Kenneth Galbraith Quotes

The conventional view serves to protect us from the painful job of thinking.

The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness.

The only function of economic forecasting is to make astrology look respectable.

Under capitalism, man exploits man; while under socialism just the reverse is true.

I am worried about our tendency to over invest in things and under invest in people.

Faced with the choice between changing one's mind and proving that there is no need to do so, almost everybody gets busy on the proof.

There are two kinds of forecasters: those who don’t know, and those who don’t know they don’t know.

The complaints of the privileged are too often confused with the voice of the masses.

If you feed enough oats to the horse, some will pass through to feed the sparrows (referring to "trickle down" economics).

Politics is not the art of the possible. It consists in choosing between the disastrous and the unpalatable.

More die in the United States of too much food than of too little

Milton Friedman’s misfortune is that his economic policies have been tried.

Economics is extremely useful as a form of employment for economists.

In all life one should comfort the afflicted, but verily, also, one should afflict the comfortable, and especially when they are comfortably, contentedly, even happily wrong.

If all else fails, immortality can always be assured by spectacular error.

The sense of responsibility in the financial community for the community as a whole is not small. It is nearly nil.

All of the great leaders have had one characteristic in common: it was the willingness to confront unequivocally the major anxiety of their people in their time. This, and not much else, is the essence of leadership.

Wealth, in even the most improbable cases, manages to convey the aspect of intelligence.

One of my greatest pleasures in writing has come from the thought that perhaps my work might annoy someone of comfortably pretentious position. Then comes the saddening realization that such people rarely read.

It is a far, far better thing to have a firm anchor in nonsense than to put out on the troubled seas of thought.

Wealth is not without its advantages and the case to the contrary, although it has often been made, has never proved widely persuasive.

Americans had built themselves a world of speculative pipe dreams. That world was inhabited, not by people who had to be convinced, but by people who sought excuses for believing.

We are becoming the servants in thought, as in action of the machine we have created to serve us.

The man who is admired for the ingenuity of his larceny is almost always rediscovering some earlier form of fraud. The basic forms are all known, have all been practiced. The manners of capitalism improve. The morals may not.

The process by which money is created is so simple that the mind is repelled.

Trickle-down theory - the less than elegant metaphor that if one feeds the horse enough oats, some will pass through to the road for the sparrows.

Wisdom, itself, is often an abstraction associated not with fact or reality but with the man who asserts it and the manner of its assertion.

Do not be alarmed by simplification, complexity is often a device for claiming sophistication, or for evading simple truths.

War remains the decisive human failure.

If there must be madness, something may be said for having it on a heroic scale

One of the greatest pieces of economic wisdom is to know what you do not know.

Men can labor to make sense out of single steps toward the goal without ever pausing to reflect that the goal itself is ludicrous.

Then the shit hit the fan.

But there is merit even in the mentally retarded legislator. He asks the questions that everyone is afraid to ask for fear of seeming simple.

The threat to men of great dignity, privilege and pretense is not from the radicals they revile; it is from accepting their own myth. Exposure to reality remains the nemesis of the great -- a little understood thing.

We now in the United States have more security guards for the rich than we have police services for the poor districts. If you're looking for personal security, far better to move to the suburbs than to pay taxes in New York.

Wealth is the relentless enemy of understanding

Man, at least when educated, is a pessimist. He believes it safer not to reflect on his achievements; Jove is known to strike such people down.

A person buying ordinary products in a supermarket is in touch with his deepest emotions.

Decision has greater virtue and force if taken after there has been eloquent dissent.

John Kenneth Galbraith said: “Faced with the choice of changing one’s mind and proving that there is no need to do so, almost everyone gets busy on the proof.

Men of conservative temperament have long suspected that one thing leads to another.

The income men derive from producing things of slight consequence is of great consequence to them.

In the world of minor lunacy, the behavior of both the utterly rational and the totally insane seems equally odd.

The shortcomings of economics are not original error but uncorrected obsolescence. The obsolescence has occurred because what is convenient has become sacrosanct. Anyone who attacks such ideas must seem to be a trifle self-confident and even aggressive. The man who makes his entry by leaning against an infirm door gets an unjustified reputation for violence. Something is to be attributed to the poor state of the door.

