Excerpts from the writing of John Kenneth Galbraith
Read from the celebrated economist's most influential writings through the years.
NEW YORK (FORTUNE) - John Kenneth Galbraith died in April at the age of 97. Always the enemy of inequality, he left a lasting legacy of economic thought and social commentary.
Some excerpts below:
"Germany Was Badly Run" (December 1945)
"Hitler, in his decision to use the Me-262 as an attack bomber, ignored the hard fact that Germany was desperately on the defensive and hence needed defensive weapons. He was moved instead by the doctrine that there are inherent as well as heroic virtues in the offensive.
Hitler's alert but undisciplined mind was peculiarly susceptible to doctrine. Since the Nazis invented most of their own doctrine, decisions were often based not on fact but on the official propaganda line. Only a part of Germany's fantastic propaganda was a deliberate effort to mislead the German people, a point that must be emphasized. Part and perhaps most of it was what Germany's leaders wanted to believe...
Germany's leaders, and a whole army of subordinate officials, failed to recognize the need for all-out effort because they believed their own newspapers...
They should have been hard to defeat. That they were defeated is conclusive testimony to the inherent inefficiencies of dictatorship, the inherent efficiencies of freedom."
From "Japan's Road Back" (March 1946):
"[I]n a very important sense, the Japanese cities were more fortunate than those of Germany. In Japan, the street cars continued to run. Water and electricity were soon restored...Hiroshima was interrupted only about forty-eight hours by the atomic bomb. Tax collectors, postmen, and creditors continued to make their rounds.
The Japanese cities were burned but those of Germany were torn out by the roots by high explosives and the battles in the streets. The ultimate in the dark art of destruction is not the burning or wrecking of houses or factories or even of communications. Rather it is the annihilation of organization - of the services by which people live, of the economy that enables them to live together, and of the government that makes both possible.
In Germany all organization was a casualty. Japan survived with an organized government and a starved but viable economy. This good fortune of the Japanese may be also the good fortune of their recent enemies. Japan's tenuous thread of organization is its one chance of working its way back to peaceful citizenship without becoming, as Germany has become, a kind of planetary indigent dependent on the conscience of its late enemies."
From "Is There A German Policy?" (January 1947):
"Headquarters of the Office of Military Government, U.S. (OMGUS to Americans and Germans alike), is in Zehlendorf, a pleasant suburban district of Berlin roughly comparable to Bronxville, Chevy Chase, or Pasadena.
A year ago the buildings were still covered with camouflage paint, and one or two had been bombed and partly gutted. Now the stucco has been sandblasted to a clean gray-white and the bomb damage completely repaired. The grounds are impeccably landscaped and across the road, across a new moss-green lawn, is the brand-new mess hall - Truman Hall.
One evening last autumn an American businessman, one of the buyers now being invited to Germany to negotiate for German exports, paused on the steps of Truman Hall, looked reflectively at the gleaming buildings across the way, and commented: "We certainly do a nice job of fixing things up but I doubt like hell if anyone knows what we're supposed to be doing in this country."
From "The Strategy of Limited Control" (March 1951):
"[T]he purpose of direct controls is not simply to prevent the increases in prices that are the outward manifestations of inflation. Not much is accomplished, in the first instance, by merely suppressing such price movements. Instead of the higher prices there are shortages and surplus funds looking for an outlet.
The same devil who finds mischief for idle hands does a sideline business in idle purchasing power. In England during the last war this kind of money sustained the spivs; in our less austere community it went to the racetracks and the like.
Suppressed inflation - the building up of surplus purchasing power under a ceiling of controls - can, of course, be tolerated for a short period and no one should suppose that it is as damaging as open inflation. But it is debilitating and, especially over a long period, it can be dangerous."
"The Language of Economics" (December 1962)
"Anyone who wishes to contend that economists are bad writers is faced with the fact that no learned discipline unconnected with literature or the arts has had such distinguished ones....An impressive number of English-writing economists qualify strongly by these standards.
At the head of the list, if I may digress for a moment into literary criticism, I would put Adam Smith. In both purity of style and certainty in his command of language he is inferior to J.S. Mill. But he is effective and resourceful in exposition and far superior to Mill in imagery and humor.
Smith knew that a trip into the pin factory to see the division of labor in operation would establish the importance of the phenomenon for good. (Pins were also an excellent selection. Something more important might have been dismissed as a special example of scientific management occasioned by the social need for output.)"
"The Galbraithian Guide to the Economic Folkways of Americans" (August 1977)
To a French journalist seeking to write about American business and economics, Galbraith offered ten pieces of advice. Here are the first two:
"1. Under all circumstances you should mistrust and hence ignore all official American economic forecasts. Only the official American crop forecasts have validity. The reason is that no government forecast can be in conflict with what the Administration currently in office needs to have happen...
2. Mistrust likewise the forecasts of all other economists. These, unlike official forecasts, have no compelled error."
Click here to read about his last interview