John Kenneth Galbraith
Galbraith, John Kenneth
Galbraith, John Kenneth 1908-2006
John Kenneth Galbraith was an institutional economist, Harvard professor, advisor to presidents, bureaucrat, ambassador to India, raconteur, caustic wit, and man of letters. His concepts of countervailing power, the affluent society, conventional wisdom, want creation, and the technostructure of the industrial state have become part of the modern vernacular and the battle for the controlling metaphors of economics and politics. Born on a farm in southern Ontario, Canada, he attended Ontario Agricultural College, graduating in 1931. His family and community background are detailed in his memoir, The Scotch (1964). A desire to understand the causes of the Great Depression led him to seek a PhD in agricultural economics at the University of California, Berkeley, graduating in 1934. The influence of Progressive Era economists such as Richard Ely (1854–1943), John R. Commons (1862–1945), and Thorstein Veblen (1857–1929) was in evidence and it created an atmosphere accepting of the New Deal initiatives of President Franklin D. Roosevelt (1882–1945).
Galbraith’s first job involved research in agricultural economics under the tutelage of Harvard professor John D. Black (1883–1960), who was well connected in Washington, D.C. Before beginning, Galbraith served as a summer intern in the Agricultural Adjustment Administration. There he learned the role of power in the economy as he witnessed southern congressmen stopping the payment of agricultural subsidies to tenant farmers (mostly blacks). During World War II (1939–1945), Galbraith was placed in charge of price control and rationing in the Office of Price Administration. The political pressure from business was intense, charges of communism flew, and Galbraith was fired in 1943.
Galbraith’s writing and analysis led to a stint at Fortune magazine from 1943 to 1948. During this time, he also participated in the Strategic Bombing Survey to assess the role of air power in winning the war. The survey concluded that strategic bombing played a minor role and that ground troops were essential in both Germany and Japan. Galbraith later objected to what he called “military Keynesianism”—stimulating the economy via military spending at the expense of social programs.
Upon his controversial return to Harvard, Galbraith wrote American Capitalism (1952), in which he argued that a decentralized private economy excelled in production and innovation. He further maintained that concentration and bigness were inevitable. Countervailing the power of buyers, unions, and government would be more effective in controlling the seller’s power than traditional antitrust.
In his best-selling Affluent Society (1958), Galbraith observed that wealthy economies were no longer typified by scarcity. In fact, corporations maintained themselves by creating demand, rather than merely responding to it, as the “conventional wisdom” had it, producing what he called the “dependence effect.” He observed a “social imbalance” between abundant private consumption goods and inadequate publicly provided goods, such as education, clean air and water, and transportation. His description of “the family which takes its mauve and cerise, air-conditioned, power steered, and power-braked car out for a tour passes through cities that are badly paved, made hideous by litter, blighted buildings, billboards and posts” (1958, pp. 199–200) has become legendary and still applies today.
The New Industrial State (1967) describes giant corporations that are run and planned by a hired bureaucratic technostructure rather than owners and that strive for survival and independence rather than profit maximization. Advertising, information management, and access to government are key assets. The economy cannot be understood without attention to the use of power in both politics and business. Robert M. Solow contested Galbraith’s argument that giant corporations controlled the economy (1967). But, after subsequent decades of mergers, Galbraith’s concerns seem warranted. Solow also objected to Galbraith’s “revised sequence” of consumption (want creation rather than only prior want fulfillment) by asserting that advertising only serves to cancel other advertising. Galbraith’s concerns drew the label of “sociologist” from Milton Friedman (1912–2006), and along with Galbraith’s argument that public planning must balance the private planning of the corporate technostructure, the label of “socialist.”
Galbraith questioned the monotheistic worship of gross domestic product as the test of a good society and wondered if the same energy (and the discipline of economics itself) might be better directed toward social harmony, aesthetic enjoyment, and leisure. Galbraith remained a social critic until his death in 2006.
SEE ALSO Liberalism; Wage and Price Controls
Galbraith, John Kenneth. 1952. American Capitalism: The Concept of Countervailing Power. Boston: Houghton Mifflin.
Galbraith, John Kenneth. 1958. The Affluent Society. Boston: Houghton Mifflin.
Galbraith, John Kenneth. 1964. The Scotch. Boston: Houghton Mifflin.
Galbraith, John Kenneth. 1967. The New Industrial State Boston: Houghton Mifflin.
Galbraith, John Kenneth. 1983. The Anatomy of Power. Boston: Houghton Mifflin.