Good writing, and this is especially important in a subject such as economics, must also involve the reader in the matter at hand. It is not enough to explain. The images that are in the mind of the writer must be made to reappear in the mind of the reader, and it is the absence of this ability that causes much economic writing to be condemned, quite properly, as abstract.

In economics, hope and faith coexist with great scientific pretension and also a deep desire for respectability.

There is an old saying, or should be, that it is a wise economist who recognizes the scope of his own generalizations.

In economics, it is often professionally better to be associated with highly respectable error than uncertainly established truth.

To proclaim the need for new ideas has served, in some measure, as a substitute for them.

The process by which money is created is so simply that the mind is repelled. Where something so important is involved, a deeper mystery seems only decent.

The modern conservative is not even especially modern. He is engaged, on the contrary, in one of man’s oldest, best financed, most applauded, and, on the whole, least successful exercises in moral philosophy. That is the search for a superior moral justification for selfishness. It is an exercise which always involves a certain number of internal contradictions and even a few absurdities.

It was John Kenneth Galbraith, the hyperliterate economic sage, who coined the phrase “conventional wisdom.” He did not consider it a compliment. “We associate truth with convenience,” he wrote, “with what most closely accords with self-interest and personal well-being or promises best to avoid awkward effort or unwelcome dislocation of life. We also find highly acceptable what contributes most

The modern conservative is engaged in one of man's oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness... & ... Liberalism is, I think, resurgent. One reason is that more and more people are so painfully aware of the alternative. –

The family which takes its mauve an cerise, air-conditioned, power-steered and power-braked automobile out for a tour passes through cities that are badly paved, made hideous by litter, lighted buildings, billboards and posts for wires that should long since have been put underground. They pass on into countryside that has been rendered largely invisible by commercial art. (The goods which the latter advertise have an absolute priority in our value system. Such aesthetic considerations as a view of the countryside accordingly come second. On such matters we are consistent.) They picnic on exquisitely packaged food from a portable icebox by a polluted stream and go on to spend the night at a park which is a menace to public health and morals. Just before dozing off on an air mattress, beneath a nylon tent, amid the stench of decaying refuse, they may reflect vaguely on the curious unevenness of their blessings. Is this, indeed, the American genius?

An economy that depends on slavery needs to promote images of slaves that “justify” the institution of slavery. The contemporary economy depends right now on the representation of women within the beauty myth. Economist John Kenneth Galbraith offers an economic explanation for “the persistence of the view of homemaking as a ‘higher calling’”: the concept of women as naturally trapped within the Feminine Mystique, he feels, “has been forced on us by popular sociology, by magazines, and by fiction to disguise the fact that woman in her role of consumer has been essential to the development of our industrial society…. Behavior that is essential for economic reasons is transformed into a social virtue.

The capacity for erroneous belief is very great, especially where it coincides with convenience.

All crisis have involved debt that, in one fashion or another, has become dangerously out of scale in relation to the underlying means of payment.

Recurrent descent into insanity is not a wholly attractive feature of capitalism.

The second factor contributing to speculative euphoria and programmed collapse is the specious association of money and intelligence.

There is nothing reliable to be learned about making money. If there were, study would be intense and everyone with a positive IQ would be rich.

Economists are generally negligent of their heroes.

There are two kinds of forecasters: those who don’t know, and those who don’t know they don’t know,” wrote Harvard economist John Kenneth Galbraith.

Nothing in modern attitudes is believed more to signify exceptional intelligence than association with large pools of money. Only immediate experience with those so situated denies the myth.

Conservators, in the words of John Kenneth Galbraith, are “engaged in one of man’s oldest exercises in moral philosophy, that is the search for a superior moral justification for selfishness.

I would now, however, more strongly emphasize, and especially as to the United States, the inequality in income and that it is getting worse—that the poor remain poor and the command of income by those in the top income brackets is increasing egregiously. So is the political eloquence and power by which that income is defended. This I did not foresee.

