Capitalism and Happiness—Not What You Thought

On January 20, 2011, Prof. of Political Economy, Robert Skidelsky, a member of the British House of Lords, and author of a prize-winning biography of the economist John Maynard Keynes, wrote [47], “Capitalism may be close to exhausting its potential to create a better life, at least in the world’s rich countries. By ‘better,’ I mean better ethically, not materially. ...It was, and is, a superb system for overcoming scarcity. By organizing production efficiently, and directing it to the pursuit of welfare rather than power, it has lifted a large part of the world out of poverty.

“Yet what happens to such a system when scarcity has been turned to plenty? Does it just go on producing more of the same, stimulating jaded appetites with new gadgets, thrills, and excitements? How much longer can this continue? Do we spend the next century wallowing in triviality?..

“Indeed, the ‘spirit of capitalism’ entered human affairs rather late in history. Before then... A person who devoted his life to making money was not regarded as a good role model. ...It was only in the 18th century that greed became morally respectable. ...This inspired the American way of life, where money always talks.

“The end of capitalism means simply the end of the urge to listen to it. People would start to enjoy what they have, instead of always wanting more. ...As more and more people find themselves with enough, one might expect the spirit of gain to lose its social approbation. Capitalism would have done its work, and the profit motive would resume its place in the rogues' gallery.

“...The evidence suggests that economies would be more stable and citizens happier if wealth and income were more evenly distributed. The economic justification for large income inequalities—the need to stimulate people to be more productive—collapses when growth ceases to be so important.

“Perhaps socialism was not an alternative to capitalism, but its heir. It will inherit the earth not by dispossessing the rich of their property, but by providing motives and incentives for behavior that are unconnected with the further accumulation of wealth.”

[47] Robert Skidelsky, “Life after Capitalism,” Project Syndicate (January 20, 2011), http://www.project-syndicate.org/commentary/skidelsky37/English