Monday, May 27, 2013

John Kenneth Galbraith's "The Age of Uncertainty: Land and People"

Continuing with John Kenneth Galbraith's 1977 documentary series, The Age of Uncertainty, Episode 10, Land and People:

In the corresponding chapter of the companion volume, Galbraith looks at economic lessons from Singapore:

The Singapore government's contribution is to make pragmatic use of all ideas and refuse to be the captive of any one. Is Adam Smith alive in Singapore? The answer is : Very much. There can be few places in the world where pecuniary self-interest is pursued more diligently and with more visible satisfaction in the material result.

Is Keynes there? The answer is also yes. Public outlays are balanced as a matter of course against the availability of workers and the current and prospective capacity of the economy.

The post-Keynesian view of inflation - a view which I have long urged - is also treated with respect in Singapore. Wage settlements are controlled, again as a matter of course, to minimize inflation and to keep Singapore's manufacturing competitive in world markets. When others talk of the need for an incomes policy, Singapore economists, businessmen and union leaders are known to yawn. They've had one for years.

Is there planning, even socialism in Singapore? Have the Webbs, Franklin Roosevelt, Clement Attlee been here? Would Enoch Powell and Barry Goldwater be distressed? The answer again is yes. If housing, harbor works, transportation and industrial sites are needed , the government provides. Public apartment blocks control the horizon. Self-interest serves well as a motivation. But it is recognized in Singapore that it does not serve all purposes. And it serves best within a framework of systematic and deliberate planning.
Also in this chapter, he discusses the issues of "overpopulation," migration and immigration:

The other remedy [besides birth control] for overpopulation is for the people to go. This, for centuries, has been the primary solution. It continues to be so. In the last thirty years the need for readjustment between land and people has set in motion great migrations within and into Europe and within the United States. It has attracted only a fraction of the respectable discussion that has been evoked by birth control. That is because the redistribution of people has been from the poor countries or communities to the rich. The rich have not responded with warmth to this remedy. More often, in a mood of some righteousness, they have sought to erect barriers to the tide. They have not wanted to think that a redistribution of population, however logical and effective, is the right answer to the equilibrium of poverty. [my emphasis]

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