The text below is an excerpt from Bourgeois Equality: How Ideas, Not Capital or Institutions, Enriched the World, the third volume of Deirdre McCloskey’s trilogy on the ethical and historical origins of modern prosperity.

And there are doubts from the right, too. Some students of the economy, such as Robert Gordon, Lawrence Summers, Edward Gordon, Erik Brynjolfsson, Andrew McFee, Edmund Phelps, Edward E. Gordon, Jeffrey Sachs, Laurence Kotlikoff, and Tyler Cowen, have argued that countries in the position of the United States, on the frontier of betterment, are facing a slowdown, with a skill shortage, and that technological unemployment will be the result.¹ Maybe. The economists would acknowledge that in the past couple of centuries numerous other learned commentators have predicted similar slowdowns—such as the Keynesian economists in the late 1930s and the 1940s, confident in their theory of “stagnationism”—only to find their predictions once again falsified by the continuing Great Enrichment.² The classical economists of the first three-quarters of the nineteenth century, Marx included, expected landlords, or in Marx’s case capitalists, to engorge the national product. In a cartoon cover of the National Review by Thomas Reis, a supercool little Karl Marx with a Starbucks coffee in his hand and an MP3 player in his ear sports a T-shirt inscribed, “Still Wrong.”³ Right.

Marx supposed that wages would fall and yet profits would also fall and yet technological betterments would also happen. Such an accounting, the left-Keynesian and eventually Maoist economist Joan Robinson used to point out, is impossible. At least one, the wages or the profits, has to rise if technological betterment is happening, as it so plainly did. In the event, what rose were wages on raw labor and the return to human capital, owned by the wage-earners, not the bosses. The return to physical capital was higher than a riskless return on British or American government bonds, in order to compensate for the risk in holding the capital (such as being made obsolete by betterment—think of your computer, obsolete in four years). But the return on physical capital was anyway held down, I just noted, by competition among the proliferating capitalists, to its level of 10 percent. Imagine if real wages had experienced a similar history of stagnation since 1800. Instead they increased by a factor of twenty or thirty or one hundred.

Startlingly, the learned economists from the right of politics join their colleagues from the left in predicting that machines will cause low wages. They haven’t yet. But soon. Tyler Cowen, for example, an economist I admire, spends many pages of his book Average Is Over (2013) describing breathlessly “the increasing productivity of intelligent machines,” such as those used for dating services. Your fate is determined, he says, by how you answer the technological-unemployment question: “Are you good at working with intelligent machines or not? . . . This is the wave that will lift or that will dump you.”⁴ He concedes that “it was true in the great Industrial Revolution of the nineteenth century and it is true now: machines do not put us all out of work, as eventually machines will create jobs.”⁵ I italicize the words amazing in an economist of Cowen’s ability. Not “all” jobs, he concedes. Well, actually, machines have put no one out of work who can move to another job, and on balance not anyway the bulk of workers, as you can see in the absence, 1848 to the present, of a rising reserve army of unemployed. The other italicized locution, “create jobs,” is regularly a sign of a slot theory of labor supply and demand, which no economist since J. R. Hicks published The Theory of Wages in 1932 has believed. A job is a voluntary deal between a worker and a boss. It is the opportunity, not the job, that is “created” by a newly invented machine. Government can “create jobs” only by taxing some deal to subsidize another, with no net gain unless the government is wiser about trading opportunities than people in trade.

On the preceding page Cowen had characterized some things as “scarce” (high-quality labor with unique skills, for example) and others as “not scarce” (unskilled labor). It is a meaningless locution in economics. It ‘s like saying that gold is scarce but water is not. No: they have a relative price, that is all. Both are scarce, in the sense that neither is free of opportunity cost, and it is meaningless to compare them, or apples and oranges, by the ounce, something Cowen teaches his students in Economics 1 during the third week of the course. And in any case the economics and the history says that in the long run unskilled and skilled people are substitutes. The unskilled benefit as much—more when the standard of genuine comfort is applied to rich and poor. Remember Robert Frost choosing at the margin between teaching and farming, which keeps the wage in each occupation within hailing distance of the other. And if goods and services are provided by machines we will still have “jobs,” that is, ways of spending our time that other people will pay for—deciding what to buy, for example, or who to vote for or what is to be done or what machines to invent next, which cannot in its nature be eliminated by mechanization.

Later Cowen gives a chart of labor’s income as a share of the total, showing an alarming fall since the 1970s. “If there is one picture that sums up the dilemma of our contemporary economy, it that one.”⁶ But the chart is what we used to call a Time-magazine chart—it cuts off the top and bottom in order to exaggerate a relatively slight change. How alarming is the decline? It is a decline in Bureau of Labor Statistics numbers from 63 percent to 61 percent—a decline of labor’s share by two percentage points of national income. On this Cowen erects his terrifying case that “average is over.”

Something is driving intelligent economists out of their economic minds. Perhaps it is the short run, the first act. Before they have well lost their minds, some of them acknowledge what has been true of every economy since the beginning, that “jobs”—that is, opportunities for mutually advantageous exchange—adjust to the skills available. Better tools or better skills make for higher income in total. But if not, the economy finds something to do with the badly skilled. The principle is called comparative advantage, one of the few nonobvious propositions in economics.

Of course, if one raises wages artificially, by union or by statute, unemployment will result. The argument one hears from, say, Paul Krugman—that raising wages is good for the company because workers will work harder as a result—seems implausible, considering that the company in such a case would already have raised wages, for its own good. And working harder worsens the conditions of work. Both the company and the workers suffer. Cowen notes that one can observe “labor market troubles of the young” “in many countries.”⁷ Yes, one observes such troubles in Egypt and South Africa even more than in France and the United States, which suggests that laws protecting the employment of favored classes (old people, for instance, or government-approved union members, often grotesquely favored in poor countries), not the advanced machine tools of advanced economies, imitated in poor countries, are what is causing the troubles.

Joel Mokyr, a deep student of the history of technology, has recently offered some persuasive Whiggish assurances on the matter of slowdown, observing that by now the sciences behind biology and computers and the study of materials promise gigantic enrichment.⁸ And Patrizio Pagano and Massimo Sbracia argue that failures of previous stagnationisms—proposed after every major recession, they observe—failed not so much in not anticipating wholly new technology as in not grasping the further rewards of existing technology, such as, now, computers.⁹ As Macaulay asked in 1830, “On what principle is it that, when we see nothing but betterment behind us, we are to expect nothing but deterioration before us?”¹⁰ He continued:

If we were to prophesy that in the year 1930 a population of fifty million, better fed, clad, and lodged than the English of our time, will cover these islands, that Sussex and Huntingdonshire will be wealthier than the wealthiest parts of the West Riding of Yorkshire now are, that machines constructed on principles yet undiscovered will be in every house, many people would think us insane.¹¹

Whiggish and bourgeois and progress-minded and vulgarly pro-betterment though Macaulay was, he was in his prediction exactly right, even as to the British population in 1930. If one includes the recently separated Republic of Ireland, he was off by less than 2 percent.

And even the pessimistic, anti-Whiggish economists—”gloomsters,” the headline writers call them—would not deny that we have before us fifty or a hundred years in which now middling and poor countries such as South Africa and Brazil and Haiti and Bangladesh will catch up to what is already, in the rich countries, a stunningly successful level of average real income. Edward Phelps, among the pessimists, believes that many rich countries lack dynamism.¹² But nowadays China and India, making up 37 percent of world population, have become more free-market than they once were, and therefore are quickly catching up, growing with notable dynamism at upward of 7 to 12 percent per person per year. All the economists who have looked into the evidence agree that the average real income per person in the world is rising faster than ever before.¹³ The result will be a gigantic increase in the number of scientists, designers, writers, musicians, engineers, entrepreneurs, and ordinary businesspeople devising betterments which spill over to the now rich countries allegedly lacking in dynamism. Unless one believes in mercantilist/business-school fashion that a country must “compete” to prosper from world betterment, even the leaky boats of the Phelpsian undynamic countries will rise.

To appreciate what will happen in the world’s economy over the next fifty or a hundred years it’s a good idea to pause to learn the “Rule of 72.” The rule is that something (such as income) growing at 1 percent per year will double in seventy-two years. The fact is not obvious without calculation. It just happens to be true. You can confirm it by taking out your calculator and multiplying 1.01 by itself seventy-two times. It follows that if the something grows twice as fast, at 2 percent instead of 1 percent, that something will double, of course, in half the time, thirty-six years—as a runner going twice as fast will arrive at the mile marker in half the time. Similarly, something growing at 3 percent a year will double in a third of the time, or twenty-four years. And so forth. The general formula, then, says something growing at N percent per year doubles in 72/N years. The approximation gets less exact for higher growth rates—clearly something growing at 72 percent per year won’t double in a year—but for the growth rates we’re considering, it’s accurate enough.¹⁴

Consider some Rule-of-72 calculations. At 7 percent per year a real income will double in 72 divided by 7 years, or a little over 10 years; at 12 percent it will double in about 6 years. Even at the modest 4 percent per year per person that the World Bank implausibly reckons China will experience out to 2030 the result will be a populace almost twice as rich.¹⁵ The specialists on China’s economy Dwight Perkins and Thomas Rawski (2008) reckon a 6 to 8 percent annual growth out to 2025, by which time the average Chinese person will have a 1960s-U.S. standard of living.

China and India during their socialist experiments of the 1950s through the 1970s were so badly managed that there was a great deal of ground to be made up merely by letting people open shops and factories where and when they wanted to, without approval from the authorities. As Perkins pointed out in 1995, “When China stopped suppressing such activity, . . . shops, restaurants and many other service units popped up everywhere . . . [because] Chinese . . . had not forgotten how to trade or run a small business.”¹⁶ No genetic argument can be put forward that implies that Chinese or Indians or Africans or Latin Americans should do worse than Europeans permanently. The environmental limit can reasonably be expected to be overcome by serious environmentalists implementing serious technologies, such as carbon capture and nuclear power (India in 2014 bought ten nuclear reactors from Russia). No limit to fast world growth of per-person income is close at hand—not in your lifetime, or even that of your great-grandchildren. Then, in the year 2100, with everyone pretty rich, and hundreds of times more scientists and entrepreneurs working on improvements in solar power and methane burning, we can reconsider the limits to growth.

§

The environmental limit, which worries even the middle of the political spectrum, is often inferred from a use of merely mathematical arguments, which are identically true but scientifically irrelevant. “After all,” it is said, “nothing can grow forever” when the practical limit is scores of times larger than the present level. The actual carrying capacity of the earth, as one can judge from such densely populated place as Holland or Java, is on the order of a hundred billion people, not the ten or eleven billion at which it will soon peak and then start falling in response to rising per-person incomes. “After all, resources are finite,” the doubters continue, when what is a “resource,” as Julian Simon showed, is ever changing in response to human ingenuity.¹⁷ Bauxite ore was once useless dirt, but became valuable for making aluminum. Rare earths were not economically rare until they came to be used for computer batteries. Valuable whale oil became almost useless (and saved the whales) compared with the newly exploited oil from the ground. Black rock from the ground called “coal” was rediscovered many centuries ago in Europe and known two thousand years earlier in China to be useful for heating houses and making glass. Underground water inaccessible with old drilling techniques suddenly became minable, and its large if limited amount is soon to be supplemented, as it already is in some arid places, by ingenuity in finding ways to desalinate sea water cheaply, powered as in Western Australia by wind and sun. The man in the street thinks that countries are rich because of “resources,” in which case Japan and Hong Kong would be poor and the Russian Federation and the Democratic Republic of te Congo rich. In a modern economy in which people on farms are 2 percent of population, presently used resources earn 5 percent or less of national income, and do not determine much of its level.

The environmental limit looks to be solved by the ingenuity that caused the Great Enrichment in the first place. It will not be solved by some of the stranger anti-economic suggestions, such as Eating Local. As Robert Wuetherick asks, “What will be next? 100-mile-sourced medicines? 100-mile-sourced ideas? 100-mile-sourced economic history?”¹⁸ Some of the more unreasonable environmentalists in this line have campaigned against genetically modified bananas delivering vitamin A, an innovation that could save seven hundred thousand children’s lives each year and prevent three hundred thousand cases of blindness.¹⁹

Yet reasonable environmentalists have for decades been solving problems such as smog caused by soft coal for heating, or intelligence-reducing emissions from cars using lead-enhanced fuels, and will continue their virtuous labors with the hearty approval of us economists and calculators. After all, the goal is not growth-regardless, in the style of the North Carolina legislature in 2014 requiring science to be revised to make rising ocean levels appear less threatening or the governor of Florida issuing instructions that the phrase “global warming” be banished from official documents. The goal is ethical trade-tested betterment, such as making poor people rich, which has happened, or reducing inequality in essentials, which has also happened. Making people dangerously ill with bad air (or for that matter denying children life-saving genetically modified crops) is not ethical, or bettering. Nor is it something “the corporations” want. Nike and Toyota, unlike some governments with their local monopoly of violence, do not want to sicken or kill us.

The rich countries decided to take seriously the threat to the ozone layer from air-conditioning fluid and hair spray (hair spray!), led by Margaret Thatcher the Conservative British prime minister (and a big user of hair spray) , and now the ozone gaps at the poles are getting smaller. Waterways, which were open sewers until the development of effective waste treatment at the end of the nineteenth century, are in rich countries largely cleaned up.²⁰ Levels of particulate matter from burning coal for house heating in American cities in the 1930s and 1940s—American income per head then was as I have noted about the same as Brazilian income now—were comparable to those in present-day poor countries, and fell by the late twentieth century to an eighth of their previous level. In 1912–1913 a poor and therefore smoky Chicago was smothered in suspended particulates 50 percent higher than those in 58 poor Chinese cities in 1980–1993.²¹ Since the use of soft coal in British cities was banned in 1954 and then more rigorously in 1968, the Royal Courts of Justice in now-rich London have been scrubbed to return to their original white stone facing. Little but rich Denmark spends a good deal of its riches on avoiding carbon-based fuel and is prominent, for example, in the world market in windmills.²² As the libertarian columnist at the Chicago Tribune, Steve Chapman, reported: “Since 1980, carbon monoxide pollution in America has been cut by 83 percent, lead by 91 percent, and sulfur dioxide by 78 percent. But total economic output per person, adjusted for inflation, has risen by 77 percent. We’ve gotten greener and healthier as we’ve gotten richer.”²³ If we care about the environment, then, let us become prudently and temperately rich. Then we can do some good.

