Freaking out

Take a look at “Freakoutonomics,” by Charles R. Morris, in NYT, as socio-economic-psychological explanation of people’s worries and fears about our economy — indicators up, attitudes down.  He compares our time to the 1870s, when the economy was booming and most people’s, including farmers’, situation was improving.  Farmers didn’t think so, however, and in any case prices were in play globally, leaving some in the dust.  Most interesting is Morris’s point about lost egalitarianism, what I’d call those old income-gap blues, which feed on bigger-than-ever disparities.

Before the Civil War, America was perhaps the most egalitarian society in the world. But the unbridled entrepreneurialism of the 1870's gave rise to the robber barons [a highly debatable term, by the way, coined or disseminated by committed leftist and careless historian Matthew Josephson]. Even if ordinary people were doing better in the 1870's, the yawning gap between the very rich and everybody else fanned resentments. Interestingly, wealth inequality in today's America is roughly the same as in the Gilded Age.

Add to that the sheer discomfort from big changes:

The sharply increased social and geographic mobility of the 1870's set people adrift from traditional sources of security in families and villages. In our own day, the destruction of employer-employee relationships, the erosion of pension protection and employee health insurance may be creating a similar loss of moorings.

And you have reason enough for sadness in the midst of prosperity.

However, consider also F.A. Hayek’s argument of the importance of income disparity for the good of all, if only to show the way to the rest of us about how to live if you can afford it. 

Moralistic fussbudgets inveigh against consumerism but have no suggestions about how better to stoke the progress that saves lives through expensive medicine, to name one obvious benefit.  As someone else argued recently, how would the all-night pharmacy be available if it weren’t for the doo-dads and knick-knacks whose sales support the mall?

For Hayek’s thinking in the matter, try Don Boudreaux, “Americans are Wealthy (and Getting Wealthier),” at Cafe Hayek. 

As for Morris, he has “many highly praised books,” says the Century Foundation, including Computer Wars, American Catholic, and The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J. P. Morgan Invented the American Supereconomy.