Reisman, David. 1980. Galbraith and Market Capitalism. New York: New York University Press.
Sasson, Helen, ed. 1999. Between Friends: Perspectives on John Kenneth Galbraith. Boston: Houghton Mifflin.
Solow, Robert M. 1967. The New Industrial State or Son of Affluence. The Public Interest 9: 100–108.
A. Allan Schmid
Galbraith, John Kenneth
GALBRAITH, JOHN KENNETH
John Kenneth Galbraith (1908–) was one of the more influential economists of the post–World War II era. Galbraith was an economic advisor to many Democratic party candidates and officeholders, with his influence peaking as advisor to President John F. Kennedy (1961–1963). Kennedy rewarded Galbraith with an ambassadorship to India, a country in which he had a personal interest.
John Kenneth Galbraith was born in southern Ontario, Canada, on October 15, 1908 to a Scottish farming family. He attended the Ontario Agricultural College, which at the time was part of the University of Toronto but is now the University of Guelph. He graduated with distinction in 1931, having studied agricultural economics. He then moved to Berkeley and studied agricultural economics at the University of California, where he received his Ph.D. in 1934. His dissertation was on public expenditures in California counties, a subject that presaged his career in public service.
As soon as he graduated, Galbraith began his career teaching at Harvard University, where he remained, albeit with interruptions, until he retired in 1975. Galbraith became a citizen of the United States in 1937. He worked in the Department of Agriculture for President Franklin Roosevelt (1933–1945) and was a proponent of the New Deal. During World War II, he served in the Office of Price Administration and Civilian Supply. John S. Gambs said Galbraith was "virtually the economic czar of the United States" until he left the position in 1943. As a result of his experience during the war, Galbraith published The Theory of Price Control in 1953.
Galbraith worked for the Office of Strategic Services after the war ended, studying the effectiveness of the strategic bombing of Germany. He was one of the founders of Americans for Democratic Action, a liberal interest group, in 1947. He worked as a speech writer for Senator Adlai Stevenson (1835–1914) during his presidential campaigns, then chaired the Democratic Advisory Council during the presidency of Dwight D. Eisenhower (1953–1961). In 1960, he campaigned for the successful presidential candidacy of John F. Kennedy.
Having visited India in 1956 and finding the country fascinating, Galbraith was rewarded for his efforts in the Kennedy campaign by an appointment as U.S. Ambassador to India. He held the post from 1961 to 1963. Galbraith's political leanings were decidedly toward liberal causes and candidates of the Democratic Party. He was an outspoken critic of the U.S. involvement in Vietnam, and campaigned for anti–war candidates Eugene McCarthy (1916–) in 1968 and George McGovern (1922–) in 1972. In 1976, he worked for the presidential campaign of Congressman Morris Udall and in 1980, for the presidential campaign of Senator Edward Kennedy.
Galbraith was a thoughtful educator and an observant writer. He published over twenty books, two novels, coauthored a book on Indian painting, and wrote memoirs, travelogues, and political tracts. In 1977 he collaborated on the writing and narrated a Public Broadcasting System television series, "The Age of Uncertainty." His first major book, American Capitalism: The Concept of Countervailing Power was published in 1952. In it Galbraith argued that the growth of economic power in one area breeds countervailing power from those who must bargain with the powerful. For example, powerful manufacturers are counterbalanced by the rising power of organized labor. Galbraith's view was that the government had a role in supporting the countervailing powers for the good of the economy.
Of all his writings and publications, three stand out as major works of economic thought. The Affluent Society was published in 1958, and put forth the proposition that economic progress is impeded by the more–is–better mentality. Galbraith further postulated that progress could be extended by putting affluence to better use than purchasing goods propped up by artificial techniques such as advertising and salesmanship. He also argued in support of the view that culture and history have a significant role in economic life. The Affluent Society was a best seller, and served to place Galbraith in the forefront of economic thought.
The second of Galbraith's three important works was The New Industrial State, published in 1967. In it he argued for a concept, which he called revised sequence. Revised sequence simply means that the order of control and economic power is reversed in certain situations. Normally price competition is the dominant force controlling the economy. In instances where businesses control consumers through advertising and salesmanship, the forces controlling the economy are reversed. It is this revised sequence that is at the core of Galbraith's economic thinking, explaining distortions in the economy, which he saw as stemming from this reversal of control. The New Industrial State was also a best seller and proposed a plausible explanation of the power structure in the American economy.