What, then, about the polluting poor countries? Rising real income per person at such heady rates as 6 or 12 percent per year, with the level quadrupling in a generation, is understandably popular with ordinary Chinese and Indian people. Yet when their incomes went up, the formerly poor, such as the Danes and the Australians and the British, came to value the environment more. Sometimes, true, they have valued it irrationally, as for example by stopping nuclear power, which has made dirty old coal the fastest growing source of energy worldwide.²⁴ Yet China, bettering but still very poor, has now a vigorous environmental movement—a movement against coal, not against nuclear power—with numerous riots substituting for democracy. In a nervous response to the movement, and maybe even because it is good for people, the Chinese government in January 2014 started requiring fifteen thousand factories to report their air and water pollution in real time, and to release the results to the public.²⁵ If they actually do so (don’t hold your breath; and when visiting Beijing, do), the Chinese standard of transparency in pollution control will be higher than in the United States. Also in 2014 China signed an agreement with the United States to work seriously on restraining the release of atmospheric carbon. China is now at a stage of industrialization similar to England’s in the 1870s or the United States’s in the 1890s, during which sulfur-laden coal smoke rising from Birmingham, Warwickshire or from Birmingham, Alabama was viewed not an occasion for rioting but as a good sign. In the 1940s, when my grandparents would drive to Chicago around the southern edge of Lake Michigan, they would note with pleasure the smoke rising from US Steel in Gary, Indiana—an improvement, they implied, over the shuttered mills of the 1930s.

Oil supply, too, is no long-term limit, as the failures of limits-to-growth predictions from the 1960s to the present have shown, and as fracked gas in Pennsylvania and oil sands in Alberta and deep discoveries in the Falklands/Malvinas seas and in the Australian outback are showing again, whenever the price of oil rises. The rhetorical triumph of fossil fuel over nuclear power has, to be sure, worsened global warming. But this too can be overcome (some reasonable people have argued) by realizing that even Chernobyl, incompetently managed by the USSR, resulted in few fatalities (a onetime event of fifty-six direct fatalities and a few thousand shortened lives, it is claimed, which is two or three orders of magnitude smaller than the coal-caused deaths in the same region yearly). Fukushima resulted in still fewer fatalities, and Three Mile Island, unless you believe conspiracy theories on the left, none. We can return to an improved nuclear power—or, if you are optimistic, and understandably resistant to the evidence about nuclear power, and determined to stay spooked about the One Big Disaster, which French nuclear engineering has obviated—you can wait for clean coal, on which Southern Illinois University is feverishly working.²⁶ The present engineering is clear. France, with 80 percent nuclear power for its electricity, the cheapest in Europe, has one-fifth the carbon pollution of neighboring, coal-fed-if-green-obsessed Germany. In any case, however you come down on nuclear power, on what principle is it that, when we see nothing but betterment behind us, we are to expect nothing but deterioration before us?

Consider more Rule-of-72 calculations: If we take 9 percent as the combined annual per-person growth rate in the 37 percent of world population living in China and India, the rest of the world could have literally zero growth per person and yet the world’s average growth per year of real income per person would be 0.37 × 9, or 3.3 percent, which is a little faster even than during the great postwar boom of 1950–1972. If the rest of the world were to grow merely at the subdued rates of 1973–2003 (namely, 1.56 percent per person per year conventionally measured, without allowance for improved quality), the world result, factoring in the Chinese and Indian marvels, would be (if the population share held up) (0.37 × 9.0) + (0.63 × 1.56), or 4.3 percent per year, the highest in history.²⁷ A rather lower sustained growth rate worldwide of, say, 4 percent per year per person would result in a doubling of the material welfare of the world’s average person within a short generation (72/4 = 18 years), with economies of scale in world invention kicking up the rate in addition. In two such generations, just thirty-six years, that would mean a quadrupling, which would raise the average real income in the world to the levels attained in 2012 in the United States, a country that for well over a century has sustained the world’s highest per-person income of any place larger than Norway. Pretty good. And it will be good for solving many if not all of the problems in the environment and in the society.

§

The resulting spiritual change, as I have noted, has been and will be as impressive as the material change. At the level of the purpose of a human life it is the more important outcome. For what is a man profited, if he shall gain the whole world, and lose his own soul? The sacred and meaning-giving virtues of hope, faith, and transcendent love for science or baseball or medicine or God are enabled by our riches in our present lives to bulk larger than the profane and practical virtues of prudence and temperance necessary among people living in extreme poverty. True, in our modern times even unworthy uses of our higher income—eating more Fritos, watching more reality TV—are better physically than in ancient times starving in beggary by the West Gate. Look again at falling death rates worldwide. But one would hope that the Great Enrichment would be used for higher purposes.

And, on the most hard-minded criteria, it has been, and will be. Enrichment leads to enrichment, not loss of one’s own soul. The American journalist and essayist H. L. Mencken, no softie, noted in 1917 à propos of Sister Carrie’s good fortune, that “with the rise from want to security, from fear to ease, comes an awakening of the finer perceptions, a widening of the sympathies, a gradual unfolding of the delicate flower called personality, an increased capacity for loving and living.”²⁸ Nor was the University of Iowa economist Frank Knight a softie, yet he too spoke in 1923 about such an increased capacity: “As the standard of living rises, the economic interests of people are transferred more and more out of the sphere of fundamental needs into that of aesthetic and social gratification and pure experimentation.”²⁹ And no blame attaches.

Know also a remarkable likelihood in our future. Begin with the sober scientific fact that sub-Saharan Africa has great genetic diversity, at any rate by the standard of the narrow genetic endowment of the ancestors of the rest of us, the small part of the race of Homo sapiens that left Mother Africa in dribs and drabs after about 70,000 BCE.³⁰ The lower diversity outside Africa comes from what geneticists call the founder effect, that is, the dying out of genetic lines in an isolated small group, such as those that ventured into west Asia and then beyond. The founder effect is merely a consequence of the small samples dribbling out, as against the big sample of the Homo-sapiens folk that stayed put in Africa. Any gene-influenced ability is therefore going to have more African extremes. The naturally tallest people and the naturally shortest people, for example, are in sub-Saharan Africa. The naturally quickest long-distance runners are in East Africa. The best basketball players descend from West Africans. In other words, below the Sahara the top end of the distribution of human abilities—physical and intellectual and artistic—is unusually thick. (Yet even in Africa the genetic variability in the Homo-sapiens race appears to have been thinned repeatedly before the time of the modest emigrations, by population crashes, such as when the super volcano Toba in Sumatra went off, suggestively also around 70,000 BCE.³¹ It reduced our Homo-sapiens ancestors to a few thousand—a close call.)

The thickness of sub-Saharan abilities at the high end of the distribution is a mere consequence of the mathematics. Greater diversity, which is to say in technical terms, higher variance, means that unusual abilities at both ends of the distribution, high and low, are more common. Exactly how much more depends on technical measures of genetic difference and their expression. The effect could be small or large depending on such measures and on the social relevance of the particular gene expression.

The high end is what matters for high culture. Sub-Saharan Africa, now at last leaning toward liberal democracy, has entered on the blade of the hockey stick, growing since 2001 in per-person real income by over 4 percent per year—doubling that is, every eighteen years. A prominent Nigerian investment manager working in London, Ayo Salami, expects an ideological shift among African leaders in favor of private trading as the generation of the deeply socialist anticolonialists born in the 1940s dies out.³² The 6- to 10-percent growth rate available to poor economies that wholeheartedly adopt liberalism will then do its work and yield educational opportunities for Africans now denied them.

The upshot? Genetic diversity in a rich Africa will yield a crop of geniuses unprecedented in world history. In a century or so the leading scientists and artists in the world will be black—at any rate if the diversity is as large in gene expression and social relevance as it is in, say, height or running ability. Today a Mozart in Nigeria follows the plow; a Bashō in Mozambique was recruited as a boy soldier; a Tagore in East Africa tends his father’s cattle; a Jane Austen in Congo spends her illiterate days carrying water and washing clothes. “Full many a gem of purest ray serene / The dark unfathom’d caves of ocean bear.”

§

We should expect during the next hundred years, then, a world spiritual change enabled by much higher real incomes. In fifty-four years at that conservative 4 percent per year, world income per person will rise by a factor of about eight—that is, 700 percent. The figure is not much below the factor of ten and the percentage of 900 by which conventionally measured income averaged over the rich and poor parts of the world has risen in the span of the fully four half-centuries since 1800. The growth rate will probably be higher than such a calculation assumes, when the increasing returns from discoveries shared worldwide is allowed for, and when more and more countries see the Chinese and especially the Indian light of liberty and dignity for the bourgeoisie, first lit in Holland and then in Britain. In fifty years, in other words, if tyrants, robbers, militarists, populists, Maoists, and the less thoughtful among socialists, regulators, end-state egalitarians, Bakuninite anarchists, and environmentalists do not break it, the businesslike blade of the hockey stick will have eliminated the worst of human ignorance and poverty, the malaria-crippled, soldier-raped, zero-schooling lives of the poorest among us. By the middle of our twenty-first century it will have resulted in a big bang of world culture, with sub-Saharan Africa by the early twenty-second century in the lead.

Notes

1. Robert Gordon 2012; Summers 2014; E. E. Gordon; Brynjolfsson and McFee 2014; Phelps 2013; Edward Gordon 2013; Sachs and Kotlikoff 2012; Cowen 2011, 2013.

2. Fogel 2005.

3. National Review, May 19, 2014.

4. Cowen 2013, pp. 4, 6.

5. Cowen 2013, p.20.

6. Cowen 2013, p. 39.

7. Cowen 2013, p. 3.

8. Mokyr 2013, 2014.

9. Pagano and Sbracia 2014; compare again Fogel 2005.

10. Macaulay 1830 (1881), pp. 186, 187.

11. Macaulay 1830 (1881), p. 185.

12. Phelps 2013, pp. viii, x, 14, 15, 21, and throughout.

13. Population shares from Maddison 2007, p. 378.

14. I realize that a Rule of 69 would be a little more accurate for continuous as against periodic (that is, annual or quarterly) compounding, and that perfectly accurate continuous compounding would involve e = 2.718281. . . . But 72 has lots of integer divisors, is pretty accurate except at very high (for example, 30 percent) interest rates, and is honored by history.

15. Wall Street Journal, October 7, 2013, p. A14.

16. Quoted in Brandt, Ma, and Rawski 2014, p. 99.

17. Simon 1981 (1996).

18. Wuetherick, personal communication, January 26, 2014.

19. Independent, June 17, 2014, p. 9.

20. Troesken 2014.

21. Barreca, Clay, and Tarr 2014, p. 5, table 1 (p. 37). I can remember my father shoveling coal in the basement of our apartment in Cambridge, Massachusetts, in 1947, and my mother can remember trying to keep clothing and windowsills clean in the face of coal heating.

22. The Danish philosopher of science Hans Siggaaurd Jensen tells me in a personal communication that windmills are designed with three vanes mainly because farmers have always used three vanes—one vane is from an engineering point of view more efficient.

23. Chapman 2014.

24. Stone 2013.

25. Denyer 2014.

26. Stone 2013, quoting studies following Chernobyl. One student of the matter concludes that “losses arising from Chernobyl were not of sufficient magnitude and the event was so long ago that the accident should not be definitive in decisions about investment in new reactors” (Simmons 2011, p. 12). Cleanup workers at Fukushima have no discernible rise in disease. See Rivkin 2013.

27. Maddison 2007, p. 383. I am aware that China and India should be removed from the 1973–2003 rate to make the hypothetical exact, which would make it a trifle lower—say, 4 percent. But 4 percent is still, as I say, unprecedented.

28. Mencken 1917 (2006), p. 63.

29. Knight 1923 (1997), p. 137.

30. For example, “The migration of modern humans out of Africa resulted in a population bottleneck [in the small bands of humans migrating] and a concomitant loss of genetic diversity”(Campbell and Tishkoff 2008); “all systems show greater gene diversity in Africans than in either Europeans or Asians” (Jorde et al. 2000, abstract). There is, they say, “a marked founder effect associated with the expansion out of Africa.”

