Authors: Kurt Andersen
We have been expressly evolved…for the purpose of solving the economic problem. If the economic problem is solved, mankind will be deprived of its traditional purpose….Thus for the first time since his creation, man will be faced with his real, his permanent problem—how to use his freedom from pressing economic cares, how to occupy the leisure, to live wisely and agreeably and well….[T]here is no country and no people, I think, who can look forward to the age of leisure and of abundance without a dread. For we have been trained too long to strive and not to enjoy. It is a fearful problem for the ordinary person…to occupy himself.
But Keynes thought we’d manage it.
Learning to live well after solving the economic problem is literally the ultimate First World Problem. There’s obviously no fixed financial marker for when the economic problem is solved. During the last two centuries, especially the last one, we’ve built a political economy and an accompanying culture that really do encourage us to be insatiable, to keep always wanting more, specifically to
more. Remember that in hypothetical America 2, if our present national income and wealth were divided equally, every household would earn $140,000 or so and have a net worth approaching $1 million. Going forward, if our economy grows only as fast as it has for the
last quarter-century, then a quarter-century from now, it’ll still be 50 percent bigger—which should boost those annual incomes in America 2 toward $200,000 per household. Won’t we have solved the economic problem
? Of course, as we get close to solving the economic problem, politics aside, it becomes primarily a cultural and psychological problem that people must
is solved and declare victory.
“The Puritan work ethic,” Leontief wrote in the 1980s about machines taking on more and more of the work, “will have to yield gradually to a somewhat different attitude toward life. Those who ask what the average working man and woman could do with so much free time forget that in Victorian England the ‘upper classes’ did not seem to have been demoralized by their idleness.” Back in Victorian England, the very productive upper-class writer Oscar Wilde created a Russian prince character who said that “in a good democracy, every man should be an aristocrat.” It was a joke in 1880, but it’s less of a joke now that the average U.S. household income is by the most conservative reckoning nearly six figures, and nonrich Americans spend endless hours on passionate amateur pursuits—noble, delightful, eccentric, stupid—in the way that only aristocrats used to be able to do.
College degrees make it much easier for people to earn enough money, but higher education is also supposed to make it easier for people to keep educating and amusing and occupying
like aristocrats, and to help others, like aristocrats with a sense of noblesse oblige. Again, as the future first Baron Keynes predicted in 1930 about 2030: “We shall do more things for ourselves than is usual with the rich today, only too glad to have small duties and tasks and routines.”
Beyond aristocrats and the well-to-do, there are other relevant models for Americans finding a sense of self-worth without the structure of a job to fill half their waking hours. A century ago, after working an average of sixty or seventy hours a week, American workers quickly adapted to forty hours and even less. Today when one lucky person in a couple earns enough from a job to support the household comfortably, a partner who decides against taking a paying job can usually figure out how to be useful and lead a satisfying life. I know contented former firefighters and military veterans who left those jobs after twenty years with pensions that equal or exceed the average annual U.S. salary. In my Brooklyn neighborhood, a large number of middle-aged and now elderly men have been leading relaxed boulevardier lives ever since I arrived thirty years ago: they’d been longshoremen on the nearby East River docks until container ships and automation changed everything—and in the 1970s, when they were young, their powerful union got them pensioned off comfortably. As of 2019, almost 10 percent of Americans leave their paying jobs by age fifty, a quarter by fifty-five, and
thanks to the wealth accumulated by the lucky few but mainly to long-lasting marriages and the socialism of Social Security and Medicare—retire no later than their early sixties.
But the economic problem won’t be solved if the abundance is not fairly shared, which explains why most Americans are not sanguine about their ability to enjoy a future where intelligent machines are doing more and more of the work. According to a 2017 Pew survey, they believe by three to one that an AI-dominated America is going to make “inequality between rich and poor much worse than today,” which is surely correct if our political economy remains as it is now. That’s why by three to one Americans also say they’re “worried” about a “future where robots and computers can do many jobs.”
They’re so worried that in supposedly antiregulation free-market America, 58 percent support legal limits on how many jobs a business may automate, majorities of Republicans as well as Democrats. The big difference of opinion on this question is between those more and those less likely to be replaced by machines: people with only high school educations are strongly in favor (70 percent) of legally reserving jobs for humans, and people with college degrees are strongly against (59 percent).