The third book in Galbraith's trilogy of economic thought was Economics and the Public Purpose, and it continued the thinking from his earlier works. In this book, however, Galbraith goes on to argue the conventional economic model produces an "imagery of choice" that obscures the true sources of power within the economy. This situation prevents policymakers and citizens from understanding the true sources of decisions and the true seats of power, making the establishment of sound economic policy problematic. Galbraith believed any economic model should pass the "test of anxiety," or the ability of the economic system to allay fears and anxiety within the populace. It was Galbraith's contention that conventional economic systems did not meet that test.
Following his years in public service, Galbraith returned to Harvard University. He continued even in semi–retirement to critique conventional economic thought. He continued to propose "there must be, most of all an effective safety net [of] individual and family support for those who live on the lower edges of the system. This is humanely essential. It is also necessary for human freedom. Nothing sets such stern limits on the liberty of the citizen as the total absence of money."
There must be, most of all an effective safety net [of] individual and family support for those who live on the lower edges of the system. This is humanely essential. It is also necessary for human freedom. Nothing sets such stern limits on the liberty of the citizen as the total absence of money.
john kenneth galbraith
Encyclopedia of World Biography. Detroit: Gale Research, 1999, s.v. "Galbraith, John Kenneth."
Galbraith, John Kenneth. The Affluent Society. Boston: Houghton, 1958.
——. A Life in Our Times. Boston: Houghton Mifflin, 1981.
Who's Who. New York: St. Martin's Press, 1998, s.v. "Galbraith, John Kenneth."
Kretsler, Harry. "Intellectual Journey: Challenging the Conventional Wisdom." Conversations with History. Berkeley: Institute of International Studies, University of California, 1986. Available from the World Wide Web @ (http://globetrotter.berkeley.edu/convresations/Galbraith)
John Kenneth Galbraith
John Kenneth Galbraith
John Kenneth Galbraith (born 1908) was a leading scholar of the American Institutionalist school and arguably the most famous economist in the post World War II world. His views were a stinging indictment of the modern materialistic society that championed personal achievement and material well-being over public interest and needs. In spite of these views, he served as an advisor in both the American and Canadian governments from the 1930s onward.
John Kenneth Galbraith was born on October 15, 1908 in southern Ontario, Canada, on the shores of Lake Erie to a farming family of Scotch ancestry. He studied agricultural economics at the Ontario Agricultural College (then part of the University of Toronto; now, the University of Guelph) and graduated with distinction in 1931. He went on to study agricultural economics at the University of California, receiving his Ph.D. in 1934 after submitting a dissertation on public expenditures in California counties. In this year he also began his long, though frequently interrupted, tenure at Harvard University, where he became an emeritus professor. Galbraith's academic career frequently gave way to public service. He worked in the Department of Agriculture during the New Deal and in the Office of Price Administration and Civilian Supply during World War II, where, according to John S. Gambs, he was "virtually the economic czar of the United States until he left in 1943" From his wartime work emerged a monograph, The Theory of Price Control (1952), which, though not widely influential, contained some of the seminal ideas of his major works.
After the end of the war in Europe, Galbraith worked with the Office of Strategic Services directing research on the effectiveness of the Allies' strategic bombing of Germany. In 1947 he was one of the liberal founders of the Americans for Democratic Action. After working prominently as a speechwriter in the presidential campaigns of Senator Adlai Stevenson, Galbraith went on to chair the Democratic Advisory Council during Dwight D. Eisenhower's Republican administration. In 1956 he visited India where his fascination with the country inspired his later works. He campaigned for President John F. Kennedy, and after Kennedy's victory he was named U.S. ambassador to India in the early 1960s. An outspoken critic of U.S. involvement in Vietnam, he campaigned on behalf of the presidential ambitions of Senators Eugene McCarthy (1968) and George McGovern (1972). Later he worked in the campaigns of Congressman Morris Udall (1976) and Senator Edward Kennedy (1980).
Galbraith's major intellectual contributions lie in the trilogy The Affluent Society (1958), The New Industrial State (1967), and Economics and the Public Purpose (1973). Along the way he published over 20 other books, including two novels, a co-authored book on Indian painting, memoirs, travelogues, political tracts, and several books on economic and intellectual history. He also collaborated on and narrated a Public Broadcasting System television series, "The Age of Uncertainty."