31. Pritchard et al. 1999, pp. 1795, 1797.

32. Personal communication at HedgePo’s Global CIO Summit, Gleneagles, Scotland, October 23, 2014.

Yet in each of the forty-odd recessions since 1785, big or small, the real income of the poor and of the average wage earner was higher after the recession than it had been at the peak of the previous boom. In the three dozen or so ordinary recessions the previous peak was exceeded after the trough in about two years. Unhappily, it was not the case everywhere after the Great Recession of 2008. In the 1930s it had been even less so, disastrously, in the mismanaged recoveries from the Great Depression, especially in gold-obsessed France, Switzerland, and the United States. But in the Great Recession, despite the Schadenfreude expressed on the left, still echoing in such circles, the growth of real incomes did not stop permanently, even in the already developed and therefore necessarily slower-growing countries. Merely two years after the 2008 peak, real per-person income in the United States, for example, had grown beyond the peak (though not for the young, considering the job protections arranged by and for the middle-aged).¹ In the world as a whole, real income per person was fully 10 percent higher by 2011 than before the world crisis.² It had begun to exceed the 2008 peak by 2009. Here are some of the larger or more interesting countries arrayed by the years they took to match or exceed their previous peak in real per-person income (the peak being for most countries 2008, but 2006 for many of the worst performers):

§

The eminent Marxist historian Eric Hobsbawm (1917–2012) gave in 2011 the conventional left-wing analysis of the Great Recession. In the peroration of a book republishing some of his essays, Hobsbawm decried how “the unlimited and increasingly high-tech economic growth in the pursuit of unsustainable profit produces global wealth, but at the cost of an increasingly dispensable factor of production, human labor, and, one might add, of the globe’s natural resources.”³

The details of his rhetoric—tacking on a concern for “the globe’s natural resources” with a “one might add”—show him, as Hobsbawm would have affirmed, to be an old leftist. He stopped being a dues-paying if unorthodox member of the Communist Party of Great Britain only a few months before it dissolved itself, in 1991. The “one might add” suggests a wariness toward the recent environmentalist modulation of the left, a modulation, as he suspiciously observed elsewhere in the same essay, “on a much more middle-class basis.” The environmentalist, anticorporatist, antiglobalist, usually middle-class radicals exemplified by the Occupy movement and its Spanish model, Los Indignatos, were, he wrote, “anti-capitalist, though without any clear idea of capitalism.” “It was almost impossible to identify what they proposed to substitute for it. This may explain a revival of what looks like Bakuninite anarchism.”⁴ From an Old Communist, “Bakuninite” is not a compliment.

But the main point of Hobsbawm’s sentence is to cast doubt on the Great Enrichment. The left after Marx and Engels has always been, as Hobsbawm himself was in all his writings, strangely alarmed by economic growth. They have been alarmed even though economic growth was what in historical fact enriched the poor, not the nationalizing policies of the old Labourites and of the Communist Party, or for that matter the war-making policies of the Conservative Party and of the fascists, or the redistributive policies of the Liberal Democrats and of the populists. The radical left and the traditionalist right see economic growth as a vine smothering the world, a monopolistic kudzu, bringing on the cultural triumph of the West. (The traditionalist right glories in the cultural triumph of the West, at any rate if the rightist is a Thatcherite Westerner.) The hard-left Indian writer Pankaj Mishra lists in parallel with Hobsbawm the usual antigrowth claims: “the cultural homogeneity, or the other Trojan viruses—uneven development, environmental degradation—built into the West’s operating software. . . . [And] the harshest aspects of American-style capitalism: the truncation of public services, de-unionization, the fragmenting and lumpenization of urban working classes, plus the ruthless suppression of the rural poor.”⁵ Thus Mahatma Gandhi admired the foot-treadle sewing machine but viewed it as one of the few good innovations. No electricity or flush toilets. Stop growth now.

The antigrowth left, with the antigrowth right, is mistaken. (It does not mistake, though, that the fruits of the Great Enrichment have made the proletariat into a petty bourgeoisie, lamentably uninterested in revolution, and in its vulgar way now able to enjoy the goods and services formerly available only to the better sort of people. And it has made the poor into department-store and now Walmart customers, lamentably uninterested in making their women spin their yarn and weave it into cloth by hand.) Growth’s “high-tech” feature, in Hobsbawm’s way of putting it, makes certain laborers “dispensable,” true—which is to say that people move from wretched assembly-line jobs at Ford near Detroit or at Volvo near Gothenburg to better jobs standing in a white coat monitoring robots, at the higher wages made possible by the higher tech. Or, mainly, they move to jobs outside the auto industry, the real rewards of which are now higher because people can buy the radically cheaper stuff made by the robots.

And if their new jobs are not higher paying it may be because the United Automobile Workers of America or the IF Metall union of Sweden had been able to extract monopoly profits from the company and therefore from consumers. Robert Reich, a reliable source of sweetly leftish errors of facts and ethics, declares that “the decline in unionization [of private companies] directly correlates with the decline of the portion of income going to the middle class.”⁶ But paying selected workers on the auto assembly line more than they can earn elsewhere, at the expense of other, sometimes poorer, workers buying autos, is hardly a formula for raising up the working class, or for that matter the middle class.

Walter Reuther, president of the United Auto Workers long ago, replied to a young manager enthusiastic about robots on the assembly line, “Tell me, those wonderful new robots—will they go out and buy cars from your company?” Reuther’s, and Reich’s, argument, though well intentioned, is fallacious, the “productionist” fallacy: trickle up. Employees of the auto companies are a trivial share of the auto-buying public. You can’t create prosperity merely by buying from your own employer, hoisting yourself up by your bootstraps. The left’s trickle-up economics is as illogical as is the right’s trickle-down version.

The robots themselves are made by people who buy cars. Compared with horses, cars themselves are “robots.” Yet the advent of cars did not produce mass unemployment because of insufficient demand for the output of blacksmiths and horse traders. Fundamentally, all tools—a blast furnace and a spinning jenny, or for that matter an Acheulean hand ax or a Mycenaean chariot wheel—are “robots,” that is, contrivances that make labor more productive. Reich listed in 2014 the usual lineup of villains allegedly driving down American wages: “Automation, followed by computers, software, robotics, computer-controlled machine tools and widespread digitization, further eroded jobs and wages.”⁷ No they didn’t. They raised real wages, correctly measured, according to the common sense that a human supplied with a better tool can produce more. If Rosie the Riveter gets better tongs to insert the rivets she gets higher wages, because employers have to compete for the now more productive worker, and can give her children more to eat. If everyone gets better tools they move out of old jobs and produce more for everybody in their new jobs with the new tools.

After all, the point of an economy is production for consumption, not protection of existing jobs using old tools—horses, candles, hand-controlled drill presses. Any contrivance substitutes for raw labor, as does the cactus spine that the Galapagos finches use to dig grubs out of tree bark. The finches use “robots.” In Afrikaans the word “robot” means what it means elsewhere, following its coinage from Czech (the original meaning is “required work”). But it is also the normal Afrikaans word for “traffic light.” The traffic light substitutes for the labor of a policeman with white gloves on a pedestal. And such substitutions are good, in the third act, for workers as a whole, not bad.

In the literal second act of Ibsen’s Pillars of Society (1877), one of the pillars, Karsten Bernick, the owner of a shipyard in Norway, scolds his foreman, Aune:

BERNICK. You don’t know how to work with the new machines I had installed—or, better, you won’t work with them. . . . Progress has to come from me, or it won’t come at all.

AUNE. I also want progress, Mr. Bernick.

BERNICK. Yes, for your own narrow faction, for the working class. . . .

AUNE. What right do technology and capitalism have to introduce all these new inventions before society’s trained a generation in how to use them? . . . I can’t stand seeing one good workingman after another turned out to go hungry, all on account of these machines.

BERNICK. Hm. When printing was invented, a lot of scribes went hungry.

AUNE. How’d you like it, Mr. Bernick, if you’d been a scribe at the time?⁸

Aune articulates the program on the left to educate an entire generation of people to work with all conceivable robots before any are installed and tried. He believes the future can be laid down because we already know how it will turn out. Aune’s program would stop the enrichment of the working class (the “narrow faction” constituting 90 percent of Norwegian society, then as now). By contrast, Bernick articulates the program on the right to let the bourgeoisie install whatever labor-abridging device it wishes and afterward train the workers, a bet on progress without quite knowing how it will turn out. In society’s third act Bernick’s has turned out to be the better program, because we pay the Bernicks to have such ideas, punishing them with bankruptcy when they are wrong. The Bernicks push for an unknowable future, which in the event has been massively good for the workers.

And indeed in the literal fourth act of the play an ethically renovated Bernick meets with gratifying cooperation from Aune:

BERNICK. I gave you too little time. [The ship under repair] needs a more careful job.

AUNE. Will do, Mr. Bernick. And with the new machines!

BERNICK. That’s the way. But take special care and pains with it now. There’s a lot with us that could stand some careful, painstaking renovation.⁹

It’s a happy ending, a trifle twee. But after all the new machines are in fact necessary for the happy result of enriching the workingmen.

§

The business profit that the left abhors—”in the pursuit of unsustainable profit,” said Hobsbawm—is indeed temporary, “unsustainable.” That’s good, not bad, and is the reason why profits on American industrial capital fell from their “unsustainable” levels of about 15 percent per year after World War II, when the United States was the only big industrial economy left standing, down to a normal level of about 10 percent per year on the capital sum invested from the 1960s on, a level typical since industrialization began two and a half centuries ago. The reward for venturing, for example, on robotization—that is, toolmaking—has been eroded time and again, I say again, by competition driving down the rewards to the inventors of weaving machines and rolling mills and assembly lines, and leaving the fruits for the rest of us in much cheaper clothes and girders and automobiles measured by the labor time to buy them.

The left speaks as though such competition among capitalists for the dollar of the worker-consumer, keeping down profits on capital, is a bad idea. From both the socialist left and the nationalist right the feeling seems to be that competition by businesspeople vying to give you what you want is the same thing as competition by violence. The feeling misleads. Marshall Field of Chicago formulated the motto of his department store as “Give the lady what she wants.” Giving the lady what she wants in a manner better than Goldblatt’s or Carson, Pirie, Scott is not an act of violence. It is an act of seduction, a form of love, admittedly a self-interested form. Harry Gordon Selfridge, trained in Chicago by Field, continued after 1909 the seduction in his London store, becoming rich by competing for the love of the ladies with his new business plan, driving down the price of glamour.¹⁰

In The Ladies’ Paradise (1882–1883), set in fictional 1864–1869, Zola makes a central character out of the perfected department store, a betterment dating from the 1850s, such as Le Bon Marché (“the good deal,” still on offer). The owner of the bettering store, M. Octave Mouret, is describing to a Baron Hartmann (= Haussmann) how he is driving the old-fashioned sellers of fabrics out of business. The implied author uses a cup of anticapitalism (from the author of Germinal), a dose of misogyny, a pinch of regional prejudice, and a soupçon of anti-Semitism. (The passage, however, is from the pen also of the defender of Captain Dreyfus; it is in free indirect style, and cannot be taken as a straightforward report on the opinions of Zola himself.) Mouret boasts, “Why, we can sell what we like when we know how to sell! There lies our triumph.” The implied author continues:

And with his southern spirit, he showed the new business at work. . . . From counter to counter the customer found herself . . . yielding to her longing for the useless and the pretty. . . . Right at the summit appeared the exploitation of woman. . . . It was woman that they were continually catching . . . yielding at first to reasonable purchases for the household, then tempted by their coquetry, then devoured. . . . Through the very gracefulness of his gallantry, Mouret thus allowed to appear the brutality of a Jew. . . .

“Once have the woman on your side,” whispered he to the baron, and laughing loudly, “you could sell the very world.”¹¹

Unlike Balzac or Dickens or many other of the clerisy, Zola was not anticapitalist out of mere ignorance about how trade-tested betterment worked. In his laboriously gathered notes for The Ladies’ Paradise (he spent a month wandering in Le Bon Marché and its competitors overhearing conversations and interviewing its staff) he wrote, “A department store [smashes] all the small commerce of a neighborhood . . . but I would not weep for them, on the contrary: for I want to show the triumph of modern activity,” of which Zola in his rational optimism by 1882 approved. The local drapers, like the local hardware stores facing Menards and Home Depot, “are no longer of their age, too bad for them!”¹² And good for the consumer.

The sociologist Georg Simmel—about the economy often more penetrating than his contemporary Max Weber—noted in 1908 that “usually, the poisonous, divisive, destructive effects of competition are stressed” (though it is creative destruction):

But, in addition. . . . competition compels the wooer who has a co-wooer, . . . to go out to the wooed, come close to him, establish ties with him. . . . To be sure, this often happens at the price of the competitor’s own dignity and of the objective value of his product [that is, by driving down the price]. . . . [Yet] it achieves what usually only love can do: the divination of the innermost wishes of the other, even before he himself becomes aware of them. . . . Modern competition is described as the fight of all against all, but at the same time it is the fight of all for all.¹³

Notes

1. See Measuring Worth.

2. Short 2012, especially his chart “Real GDP per Capita Percent Off High,” extrapolated into 2013; and for international comparisons, 2008–2012, http://data.worldbank.org/indicator/NY.GDP.PCAP.CD.

3. Hobsbawm 2011, p. 419 (the last page). I knew Hobsbawm a little when we were colleagues in the Department of History at Birkbeck College back in 1975–1976, and I have long admired his historical scholarship, without always agreeing with it.

4. Hobsbawm 2011, p. 417.

5. Mishra 2011, p. 12.

6. Reich 2014.

7. Reich 2014.

8. Ibsen 1877 (1965), p. 43.

9. Ibsen 1877 (1965), p. 117.

10. Postrel has written the book on glamour (2013).

11. Zola 1882–1883 (1992), pp. 68–70.

12. Quoted in Kristin Ross’s introduction to Zola 1882–1883 (1992), pp. xi–xii; the italics are Zola’s.

13. Simmel 1908 (1955), pp. 61–62; his italics.

Widening inequality still hampers upward mobility. That’s simply because the ladder is far longer now. The distance between its bottom and top rungs, and between every rung along the way, is far greater. Anyone ascending it at the same speed as before will necessarily make less progress upward.¹

Reich is mistaken. Horwitz summarizes the results of a study by Julia Isaacs on individual mobility 1969–2005: “82% of children of the bottom 20% in 1969 had [real] incomes in 2000 that were higher than what their parents had in 1969. The median [real] income of those children of the poor of 1969 was double that of their parents.”² There is no doubt that the children and grandchildren of the English coal miners of 1937, whom Orwell describes “traveling” underground, bent over double walking a mile or more to get to the coal face, at which point they started to get paid, are much better off than their fathers or grandfathers. There is no doubt that the children and granchildren of the Dust Bowl refugees in California are. Steinbeck chronicled in The Grapes of Wrath their worst and terrible times. A few years later many of the Okies got jobs in the war industries, and many of their children went to university. Some became university professors who think that the poor are getting poorer.