And then on the other hand there are, once again, the 27 million people of the Nordic countries. They’ve built their successful free-market social democracies, they act on the knowledge that work isn’t everything, and both of those things make them optimistic about a future in which machines do more and more of the work. When the European Union conducted a survey in 2017 about attitudes toward robots and AI, specifically asking if they’re “a good thing for society” because they “help” with jobs, the people of Finland, Sweden, and especially Denmark were consistently among the several most enthusiastic of all twenty-eight countries, between 71 and 86 percent welcoming their robot-overlord liberators.
According to the same survey, one in seven Danes have already worked alongside robots, remarkably, and the Finns (one in eleven) are tied for second place. Sweden’s powerful unions cooperate with companies as they automate everything from journalism (okaying software that writes hundreds of stories a week about sports events that weren’t previously covered at all) to zinc mining. “In Sweden,” the left-wing minister of employment says, “if you ask a union leader, ‘Are you afraid of new technology?’ they will answer, ‘No, I’m afraid of
technology.’ The jobs disappear, and then we train people for new jobs. We won’t protect jobs. But we will protect workers.”
The average Nordic person generates less economic output than the average American, 15 percent less in Denmark and Sweden—but they
more of the wealth they generate, on average. Moreover, Paul Krugman says analysis of those differences between our economy and theirs shows that “much of the gap represents a choice” and “in the case of Denmark, all of it.” That is, they work a little less on purpose.
Between laws requiring employers to give everyone five weeks for vacation and a year of paid leave to new parents, as well as the general cultural sanity concerning work, the average Nordic spends 20 percent less time on the job than the average American, giving them three to four hundred extra hours each year to do whatever they please. Since they don’t rack up college debt or pay onerous amounts for healthcare, they’re also able to put more away: the Danes save money at a rate more than three times that of Americans. They systematically chill and systematically share, embracing the inevitable new on the road to the future. Alas, we are not Denmark. Yet.
Such a cozy English intellectual elite it was: Wells turned Keynes into an offstage character in a novel in 1926, then did the same with Huxley in 1937 in
The Shape of Things to Come.
The federal standard for what qualifies as an “impairment” that renders you “unable to perform substantial gainful activity” is vague and can include back pain or anxiety, for instance, depending on how a local doctor here or a local judge there feels about it or you. Of the 2 million Americans who apply for disability insurance each year and have worked enough years to qualify, about half make the cut and win an award.
“The love of money as a
” Keynes wrote in that witty essay, “will be recognized 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. All kinds of social customs and economic practices…which we now maintain at all costs, however distasteful and unjust they may be in themselves, because they are tremendously useful in promoting the accumulation of capital, we shall then be free, at last, to discard.”
The survey respondents who said they’d “heard a lot” about the AI-robot future were just as likely to be “worried,” but
said they were “enthusiastic” about it. To me, that ambivalence seems reasonable.
On the other hand, compared to Americans, many
Danes decide for whatever reason not to work at all. In fact, of the three dozen most developed countries, as of 2016 the United States had a lower percentage of prime-age men in the labor force than any country but Italy.
Forty years ago the script flipped. The rational right, as opposed to its religious and other non-reality-based allies, sold the country a vision of a political economy that they promised would make life more like it used to be.
Used to be
used to be
was the vision, a bouncy neighborly prosperity without government mucking things up, America as Norman Rockwell and Frank Capra had depicted it.
What we got instead is a return to the grimness of the
older days, as things were in 1919 or 1883—fashion-mad party-hearty prosperity (and stature and power) for the few, hardscrabble insecurity for the rest, everybody for themselves without even the consoling expectation, reasonable in the actual old days, of a better tomorrow. As Americans in the 1970s and afterward slid into a pleasant warm bath of cultural nostalgia that then grew into a weird stagnant lake, they learned to equate
across the board
the new downgraded social contract (with newly underpaid and impotent workers, new self-funded pensions, newly exorbitant college costs), new socially-liberal-but-fiscally-conservative Democrats who didn’t seem so different from Republicans, newly corrupted politics, new technologies and a new world order that wiped out jobs and local shops.