Other than his main trilogy, and perhaps The Theory of Price Control, Galbraith's American Capitalism: The Concept of Countervailing Power (1952) stands out in importance. The central argument of this book is that the growth of economic power in one economic sector tends to induce countervailing power from those who must bargain with the powerful. Hence, unionized labor and politically organized farmers rose in response to powerful manufacturers. The government is often involved in supporting the rise of this countervailing power and, in Galbraith's view, should be.
With its characteristic emphasis on the reality of economic concentration and on the microeconomics background of stabilization issues, this book solidified Galbraith's position as a continuing spokesperson for the New Deal perspective in economics. Galbraith coupled the new economics of John Maynard Keynes with the New Deal corporatist view, as did other Institutionalists of the time, notably C.E. Ayres and Allan G. Gruchy. With this book Galbraith's interest in power and his strong dissent from the neoclassical synthesis which was maturing at that time were set. The competitive modes so often used in economics textbooks, which had then been resurrected in the neoclassical synthesis which combined neoclassical microeconomics with Keynesian macroeconomics, maintain that good results follow from certain assumptions about the structure of the economy. Galbraith argued that such assumptions are not met in the actual economy, are unlikely to ever be met, and probably should not be met. He recognized power as an essential element of economic life and argued that only by examining the power of corporations, unions, and others could economists address the vital issues of social control and economic policy.
The Affluent Society
The Affluent Society examined the continuing urgency that affluent societies attach to higher consumption and production. The general explanation for this paradox, familiar to students of Veblen, is that obsolete ideas are held over from one historical period to another. These ideas persist not by inertia alone but also because they are convenient to powerful vested interests. The Affluent Society argued that the outmoded mentality of more-is-better impeded the further economic progress that would be possible if contemporary affluence were put to more reasonable use. Advertising and related salesmanship activities create artificially high demand for the commodities produced by private businesses and lead to a concomitant neglect of public sector goods and services that would contribute far more to the quality of life.
Galbraith's breakthrough as a best-selling author came with The Affluent Society. The widespread attention guaranteed some, albeit reluctant, hearing of his dissenting ideas in the economics profession. Indeed, he was eventually honored with the American Economic Association's prestigious presidency over the objections of some of the association's more conservative members. With its emphasis on the role of culture and history in economic life, and especially its review of the debilitating effects of an invidious pecuniary culture which seemingly had no higher social purpose than expanding material welfare, The Affluent Society gave a much needed awakening to the American Institutionalist school of economics. The book also influenced both the Great Society program and the rise of the American "counterculture" in the 1960s.
The New Industrial State
In The New Industrial State Galbraith expanded his analysis of the role of power in economic life. A central concept of the book is the revised sequence. The conventional wisdom in economic thought portrays economic life as a set of competitive markets governed ultimately by the decisions of sovereign consumers. In this original sequence, the control of the production process flows from consumers of commodities to the organizations that produce those commodities. In the revised sequence, this flow is reversed and businesses exercise control over consumers by advertising and related salesmanship activities.
The revised sequence concept applies only to the industrial system—that is, the manufacturing core of the economy in which each industry contains only a handful of very powerful corporations. It does not apply to the market system in the Galbraithian dual economy. In the market system, comprised of the vast majority of business organizations, price competition remains the dominant form of social control. In the industrial system, however, comprised of the 1,000 or so largest corporations, competitive price theory obscures the relation to the price system of these large and powerful corporations. In Galbraith's view, the principal function of market relations in this industrial system is not to constrain the power of the corporate behemoths but to serve as an instrument for the implementation of their power. Moreover, the power of these corporations extends into commercial culture and politics, allowing them to exercise considerable influence upon popular social attitudes and value judgments. That this power is exercised in the shortsighted interest of expanding commodity production and the status of the few is both inconsistent with democracy and a barrier to achieving the quality of life which the new industrial state with its affluence could provide.
The New Industrial State not only provided Galbraith with another best-selling book, it also extended once again the currency of Institutionalist economic thought. The book also filled a very pressing need in the late 1960s. The conventional theory of monopoly power in economic life maintains that the monopolist will attempt to restrict supply in order to maintain price above its competitive level. The social cost of this monopoly power is a decrease in both allocative efficiency and the equity of income distribution. This conventional economic analysis of the role of monopoly power did not adequately address popular concern about the large corporation in the late 1960s. The growing concern focused on the role of the corporation in politics, the damage done to the natural environment by an unmitigated commitment to economic growth, and the perversion of advertising and other pecuniary aspects of culture. The New Industrial State gave a plausible explanation of the power structure involved in generating these problems and thus found a very receptive audience among the rising American counterculture and political activists.