The usual way of talking about poverty relies on the percentage distribution of income, staring fixedly for example at an official-sounding but relative “poverty line.” As the progressive Australian economist Peter Saunders observes, however, such a definition of poverty “automatically shift upwards whenever the real incomes [and hence the poverty line] are rising.”³ The poor are always with us, but merely by definition, the opposite of the Lake Wobegon effect—it’s not that all the children are above average, but that there is a bottom fifth or tenth or whatever, always, in any distribution whatsoever. Of course.

It’s not higher math. The philosopher Harry Frankfurt noted long ago that “calculating the size of an equal share [of income in the style of poverty lines or Gini coefficients] is plainly much easier than determining how much a person needs in order to have enough”—”much easier,” as in dividing GDP by population and reporting with irritation that some people earn, or get, more.⁴ It is the simplified ethics of the schoolyard, or dividing a cake among friends: “That’s unfair.”

But as Frankfurt also noted, inequality is in itself ethically irrelevant: “Economic equality is not, as such, of particular moral importance.” In ethical truth we wish to raise up the poor to “enough” for them to function in a democratic society and to have full human lives. It doesn’t matter ethically whether the poor have the same number of diamond bracelets and Porsche automobiles as do owners of hedge funds. It does, however, matter ethically whether they have the same opportunities to vote or to learn to read or to have a roof over their heads. The Illinois state consitution of 1970 embodied the confusion between the condition of the working class and the gap between rich and poor, claiming in its preamble that it seeks to “eliminate poverty and inequality.”⁵ We had better focus directly on what we actually want to achieve, which is equal sustenance and dignity, eliminating poverty, acquiring for all people what the economist Amartya Sen and the philosopher Martha Nussbaum call capabilities.⁶ The size of the Gini coefficient or the share of the bottom 10 percent is irrelevant to the noble and ethically relevant and actually attainable purpose of raising the poor to a condition of dignity, Frankfurt’s “enough.”

The Liberal Lady Glencora Palliser (née M’Cluskie) in Anthony Trollope’s political novel Phineas Finn (1867–1868) declares, “Making men and women all equal. That I take to be the gist of our political theory,” as against the Conservative delight in rank and privilege. But one of the novel’s radicals in the Cobden-Bright-Mill mold (“Joshua Monk”) sees the ethical point more clearly, and replies to her: “Equality is an ugly word, and frightens,” as indeed it had long frightened the political class in Britain, traumatized by wild French declarations for égalité, and by the example of American egalitarianism (well . . . egalitarianism for male, straight, white, Anglo, middle-aged, high-income, nonimmigrant, New England mainline Protestants). The motive of the true Liberal, Monk continues, should not be equality but “the wish of every honest [that is, honorable] man . . . to assist in lifting up those below him.”⁷ Such an ethical goal was to be achieved, Monk the libertarian liberal would argue, not by direct programs of redistribution, nor by regulation, nor by trade unions, but by free trade and rights for women and tax-financed education—and in the event above all by the Great Enrichment, which finally in the late nineteenth century started sending real wages sharply up, Europe-wide. The absolute condition of the poor has been raised overwhelmingly more by the Great Enrichment than by regulation or redistribution. As the economic historians Ian Gazeley and Andrew Newell concluded in their 2010 study of “the reduction, almost to elimination, of absolute poverty among working households in Britain between 1904 and 1937”: “The elimination of grinding poverty among working families was almost complete by the late thirties, well before the Welfare State.” Their chart 2 exhibits weekly income distributions in 1886 prices at 1886, 1906, 1938, and 1960, showing the disappearance of the inflation-adjusted classic line of misery for British workers, “’round about a pound a week.”⁸

Yet the left works overtime, out of the best of motives, to rescue its ethically irrelevant focus on Gini coefficients and the relative poverty line. A recent example of the leftish labor is the book by a French economist I have mentioned, Thomas Piketty’s Capital in the Twenty-First Century (translated 2014), which was greeted with squeals of delight by the American and British left, and rapidly rose to number one on the New York Times best-seller list. Piketty claims that relative poverty is what matters, whether or not the poorest improve. “Just as we’ve been saying!” the left cried. “Eliminate poverty and inequality.”

Much of the research on the economics of inequality stumbles on this simple ethical point, focusing on measures of relative inequality such as the Gini coefficient rather than on measures of the absolute welfare of the poor, on inequality rather than poverty, having elided the two. Speaking of the legal philosopher Ronald Dworkin’s egalitarianism, Frankfurt observed that Dworkin in fact, and ethically, “cares principally about the [absolute] value of people’s lives, but he mistakenly represents himself as caring principally about the relative magnitudes of their economic assets.”⁹ Dworkin and the left commonly miss the ethical point, which is the liberal, Joshua Monk one of lifting up the poor. By redistribution? By equality in diamond bracelets? By codes for buildings or unions for trades? No: by the dramatic increase in the size of the pie, which has historically brought the poor to 90 or 95 percent of “enough,” as against the small percent of enough attainable by redistribution without enlarging the pie. The economic historian Robert Margo noted in 1993 that before the Civil Rights Act “blacks could not aspire to high-paying white collar jobs” because of discrimination. Yet African Americans had prepared themselves, by their own efforts, up from slavery, to perform in such jobs if given a chance. “Middle-class blacks owe their success in large part to themselves,” and to the increasingly educated and productive society they lived in. “What if the black labor force, poised on the eve of the Civil Rights Movement, was just as illiterate, impoverished, rural, and Southern as when Lincoln freed the slaves? . . . Would we have as large a black middle class as we do today? Plainly not.”¹⁰

Piketty is alarmed by what he claims is the force of interest on inherited wealth causing inequality to increase. In 2014 he declared to the BBC’s Evan Davis in an interview that “money tends to reproduce itself.” Yet his own data suggest that only in the United States and the United Kingdom (with Canada) has inequality of wealth increased recently—a puzzle if money tends to reproduce itself, always, as a general law governed by his Ricardo-plus-Marx inequality-producing accumulation of financial capital, Piketty’s master algebra of r > g. Inequality in fact goes up and down in great waves, 1800 to the present, which also doesn’t figure in such a tale. Once a Piketty-wave starts it would, according to his logic, never stop, which means we should have been overwhelmed by an inequality-tsunami in 1800 CE or 1000 CE or for that matter 2000 BCE.

Nor does Piketty acknowledge entrepreneurial profit, the trade-tested betterment that through the Bourgeois Deal has made the poor rich. He focuses on the evil of rich people having seven Rolex watches by mere inheritance. Liliane Bettencourt, heiress to the L’Oréal fortune, in 2014 the wealthiest woman in the world, who “has never worked a day in her life, saw her fortune grow exactly as fast as that of [the admittedly bettering] Bill Gates.” Ugh. Which is the sum of Piketty’s ethical analysis.

The Australian economists Geoffrey Brennan, Gordon Menzies, and Michael Munger make a similar argument in a recent paper, written in advance of Piketty’s book, that inheritance inter vivos of human capital is bound to exacerbate Gini-coefficient inequality because “for the first time in human history richer parents are having fewer children. . . . Even if the increased opulence continues, it will be concentrated in fewer and fewer hands.”¹¹ The rich will send their one boy, intensively tutored in French and mathematics, to Sydney Grammar School and on to Harvard. The poor will dissipate what little they have among their supposedly numerous children.

Yet if on account of Adam Smith’s hoped-for “universal opulence which extends itself to the lowest ranks of the people” all have access to excellent education—which is a proper subject for social policy—and if the poor are so rich (because the Great Enrichment) that they too have fewer children, which is the case, then the tendency to rising variance will be attenuated.¹² The economist Tyler Cowen reminds me, further, that “low” birth rates also include zero children, which would make lines die out—as indeed they often did, even in royal families, well nourished. Nonexistent children, such as those of Grand Duke of Florence Gian Gastone de’ Medici in 1737, can’t inherit either financial or human capital.

And the effect of inherited wealth on children is commonly to remove their ambition, as one can witness daily on Rodeo Drive, or in Bettencourt’s daughter. Laziness from being rich too early is a powerful equalizer. Imagine if you had inherited ten million dollars at age eighteen, before your character was fully formed. It would have been an ethical disaster, as it regularly is for the children of the rich. However many diamond bracelets they have, most rich children don’t bother to suffer through, say, a PhD in economics. Why bother? David Rockefeller did, to be sure (University of Chicago, 1940), but his grandfather was unusually lucky in transmitting a poor boy’s values and a life-long philanthropist’s tastes to his son and then to his six John-Junior-begotten grandchildren. We prosperous parents of the Great Enrichment can properly worry about our children’s and especially our grandchildren’s incentives to undertake such efforts as a PhD, or serious entrepreneurship, or for that matter serious charity (Bettencourt’s charitable foundation, by contrast with the Rockefellers’, is comically niggardly, endowed with only one-half of 1 percent of her wealth).

And it is commonly the case, contrary to the focus of Piketty and of Brennan, Menzies, and Munger on inheritance, that the people with more money got their more by being more productive, for the benefit of us all—getting that PhD, for example, or being excellent makers of automobiles or excellent writers of novels or excellent throwers of touchdown passes or excellent providers of cell phones, such as Carlos Slim of Mexico (with a little boost, it may be, from corrupting the Mexican parliament). That Frank Sinatra became richer than most of his fans was not an ethical scandal. The “Wilt Chamberlain” example devised by the philosopher Robert Nozick says that if we pay voluntarily to get the benefit of clever CEOs or gifted athletes there is no further ethical issue.¹³ The unusually high rewards to the Frank Sinatras and Jamie Dimons and Wilt Chamberlains come from the much wider trading during the age of globalization and of mechanical reproduction, not from theft.¹⁴

For the poor in the countries that have allowed the ethical change to happen, Frankfurt’s “enough” has largely come to pass. “Largely,” I say, and much more than alternative systems have allowed. I do not say “completely” or “as much as every honest person would wish.” But I have noted that the contrast between the condition of the working class in the United States and in such avowedly social-democratic countries as the Netherlands or Sweden is not in fact large, despite what you have heard from journalists and politicians who have not seriously looked into the actual statistics or have not seriously experienced more than one country. The social safety net is, in practice, rather similar among rich countries. But in any event the safety net, with or without holes, is not the main lifter of the poor in the United States, the Netherlands, Switzerland, Japan, Sweden, or the others. The way to the lift is the Great Enrichment.

Boudreaux noted that a literal billionaire who participated in a seminar of his didn’t look much different from an “impoverished” graduate student giving a paper about Gini coefficients. “In many of the basic elements of life, nearly every American is as well off as Mr. Bucks [his pseudonym for the billionaire]. If wealth differences between billionaires and ordinary Americans are barely visible in the most routine aspects of daily life, then to suffer distress over a Gini coefficient is to unwisely elevate ethereal abstraction over palpable reality.”¹⁵ Mr. Bucks undoubtedly had more houses and more Rolls Royces than the graduate student. One may ask, though, the cheeky but always relevant question: So what?

People are actually and ethically looking for a standard of what is enough for a dignified life in a given society. How much dough is enough? To the Dust Bowl refugees the minstrel Woody Guthrie sang, “California’s a garden of Eden, / A paradise to live in or see. / But believe it or not / You won’t find it so hot / If you ain’t got the do re mi.” You need the dough in the do re mi to buy the roof and the toilet and the food at California prices. Therefore Peter Saunders and others such as Horwitz and the theorists of capabilities propose to look at the goods poor people can buy and the rights they have. They ask: What’s enough? Saunders determined “the items that are widely regarded as essential in today’s [Australian] society,” such as a telephone, a washing machine [thus the Washing Line], a separate bed for each child.¹⁶ The “widely regarded” in his study comes from an opinion poll of Australians. If things go well by such a measure the level of Australian poverty can possibly fall. With an ever-rising relative poverty line it can never fall, which is nice for pessimists but silly as science or policy. If one uses a Gini coefficient, the measure of inequality becomes the level of diamond-encrusted-watch owning, excesses that are annoying and blameworthy but ethically irrelevant so far as state compulsion is concerned. After all, many private actions are blameworthy without triggering justifiable interference by the state—listening to NPR without pledging, or failing once again to go to the gym, or not eating your vegetables. Measuring rather the goods poor people can buy and the rights they have, public policy (that is, state compulsion) can focus on what actually matters to dignity, such as making schools work well, improving medical care, ending the War on Drugs, preventing voter suppression, changing the trade union–determined building code so that apartments can be built that the poor can occupy in a dignified way at a low rent.

Using Saunders’s survey, for example, between 2006 and 2010 (which includes the world’s Great Recession years, though at the time Australia was having a mining boom selling to China), the average number of items, out of the twenty-four the Australian public viewed as “essential,” that were absent in single-parent households fell from 3.6 to 2.9. If things had got worse, with the number of absent essentials rising to 6.9 instead of falling to 2.9, Australians would have a justifiable basis for alarm, and some indication of what to do about it.

The postmodern French philosopher worshipped on the left, Michel Foucault (1926–1984), provides unlikely support for such thinking. Daniel Zamora, a Belgian sociologist, in an interview about his 2014 book Critiquer Foucault (Criticizing Foucault) reports that

Foucault himself met with [the conservative French economist Lionel] Stoléru several times when Stoléru was a technical advisor on the staff of [the right-wing French president] Valéry Giscard D’Estaing. An important argument runs through [Stoléru’s] work and directly attracted Foucault’s attention: in the spirit of [Milton] Friedman, it draws a distinction between a policy that seeks equality (socialism) and a policy that simply aims to eliminate poverty without challenging disparities (liberalism). . . . [Stoléru wrote:] “I believe the distinction between absolute poverty and relative poverty is in fact the distinction between capitalism and socialism.”

Indeed. Solving absolute poverty came in fact from the Great Enrichment, and attempting to solve a logically insoluble relative poverty resulted in slow growth and the encouragement of an insatiable envy.

