
In Europe the rise in standards has been fast lowest down, among the sorts of ordinary working Englishman or Frenchman who in 1928 owned only one pair of trousers. As in America, it has been fastest of all for working-class married women. It is therefore a pity that married women are virtually disappearing among the groups that have most need of a lot of them.