One broad period we can learn from is the developed countries in the middle of the twentieth century. What you see is that policy makers were aware that the demobilization after the First World War led to slow and uneven growth and had a direct effect on the events of the Second World War. (Keynes saw it by 1919, others took more time). What is amazing is that British policy makers were thinking of a way to reorder society while the allies were still fighting Hitler on the continent. One such illustration of that attitude was “Full Employment in a Free Society,” a report by Sir William Beveridge. In the summary of the larger report, he makes a claim for three strong needs, one for peace, one for a job when you can work, and a need to have income support when you cannot work (1). The focus in the essay is the problem of unemployment, which for Beveridge is not just an economic problem, but also a moral issue for the “hatred and fear which it breeds” (6). The diagnosis of unemployment is one that focuses on spending through the business cycle, in that it is uneven and unpredictable and ultimately in the aggregate average just too low (7), too concentrated in certain cities ( 8), and in the British case too focused on international trade (9). To cure the ill of unemployment, Beveridge suggest that the answer is to always make sure that the demand for workers outpaces the number of people available to work (10), or “Jobs rather than men should wait” (12).
Here it is easy to dismiss the idea. Of course, it would be nice if people all had jobs that took into consideration of their fundamental rights. However, Beveridge had a recent and valid comparison. The war itself showed that the lump of labor fallacy was not true. If the state wanted to bring everyone into the labor force and supply them with productive activity, they had the ability to come and do their job to defeat fascism, as “The demand for man-power in total war is unsatiated, and insatiable” (15). Just as in war there is always work that is undone, so the same follows in peacetime. In the good times and the bad, the lack in the economy is not want, but the “lack of purchasing power” (16).
How do we do this according to Beveridge? We cannot rely entirely on the state to do it. We need to make sure that it is “a function of the state in future to ensure adequate total outlay and by consequence to protect its citizens against mass unemployment” in the same way that it is the state’s responsibility to protect the citizens from physical violence (20). Beveridge is at pains to point out that this does not mean full state control as in the Soviet Union but through a combination of encouraging consumption, added public spending, or even developing exports (21). What Beveridge proposes in his essay is a long-term plan to reorganize society so that it is more equitable to everyone in society and to eliminate as much suffering and want as possible through the agent of state policy. It is prioritizing the wants and needs of everyone - planning as a social tool and an ongoing process, where the budget is not just about taxes, but how to manage the available labor, a “Human Budget” that looks at the resources available (26). Importantly, the vision outlined in the report is one that is proactive, aiming for “continuous steady expansion” (32) and not reactive to the business cycle, where society, “demands better houses and transport and light and power and schools and hospitals, without waiting for the opportunity when business men cannot make profits by selling less important things. Public outlay should be looked on as a means of meeting collectively urgent national needs, not as a gap-filling device” (35).
We can use this period as something to look back to as a guide for our policymaking. The economy was hot but there was a transition in the air. The memory of Depression was not too far away. In the postwar time, the economy in our imaginations became personified by the early television sitcom. There were jobs available for people to go to from their homogeneous suburb. These were jobs where one job could support a whole family and the expected leisure activities of that family while in the domestic sphere the wife helped raise the kids. It was the payoff of the struggle against fascism, and even if the red menace loomed over the oceans, the American Way was the best way as the US was the factory to the world that was rebuilding itself from the rubble of the Second World War or trying to create itself from the shadow of the colonial powers. We call this time the Golden Age of Capitalism, and the French call it Les Trente Glorieuses, because this was a time when capitalism just without trouble worked. The planning of the war years worked and the transition on both sides of the Atlantic was successful in that the depression was not entered into again when peace came.
The thing about that is that if you start to look at the history of the time, it was not all Leave It to Beaver monochrome. This golden age existed in conflict with a lot of uncertainty and distrust towards the prevailing order. In 1954, the Supreme Court had to tell the states that separate was not equal and we are still fighting that battle today. Women who were demobilized from their role as the prime movers on the home front during the war felt anger and disenchantment from being marginalized, and we saw the rise of postwar feminism represented first in authors like Simone de Beauvoir to Betty Friedan through Gloria Steinem. Even the winners of the postwar expansion, the straight white males, saw pushback against the created norms, as the fiction of John Ford and a raft of midcentury male writes will illustrate, as well as the more systemic evaluations of the culture like C. Wright Mills’ White Collar or Riesman’s The Lonely Crowd show. In addition, we can easily find the cultural and economic dropouts from the Beatniks to the Hippies to see there was an undercurrent of disenchantment when things were finally working.
I play with this dialectic in my mind because for my entire life, the economic and political landscape has moved. My father grew up in a world where there was a larger manufacturing base with long-tenured employees who would then retire on a pension from that company, but there was some class conflict but the unions and the corporations had an uneasy truce for the most part. My generation has seen jobs casualised and society atomized in a way that would astonish Riesman. We are 20 years past Putnam’s coining the idea of “Bowling Alone,” and social media has made this anomie even worse. Thankfully, there has been a political reaction to this. Unfortunately, the strongest reaction that has been successful so far is the movement to isolationist populism that is represented from the Tea Party movement through to the election of Trump. What gives me hope is that there has been a reaction from the left that started with the bank bailouts and opened the way from Occupy Wall Street through to the Sanders campaigns in 2016 and 2020. The pendulum has been pushed far enough that there is now some push back to the idea that the rich have earned the just deserts and anyone struggling are just losers who deserve these struggles.
Reading the summary of Beveridge’s report gives me a bittersweet feeling. In the darkest period of Europe’s 20th Century, policymakers were able to look forward and embrace ideas of equity and lack of want and realize that in the fight against fascism there had to be a fight for something as well. The report makes it clear that it is not a call for socialism but leaves it open as a potential path. The amazing thing from my vantage point is that they were ever able to implement any of it at all. America had a more paternalistic capitalism than we do now, but the welfare state then was more embedded in the corporations so that it was an ideal and never universalized. To call for policies outlined in the report would get you painted as a radical by bad faith actors – both then and now. “Radical” is true in the meaning the Beveridge looks at, in terms of getting at the root of the problem. I keep asking myself, if we must have some sort of capitalism, can we at least go back to that as an outline? With the path we have taken and the lack of incentives and historical impetus to take us off the path, I am not optimistic but would be happy to be proven wrong. Perhaps we need not be looking backwards but forging a new way forward.
Works Cited:
Beveridge, William Henry Beveridge. (1944). Full employment in a free society: a summary. London: The New Statesman and Nation, and Reynolds News