The result is general. Despite the clamor about poverty lines and Gini coefficients, nowhere in the past few decades except in war-of-all-against-all countries such as Somalia have conditions measured by a correct standard of “enough” worsened, even in notably unequal places such as Brazil, South Africa, Chile, China, or the United States. They have got better.

Notes

1. Reich 2014.

2. Isaacs 2007, quoted in Horwitz 2013, p. 7.

3. Saunders 2013, p. 214.

4. Frankfurt 1987, pp. 23–24.

5. ilga.gov/commission/lrb/conent.htm.

6. Sen 1985; Nussbaum and Sen 1993.

7. Trollope 1867–1868, vol. 1, pp. 126, 128.

8. Gazeley and Newell 2010, abstract, p. 19, chart 2 (p. 17).

9. Frankfurt 1987, p. 34; my italics.

10. Margo 1993, pp. 68, 65, 69.

11. Brennan, Menzies, and Munger 2013.

12. Smith 1776, 1.1.10, p. 22.

13. Nozick 1974, p. 164.

14. Benjamin 1936.

15. Boudreaux 2001.

16. Saunders 2013, pp. 213, 215.

The capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within the reach of factory girls in return for steadily decreasing amounts of effort. . . . The capitalist process, not by coincidence but by virtue of its mechanism, progressively raises the standard of life of the masses.¹

By now Schumpeter’s point is still more obviously correct. The “mechanism” he had in mind is the entry of fresh entrepreneurs, driving the labor-hour price of things down, down, down, to the annoyance of the first betterers, who would rather have patent monopolies, such as Thomas Edison persistently sought.

W. Michael Cox and Richard Alm in 1999 documented the driving down, and recently Donald Boudreaux has reprised their argument using various catalogues from Sears, Roebuck (a company itself overtaken by the entry of entrepreneurs from Target, Walmart, Best Buy, Home Depot, Nordstrom’s Rack, and other betterers, but in 1956 still dominant): “Sears’ lowest-priced no-frost refrigerator-freezer in 1956,” notes Boudreaux, “had 9.6 cubic feet of space, and sold for $219.95 (in 1956 dollars).”

Because the typical production-line worker back then earned $1.89 per hour (in 1956 dollars), an average American in the mid-1950s had to toil 116 hours to buy this refrigerator-freezer. Today, Home Depot sells a similar refrigerator-freezer for $298 (in 2013 dollars). Earning $20.14 per hour, an average American worker today works 15 hours to buy that appliance.²

That’s 116 hours versus merely 15, an 87 percent decline in the real cost of living by work. The widespread notion that times were better for ordinary Americans in the 1950s than they are now could use some fact checking.

Yes, the rich got richer, 1800 to the present—they too spend less to buy a much better color television now than they did in 1975, and get a much better commute in their chauffeur-driven vehicle now than in 1800. But so did the poor get richer, much richer, at first in the late nineteenth century in such pioneering countries as Britain and France, and then in a wider world. Even in 1776 Adam Smith could claim that because of the elaborate division of labor and the trade that accompanied it “the very meanest person in a civilized country” had the advantage of “the easy and simple manner in which he is commonly accommodated”:

Compared, indeed, with the more extravagant luxury of the great, his accommodation must no doubt appear extremely simple and easy; and yet it may be true, perhaps, that the accommodation of an European prince does not always so much exceed that of an industrious and frugal peasant, as the accommodation of the latter exceeds that of many an African king, the absolute master of the lives and liberties of ten thousand naked savages.³

Smith knew next to nothing about African kings, and one may doubt the literal truth of the comparison in 1776 (it had become a common figure of argument after the Age of Exploration, used for example by John Locke). But the Great Enrichment made it true.

The subsequent enrichment of the very meanest person in Scotland was, I have frequently noted, 9,900 percent. It can only be explained by vastly greater productivity per worker, which is to say by a startling speeding up since 1800 of trade-tested betterment. (The figure of 9,900 percent derives from the fifth-grade arithmetic I mentioned earlier. A factor of 100, if expressed as a percentage change over the base, is calculated as 100 minus the base of 1 [in the year 1800], which is by the subtraction 99, divided by the same base, 1, but then multiplied by 100 to get it into per hundred terms, that is, [(100 – 1)/1] × 100 percent, or 9,900 percent. The exactitude of the 9,900 percent is silly: we do not know such a figure even to two significant digits. Its non-silly import, though, and the reason I’ll keep using it, is that we have in fact benefited mightily from a very large percentage increase of productivity over the base in 1800.)

One thousand percent, 5,000 percent, 10,000 percent—take your pick. It is anyway orders of magnitude of uplift that cannot be explained by little uplifts from improved static efficiency or little uplifts by reductions of worker exploitation. The Great Enrichment did not happen because of union demands or government regulation or routine exploitations or routine investments. Such routines, about which so much politics of left and right turns (“Raise the minimum wage!” “Protect the investing class!”), can’t deliver 9,900 percent, whether one-by-one or in combination. If they could, the Great Enrichment would have happened earlier and elsewhere, since thrift and exploitation and investment, and for that matter occasional outbreaks of democratic demands for higher wages, are routine in human history.

The uplifting since 1800, in other words, was distinctly positive-sum, a free lunch, the sort of event the management theorist Mary Parker Follett dubbed in 1925 a win-win. She elsewhere said that the best democracy is not the rule of the majority but a search for agreement.⁴ The easiest way of finding agreement is to find a win-win deal, which economists call “Pareto improving.” The deals were possible because of radically new ideas, such as the betterments of steam and steel or of fertilizer and antibiotics or of voting and education—betterments, and voting and education, not encouraged in an old world long in the grip of an anxious and arrogant elite able to enforce its self-protectionisms. The economic and political betterments, and the intellectual children and grandchildren and great-grandchildren of the betterments, were imagined, produced, financed, tested, and sold by the middle class.

It didn’t happen, I repeat, because of elite science.⁵ As Ó Gráda put it recently, “The foremost inventor-entrepreneurs of the Industrial Revolution were of rather modest, artisanal origins.”⁶ Elite science made us richer only quite late in economic history, long after 1900. And anyway the eventual successes of useful science itself came from a Scottish equality and a resulting Great Enrichment that gave British design engineers and German organic chemists from modest backgrounds a shot at fame and riches. Without liberty and dignity for ordinary people the anxious elite would have suppressed commercial improvements, such as Wedgwood’s pottery (Wedgwood despised patents, and only had one) or Edison’s movie camera (his patent on movies, among the fully 1,093 he acquired, was partly overturned only in 1902, and for good in 1917), which in the event were brought within the reach of factory girls in return for steadily decreasing amounts of effort.

The Great Enrichment after 1800 came from human creativity unleashed by liberty and dignity for ordinary people, through trade-tested betterment resting on a new equality in the eyes of others, and spread by the overturning of monopoly in competition. On the supply side, the creativity of ordinary people now able to become extraordinary was released. On the demand side, the tastes of ordinary people were indulged, in cheap watches and Model T Fords and no-press shirts. The philosopher Karl Popper called the trade-oriented novelty of the modern world the “open society,” and the politico-economic theorists Douglass North, John Wallis, and Barry Weingast call it the “open-access” society.⁷ The ORDO liberals of pre- and postwar Germany called it “a competitive order” or a “social market economy” (which, however, they believed required a strong government to keep it from descending into monopolies, as indeed it had in Germany).⁸ Whatever it is called, such a society, thronging with free conversations easily joined, made for a creativity that disturbed the rules of the game—rules designed, unsurprisingly, by the elite in favor of the old rich. The open economy created numerous nouveaux riches, such as James Watt and Robert Fulton. Both eventually failed to protect their monopolies. Fernand Braudel argued to the contrary that capitalism was inherently and permanently monopolistic. But les nouveaux hommes were themselves competed against by still newer rich, to the benefit, in the third act, of us all, à la Schumpeter and Nordhaus. A patent or copyright monopoly, to be sure, must be broken for the poor to benefit. But aside from overlawyered definitions of so-called intellectual property, for the most part it has been.⁹

The mechanism that raised up the poor is not a trickle down of expenditures from rich people. One hears such an argument from the right—even, alas, from Adam Smith on a rare bad day, in one of merely two uses in his published writings of the phrase “invisible hand.”¹⁰ One hears too a Keynesian form of trickle up from the left, as from the well-meaning Robert Reich in the Nation magazine: “If consumers don’t have adequate purchasing power, businesses have no incentive to expand or hire additional workers [note Reich’s desideratum: jobs]. Because the rich spend a smaller proportion of their incomes than the middle class and the poor, it stands to reason that as a larger and larger share of the nation’s total income goes to the top, consumer demand is dampened.”¹¹

Reich’s reasoning supposes that the point of an economy is jobs, jobs, jobs, and that spending assures jobs. The writer Pascal-Emmanuel Gobry calls such a view “productionist,” as against “creativist,” and admits (as I do) that in the very short run it is true.¹² The economy in the short run is indeed a treadmill of production and consumption that can stop running if whacked with a sledgehammer, as for example the Greek economy was in 2015 when the banks were closed. In a year of mass unemployment caused by great whackings—1933 in the United States and Germany, for example—the Keynesian trickle up from expenditure is correct. By all means, dig holes and fill them up and then dig them again, and pay the diggers/fillers with newly printed currency. (On the other hand, estimates of the “multiplier” on government expenditure even in 1933 have come in at below 1.0.) But in a more typical year of mismatched jobs and skills, the Keynesian argument is incorrect. Nor is it correct from peak to peak of the business cycle, for which only a creativist view makes economic sense. In the long run we get better off only by betterment, not by spending.¹³ If spending worked, we could enrich ourselves endlessly by printing money and handing it out in steadily increasing sums to those high-spending poor—an unlimited miracle achieved merely by printing little portraits of George Washington. In nonmiraculous economies, during the long run and even in most of the short run, spending on an auto or TV has an opportunity cost of spending on food or education. There is no free lunch springing from a trickle down (as the Republicans say), or a trickle up (as the Democrats say), from mere spending. We get better by getting smarter, only, not by miraculous trickles up or down.

The Schumpeterian mechanism is the long-run one of open competition of betterments among the temporarily rich in Riverside orange groves and Manchester cotton mills and Chicago apartment developments and Swedish furniture stores that radically cheapens food and clothing and housing and furniture. It has nothing to do with trickling. Such openness to competition after 1800, and the cooperation that betterments require, made the economies that adopted it startlingly more productive, creating ten times, thirty times, a hundred times more goods and services, and to the poorest among us.

§

Even in the already-advanced countries in recent decades there has been no complete stagnation of real incomes for ordinary people. You will have heard that “wages are flat” or that “the middle class is shrinking.” But you also know that you should not believe everything you read in the papers.¹⁴ This is not to say that no one in rich countries such as the United States is unskilled, addicted, badly parented, discriminated against, or simply horribly unlucky. George Packer’s recent The Unwinding: An Inner History of the New America (2013) and Barbara Ehrenreich’s earlier Nickel and Dimed: On (Not) Getting By in America (2001) carry on a long and distinguished tradition of telling the bourgeoisie about the poor, going back to James Agee and Walker Evans’s Let Us Now Praise Famous Men (1944), George Orwell’s The Road to Wigan Pier (1937), Jack London’s The People of the Abyss (1903), Jacob Riis’s How the Other Half Lives: Studies among the Tenements of New York (1890), and, the fount of such writings, Friedrich Engels’s The Condition of the Working Class in England (1845).

They are not making it up. Anyone who reads such books is wrenched out of a comfortable ignorance about the other half. The wrenching comes also in fictional form, from John Steinbeck’s The Grapes of Wrath (1939) or James T. Farrell’s Studs Lonigan (1932–1935) or Richard Wright’s Native Son (1940) or, in Europe, among the many observers of the Two Nations since the beginning of such a sensibility in the 1840s, Émile Zola’s Germinal (1885), which made many of us into socialists. The wrenching is salutary. It is said that Winston Churchill, scion of the aristocracy, believed that most English poor people lived in rose-covered cottages. He couldn’t imagine back-to-backs in Salford, with the communal outhouse at the end of the row. Wake up, Winston.

But waking up does not imply despairing, or proposing the overthrow of the System, if the System is in fact over the long run enriching the poor, or at any rate enriching the poor better than those other systems that have been tried from time to time. Righteous, if inexpensive, indignation inspired by survivor’s guilt about alleged “victims” of something called “capitalism,” and envious anger at the silly consumption by the rich, does not invariably yield betterment for the poor. Remarks such as “there are still poor people” or “some people have more power than others,” though claiming the ethical high-ground for the speaker, are neither deep nor clever. Repeating them, or nodding wisely at their repetition, or buying Piketty’s Capital in the Twenty-First Century to display on your coffee table, does not make you a good person. You are a good person if you actually help the poor. Open a business. Invest in a grocery store in an urban food desert. Invent a new battery. Vote for better schools. Adopt a Pakistani orphan. Volunteer to feed people at Grace Church on Saturday mornings. The offering of counterproductive policies, or the making of indignant declarations to your husband after finishing an article in the Sunday New York Times Magazine, does not help the poor.

The economy and society of the United States are not in fact unwinding, and people are in fact getting by better than they did before. The children of the sharecropping families in Hale County, Alabama whom Agee and Evans objectified, to the lasting resentment of the older members of the families, are doing pretty well, earning money, many of their children going to college.¹⁵ That even over the long run there remain some poor people does not mean that the system is not working for the poor, so long as the condition of the poor is continuing to improve, as it is, contrary to the newspaper stories and the pessimistic books, and so long as the percentage of the desperately poor is heading toward zero, as it is nationally in the United States, and worldwide. That people still sometimes die in hospitals does not mean that medicine is to be replaced by witch doctors, so long as death rates are falling and so long as the death rate would not fall under the care of the witch doctors.

