Macaulay On Economical Progress, 100 Years Earlier Keynes

Economists create got long been fascinated past times a 1930 essay written past times John Maynard Keynes called "Economic Possibilities for Our Grandchildren" (available diverse places similar here and here). Writing inwards the opening storms of what would driblet dead the Great Depression, Keynes maintained that the principal issues facing the economic scheme inwards the long run was an adjustment to ongoing technological progress. He wrote: "We are suffering, non from the rheumatics of onetime age, but from the growing-pains of over-rapid changes, from the painfulness of readjustment betwixt i economical menstruum in addition to another." He added: "I would predict that the criterion of life inwards progressive countries i hundred years so volition live on betwixt 4 in addition to viii times every bit high every bit it is to-day. There would live on cipher surprising inwards this fifty-fifty inwards the low-cal of our acquaint knowledge. It would non live on foolish to contemplate the possibility of afar greater progress still." 

That growth projection may audio crazily optimistic. But every bit I pointed out here, it assumes exclusively an average annual growth charge per unit of measurement of 1.5-2.0% per year. Seemingly deadening annual rates of growth, sustained over a century, are a powerful force. 

Perhaps it is well-known amid the cognoscenti that Thomas Babington Macaulay, the British historian, essayist, in addition to politician, made essentially the same claim close the powerfulness of long-run economical growth inwards 1830, just 100 years earlier the essay past times Keynes. But I had non known it until a few weeks ago. So I'll portion alongside yous roughly of the Macaulay's commentary, which appeared inwards an 1930 review essay close "Southey's Colloquies on Society" inwards the Edinburgh Review.  I quote hither from the version of the article available at the always-useful Library of Economics in addition to Liberty website. 

Perhaps the best-known passage from the essay is Macaulay's comment: "We know of no province which, at the terminate of l years of peace in addition to tolerably skilful government, has been less prosperous than at the commencement of that period." 

But the passage of most involvement to me hither is when Macauley looks dorsum to a greater extent than than a century to 1720, in addition to also ahead 100 years from 1830 to 1930--when Keynes was writing. Macauley wrote: 

"Hence it is that, though inwards every historic menstruum everybody knows that upward to his ain fourth dimension progressive improvement has been taking place, nobody seems to reckon on whatsoever improvement during the adjacent generation. We cannot absolutely attempt that those are inwards mistake who tell us that social club has reached a turning point, that nosotros create got seen our best days. But so said all who came earlier us, in addition to alongside just every bit much apparent reason. ... On what regulation is it that, when nosotros encounter cipher but improvement behind us, nosotros are to aspect cipher but deterioration earlier us?"

I've raised this subject oft plenty inwards discussions. Yes, mayhap economical progress is close to halt in addition to contrary itself. Maybe nosotros volition live on immiserated past times novel technology. Maybe the time to come is i of majority starvation from overpopulation. But looking dorsum at the historical sense of the final several hundred years, what tin sack live on the footing for having whatsoever confidence inwards such pessimistic claims? 

Here's a fuller rendering of the passage which contains the 2nd Macaulay quotation (I've added roughly paragraph breaks for readability).

The acquaint minute is i of corking distress. ... Yet is the province poorer than inwards 1790? We firmly believe that, inwards spite of all the misgovernment of her rulers, she has been almost constantly becoming richer in addition to richer. Now in addition to so at that topographic point has been a stoppage, right away in addition to so a brusk retrogression; but every bit to the full general style at that topographic point tin sack live on no doubt. Influenza A virus subtype H5N1 unmarried breaker may recede; but the tide is patently coming in.

If nosotros were to prophesy that inwards the twelvemonth 1930 a population of l millions, amend fed, clad, in addition to lodged than the English linguistic communication of our time, volition embrace these islands, that Sussex in addition to Huntingdonshire volition live on wealthier than the wealthiest parts of the West Riding of Yorkshire right away are, that cultivation, rich every bit that of a flower-garden, volition live on carried upward to the rattling tops of Ben Nevis in addition to Helvellyn, that machines constructed on principles yet undiscovered, volition live on inwards every house, that at that topographic point volition live on no highways but railroads, no travelling but past times steam, that our debt, vast every bit it seems to us, volition appear to our great-grandchildren a trifling incumbrance, which mightiness easily live on paid off inwards a twelvemonth or two, many people would mean value us insane.

We prophesy nothing; but this nosotros say: If whatsoever somebody had told the Parliament which met inwards perplexity in addition to terror afterward the crash inwards 1720 that inwards 1830 the wealth of England would surpass all their wildest dreams, that the annual revenue would equal the principal of that debt which they considered every bit an intolerable burden, that for i homo of 10 K pounds so living at that topographic point would live on 5 men of l K pounds, that London would live on twice every bit large in addition to twice every bit populous, in addition to that silent the charge per unit of measurement of mortality would create got diminished to i one-half of what it so was, that the post-office would select to a greater extent than into the exchequer than the excise in addition to customs had brought inwards together nether Charles the Second, that stage-coaches would run from London to York inwards twenty-four hours, that men would live on inwards the habit of sailing without wind, in addition to would live on commencement to ride without horses, our ancestors would create got given every bit much credit to the prediction every bit they gave to Gulliver’s Travels. Yet the prediction would create got been truthful ...