One of the many signs of verbal virtuosity among intellectuals is the repackaging of words to mean things that are not only different from, but sometimes the direct opposite of, their original meanings. 'Freedom' and 'power' are among the most common of these repackaged words. The basic concept of freedom as not being subjected to other people's restrictions, and of power as the ability to restrict other people's options have both been stood on their heads in some of the repackaging of these words by intellectuals discussing economic issues. Thus business enterprises who expand the public's options, either quantitatively (through lower prices) or qualitatively (through better products) are often spoken of as 'controlling' the market, whenever this results in a high percentage of consumers choosing to purchase their particular products rather than the competing products of other enterprises. In other words, when consumers decide that particular brands of products are either cheaper or better than competing brands of those products, third parties take it upon themselves to depict those who produced these particular brands as having exercised 'power' or 'control.' If, at a given time, three-quarters of the consumers prefer to buy the Acme brand of widgets to any other brand, then Acme Inc. will be said to 'control' three-quarters of the market, even though consumers control 100 percent of the market, since they can switch to another brand of widgets tomorrow if someone else comes up with a better widget, or stop buying widgets altogether if a new product comes along that makes widgets obsolete. ....by saying that businesses have 'power' because they have 'control' of their markets, this verbal virtuosity opens the way to saying that government needs to exercise its 'countervailing power' (John Kenneth Galbraith's phrase) in order to protect the public. Despite the verbal parallels, government power is in fact power, since individuals do not have a free choice as to whether or not to obey government laws and regulations, while consumers are free to ignore the products marketed by even the biggest and supposedly most 'powerful' corporations in the world.

The process by which wants are now synthesized is a potential source of economic instability. Production and therewith employment and social security are dependent on an inherently unstable process of consumer debt creation. This may one day falter.

In many ways the effect of the crash on embezzlement was more significant than on suicide. To the economist embezzlement is the most interesting of crimes. Alone among the various forms of larceny it has a time parameter. Weeks, months, or years may elapse between the commission of the crime and its discovery. (This is a period, incidentally, when the embezzler has his gain and the man who has been embezzled, oddly enough, feels no loss. There is a net increase in psychic wealth.) At any given time there exists an inventory of undiscovered embezzlement in — or more precisely not in — the country’s businesses and banks. This inventory — it should perhaps be called the bezzle — amounts at any moment to many millions of dollars. It also varies in size with the business cycle. In good times people are relaxed, trusting, and money is plentiful. But even though money is plentiful, there are always many people who need more. Under these circumstances the rate of embezzlement grows, the rate of discovery falls off, and the bezzle increases rapidly. In depression all this is reversed. Money is watched with a narrow, suspicious eye. The man who handles it is assumed to be dishonest until he proves himself otherwise. Audits are penetrating and meticulous. Commercial morality is enormously improved. The bezzle shrinks. … Just as the boom accelerated the rate of growth, so the crash enormously advanced the rate of discovery. Within a few days, something close to a universal trust turned into something akin to universal suspicion. Audits were ordered. Strained or preoccupied behavior was noticed. Most important, the collapse in stock values made irredeemable the position of the employee who had embezzled to play the market. He now confessed.

Fools, as it has long been said, are indeed separated, soon or eventually, from their money. So, alas, are those who, responding to a general mood of optimism, are captured by a sense of their own financial acumen. Thus it has been for centuries; thus in the long future it will also be.

The oldest problem in economic education is how to exclude the incompetent. A certain glib mastery of verbiage-the ability to speak portentously and sententiously about the relation of money supply to the price level-is easy for the unlearned and may even be aided by a mildly enfeebled intellect. The requirement that there be ability to master difficult models, including ones for which mathematical competence is required, is a highly useful screening device.

None of this excuses anyone from mastering the basic ideas and terminology of economics. The intelligent layman must expect also to encounter good economists who are difficult writers even though some of the best have been very good writers. He should know, moreover, that at least for a few great men ambiguity of expression has been a positive asset. But with these exceptions he may safely conclude that what is wholly mysterious in economics is not likely to be important.