Third Book of the Trilogy
Economics and the Public Purpose, the last work in Galbraith's major trilogy, continued the characteristic insistence on the role of power in economic life and the inability of conventional economic thought to deal adequately with this power. Conventional economic thought, with its competitive model and presumptions of scarcity and consumer sovereignty—what Galbraith called the "imagery of choice"—serves to hide the power structure that actually governs the American economy. This obscurantism prevents economists from coming to grips with this governing structure and its untoward effects on the quality of life. Galbraith employed what he called "the test of anxiety" in this attack on conventional economics. He argued that any system of economic ideas should be evaluated by the test of anxiety—that is, by its ability to relate to popular concern about the economic system and to resolve or allay this anxiety. Galbraith contended that conventional economic thought failed the test of anxiety and again offered his basic model from The New Industrial State as an alternative approach to understanding the contemporary economy.
After the years he served in both the American and Canadian governments, Galbraith returned to scholarly activity, extensive travel, and writing, using Harvard University as his home base. Although "conventional economic wisdom" has remained firmly entrenched, Galbraith continued to kick at some of the props supporting it. In January 1997 Galbraith, delivering a lecture at the University of Toronto, again espoused his views that governments should create jobs by direct intervention in the economy. Although he represented the obscure Institutionalist school of economic thought, he nonetheless continued to convey his message that "there must be, most of all an effective safety net [of] individual and family support for those who live on the lower edges of the system. This is humanely essential. It is also necessary for human freedom. Nothing sets such stern limits on the liberty of the citizen as the total absence of money." Only the future will likely force a resolution of Galbraith's principles. Either the visibility of the Institutionalist perspective will rise or Galbraith's work will experience the neglect common to other scholars of that school. Nonetheless, Galbraith's influence on the structure of the American economy will be felt for decades to come.
The best biographical work on John Kenneth Galbraith is his highly readable memoir, A Life in Our Times (1981). His influence and discussions of his work show up frequently in the Journal of Economic Issues. The book-length secondary literature on Galbraith includes Allan G. Grunchy, Contemporary Economic Thought (1972); Charles H. Hession, John Kenneth Galbraith and His Critics (1972); Myron E. Sharpe, John Kenneth Galbraith and the Lower Economics (1973, 2nd ed., 1974); John S. Gambs, John Kenneth Galbraith (1975); C. Lynn Munro, The Galbraithian Vision (1977); Frederick J. Pratson, Perspectives on Galbraith (1978); and David Reisman, Galbraith and Market Capitalism (1980). □
Galbraith, John Kenneth
John Kenneth Galbraith became a leading scholar and arguably the most famous economist in the second half of the twentieth century. His views are a severe criticism of the modern society that upholds personal achievement and material well-being over public interest and needs.
Galbraith's early years and education
John Kenneth Galbraith was born on October 15, 1908, in Iona Station, Ontario, Canada, on the shores of Lake Erie, to a farming family of Scotch ancestry. His father, William, was involved in the politics of their community, supporting a liberal (open to change) view, and started bringing William to political rallies when he was about eight years old. His mother died before William, his brother, and his two sisters were in their teen years.
William attended school but his education was interrupted occasionally so he could work on the farm. He graduated from high school and then went on to study agricultural (having to do with land and farming) economics at the Ontario Agricultural College (then part of the University of Toronto; now, the University of Guelph) and graduated with honors in 1931. He went on to study agricultural economics at the University of California, receiving his doctorate in 1934. That same year he also began his long, though frequently interrupted, teaching career at Harvard University, where he eventually became an emeritus (a person who is retired but retains their title) professor.
Galbraith's academic career frequently gave way to public service. He worked in the Department of Agriculture during the New Deal (President Franklin D. Roosevelt's [1882–1945] plan to help the United States recover from the Great Depression, a time of severe economic hardship in the 1930s) and in the Office of Price Administration and Civilian Supply during World War II (1939–45; a war between the Axis: Germany, Italy, and Japan—and the Allies: England, France, the Soviet Union, and the United States). From his wartime work emerged The Theory of Price Control (1952), which, though not widely influential, contained some of the ideas of his major works.
After the end of the war in Europe, Galbraith worked with the Office of Strategic Services directing research on the effectiveness of the Allies' bombing of Germany. In 1947 he was one of the liberal founders of the Americans for Democratic Action.