To almost all men the province of things nether which they create got been used to alive seems to live on the necessary province of things. We create got heard it said that 5 per cent. is the natural involvement of money, that twelve is the natural number of a jury, that 40 shillings is the natural qualification of a county voter. Hence it is that, though inwards every historic menstruum everybody knows that upward to his ain fourth dimension progressive improvement has been taking place, nobody seems to reckon on whatsoever improvement during the adjacent generation. We cannot absolutely attempt that those are inwards mistake who tell us that social club has reached a turning point, that nosotros create got seen our best days.

But so said all who came earlier us, in addition to alongside just every bit much apparent reason. ‘A meg a twelvemonth volition beggar us,’ said the patriots of 1640. ‘Two millions a twelvemonth volition grind the province to powder,’ was the cry inwards 1660. ‘Six millions a year, in addition to a debt of l millions!’ exclaimed Swift; ‘the high allies create got been the ruin of us.’ ‘A hundred in addition to 40 millions of debt!’ said Junius; ‘well may nosotros say that nosotros owe Lord Chatham to a greater extent than than nosotros shall ever pay, if nosotros owe him such a charge every bit this.’ ‘Two hundred in addition to 40 millions of debt!’ cried all the statesmen of 1783 inwards chorus; ‘what abilities, or what economic scheme on the component subdivision of a minister, tin sack relieve a province so burdened?’ We know that if, since 1783, no fresh debt had been incurred, the increased resources of the province would create got enabled us to defray that debt at which Pitt, Fox, in addition to Burke stood aghast, nay, to defray it over in addition to over again, in addition to that alongside much lighter taxation than what nosotros create got genuinely borne. On what regulation is it that, when nosotros encounter cipher but improvement behind us, nosotros are to aspect cipher but deterioration earlier us?

For fans of intellectual combat, Macaulay's review is worth reading every bit an example of a bitingly negative review, couched inwards a pleasant in addition to fifty-fifty languorous tone. Here are the opening paragraphs:

It would live on scarcely possible for a homo of Mr. Southey’s talents in addition to acquirements to write 2 volumes so large every bit those earlier us, which should live on wholly destitute of data in addition to amusement. Yet nosotros make non think to create got read alongside so picayune satisfaction whatsoever equal quantity of matter, written past times whatsoever homo of existent abilities. We have, for roughly fourth dimension past, observed alongside corking regret the foreign infatuation which leads the Poet Laureate to abandon those departments of literature inwards which he mightiness excel, in addition to to lecture earth on sciences which he has silent the rattling alphabet to learn. He has now, nosotros think, done his worst. The discipline which he has at final undertaken to process is i which demands all the highest intellectual in addition to moral qualities of a philosophical statesman, an agreement at i time comprehensive in addition to acute, a midpoint at i time upright in addition to charitable. Mr. Southey brings to the chore 2 faculties which were never, nosotros believe, vouchsafed inwards stair out so copious to whatsoever human being, the faculty of believing without a reason, in addition to the faculty of hating without a provocation.

It is, indeed, most extraordinary, that a postulate heed similar Mr. Southey’s, a postulate heed richly endowed inwards many respects past times nature, in addition to highly cultivated past times study, a postulate heed which has exercised considerable influence on the most enlightened generation of the most enlightened people that ever existed, should live on utterly destitute of the powerfulness of discerning truth from falsehood. Yet such is the fact. Government is to Mr. Southey i of the fine arts. He judges of a theory, of a world measure, of a religious or a political party, of a peace or a war, every bit men gauge of a motion-picture demonstrate or a statue, past times the upshot produced on his imagination. Influenza A virus subtype H5N1 chain of associations is to him what a chain of reasoning is to other men; in addition to what he calls his opinions are inwards fact just his tastes.

Given that Keynes was remarkably well-read, I make wonder if he had Macaulay inwards postulate heed when he sat downwards to write  his 1930 essay.

I can't claim whatsoever deep familiarity alongside the disputes betwixt Southey in addition to Macaulay. But for an overview, interested readers alongside access to JSTOR mightiness start alongside the article past times W.A. Speck, "Robert Southey, Lord Macaulay in addition to the Standard of Living Controversy," which appeared inwards History (October 2001, 86:284, pp. 467-477).

Postscript: For a fairly brusk in addition to rattling readable overview of the Macauley-Southey contretemps, encounter "Macaulay: Defender of Capitalism An answer, inwards 1830, to Robert Southey's charges against the manufacturing flora system," by Bruce Bartlett, appearing in The Freeman, May 1975, pp. 272-276.