The worst continued to worsen. What looked one day like the end proved on the next day to have been only the beginning. Nothing could have been more ingeniously designed to maximize the suffering, and also to insure that as few people as possible escape the common misfortune. The fortunate speculator who had funds to answer the first margin call presently got another and equally urgent one, and if he met that there would still be another. In the end all the money he had was extracted from him and lost. The man with the smart money, who was safely out of the market when the first crash came, naturally went back in to pick up bargains. The bargains then suffered a ruinous fall. Even the man who waited for volume of trading to return to normal and saw Wall Street become as placid as a produce market, and who then bought common stocks would see their value drop to a third or a fourth of the purchase price in the next 24 months. The Coolidge bull market was a remarkable phenomenon. The ruthlessness of its liquidation was, in its own way, equally remarkable.

Η συμπεριφορά των διοικήσεων των επιχειρήσεων μπορεί να διορθωθεί εκ βάθρων, αν υπάρχει και το όχι και τόσο ευχάριστο μεν,πραγματικό δε, ενδεχόμενο της φυλάκισης

Galbraith's First Law: Modesty is a vastly overrated virtue.

There is the possibility, even the likelihood, of self-approving and extravagantly error-prone behavior on the part of those closely associated with money.

The rule will often be here reiterated: financial genius is before the fall. I

Speculation, it has been noted, comes when popular imagination settles on something seemingly new in the field of commerce or finance.

This was because of a special American commitment to the seeming magic of money creation and its presumptively wondrous economic effects. T

prime threat hovering over a society of general well-being.

Speculation buys up, in a very practical way, the intelligence of those involved.

the speculative episode always ends not with a whimper but with a bang.

Anyone taken as an individual is tolerably sensible and reasonable - as a member of a crowd, he at once becomes a blockhead. - Friedrich Von Schiller, as quoted by Bernard Baruch

Scholars gather in scholarly assemblages to hear in elegant statement what all have heard before. Again, it is not a negligible rite, for its purpose is not to convey knowledge but to beatify learning and the learned.

The recurrent and sadly erroneous belief that effortless enrichment is an entitlement associated with what is thought to be exceptional financial perspicacity and wisdom is not something that yields to legislative remedy.

I have sufficiently urged that all suggestions as to financial innovation be regarded with extreme skepticism. Such seeming innovation is merely some variant on an old design, new only in the brief and defective memory of the financial world.

The world of finance hails the invention of the wheel over and over again, often in a slightly more unstable version. All financial innovation involves in one form or another, the creation of debt secured in greater or lesser adequacy by real assets.

There would also be, we may be certain, the traditional reassuring words from Washington. Always when markets are in trouble, the phrases are the same: “The economic situation is fundamentally sound” or simply “The fundamentals are good.” All who hear these words should know that something is wrong.

Here in briefest form is the modern political dialectic. It is an unequal contest: the rich and the comfortable have influence and money. And they vote. The concerned and the poor have numbers, but many of the poor, alas, do not vote. There is democracy, but in no slight measure it is a democracy of the fortunate.

It was John Kenneth Galbraith, the hyperliterate economic sage, who coined the phrase “conventional wisdom.” He did not consider it a compliment. “We associate truth with convenience,” he wrote, “with what most closely accords with self-interest and personal well-being or promises best to avoid awkward effort or unwelcome dislocation of life. We also find highly acceptable what contributes most to self-esteem.” Economic and social behaviors, Galbraith continued, “are complex, and to comprehend their character is mentally tiring. Therefore we adhere, as though to a raft, to those ideas which represent our understanding.” So

Tenure was originally invented to protect radical professors, those who challenged the accepted order. But we don't have such people anymore at the universities, and the reason is tenure. When the time comes to grant it nowadays, the radicals get screened out. That's its principal function. It's a very good system, really - keeps academic life at a decent level of tranquility.

Those involved in mental as opposed to physical effort or who carry the responsibilities of management are presumed to require a higher payment for their submission to the purposes of organization than those who render only physical or manual service, however adept or talented that may be. This is because there is profound difference in the nature and extent of the submission that is made. The person on the shop floor or its equivalent gives more or less diligent and deft physical effort for a specified number of hours a day. Beyond that nothing in principle--not thought, certainly not conformity of speech or behavior--is expected. Of the high corporate executive a more complete submission to the purposes of the organization is usually required. He (or she) must speak and also think well of the aims of the enterprise; he may never in public and not wisely in private raise doubt as to the depth and sincerity of his own commitment. Many factors determine his large, often very large, compensation, including the need to pay for the years of preparation, for the considerable intelligence that is requires, for the responsibility that is carried, and for the alleged risks of high position. As a practical matter, his rate of pay is also influenced by the significant and highly convenient role the executive plays in establishing it; much that accrues to the senior corporate executive is in response to his own inspired generosity. But there is also payment for the comprehensive submission of his individual personality to that of the corporation. It is no slight thing to give up one's self and self-expression to the collective personality of one's employer.

