The Moral Consequences of Economic Growth

by Benjamin M. Friedman

Book Overview

From the author of Day of Reckoning , the acclaimed critique of Ronald Reagan's economic policy ("Every citizen should read it," said The New York Times ): a persuasive, wide-ranging argument that... This description may be from another edition of this product.

• Format: Paperback
• Language: English
• ISBN: 1400095719
• ISBN13: 9781400095711
• Release Date: September 2006
• Publisher: Vintage
• Length: 592 Pages
• Weight: 1.11 lbs.
• Dimensions: 1.1" x 5.4" x 7.9"

Customer Reviews

The Chicken or the Egg?

Since the rise fascism and Bolshevism in the 1920s there has been the question of how political rights and civil liberties correspond to economic rights and growth. Amartya Sen has argued that the political rights and civil liberties should not be divorced from economic process (Development As Freedom). Sen's normative approach of equating economic rights to the freedoms one achieves with guaranteed civil liberties is one that many can respect. Benjamin Freidman has taken a more positivist to the same issue. In doing so he asks, "Which came first the chicken or the egg?" Does economic growth in a capitalist setting require democracy and civil liberties or visa versa? Friedman's study looks back not only over all to this question in modern economic history. But, he also takes specific case studies from the United States, Germany, France and others to see the over all trends of the problem. From this he develops a matrix on the issue. In times of growth political rights tend to expand. In times of stagnation they tend to contract. What is interesting his not how Friedman arrives at this basic framework, but his look into the exceptions of this common sense rule. Why in the 1930s was the political openness of the New Deal accepted, but the recent economic stagnation in France caused the rise of the right-wing Le Pen party? Friedman is one of the foremost experts on the political economy. He has held a seat at Harvard since 1972. Yet, in this work for public consumption his writing is more along the lines of an historian. He does not delve too far into the economics or the political science of the issue, which many academics tend to - even for the lay reader. Instead, he sees to it that the main ideas are gotten across. His prescriptions are simple. Maintain economic growth and we can maintain political and civil liberties. While Amartya Sen may find a problem with placing the chicken before the egg, after this work one must understand that economic stagnation helps noone.

Gross Domestic Goodness

Almost everyone can agree that economic growth is good: the material benefits of more jobs, better pay, bigger houses and more money to spend on education and healthcare are indisputable. There may be a few spoilers railing against resource depletion, urban blight, and greenhouse gases, but ultimately those problems can be overcome by growth also. Now Harvard professor Benjamin Friedman argues that in addition to material benefits there are also moral benefits. Friedmand writes that: "Economic growth - meaning a rising standard of living for a clear majority of citizens - more often than not fosters greater oppurtunity, tolerance of diversity, social mobility, commitment to fairness and dedication to democracy." And conversely, when there is economic stagnation or decline the citizen's "moral character" tends to decline accordingly, there being less tolerance, less openess, and less generosity to the poor and the disadvantaged. Using the United States as a case in point, Friedman argues that from 1953 to 1973 median family income doubled. As the economy grew and Americans prospered, society became more open and tolerant. During this period, segregation became unconstitutional, the right to vote was guaranteed, racial discrimination was banned, fair housing and equal employment opportunity legislation was enacted. These events made America a more just and equitable society. Then from 1973 to 1995, the average wage in today's dollars declined. The national mood toward progressive social programs began to sour. Indeed these programs were cited by some as being unduly burdensome and being the cause of slow wage growth. Nevertheless, in times of falling incomes, Americans naturally become more concerned with their share of the shrinking economic pie. Friedman also sees here a deterioration of moral character. It should be fairly obvious by now that Friedman is a liberal and equates morality with social welfare programs - this being the most contentious issue of the book. Conservatives and libertarians will be quick to point out that support for affirmative action, immigration, strong unions, endangered species, etc. have been detrimental to economic growth and are, therefore, by Friedman's definition, immoral. These critics will claim that in order to foster economic growth we must have reduced taxes, less regulation, non-union labor and fewer workplace rules. The resulting economic growth would raise all boats, and would thus be morally correct. Friedman and his critcs do not disagree that the end result of economic growth - aside from material well-being - should be tolerance, openess, social mobility and dedication to democracy. They disagree on the means of achieving those goals. Friedman favors government intervention on behalf of the poor and the disadvantaged. The big question is whether or not it is in fact helping them. Two other books that have examined this question are Amartya Sen's "Development As Freedom" and Jeffre

The richer we are the better we become

The argument that there is a link between economic prosperity and moral behavior is the central thesis of the work. The more prosperous societies are shown to be those most generous and compassionate, those least- conflict ridden. In a sense this is an extension of the old Puritan idea of chosenness by hard work and success. The successful on earth are taken to be those chosen by God for blessedness. Now it is the successful society as a whole which is able to use its largesse to be morally beneficial. This thesis, however broad, is backed up by a lot of empirical data. Even among the primates it is those living in lush tropical areas such as the gibbons who are taken to be most friendly and generous to each other. Scarcity brings out the worst in us, the tooth- and- nail struggling for each little advantage. Except that there are exceptions, very great exceptions. And as great power corrupts great wealth often too corrupts, not only for individuals and families but for societies' also. One can say read the story of the birth- dearth in the West, and what Christopher Lasch called 'the culture of narcissism' as coming directly out of the temptations given by abundance of wealth. And one can trace many family breakdown scenarios to the kind of seeming freedom from responsibility given by great wealth. There are after all those who maintain that the present day United States , conceivably the wealthiest society that has ever existed, is filled with corruption and moral failure.

a worthwhile read

People who complain that books like Freakonomics are too short, elementary or filled with fluff should take a look at Friedman's Moral Consequences of Economic Growth. Not to say that this is an introduction to economics, gee-whiz or otherwise. This is a different book entirely. Focusing on how economic activity can impact human culture from a moral standpoint instead gives this book an interdisciplinary "bigger picture" authority and appeal. There is a lot to appreciate in this book and while I wouldn't exactly call it an easy read, it is understandable even to a non-economist like myself. I don't agree with all of Friedman's arguments, but in my opinion he does a fine job of choosing and presenting relevant issues. So whether or not you agree with what he has to say, this book will give you plenty of good food for thought.

Highly Recommended!

Although author Benjamin M. Friedman teaches economics at Harvard, this book is not mainly about economics; it is mainly about morality. Friedman goes beyond traditional academic boundaries to propose that the moral tone of various Western democratic societies is connected to their economic growth. This impressive effort may introduce you to potential connections you might otherwise have ignored. However, Friedman offers both sides of the picture. Although economic growth correlates with social progress and stronger democracy, the correlation is not exact. There are some interesting counterexamples. Moreover, the question of how to define social moral progress is very much open. The author, for example, equates racial preferences in college admissions with moral progress, though that is a controversial issue. We find that this good, thought-provoking book offers a great deal of valuable insight into a seldom-considered aspect of economic growth.