And poverty is indeed falling, even recently, even in already rich countries. If income is correctly measured to include better working conditions, more years of education, better health care, longer retirement years, larger transfers such as Social Security and Medicaid, and above all the rising quality of the larger number of goods, the real income of the poor has risen, if at a slower pace than in the 1950s—which followed the wretched time-outs of the Great Depression and World War II.¹⁶ The economist Angus Deaton notes that “once the rebuilding is done [as it was fully in, say, 1970], new growth relies on inventing new ways of doing things and putting them into practice, and this turning over of virgin soil is harder than replowing an old furrow.”¹⁷ In 2013 the economists Donald Boudreaux and Mark Perry noted that “according to the Bureau of Economic Analysis, spending by households on many of modern life’s ‘basics’—food at home, automobiles, clothing and footwear, household furnishings and equipment, and housing and utilities—fell from 53 percent of disposable income in 1950 to 44 percent in 1970 to 32 percent today.” It is a point that the economic historian Robert Fogel had made in 1999 for a longer span.¹⁸ The economist Steven Horwitz summarizes the facts on labor-hours required to buy a color TV or an automobile, and notes that “these data do not capture . . . the change in quality. . . . The 1973 TV was at most 25 inches, with poor resolution, probably no remote control, weak sound, and generally nothing like its 2013 descendant. . . . Getting 100,000 miles out of a car in the 1970s was cause for celebration. Not getting 100,000 miles out of a car today is cause to think you bought a lemon.”¹⁹

Nor in the United States are the poor getting poorer. Horwitz observes that “looking at various data on consumption, from Census Bureau surveys of what the poor have in their homes to the labor time required to purchase a variety of consumer goods, makes clear that poor Americans are living better now than ever before. In fact, poor Americans today live better, by these measures, than did their middle class counterparts in the 1970s.”²⁰ In the summer of 1976 an associate professor of economics at the University of Chicago had no air conditioning in his apartment.²¹ Nowadays many quite poor Chicagoans have it. The terrible heat wave in Chicago of July 1995 killed over seven hundred people, mainly low-income.²² Yet earlier heat waves in 1936 and 1948, before air conditioning was at all common, had probably killed many more.²³ The 2003 heat wave in non–air conditioned France killed 14,800 people, and 70,000 Europe-wide. Imagine what the London heat wave in June 1858 did.

Notes

1. Schumpeter 1942 (1950), pp. 67–68.

2. Boudreaux 2013.

3. Smith 1776, 1.1.11.

4. Professor Eduard Bonet of Escuela Superior de Administración y Dirección de Empresas, Barcelona, drew my attention to Follett’s point about democracy.

5. Here I diverge, reluctantly, from Margaret Jacob’s view (for instance in Jacob 2014), which Mokyr follows.

6. Ó Gráda 2014, p. 8.

7. I am indebted to Marlies Mueller for reminding me of Popper’s usage.

8. See the lucid treatment in Wagner 1994. The capitalization and italicization of ORDO refers to the title of a yearbook published from 1948 by the Freiburg (Germany) School of economists recommending Ordnungspolitik, “order policy.”

9. Bell 2014; and Boldrin and Levine 2008.

10. Smith 1759 (1790), p. 184.

11. Reich 2014.

12. Gobry 2014.

13. That was the point of my early supply-side essay about British economic growth in the late nineteenth century, McCloskey 1970.

14. See for example Lawrence 2015.; and for Canada Grubel 2025, making the point that mobility through the quintiles changes the picture dramatically.

15. Whitford 2005.

16. Boudreaux and Perry 2013.

17. Deaton 2013, p. 231.

18. Fogel 1999, p. 190.

19. Horwitz 2013, p. 11 of the working paper, now published as Horwitz 2015.

20. Horwitz 2013, p. 2 of the working paper.

21. Horwitz’s table 4 reports the percentage of poor households with various appliances: in 1971, 32 percent of such households had air conditioners; in 2005, 86 percent did.

22. Klinenberg 2003.

23. Barreca et al. 2013 show the large effect in the United States of air conditioning in reducing excess mortality during heat waves.

I find the world is full of people who think that their dependence on others is decreasing, or that they would be better off if they were more self-sufficient, or that technological progress has brought no improvement in the standard of living, or that the world is steadily deteriorating, or that the exchange of things and ideas is a superfluous irrelevance.^[1]

Such pessimism is favored perhaps by our genetic inheritance of sharp attention to dangers.^[2] It certainly sells books and TV shows and newspapers. News is by definition mostly bad, and modern media tell of disasters from all the wide world. Romanticizing the good old days, compared with which our latter days look so shabby, has been standard since the Romantic movement, and anyway was a conventional trope among the Greeks and Hebrews and Hindus celebrating an age of gold. Science fiction and horror fiction, offshoots of Romanticism, have tended since their invention in the nineteenth century to predict dystopias, reflecting the pessimism about the disturbing betterment current at the time. Consider Mary Shelley’s Frankenstein; or, The Modern Prometheus (1816), H. G. Wells’s The Time Machine (1895), John Wyndham’s The Day of the Triffids (1951), or Matt Damon and Jodie Foster in Elysium (2013). It is a rare science-fiction writer, a Robert Heinlein or an Ursula K. Le Guin, who does not see the future as a version of scientific mischance or class struggle or imperial fascism or, most recently, environmental catastrophe.

But look around at the material betterments since 1800 in such places as your own room, located in a high-rise unbuildable before the 1880s with a condominium agreement first invented in Puerto Rico in 1958:

All this. And note how all of it arose over the past two centuries only, in a trade-testing economy.

It did not arise from the government or from unions, as fine as such institutions are in other ways. I do earnestly believe that government “has a role,” as my friends on the left relentlessly put it to me. For example, I admire the Civil Rights Act of 1964, especially its overturning of legal segregation, and the Voting Rights Act of 1965, overturning voter suppression. And as for unions, I belonged when I was seventeen to the National Maritime Union, and now in old age I belong enthusiastically—reacting to the union-busting folly of our local version of bureaucracy run mad in the “administrative university”—to a union for professors at the University of Illinois at Chicago, affiliated with the American Federation of Teachers, AFL-CIO. You gotta go down and join the union. I’m a union maid.

But I do not imagine that expanding the government or joining the union will radically improve the material condition of my people, rich or poor. That would be mistaken economics and mistaken history. The enrichment came mainly from bourgeois liberty and creativity unbridled, not from piling up constraints on voluntary deals or from redistributing what income we get from the deals. Wages and working conditions, after such shocking enrichment, are in fact determined largely by supply and demand, not by regulations passed by Congress or by struggles on the picket line. All boats do rise. Professors and artists and child-care workers, whose productivity has not increased for millennia, benefit from being substitutes in the long run for farmers and truck drivers and medical doctors, whose productivity during the Great Enrichment has risen enormously. A professor with an antique technology of chalk-and-talk could have instead entered farming or medicine, which means that she must earn, roughly at least, what such utterly transformed jobs earn. The professor cannot earn in equilibrium one-tenth, say, of what farmers earn, not because it would be unfair but because she could move, as the poet Robert Frost did in the early twentieth century, between farming and teaching. A ten-to-one differential is not sustainable if a sufficient number of people can move. Such reasoning was Adam Smith’s chief analytic contribution to the emerging political economy of the eighteenth century.

If such an economic analysis were not roughly true in the world, one could not explain why Walmart employees, not unionized, make conservatively measured twenty times what the average South Asian employee makes. The explanation is obviously not solidarity forever or bargaining skill, or the more stringent regulatory constraints that Walmart faces in the United States. Walmart would not be in business if the legally required minimum wage were thirty times what it earned from hiring a laborer, no more than it would if the minimum wage were raised to $300 an hour. The gap between the United States and South Asia arises not from acts of Congress but from the economist’s “marginal productivity theory,” the commercial demand for labor determined by how much money for the employers the average employee produces in an extra hour of work. Marginal, or for that matter total, productivity depends on how fully an economy has been able to take advantage of bourgeois betterment. Trade-testing of new ideas, not government-regulating or union-joining, did it.

§

The English colonists in North America at first lived on $2 a day. The historical reconstruction of the Plimouth Plantation in southeastern Massachusetts shows how the settlers lived in the 1620s—drafty, unplastered walls, without glass windows, enclosing the sole room on the ground floor, and up a ladder to a sleeping loft. Six people lived there (in northern Europe typically there were also cows in the back for additional heat, and smell). The mother had one skirt for Sunday and one or two for the rest of the week. The newcomers faced disease, often fatal, in the first, “seasoning” generation, and smallpox and dysentery were ongoing threats, especially to children. The television series Colonial House in 2004 showed people trying to live in the way of pioneers in Maine in 1628, to similar effect. It was no bag of bluebirds. (True, in America, as was not the case among most Europeans at the time, there was from the beginning usually sufficient food, though still reliant on the harvest. Smith was right to note in 1776 of the English colonies that “a dearth has never been known there.”^[3])

Yet by 2011 the average resident of the United States consumed, correcting for inflation, $132 a day, sixty-six times more housing, food, education, furniture than in 1620—a betterment of 6,500 percent. Such a figure is conservatively measured, not allowing for the better quality of today’s goods and services. The rise is a great deal larger per person if you adjust for the better quality of modern medicine (antibiotics, painless dentistry) and travel (cars, airplanes) and lighting (incandescent bulbs and now LEDs) and knowledge (philosophy and literature, physical science and, yes, economics). Such bettering would yield, according again to the always useful economist William Nordhaus, a factor as high as the rough yet justifiable figure at the upper end of the possibilities I keep mentioning, a factor of 100.^[4] Thomas Babington Macaulay (1800–1859), with a longer perspective than his depressed contemporaries the classical economists, remarked in his History of England from the Accession of James the Second (1848):

It is now the [Romantic] fashion to place the Golden Age of England in times when noblemen were destitute of comforts the want of which would be intolerable to a modern footman, . . . when to have a clean shirt once a week was a privilege reserved for the higher class of gentry, . . . when men died faster in the lanes of our towns than they now die on the coast of Guiana [thus seasoning illness]. We too shall, in our turn, be outstripped. . . . It may well be, in the twentieth century . . . that laboring men may be as little used to dine without meat as they now are to eat rye bread; that sanitary police and medical discoveries may have added several more years [try thirty more, Tom] to the average length of human life; that numerous comforts and luxuries which are now unknown, or confined to a few, may be within the reach of every diligent and thrifty working man.^[5]

In the reign of Marx and materialism, 1890–1980, it was the fashion to deprecate Macaulay as hopelessly optimistic about progress. In the same extraordinary year of 1848 in which Macaulay published the first volume of his History, John Stuart Mill published the first edition of his Political Economy, in which he predicted merely modest betterment, modest in view of diminishing returns and the principle of population. Even in its last edition, 1871, when the betterment was becoming obvious, Mill did not modify his restrained and un-Macaulayite enthusiasm for the twentieth century to come. But Macaulay, not Mill, was more correct in his predictions, and his post-dictions. The anti-Whig-history pessimists, from Mill to Herbert Butterfield, were mistaken (as Butterfield himself eventually conceded, becoming himself a Whig historian). Fernand Braudel, the soft-left French historian of “capitalism,” observed that even the rich in olden times suffered a world in which “heating was still poor, ventilation derisory.”^[6] In a rich modern economy even quite poor people have access to vaccination, air conditioning, automobiles, reliable birth control, the Internet, and flush toilets. The aristocrats attending on the very Sun King himself at Versailles in 1715 had access instead to smallpox, hand-held fans and open windows, bumpy carriages, leaky condoms, a small list of censored books, and relieving themselves in the staircases of Le Palais.

You are doubtful still. Open, then, your own closet. Compare it with the volume and quality of clothing possessed by even the richest woman in Plimouth in 1620, or for that matter the above-average woman in Amsterdam in 1800, or all but the extremely well-off in London in 1900 (if you doubt that last, watch the 1999 BBC’s series 1900 House; or while in London visit for a view of eighteenth-century life the Dennis Severs House for its family of Huguenot-descended silk weavers).

Further, a good deal of our present flow of income in the rising number of rich countries goes into consumer durables (as the economists call them), things that yield services over time rather than being, like pizza or movie tickets or copies of the Printer’s Row Journal, used up in a day or a week or a year. The very fact of our massive expenditure on consumer durables betokens an enriched population, which can invest in long-lived items such as cars and granite kitchen counters instead of hustling to get today’s food and drink. Look around at your bedroom. The $2,000 Tempur-Pedic mattress and the $500 Bose clock radio beside it contain together as much productive power as the entire average yearly income of a person in Ghana or Pakistan or Kyrgyzstan.

The point is stronger still, since the average age of U.S. consumer durables of your house, except for the house itself, is merely a little over four years. Every four and a half years the automobile or the coat or the Bose is, on average, bought again, even though many of the “old” items have no secondhand market to offset the cost of novelty. Such churning of consumer durables is not peculiar to the United States. In Japan the tiny living spaces are refurnished frequently, and the unfashionable furnishings, such as working color TVs and entire bedrooms sets, are left at the curb to be picked up by junk men specialized in the trade.^[7] Your mattress and the Bose together could pay for every fourth year of a Pakistani income. Select a few other items—a fridge, say, or that bedroom set, and you’re set for many, many years of Pakistani life. At a higher income, at say the world’s and Brazil’s average of $33 dollars a day, if you sold your $220,000 average American house (supposing you owned it clear of a mortgage) and took a small apartment or a shack in a favela in Rio you could live on that sale alone for fully eighteen years of leisure at the US average income in 1941, playing soccer barefoot on the beach at Copacabana.

§

In other words, modern economic growth emerged only in the last couple of centuries out of 1,500 centuries, or out of 500, or 100, or 10, or 5. A Malthusian could only predict—from the sevenfold increase of world population 1800 to the present—a homeostatic reversion to $3-a-day misery, or worse. Some still do, while trumpeting their status as Scientists devoted to facts. Our beloved friends the environmentalists and our less-beloved friends the population-control mavens cling to the Malthus of 1798 as their guide.