After working prominently as a speech-writer in the presidential campaigns of Senator Adlai Stevenson (1900–1965), Galbraith went on to chair the Democratic Advisory Council during Dwight D. Eisenhower's (1890–1969) Republican administration. In 1956 he visited India, where his fascination with the country inspired his later works. He campaigned for President John F. Kennedy (1917–1962), and after Kennedy's victory he was named U.S. ambassador to India in the early 1960s. An outspoken critic of U.S. involvement in Vietnam, he campaigned on behalf of the presidential campaigns of Senators Eugene McCarthy (1916–) in 1968 and George McGovern (1922–) in 1972. Later he worked in the campaigns of Congressman Morris Udall (1922–1998) in 1976 and Senator Edward Kennedy (1932–) in 1980.
Published over twenty books
Galbraith's major intellectual contributions lie in the trilogy (a series of three works that are related to one another, yet can stand on their own): The Affluent Society (1958), The New Industrial State (1967), and Economics and the Public Purpose (1973). Other than his main trilogy, and perhaps The Theory of Price Control, Galbraith's American Capitalism: The Concept of Countervailing Power (1952) stands out in importance. This book solidified Galbraith's position as a continuing spokesperson for the New Deal perspective in economics.
Along the way Galbraith published over twenty other books, including two novels, a coauthored book on Indian painting, memoirs (writings about one's personal experiences), travelogues (writings about travel), political essays, and several books on economic and intellectual history (the study of how creative thinking has influenced human development). He also collaborated (worked together) on and narrated (was the voice for the commentary) a Public Broadcasting System (PBS) television series, "The Age of Uncertainty."
Galbraith's breakthrough as a best-selling author came with The Affluent Society. It examined the need of prosperous societies to use and produce more and more goods. The widespread attention guaranteed some hearing of his opposing ideas in the economics profession. Indeed, he was eventually honored with the American Economic Association's respected presidency.
In The New Industrial State Galbraith expanded his examination of the role of power in economic life. The New Industrial State not only provided Galbraith with another best-selling book, it also extended once again the currency of Institutionalist (the effect that institutions have on the economy) economic thought. The New Industrial State gave a convincing explanation of the power structure involved in generating the problems in the 1960s of economic, social, and environmental cost of corporate monopoly powers, and thus found a very receptive audience among the rising Americans who opposed traditional standards and political activists.
Economics and the Public Purpose, the last work in Galbraith's major trilogy, continued the characteristic insistence on the role of power in economic life and the inability of conventional economic thought to deal adequately with this power.
After the years Galbraith served in both the American and Canadian governments, he returned to scholarly activity, extensive travel, and writing, using Harvard University as his home base.
On August 9, 2000, President Bill Clinton (1946–) awarded a Presidential Medal of Freedom to Galbraith. The medal is the highest civilian honor and may be awarded only by a U.S. president to individuals who have made contributions "especially meritorious [something that should be honored or praised] to the security or national interests of the United States, to world peace or to cultural or other significant public or private endeavors."
For More Information
Galbraith, John Kenneth. A Life in Our Times. Boston: Houghton Mifflin, 1981.
Galbraith, John Kenneth. The Essential Galbraith. Edited by Andrea D. Williams. Boston: Houghton Mifflin, 2001.
Gambs, John S. John Kenneth Galbraith. Boston: Twayne Publishers, 1975.
Sasson, Helen. Between Friends: Perspectives on John Kenneth Galbraith. Boston: Houghton Mifflin, 1999.
Galbraith, John Kenneth
GALBRAITH, John Kenneth
(b. 15 October 1908 in Iona Station, Ontario, Canada), world-famous economist and critic of materialism who served as U.S. ambassador to India and was an economic adviser to the administration of President John F. Kennedy.
Galbraith was the second of four children born to William Archibald Galbraith and Catherine Kendall in the farming community of Iona Station near Lake Erie in Canada. His parents were farmers, and it seemed natural that Galbraith should study agriculture. With this in mind, Galbraith attended Ontario Agricultural College, then part of the University of Toronto and since known as the University of Guelph, graduating with a B.S. in agricultural economics in 1931. He then attended the University of California, Berkeley, where he earned an M.S. in 1933, and a Ph.D. in 1934. Galbraith's doctoral dissertation concerned public expenditure and agriculture in California, a topic indicative of a future career in public service. Galbraith began his Harvard teaching career immediately after graduating in 1934. He married Catherine Atwater on 17 September 1937, the same year he became a U.S. citizen. The couple had four sons.