America was created and built to pursue and embody the new, which accounts for a lot of the country’s exceptional success. But too many of us have lost our appetite for the new. And that’s very bad timing, because right now we’re obliged to come to terms with all kinds of daunting new conditions—the pandemic and its aftermath for a while, but two others
new, existential, man-made and ongoing: the global climate we’re self-destructively heating up, and an economy we’ve made self-destructively unfair and primitive just as the intelligent-machine future arrives. We may or may not be up to summoning the old-fashioned grit and gumption necessary to persevere and thrive in this
Some of the large new challenges aren’t exclusively within Americans’ power to manage or overcome, most pressingly the climate crisis. The slower economic growth of the last few decades in the United States and the rest of the rich world may just be a permanent return to the historical average following a few decades of exceptionally fast growth—and we can’t know for sure the net result of a massive effort to deal with the climate, whether it would slow growth further or speed it up for a decades-long new boom. The creative destruction of large chunks of our economy by globalization since 1980 is probably pretty much finished, those jobs gone: it was in the 1980s and ’90s that we doubled the foreign fractions of cars and clothes we buy, and in the 1990s and early 2000s that our imports from China went from tiny to massive. But total global trade, as a percentage of the world’s GDP, peaked more than a decade ago.
The other strikingly new American condition due to globalization during the late twentieth century is the influx of people as well as goods from foreign places—the genuinely
part being that for the first time in U.S. history, most of the immigrants are people of color. The resulting outbursts of nativist and racist sentiment won’t end quickly. As we have seen, bad political leaders can always exacerbate fear and loathing of the new even after it’s no longer new and when it’s pointless to resist, but good political leaders can’t easily make that resistance end.
However, unlike the other big challenges, I think this one will tend to solve itself with the passage of time. As with the offshoring of jobs, the big change from before to after is already done, and it’s now slowing way down. There are a quarter fewer unauthorized Mexican immigrants in the United States than there were just a decade ago. Over the last half-century the immigrant fraction of Americans shot up from less than 5 percent to 14 percent, but over the next half-century it’s projected to inch up only to 18 percent. Notwithstanding a ferociously anti-immigrant president, overall antagonism toward immigrants and immigration has significantly
over the last decade. In its annual questions about the issue, the Gallup poll in 2019 found that 76 percent of people think “immigration is a good thing for this country today” and only 19 percent “a bad thing.” Ten years ago half of the Americans surveyed wanted immigration levels decreased, but now just a third do. After the youngest boomer finally turns sixty-five at the end of the 2020s, the percentage of olds in America, and their political power, will finally level off. Already in all but four of America’s biggest metropolitan areas (Seattle, Phoenix, Boston, and Palm Beach) non-Hispanic white people are minorities. I hope and believe by the time the whole country gets there in the 2040s, the significant outbreaks of white racial panic will have subsided.
But the other big problem—the decisive power grab by the right and big business and the rich, the redrafted social contract of the Raw Deal for most people, the unmaking of modern America—will absolutely not just sort itself out. Fixing that requires government, politics, and a collective will to bend the moral arc hard toward justice. And the
part of that challenge, the digital transformation of work and the economy still in its early stages, adds a high-stakes double-or-nothing dimension to America’s near future as machines take over more and more of the work—very possibly worse or possibly, if democracy wins, much better.
Earlier I referred to the rich conservative big businessman Jack Welch, the archetypal American CEO of the 1980s and ’90s, as a megalomaniacal loudmouth alpha-male SOB. But he was also very smart and, I think, had an excellent understanding of one of my subjects here—stagnation versus change, the ways cultures cling to the familiar or leap for the new. At GE his operating motto was
Change or die,
and in his last annual report as CEO, in 2000, he returned to that idea.
When the rate of change inside an institution becomes slower than the rate of change outside, the end is in sight. The only question is when. Learning to love change is an unnatural act in any century-old institution.
Businesses are entirely different species from democratic societies, but here we are, with our almost two-and-a-half-century-old country, variously terrified of change and desperate for it. The other reigning philosopher-king of corporate change in Welch’s time was Andy Grove—immigrant, engineer, Intel cofounder, cocreator of the personal computer industry.
In the 1990s, he famously took
the mathematical term for when a curve turns definitively up or down, and popularized it as a metaphor for pivotal moments in the history of any business or organization or industry.
But it really applies to all trajectories, those of individuals or of whole societies. Unlike
the related term that I’ve used to describe the changes in our political economy in the 1970s and ’80s, it means not just a profound change in basic thinking but also dramatically changed and changing facts, and in particular the choices people make and actions they take in response to new facts. “A strategic inflection point,” Grove wrote in his 1996 book
Only the Paranoid Survive,
fundamentals are about to change….Strategic inflection points can be caused by technological change but they are more than technological change….They are full-scale changes….They build up so insidiously so you may have a hard time even putting a finger on what has changed, but you know that something
….The change can mean an opportunity to rise to new heights. But it may just as likely signal the beginning of the end.