Financial capacity and political perspicacity are inversely correlated. Long-run salvation by men of business has never been highly regarded if it means disturbance of orderly life and convenience in the present. So inaction will be advocated in the present even though it means deep trouble in the future. Here, at least equally with Communism, lies the threat to Capitalism. It is what causes men who know that things are going quite wrong to say that things are fundamentally sound.

Remarkably, the man so often condemned for his cutthroat striving didn’t leap at the offer. He asked for a week to think it over—not because of any doubts he may have had about himself but because of his doubts about Nixon. Kissinger dwelt in the hothouse bubble of Cambridge, where a contemptuous attitude toward all things Nixonian was the ticket of entry to polite Harvard society. Kissinger’s friends, among them such Democratic stalwarts as Arthur Schlesinger Jr. and John Kenneth Galbraith, were almost all dedicated liberals and, “to a man,” Kissinger said, had voted against Nixon. Kissinger himself shared their view. During the campaign, he had called Nixon “unfit to be president” and “a disaster” waiting to happen. Just before the Republican convention he had declared that “Richard Nixon is the most dangerous of all the men running to have as president.” (Such opinions didn’t prevent him from providing help to the Republicans during the campaign, but then nobody ever claimed that Henry Kissinger was straightforward.)

That economics has a considerable conceptual apparatus with an appropriate terminology can not be a serious ground for complaint. Economic phenomena, ideas, instruments of analysis exist. They require names. Education in economics is, in considerable measure, an introduction to this terminology and to the ideas that it denotes. Anyone who has difficulties with the ideas should complete his education or, following an exceedingly well-beaten path, leave the subject alone. It is sometimes said that the economist has a special obligation to make himself understood because his subject is of such great and popular importance. By this rule the nuclear physicist would have to speak in monosyllables.

If the individual's wants are to be urgent, they must be original with himself. They cannot be urgent if they must be contrived for him. And above all, they must not be contrived by the process of production by which they are satisfied. For this means that the whole case for the urgency of production, based on the urgency of wants, falls to the ground. One cannot defend production as satisfying wants if that production creates the wants. Were it so that a man on arising each morning was assailed by demons which instilled in him a passion sometimes for silk shirts, sometimes for kitchenware, sometimes for chamber pots, and sometimes for orange squash, there would be every reason to applaud the effort to find the goods, however odd, that quenched this flame. But should it be that his passion was the result of his first having cultivated the demons, and should it also be that his effort to allay it stirred the demons to ever greater and greater effort, there would be question as to how rational was his solution. Unless restrained by conventional attitudes, he might wonder if the solution lay with more goods or fewer demons.

John Kenneth Galbraith, in The Economics of Innocent Fraud, provided a still stronger condemnation of prevailing economic and social science, arguing that in recent decades the system itself had been fraudulently “renamed” from capitalism to “the market system.” The advantage of the latter term from an establishment perspective was: “There was no adverse history here, in fact no history at all. It would have been hard, indeed, to find a more meaningless designation—this is a reason for the choice…. So it is of the market system we teach the young…. No individual or firm is thus dominant. No economic power is evoked. There is nothing here from Marx or Engels. There is only the impersonal market, a not wholly innocent fraud.” Along with this, “the phrase ‘monopoly capitalism,’ once in common use,” Galbraith charged, “has been dropped from the academic and political lexicon.” Perhaps worst of all, the growing likelihood of a severe crisis and a long-term slowdown in the economy was systematically hidden from view by this fraudulent displacement of the very

There is no major case against life’s enjoyments.

It was usually on about the fourth day that I put in that note of spontaneity for which I am known.

Clerks in downtown hotels were said to be asking guests whether they wished the room for sleeping or jumping. Two men jumped hand-in-hand from a high window in the Ritz. They had a joint account.