Galbraith's early career included both university teaching and public service as a government adviser. His keen intelligence and ability to explain complex problems in concise terms made him invaluable in both roles. During the 1930s, working for President Franklin D. Roosevelt, Galbraith became the most influential economic adviser in the United States, implementing New Deal policies intended to halt the collapse in farm incomes begun in the 1920s and regulating the supply of goods during World War II. The ideas for which he became famous, chiefly that governments should intervene to protect citizens from large corporations, were cemented in this period. In 1952 Galbraith published The Theory of Price Control, a book based on his wartime experience, which sealed his reputation as one of the great economists of his generation. Galbraith later worked as adviser and speechwriter to Democratic presidential hopeful Adlai Stevenson and for John F. Kennedy. Kennedy rewarded him in 1961 by making him U.S. ambassador to India, a post he held for two years.
Yet despite his deep involvement in government and education, Galbraith's major influence on the economics and culture of the 1960s came through his books The Affluent Society (1958), The New Industrial State (1967), and Economics and the Public Purpose (1973). From the time of his early work on agricultural economics in the 1930s, Galbraith had been interested in the balance between sectors of the economy and ways of maintaining it. In American Capitalism: The Concept of Countervailing Power (1952), Galbraith outlined his belief that power relations are the single most important factor in managing the economy. It was an argument that would become central to the politics of the 1960s.
Unlike the so-called neoclassical economists of the political right, Galbraith was not convinced that market forces could achieve a stable and fair society. As an institutionalist economist he was convinced not only that governments should intervene to influence economic factors such as wages and prices, but also that they should do so to maintain the balance of power between, for example, employers and employees. In The Affluent Society Galbraith attacked the conventional view that the economic boom of the 1950s was necessarily a good thing. He pointed out that market forces had created an economy that wasted its wealth on goods and services that did little to improve the quality of life. The artificially high demand created by advertising and social expectations did not benefit those with limited incomes or those who lacked access to decent schools; rather, it enriched the political, cultural, and economic elite who benefited from the neglect of public services.
Written in a clear, easy style, The Affluent Society soon became a best-seller. Galbraith emphasized culture, history, and education as crucial for the economic well-being of nations, and he was suspect among the conservatives who dominated the economics profession. But Galbraith's influence went far beyond economics. With its focus on the role of power and vested interests, The Affluent Society was in step with dissenting movements of the 1960s counterculture, including antiwar protests, civil rights campaigns, and the nascent feminist movement. These ideas were expanded in The New Industrial State (1967), in which Galbraith developed his concept of the "revised sequence." Conventional economics saw the sequence of production as being governed by the demands of informed consumers; firms would change their products and modes of production according to decisions made by their customers in competitive markets. Galbraith took an opposite view. In his revised sequence, which applies only to industrial economies, a small number of corporations strive to exercise and expand their power over consumers. Detached from price fluctuations because of their size, such corporations influence politics, culture, and social attitudes. This, Galbraith argued, was undemocratic, and prevented industrial societies from achieving the quality of life their affluence should make possible.
The New Industrial State also became a best-seller. The institutionalist school of economics, to which Galbraith belongs, was at the time obscure, but Galbraith's views on the structure of the economy and society gained popular appeal, especially among readers who were concerned about the relationship between corporations and government and about the rise of large monopolies. Galbraith's book gave expression to long-held suspicions that the people were being manipulated and controlled. The third book in the trilogy, Economics and the Public Purpose, was published in 1973 and expanded on the range of the previous two to describe the whole capitalist system, not just industrial capitalism.
By then Galbraith was acclaimed as one of the foremost economists of the post–World War II period and as a writer who brought wit and clarity to complex ideas. He was Paul M. Warburg Professor of Economics at Harvard University from 1959 to 1975, and over the course of his long career has taught at universities around the world. Galbraith holds many honorary degrees, and in 2000 was honored by President William J. Clinton with the Presidential Medal of Freedom, the highest civilian honor in the United States.
Galbraith's memoir, A Life in Our Times (1981), is a highly readable account of his experience in government and public life, and his Letters to Kennedy (1998), provides insight into his time in the Kennedy administration. James Ronald Stanfield, John Kenneth Galbraith (1996), is an affectionate biography, and Allan G. Grunchy, Contemporary Economic Thought (1972), is a useful contemporary view of Galbraith's thought and influence. David Reisman, Galbraith and Market Capitalism (1980), provides a longer view of the period.