Our last national inflection point came as a result of the epochal social changes of the 1960s and the global economic changes of the ’70s. Big business and the self-righteous rich used the opportunity to put the United States on a course that served themselves—almost exclusively themselves, even if that wasn’t the original and entire intention. We’re now at another strategic inflection point. The pandemic and its consequences have simply made it more obvious. The axioms adopted around 1980—market value is the only value, keep democracy out of economics, government is useless or worse, nothing but thoughts and prayers for the victims—can and must be undone, the political economy renovated, new technologies properly embraced in order to start solving the economic problem for everybody. But this will require a patient political long game on behalf of the economic majority—like the class war launched in the 1970s and brilliantly waged ever since by and for the economic elite.
It could mean an opportunity to rise to new heights, or it could be the beginning of the end.
A century ago Argentina was the tenth-richest country on Earth, more prosperous than Canada or Australia. When the inflection point of the Great Depression came, Argentines began making bad political choices and never stopped, and now their GDP per person is down somewhere around that of Mauritius and Gabon. Korea arrived at its inflection point after World War II, the country was split in half, and now the per capita economic output of South Korea is more than twenty times North Korea’s.
In my lifetime, the most remarkable strategic inflection point on the upside has been China’s, which it reached exactly when we reached ours, in the late 1970s, and proceeded to rise to extraordinary new heights—a per capita GDP today ten or fifteen times higher than it was then. Indeed, I think what’s required of the United States now is a transformative pivot almost as radical for us as the one China made back then was for them.
China achieved its phenomenal growth by sticking with its undemocratic political system but swapping dysfunctional, decadent command-and-control
for a state-guided market economy—“socialism with Chinese characteristics.” Here and now in America, we need to stick with (and seriously reform) our political system, but to swap our dysfunctional, decadent out-of-whack capitalism for a much more democratic and sustainable one—capitalism with American social democratic characteristics. That may seem like a long shot, but what the U.S. right achieved in the 1980s certainly seemed as improbable a decade before it happened. The epic turn we managed a half-century before that with the New Deal didn’t seem likely in the 1920s.
At the right’s moment of victory in 1982, Milton Friedman published a new edition of
Capitalism and Freedom,
his book that had taken the movement into beta (on its way to launch) in 1962, with a new preface. The default condition in any society is “a tyranny of the status quo,” he wrote. “Only a crisis—actual,” like in the 1930s, “or perceived,” like in the 1970s—“produces real change.” Note the tell: a
crisis will do. “When that crisis occurs, the actions that are taken depend on the ideas that are lying around,” so you have “to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable.”
In the 1990s one of Friedman’s adherents expanded on this in a pitch to prospective donors for the new libertarian think tank where he worked. Radical ideas properly framed and promoted by intellectuals, young Joseph Overton explained, thereby get traction and eventually move from beyond the pale toward the center and change the world. Not long afterward, he died a very American-individualist death (his one-man ultralight aircraft crashed), but the Overton Window is now shorthand for that process of normalizing the ideologically wild-and-crazy. A century before Overton or Friedman, however, Anthony Trollope nailed it in
his novel about British politics. After losing a vote in Parliament to give more rights to Irish sharecroppers, a leftist MP character explains to his young protégé how they’ll get their way in the long run:
Many who before regarded legislation on the subject as chimerical will now fancy that it is only dangerous, or perhaps not more than difficult. And so in time it will come to be looked on as among the things possible, then among the things probable; and so at last it will be ranged in the list of those few measures which the country requires as being absolutely needed. That is the way in which public opinion is made.
By the way,
was published in 1868. Three years earlier in America, the U.S. government ended slavery once and for all even though, just a decade before, emancipation and abolition were ideas on the American fringe, political pipe dreams. But the Trollope-Friedman-Overton Window opened.
What has been happening with the economic left in America lately could be a historical rhyme with what happened with the right in the 1970s after its forty years in the wilderness. It had had its celebrated lodestars for decades—popularizers like William F. Buckley and Barry Goldwater and Ronald Reagan in the 1950s and ’60s, increasingly well-known economists for the cognoscenti (the Austrian Friedrich Hayek) and the masses (Milton Friedman) who both got Nobels in the mid-1970s as credible right-wing think tanks appeared. Then in 1980 the empire struck back, and victory was theirs.