They have been gravely mistaken. Just about the time that Malthus so persuasively explained it, the old Malthusian constraint, luckily for us, began to dissolve.^[8] Nowadays, and contrary to a Malthusian belief still widely credited, having more humans on the planet is good for the rest of us.^[9] The whole of humankind, and no European imperium or class exploitation about it, broke decisively with the homeostatic equilibrium of being poor and sick. Trade-tested betterment exploded.

[1] Ridley 2010, p. 8.

[2] Adrian Bowyer of the RepRap Project suggested the survival point to me.

[3] Smith 1776, 1.2.

[4] The factor of 100 is argued in a little more detail in Bourgeois Dignity, pp. 54–59, using Nordhaus on lighting and his suggested extrapolations (Nordhaus 1996). Fouquet and Pearson (2011) confirm Nordhaus on lighting.

[5] Macaulay 1848, end of chap. 3. Tom G. Palmer drew my attention to the passage.

[6] Braudel 1967 (1973), p. 235. And yet rich Romans had floor heating, denied to rich Europeans until recently.

[7] Bailey 1999.

[8] See, for example, Kenny 2011, Kenny n.d.

[9] Simon 1981 (1996).

Since 1776, there has been a 3,000% explosion in the average real income per person in the world.

Nothing earlier came remotely close.

It was caused not by the usual suspects of investment or exploitation, but by liberty inspiring a flowering of human creativity—in the arts and sciences, and in the economy.

Though Brazilians and many other Latin Americans are uneasily aware that their economies lag some, and sometimes a lot, the Great Enrichment is nonetheless evident everywhere from the Border to Tierra del Fuego, from Santiago in Chile to Recife in Brazil.

The Latin Lag can be overcome. Brazil, like much of Latin America, needs essential liberalism to do it.

Check out my new book, Liberdade: 100 Conversation Starters on Liberalism, Latin America, and Brazil

The betterment stands in human history as that Great Enrichment, the most important secular event since we first domesticated squash and chickens and wheat and horses. The Enrichment has been and will continue to be more important historically than the rise and fall of empires or the class struggle in all hitherto existing societies. Such perennial fascinations of historians, entranced by the realpolitik that accompanies empires rising and classes struggling, had little to do with our enrichment. Empire did not enrich Britain. America’s success did not depend on slavery. Power did not lead to plenty, and exploitation was not plenty’s engine.

The real engine was the expanding ideology of liberty and dignity that inspired the proliferating schemes of betterment by and for the common people. Liberty and dignity for ordinary projectors yielded the Bourgeois Deal: “You accord to me, a bourgeois projector, the liberty and dignity to try out my schemes in voluntary trade, and let me keep the profits, if I get any, in the first act—though I accept, reluctantly, that others will compete with me in the second act. In exchange, in the third act of a new, positive-sum drama, the bourgeois betterment provided by me (and by those pesky, low-quality, price-spoiling competitors) will make you all rich.” And it did.

The ideology supporting the Bourgeois Deal displaced that of the Aristocratic Deal: “You honor me, an aristocrat by natural inequality, and give me the liberty to extract rents from you in the first act, and in the second and in all subsequent acts. I forbid you under penalty of death to seek competitive ‘protection.’ By the third act of the zero-sum drama, if you have behaved yourself, and have pulled your forelock or made your curtsey as I ride by, I will not at least have slaughtered you.” It was extortion, not protection. As an economic historian put it, reacting in 1971 to the claim by an economic theorist that feudal lords had offered “protection” to peasants, “The possibility that the main, if not the only, danger against which the peasant very frequently was in need of protection was the very lord is not mentioned.”^[1]

The bourgeois, voluntary, egalitarian, bettering ideology writ across a society is recent, and therefore cannot be put down to ancient risings of empires and strugglings of classes, or to biological evolution on a scale of centuries. We did not become rich at the time of the rise of trade, which is paleolithically ancient, or upon the establishment of towns and the agricultural state and the legal protection of real property, which are less ancient but nonetheless many millennia old, or in long times of peace, which has characterized life in economically stagnant places as much as in Europe 1815–1914. An ideological change did it, and recently. In northwestern Europe the strange idea grew up that aristocracy (the rule of the best by descent) and theocracy (the rule of priests) and even plutocracy (the rule of the present rich) were all nasty. What replaced them in people’s ideology, slowly, was the rule of the better technique, allowing free entry to compete with the monopolies that the aristocrats or the plutocrats had arranged under the aegis of a captured government. The new ideology in places like Britain and Belgium around 1800 favored a “betterocracy,” or, if you want the pure Greek, a “kaluterocracy.”

The profit going to the betterers was promptly undermined, unless governmental monopolies and governmental protectionism intervened. The economist William Nordhaus has calculated that betterers nowadays earn in profit only 2 or 3 percent of the social value of their inventions.^[2] If you are Sam Walton bettering the retail trade in the matters of inventory control and purchasing contracts, the 2 percent yields a great deal of money. But 98 percent at the cost of 2 percent is nonetheless a pretty good deal for the rest of us. The gain from macadamized roads or vulcanized rubber, then modern universities, structural concrete, and detergent, and then the airplane and the transistor, enriched even the poorest among us.

The new ideology of kaluterocracy spread quickly. In modern conditions of communication (invented by the bourgeoisie, with helpful inputs from secret police eager to read their gentlemen’s mail), quickness rules. As Gaus put it, summarizing the work since 1985 by Peter J. Richerson and Robert Boyd and other proponents of group-level evolution (which was until the 1980s considered rank scientific heresy), “Group-beneficial norms can spread much more quickly within a group via copying or imitation; major cultural changes can occur within 200 years (or indeed considerably less).”^[3] And they did, starting in Holland in the sixteenth century and spreading to England in the eighteenth, and now, two hundred years on, spreading to China and India.

For example, the lower end of the world’s present income distribution, the bottom billion out of seven, as Ó Gráda has documented, has seen a dramatic decline of famine.^[4] In the European Middle Ages a killing famine in the favored south of England came every ten years or so.^[5] The last widespread, killing famine in southern England was 1597, in northern England 1623, in Scotland the 1690s, in France 1710, in Germany, Scandinavia, and Switzerland 1770–1772, in Ireland the late 1840s, in Finland 1866–1868.^[6]

The upper middle of the present-day seven billion—perhaps two billion, double the population of the world in 1800—live in countries in the mold of Greece or Taiwan or Israel. The average income of such places exceeds $80 a day, which is to say two and a half times the present world average, and twenty-six times the world average in 1800. Hans Rosling, a Swedish professor of public health, calls $80 “the Washing Line,” because at that level a household can have an electric washing machine, freeing women from exhausting wash days.^[7] Deborah Fallows reports on a study of material aspirations among the upper bourgeoisie in China: “In the 1950s and 1960s . . . a watch, a bicycle, and a sewing machine. In the 1970s and 1980s . . . a color television, a fridge, and a washing machine. . . . By the late 1990s . . . foreign holidays, . . . computers and cars, and [the wherewithal] to buy their own houses.”^[8] In 1943 in Lansing, Michigan, my mother, a young middle-class woman, would wash the family’s clothing by hand down in the basement, using tubs with washboards. My grandfather, an electrical contractor, was dismayed and bought her a small electric washing machine. One of Donna Leon’s mystery novels set in Venice portrays chief inspector Guido Brunetti in 2012 noting to the department secretary, Signorina Elettra, that people in olden days were miserable: “They’d probably give you anything you asked for,” he declares, “in exchange for a washing machine.” Signorina Elettra laughs in agreement: “I’d give you anything. . . . I suspect that most people—at least the women—would willingly renounce their right to vote in exchange for a washing machine.”^[9]

And the higher, electric-drying end of present-day incomes, over $120 a day, enjoyed now by about half a billion people worldwide, a group growing rapidly each year in number and in share of the world population, and set to become in a few generations the typical human, supports a flourishing life of loft apartments, art museums, higher education, adventure holidays, spiritual exercises, Donna Leon mystery novels, and all the ennobling and not-so-ennobling goods and services of a modern bourgeois town.

§

In other words, when we economic historians lecture to undergraduates we emphasize an anti-Malthusian message of hope—that average human welfare has shot up startlingly since 1800. A graph of average income over time resembles an ice-hockey stick, with tens of thousands of years spent tracing the long, horizontal handle. Then finally, after 1800, history reached the business end of the hockey stick and shot up the blade. A video by Rosling, “200 Countries, 200 Years, 4 Minutes,” makes the optimistic point, illustrating the transition from misery to hope.

The successful countries are “bourgeois,” whether or not they also have capacious social safety nets, such as universal health care. Contrary to the usual myths of capitalism versus socialism, the United States has, if correctly measured, a social safety net almost as generous as, say, France’s. And “socialist” Sweden even nowadays is bourgeois and “capitalist,” and not much less so than the United States. Sweden allows property and profits. It allocates most goods by unregulated prices. The Swedish government, though busybody by historical standards—as are most governments nowadays—does not own much of the means of production. Unlike socialistic Americans, both Democrats and Republicans, who intervened to save General Motors and Chrysler during their post-2007 troubles, the Swedish government refused to bail out Saab Motors (sold in 2010 by that same GM) when it went bankrupt. Nor did the Swedes object when the Chinese bought both bankrupt Saab and solvent Volvo. All “Swedish” cars are now Chinese. Occupational choice in Sweden is free, though encumbered as it is in the United States by cartels of doctors and electricians. Trade-tested betterment is honored, though heavily regulated, as it is also in the United States. Corruption is low, much lower than in most states of the United States, though with a correspondingly high level of intrusive “transparency” from government looking into private matters.^[10] Inheritance in Sweden is not the admired path to social status, as it also is not in the United States. Like most Americans, most Swedish people live in big towns, though decamping to red-painted shacks in the woods for their long summer vacations. Swedes are honest and bourgeois. And they are, conservatively measured, thirty times richer than their ancestors were in what was in 1800 one of the poorest countries in Europe.^[11]

§

Material growth in goods and services is not the only relevant sign of the Great Enrichment. The word “enrichment” has a highly relevant secondary meaning of spiritual growth.^[12] As the economists Ronald Coase and Ning Wang put it in their peroration to How China Became Capitalist (2013), “When the markets for goods and the market for ideas are together in full swing, each supporting, augmenting, and strengthening the other, human creativity and happiness stand the best chance to prevail, and the material and spiritual civilizations march on firm ground, side by side.”^[13]

Many of the clerisy on the left and on the right lament the mass character of modern society, agreeing for example with the leftish Australian economist Geoffrey Harcourt, who wrote in 1994 that trade-tested betterment has stunted “the Christian (and humanist) virtues of altruism, cooperation, tolerance, compassion.” The conservative German economist Wilhelm Röpke in 1958 claimed similarly that mass democracy and enrichment has made for “a situation in which man can have no spiritual or moral life.”^[14] Tocqueville, Matthew Arnold, and José Ortega y Gasset lead the list of hundreds of members of the clerisy during the past century and a half who have deplored from above the Enrichment’s failure to enrich. But contrary to such talk from left and right, and from above, the ability to seek the virtues of altruism and cooperation and to have a spiritual or moral life have in fact come from the enrichment of the masses. We have more pilgrim souls now. Mass-produced food and mass-produced education have on the whole elevated modern life, not corrupted it.

The economists and especially the economic historians know it, in their quantitative way. For example, illiteracy fell from over 90 percent of the world’s adult population in 1850 to 20 percent in 2000, and by 2010 was down to 13 percent for adult women and 8 percent for adult men.^[15] The fall in illiteracy means that the absolute number of literate people has risen since 1850 by a factor of about forty, some 3,900 percent. The rise exceeds the 900 percent rise in worldwide real income per head when the presently poor countries are included. No wonder there are vastly more visits to art museums (on the order of a hundred million attendees per year) and new book titles published (2.3 million per year, about 30 percent in English^[16]).

Abraham Lincoln’s mother and father were illiterate, yet he became the poet president and his son Robert graduated from Harvard. Such leaping up the social scale by educational enrichment did happen before 1800, occasionally. It is often said that Cardinal Woolsey was the son of a butcher—though it appears in fact that the butcher was also a rich merchant. Thomas Cromwell’s father was a blacksmith—though in fact also a cloth merchant. The Chinese examination system allowed the son of a peasant to rise, occasionally, though the sons of the rich, now as then, were usually better prepared to take the exams.

After 1800, though, such leaping up became more common. Father Andrew Greeley (1929–2013), a mystery novelist and academic sociologist at the University of Illinois at Chicago as well as a priest, noted in The American Catholic: A Social Portrait (1977) that the second- and third-generation descendants of poor Irish and Italians immigrants to the United States by then trailed only Jews in educational attainment. You can confirm it by looking at the last names beginning with Mc- and O’- or ending with -a, -i, -e, or -o in any list of distinguished Americans today. The descendants of ditchdiggers and lumberjacks are now CEOs and senators. Of one hundred U.S. senators in 2014, on a rough survey four had Italian last names, six Jewish, and fifteen Irish.

Adult literacy and years of schooling are combined nowadays to measure the knowledge leg of the three-legged stool of the “human development index.” Technically speaking the index is a geometric average of measures of knowledge, of real income, and of how long people live. All of these elements are rising and some are accelerating. Years of life, for example, have shot up, as I have noted, from an expectation at birth worldwide of less than thirty years in 1800 to fifty-two years in 1960 and to seventy years in 2010, including even very poor places. As a result of declining child mortality and of female control of reproduction, as Rosling shows in another of his amazing videos, birth rates in Bangladesh have fallen almost to replacement levels.^[17]

During the recent period of intense globalization, access to clean water has dramatically improved. The distance to drinkable water is one of the heaviest burdens on the world’s poorest women, together with the hand-washing of clothes, which itself requires reasonably clean water. The women of Levi’s Italian villages in 1936–1937 “stood erect with the stately posture of those accustomed to balancing heavy weights on their heads”—the daily water or the wet clothes.^[18] The carrying of burdens on the head had the cost by age forty or so of agonizing arthritis of the neck. The United Nations’ Millennium Development Goals, set forth in 2000, aimed to “halve, by 2015, the proportion of people without sustainable access to safe drinking-water and basic sanitation.” The goal was achieved five years early. The Modi government of India, elected in 2014, vows to supply toilets and corresponding sewers to the tens of millions of Indians now accustomed to defecating in the open.