Galbraith, John Kenneth
John Kenneth Galbraith (găl´brāth), 1908–2006, American economist and public official, b. Ontario, Canada, grad. Univ. of Toronto (B.S., 1931), Univ. of California, Berkeley (M.S., 1933; Ph.D., 1934). After becoming (1937) a U.S. citizen and teaching economics at Harvard (1934–39) and Princeton (1939–40), he entered government service, working (1941–43) in the Office of Price Administration. He was an editor of Fortune magazine from 1943–48, also serving on the U.S. Strategic Bombing Survey (1945) and in other governmental advisory posts before returning (1949) to Harvard. An adviser to Democratic presidents from Franklin D. Roosevelt to Bill Clinton, most prominently to John F. Kennedy, he also was (1961–63) U.S. ambassador to India. He rejoined the Harvard faculty in 1963 (he became a professor emeritus in 1975) and continued his political activities, serving (1967–69) as chairman of Americans for Democratic Action. A Keynesian economist and a celebrated liberal, Galbraith advocated government spending to fight unemployment, supported the use of more of the nation's wealth for public services and less for private consumption, and warned against an unregulated free-market system. An influential thinker and a popularizer of economic thought, he wrote more than 40 books including American Capitalism (1952), The Great Crash 1929 (1955), The Affluent Society (1958, rev. ed. 1985), The Liberal Hour (1960), The New Industrial State (1967, rev. ed. 1971), Economics and the Public Purpose (1973), The Good Society (1997), and The Economics of Innocent Fraud (2004). A witty and urbane man with wide-ranging interests, he also wrote a book on Indian art (1968) and several novels.
See his memoir, The Scotch (1964, repr. 1985); autobiography, A Life in Our Times (1981); Ambassador's Journal (1969); and history, Name-Dropping: From FDR On (1999); J. Goodman, ed., Letters to Kennedy/John Kenneth Galbraith (1998); J. R. and J. B. Stanfield, ed., Interviews with John Kenneth Galbraith (2004); A. D. Williams, ed., The Essential Galbraith (2001); biography by R. Parker (2005); studies by C. H. Hession (1972), M. E. Sharpe (1973), A. D. Williams (1979), D. Reisman (1980), J. R. Stanfield (1996), H. Sasson, ed. (1999), and B. Laperche and D. Uzunidis, ed. (2005).
Galbraith, John Kenneth
GALBRAITH, John Kenneth
GALBRAITH, John Kenneth. American, b. 1908. Genres: Novels, Art/Art history, Economics, International relations/Current affairs. Career: Emeritus Prof., Harvard University, Cambridge, Mass., since 1975 (Instr, and Tutor, 1934-39; Prof. of Economics, 1949-59; Paul M. Warburg Prof. of Economic, 1959-60, 1963-75). Fellow, American Academy and Inst. of Arts and letters (Pres., 1984-87). Asst. Prof. of Economics, Princeton University, N.J., 1939-42; Economic Adviser, National Defense Advisory Commn., 1940-41; Member, Bd. of Eds., Fortune mag, 1943-48; U.S. Ambassador to India, 1961-63. Publications: American Capitalism: The Concept of Countervailing Power, 1951; A Theory of Price Control, 1952; The Great Crash 1929, 1955; The Affluent Society, 1958, 3rd ed. 1978; Journey to Poland and Yugoslavia, 1959; The Liberal Hour, 1960; (under pseudonym) The McLandress Dimension (satire), 1963; Made to Last, 1964; The Economic Discipline, 1967; The New Industrial State, 1967, 3rd ed. 1979; The Triumph (novel), 1968; Ambassador's Journal, 1969; (with M.S. Randawa) Indian Painting, 1969; Economics and the Public Purpose, 1973; A China Passage, 1973; Money: Whence It Came, Where It Went, 1975; The Age of Uncertainty, 1977; (with N. Salinger) Almost Everyone's Guide to Economics, 1978; The Nature of Mass Poverty, 1979; Annals of an Abiding Liberal, 1979; The Galbraith Reader, 1979; The Nature of Mass Poverty, 1979; A Life in Our Times, 1981; The Anatomy of Power, 1983; The Voice of the Poor: Essays in Economic and Political Persuasion, 1983; A View from the Stands: Of People, Politics, Military Power, and the Arts, 1986; Economics in Perspective: A Critical History, 1987; (co-author) Capitalism, Communism and Coexistence, 1988; A Tenured Professor (novel), 1990; The Culture of Contentment, 1992; A Journey Through Economic Time, 1994; Name-Dropping: From FDR On, 1999. Address: 30 Francis Ave, Cambridge, MA 02138, U.S.A.