Book Review: The End of Normal

Remember the blockbuster economic theory books from a generation ago, The New Industrial State and The Affluent Society, by John Kenneth Galbraith? Well, Galbraith’s son, James, is quite the thinker in his own right, at about the same level as his father. I’ve actually had a telephone conversation or two with him about tax policy, and he’s a really nice guy to boot.

So, his is the latest in the “The End of” books I’ve read, following The End of Oil, The End of Food, The End of Poverty, The End of Faith and The End of Growth. I’m not sure what compels me to read every book that begins with those three words.

But I digress. The End of Normal is a great read. Galbraith takes on a subject near to my heart. In my year-long dialogue with the Thuckmeister, I tried on many occasions to explain to our friend Thucky that the rankings of economists were bullshit. Galbraith explains how economists across the spectrum are focused on their rankings, which are a function of how they are perceived by other economists, and conduct their research and writing accordingly. As a result, they produce papers that are long on mathematical formulas, but short on practicality. The most glaring example of this, Galbraith explains, was how an entire generation of economists ignored constraints on the availability of resources in their analysis. Reflect on that for a moment. It’s pretty astonishing.

But there’s much more to The End of Normal than that.

Where Galbraith shines is in his refusal to get lost in theory, always taking into account the practical considerations of his views. For example, he comments on the basic income guarantee, a concept in which I’m a firm believer. He believes the better route would be a reduction in the retirement age, on the basis that policing who qualified for the basic income guarantee would in practicality be an impossible task. I personally disagree, but I do respect his argument.

Which gets to a central thesis of his book, the availability of work. He explains how we tend not to focus enough on the destruction side of the “creative destruction” associated with capitalism. At the early stages of each wave of technological innovation, jobs are created at a rapid rate. Later in the stage, jobs are lost to the new technology. Thus, in the early stage of our transition to an oil economy, things were good. Ultimately, however, Galbraith contends, the destruction of jobs associated with the transition to the oil economy was a key factor in onset of the Great Depression. That’s not to say technological advance is a bad thing, but to recognize the reality associated with it.

That should be enough to pique the interest of those whose interest might be piqued. If you’re an economic policy geek like me, you’ll find The End of Normal truly outstanding.