Liberty and Equality in Political Economy

Liberty and Equality in Political Economy

From Locke versus Rousseau to the Present

New Thinking in Political Economy series

Nicholas Capaldi and Gordon Lloyd

Liberty and Equality in Political Economy is an evolutionary account of the ongoing debate between two narratives: Locke and liberty versus Rousseau and equality. Within this book, Nicholas Capaldi and Gordon Lloyd view these authors and their texts as parts of a conversation, therefore highlighting a new perspective on the texts themselves.

Chapter 11: Locke and Keynes Arrive in the Twentieth Century US: Galbraith, Harrington, Friedman, and Rawls

Nicholas Capaldi and Gordon Lloyd

Subjects: economics and finance, history of economic thought, political economy, politics and public policy, political economy


The post-World War II economic boom in the US and the accompanying economic (general prosperity), social (vast expansion of higher education and the increasing role of women in the workforce), and political changes (formal end to legal segregation) not only made the Great Depression a distant memory, but it also made it increasingly difficult to sustain the Rousseau narrative in America. That narrative was refashioned by John Kenneth Galbraith (1908–2006), Harvard Professor and leading Rousseauean public intellectual in the US serving under four democratic administrations (Roosevelt, Truman, Kennedy, and Johnson). In American Capitalism: The Concept of Countervailing Power (1952), Galbraith maintains that prior to the Great Depression the old narrative had some validity in that “big business” ran America. However, since then the American economy has been managed by a triumvirate of business, labor, and government experts. In addition, economic reality had changed and required a new conception of economics. In The Affluent Society (1958), Galbraith argued that we have moved from an age of material poverty to an age of material “affluence.” In the 1998 Introduction to The Affluent Society, Galbraith takes a swipe at what he refers to as two errors in contemporary economic theory: (1) the status of poverty, and (2) the independent demand curve.

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