On his book Veblen: The Making of an Economist Who Unmade Economics
Cover Interview of June 23, 2021
Lastly
In addition to examining
the social origin of Veblen’s ideas, my book analyzes their vital substance.
Here too Veblen
departs from conventional wisdom, which portrays Veblen primarily as an
iconoclastic satirist of America’s wealthy in The Theory of the Leisure
Class. An iconoclast Veblen was, but mainly because he was also a
professional economist involved in debates with classical and neoclassical
economists over the distribution of wealth among different social classes.
Then, as now, the
issue of wealth distribution was an explosive and divisive one on the national
stage, where battles raged between Capital and Labor and their spokespersons.
Whether Veblen would have written about the leisure class outside of this
context is unlikely; for, as he knew, satires of the leisure class were by then
commonplace. Veblen did not think he needed to add another one unless it had
something more to offer.
And The
Theory of the Leisure Class did just that. Here (and elsewhere) Veblen maintained
that most academic economists, as well as many journalists and political
commentators, thought about economic life in the wrong way. They viewed
economies in static terms, presenting economic life as essentially the same in
all times and places. Moreover, they viewed economies as made up of separate individuals,
all of them acting out of self-interest. Today, we find many economists and
pundits who still hold to these notions in updated forms.
But Veblen relentlessly
criticized these views. He insisted that economic life is constantly changing, and
that economies are structured differently in different places and times. Not
only this, but in economic life there are no standalone individuals. Economic
activities, such as production and consumption, are always shaped, said Veblen,
by the evolving institutions that people are embedded in.
From this critical
perspective, Veblen attacked prevailing theories of wealth distribution that posited
that people with wealth earned it through their individual contributions to improving
the process of economic production. To the contrary averred Veblen—where there
is wealth, there is robbery: predatory behavior by powerful parasitic groups
that contrive to get “something for nothing” via social institutions, which evolve
to adjust to historical change by devising ever-new mechanisms for thievery.
Observing his
own society, Veblen saw economic institutions as enabling the accumulation of
vast fortunes for the predatory class as its members pursued private profit. But
he then pivoted to groups with other motives. Writing, in despair, about the beleagured men and
women who served the interests of community at large by devoting themselves to the
design and functioning of the “machine process,” Veblen posed the paradox: “Why are large and increasing portions of the community penniless… Why do we … have hard times and unemployment in the midst of excellent resources, high efficiency and plenty of unmet wants?”
More than a
century after Veblen penned this question, the paradox remains, giving alarming
pertinence to his forceful analysis of the predatory stratagems of modern economic
institutions.
[T]he Holocaust transformed our whole way of thinking about war and heroism. War is no longer a proving ground for heroism in the same way it used to be. Instead, war now is something that we must avoid at all costs—because genocides often take place under the cover of war. We are no longer all potential soldiers (though we are that too), but we are all potential victims of the traumas war creates. This, at least, is one important development in the way Western populations envision war, even if it does not always predominate in the thinking of our political leaders.Carolyn J. Dean, Interview of February 01, 2011
The dominant premise in evolution and economics is that a person is being loyal to natural law if he or she attends to self’s interest and welfare before being concerned with the needs and demands of family or community. The public does not realize that this statement is not an established scientific principle but an ethical preference. Nonetheless, this belief has created a moral confusion among North Americans and Europeans because the evolution of our species was accompanied by the disposition to worry about kin and the collectives to which one belongs.Jerome Kagan, Interview of September 17, 2009
Lastly
In addition to examining the social origin of Veblen’s ideas, my book analyzes their vital substance.
Here too Veblen departs from conventional wisdom, which portrays Veblen primarily as an iconoclastic satirist of America’s wealthy in The Theory of the Leisure Class. An iconoclast Veblen was, but mainly because he was also a professional economist involved in debates with classical and neoclassical economists over the distribution of wealth among different social classes.
Then, as now, the issue of wealth distribution was an explosive and divisive one on the national stage, where battles raged between Capital and Labor and their spokespersons. Whether Veblen would have written about the leisure class outside of this context is unlikely; for, as he knew, satires of the leisure class were by then commonplace. Veblen did not think he needed to add another one unless it had something more to offer.
And The Theory of the Leisure Class did just that. Here (and elsewhere) Veblen maintained that most academic economists, as well as many journalists and political commentators, thought about economic life in the wrong way. They viewed economies in static terms, presenting economic life as essentially the same in all times and places. Moreover, they viewed economies as made up of separate individuals, all of them acting out of self-interest. Today, we find many economists and pundits who still hold to these notions in updated forms.
But Veblen relentlessly criticized these views. He insisted that economic life is constantly changing, and that economies are structured differently in different places and times. Not only this, but in economic life there are no standalone individuals. Economic activities, such as production and consumption, are always shaped, said Veblen, by the evolving institutions that people are embedded in.
From this critical perspective, Veblen attacked prevailing theories of wealth distribution that posited that people with wealth earned it through their individual contributions to improving the process of economic production. To the contrary averred Veblen—where there is wealth, there is robbery: predatory behavior by powerful parasitic groups that contrive to get “something for nothing” via social institutions, which evolve to adjust to historical change by devising ever-new mechanisms for thievery.
Observing his own society, Veblen saw economic institutions as enabling the accumulation of vast fortunes for the predatory class as its members pursued private profit. But he then pivoted to groups with other motives. Writing, in despair, about the beleagured men and women who served the interests of community at large by devoting themselves to the design and functioning of the “machine process,” Veblen posed the paradox: “Why are large and increasing portions of the community penniless… Why do we … have hard times and unemployment in the midst of excellent resources, high efficiency and plenty of unmet wants?”
More than a century after Veblen penned this question, the paradox remains, giving alarming pertinence to his forceful analysis of the predatory stratagems of modern economic institutions.