Murder rates are down, even in the gun-toting US of A, in the short run since the 1990s and, even more dramatically, in the long run since the 1800s. Murder rates in medieval English villages were higher than in the most violent police districts in today’s United States.^[19] Addiction to alcohol is down too. American men in the early Republic toted their muzzle-loaders in a whiskey-soaked haze. In early modern cities in Europe, beer drinking absorbed from a quarter to a half of the entire crop of grain. The historian Richard Unger reckons that present-day beer consumption per person among Belgians (“among the most avid beer drinkers in the world”) is half that of European city dwellers in the Middle Ages and early modern times.^[20] Think of Monty-Pythonesque peasants and bourgeois, and worse, sword-bearing gentry and aristocrats, stumbling around inebriated all day long. European drinking and drunken brawling before the Great Enrichment makes Joe Six-Pack with his concealed-carry Glock .22 seem a model of temperance. Admittedly, medieval beer guzzling and early American whiskey imbibing had additional reasons in hygiene: alcohol kills germs and parasites in water, and had done so in the West since the earliest times. In the East the making of tea with boiled and thereby sterilized water had a similar latent function. And the worldwide use of silver goblets among the rich likewise killed some germs in the water. Colonial Americans, already pretty rich, extended this last technique, tossing silver coins into their barrels of drinking water; silver coins, too, were the preferred replacement for bone removed by trepanning to relieve pressure on the brain.

Broadening travel is now more common, the jet plane and especially the jumbo jet having reduced the hours of work required to buy a trip. In 1959 we bourgeois Americans went to Europe by sea. The percentage of people with advanced degrees has shot up since the 1960s and is hugely higher now than it ever has been. We live in an age of the artist and scholar and scientist, and can expect much more when China and India and then the rest become rich and educated. The world has now more college graduates, more serious spiritual inquirers, more creative improvers of goods and services, more artists, musicians, professors, journalists, critics, and poets, and above all more appreciators of such arts and sciences and designs and spiritual exercises than all such folk combined in world history up to, say, 1950, and probably up to 1970. And we have more of them in percentage terms, too, since enrichment makes the risk of a life in art easier to venture on, even beyond providing a market for the product. Go to the Third Fridays open house at the Zhou B Art Center on West 35th Street in Chicago and stand amazed (holding a plastic cup filled with not very good white wine) at the number and quality of paintings and sculptures exhibited there. Every big city in North America and Europe has dozens of such centers. Little Fredericton, New Brunswick, has at least one, at which you can listen to folk music and admire painters at work.

Or consider the emergence of a Nature-worshipping environmentalism that would have been viewed as a crazy luxury in the hardscrabble times of 1800 or even of 1933. The economist and student of theology Robert Nelson calls environmentalism the new religion of the West (a West that nonetheless, outside of places like Poland or the United States, imagines itself to be irreligious). He wrote recently that in the twentieth century

secular religions, such as Marxism, the American progressive “gospel of efficiency,” and other forms of “economic religion” were the leading influences on government policies around the world. In economic religion, “efficiency” and “inefficiency” take the place of “good” and “evil.” Towards the end of the century, still another secular religion, environmentalism, challenged the economic gospels—questioning the whole idea of “progress.”^[21]

The economist and think-tank maven Fred L. Smith speaks of “eco-paganism”: “Most environmentalists do not, of course, see themselves as pagans,” he writes. “Yet many do espouse a watered down form of pantheism which elevates nature to near the status of a deity.”^[22] By now the good people of rich and secular places such as Sweden, though contemptuous of the chidish absurdity (as most Swedes believe it to be) of their ancestors’ worship of a Lutheran God, have found their transcendent in the worship of Nature, and spend their Sunday mornings devoutly gathering mushrooms and lingonberries in Nature’s forest.

The Great Income Enrichment, that is, has allowed higher virtues of faith and hope and love, manifested in art and religion and lingonberries, to flourish, yielding a Great Spiritual Enrichment. In Chicago, Columbia College’s arts programs are booming, as is the School of the Art Institute and UIC’s School of Design, and the Music Conservatory of Roosevelt University. Our children, rich by historical standards, have become artists of paint and film, of music and video games. A poster promoting Columbia College pairs the slogan “Live your passion” with a photo of a young man fingering his electric guitar. The harvest is what the anarchist and communist and socialist visionaries in the nineteenth century predicted would happen following the abolition of private property and trade—except that the spiritual enrichment followed from the Great Income Enrichment that arose from property-encouraged and trade-tested betterment, not from their abolition. We are experiencing in the twenty-first century a worldwide explosion of high culture, out of “capitalism.”

[1] Gerschenkron 1971.

[2] Nordhaus 2004.

[3] Gaus 2013, p. 8. Richerson and Boyd 2004.

[4] Ó Gráda 2010.

[5] McCloskey 1976, 1989.

[6] Appleby 1980, p. 643 for Britain and France.

[7] For present-day figures (the “Penn Tables”), see Heston, Summers, and Aten 2012. For 1800, see Maddison. Luxembourg’s half million folk earn on average $252 a day, the highest (Maddison 2007).

[8] Fallows 2010, p. 72.

[9] Leon 2012, p. 171.

[10] As Czarniawska 2013 shows.

[11] Sandberg 1979.

[12] I am indebted to the philosopher Kenneth Stikkers at Southern Illinois University for stressing to me this quasi-pun in the phrase the “Great Enrichment.”

[13] Coase and Wang 2013b, p. 207.

[14] Harcourt 1994, p. 207; Röpke 1958 (1960), p. 8.

[15] http://unesco.org/education/GMR2006/full/chapt8_eng.pdf; https://efareport.wordpress.com/2012/05/31/literacy-rates-are-rising-but-not-fast-enough/.

[16] http://hyperallergic.com/68051/2012-museum-attendance-numbers-show-a-diverse-global-art-scene/; http://worldometers.info/books/.

[17] Rosling 2013.

[18] Levi 1945, p. 30.

[19] Hanawalt 1976.

[20] Unger 2007, p. 132. Actually in 2009 Belgium ranked only twenty-second worldwide, half as avid as the Czech Republic or Venezuela.

[21] Nelson 2013c, p. 1. See Nelson 2013a, 2013b, and 2010.

[22] Smith n.d.

Since 1776, there has been a 3,000% explosion in the average real income per person in the world.

Nothing earlier came remotely close.

It was caused not by the usual suspects of investment or exploitation, but by liberty inspiring a flowering of human creativity—in the arts and sciences, and in the economy.

Though Brazilians and many other Latin Americans are uneasily aware that their economies lag some, and sometimes a lot, the Great Enrichment is nonetheless evident everywhere from the Border to Tierra del Fuego, from Santiago in Chile to Recife in Brazil.

The Latin Lag can be overcome. Brazil, like much of Latin America, needs essential liberalism to do it.

Check out my new book, Liberdade: 100 Conversation Starters on Liberalism, Latin America, and Brazil

Malthus undertook to explain for the first time why the enrichment of the poor had not happened by then, and why, according to the logic of the newly invented and previously optimistic political economy, even a modest enrichment would not happen ever, especially with the Poor Law subsidizing poverty, unless people adopted what he called “preventive checks” on population growth, what came to be called “birth control.”^[1] Even these, he said, would not do all that much for the average person. In the first, 1798 edition of An Essay on the Principle of Population (later editions were less pessimistic, but it is the first edition that has for two centuries ruled people’s minds) Malthus claimed that what had kept people poor since the caves was not divine malevolence or royal extraction but human sexual intemperance and irremediable economic scarcity—which is to say, original sin and loss of Eden and all our woe.^[2]

Up to 1798 the Malthus of the first edition was correct. Zero-sum ruled. As Malthus’s inspiration, Joseph Townsend, had put it twelve years earlier, “In the progress of society it will be found that some must want; and then the only question will be this: Who is most worthy to suffer cold and hunger, the prodigal or the provident?”^[3] Townsend argued on the basis of animal models (which later inspired Darwin by way of Malthus) that “the quantity of food . . . regulates the numbers of the human species.” And the quantity of food, as some modern Malthusians still believe, was strictly limited. The “principle of population,” as it was known among the classical economists of the early nineteenth century, had kept most of our ancestors since the caves living on that $3 a day, and many on less. In the slums of Edo or Calcutta they slept on mats in the street. People wandered the veldt or the outback or the jungle. They were hungry, crowded into tenements in Naples or Glasgow or Guangdong. They lay sick for weeks on a straw cot. They died young, ignorant though clever, violent if strong.

The average income seldom pushed much above $3 a day, and always temporarily, because betterment had come slowly, not at the frenetic pace after 1800. Here some betterer would devise a new use of iron or of Roman roads, there another could devise a new use of coal or of accounting. But the betterments were too small to wrench incomes up and—startlingly—to wrench birth rates down. Again and again, then, population growth and the consequent diminishing of returns were given time to overwhelm the too-slow accumulation of new ideas. As the economic historians Nico Voigtländer and Hans-Joachim Voth put it recently:

In a Malthusian economy the race between technology and population size is the turtle against the hare—technological change can almost never rise fast enough to overcome the deleterious effects of population growth. The same logic applies for institutional improvements. They, too, can improve the mapping from resources to output, just like technological advances—but it is highly unlikely that institutional improvements outpaced the ability of human populations to grow.^[4]

They observe that before 1800 the average rate of betterment was never higher than half a percent per year, and according to the economist Oded Galor more like one-tenth of one percent, yielding at best a rise of 64 percent per century.^[5] But populations could grow at 3 percent per year, which is 1,800 percent per century. The turtle didn’t stand a chance.

In engineering lingo, the $3 a day—plus or minus $2, say—was a “homeostatic equilibrium” and worked the way your thermostat does. Average income in olden days might occasionally rise a little above $3, as it did in Holland and Britain during their commercial thrusts of the early modern era, or in many places worldwide when potatoes from the New World were suddenly introduced. But soon the rise would lead women to have more children, and more of the children would survive to have children themselves. In Ireland at the time Malthus was writing, for example, such a rise in population was happening, fueled by Ireland’s (in fact) nourishing diet of milk and potatoes. At length the Famine of 1845–1850 descended.^[6]

What the Malthus of 1798 could not have known, considering the frailty of social statistics in his time, is that the falling birth rate in France betokened a demographic transition to smaller family sizes; or, indeed, that in Britain itself the recent rapid population growth, without sharply falling wages, had already betokened quick enough betterment through new ideas for sawmills and seed drills and colonizing overseas to offset diminishing returns.

The usual story had been that the supply of labor grew too fast, that when wages rose so did birth rates, and then in a generation or two, according to the Malthusian logic of entry to an ecological niche in a world of diminishing returns, the real wage would be pushed down again to subsistence, to $5 or $3 or even $1 a day. Predator-prey relationships work that way. If foxes can freely enter a place temporarily abundant in rabbits, the foxes will eventually kill and eat so many rabbits that the return on hunting falls and the new, overlarge, fattened population of foxes gets pushed back to its former level by starvation and, especially, by infertility.^[7]

So it was with people preying on the land, or on one unreliable crop, such as potatoes in Ireland: “The praties they grow small over here. / We dig them in the fall / And eat them skin and all / Over here.” Perhaps British incompetence, and long-standing British malice in protecting British interests against Irish competition, worsened an Gorta Mór, the Great Hunger. But there is no doubt that with Irish fertility unrestrained—the original Malthusian sin—population had exceeded the carrying capacity of Ireland. The crop had done poorly many times before, as early as 1739. Mokyr and Ó Gráda have shown that up to 1845, a 50 percent failure of the potato crop had usually meant merely that the pigs starved (which is why highlanders, who were mainly herders, survived dearth better than lowlanders wholly dependent on field crops: if the highlanders’ crops they ate or sold failed, their pigs or cattle were a store of value, and of food). In the Great Hunger, though, the crop failure was 90 percent, and the people starved too.^[8] In the late 1840s one million out of Ireland’s eight million souls died of starvation and disease. Another million—especially those with the money to do so, or relatives established abroad—escaped to Boston or Liverpool, to Canada or Chile. Irish population has never recovered its level in 1845, unless you include the tens of millions of Irish descendants in land-rich places abroad, such as my father’s family. Malthus was confirmed.

Diminishing returns on labor applied to fixed land would always be immiserizing, said the Malthus of 1798. The notion was taken up with grim enthusiasm by other classical economists, such as David Ricardo and Karl Marx. True, Malthus in later editions, beginning in 1803, as the historian of economic thought Ross Emmett has argued, believed that a rational restraint on procreation could permit some modest growth of income. “Biology could never be conquered,” Emmett writes, “but within the right institutional context, reason could interrupt its career.” For a time, that is. But the classical economists came to believe that there would soon be an end to conquering, a “stationary state.” As Anthony Waterman puts it, “Malthus’ first [1798] Essay made land scarcity central, and so began a century-long mutation of ‘political economy,’ the optimistic science of wealth, to ‘economics,’ the pessimistic science of scarcity.”^[9]

And in historical fact, diminishing returns in a nonglobalized world had been in the past powerfully immiserizing, in just such a simple Malthusian way. When the population of Europe rose by a factor of two between 1000 and 1350 CE, real wage fell by a third. (Remember that in the shorter period since Malthus the population has not merely doubled but grown by a factor of seven.) After the Black Death of 1348–1350 and its recurrences, which drove the population in many places down by a third or a half, real wages of farm laborers doubled. But when, by 1600, population recovered, European real wages again collapsed, to half their previous peak.^[10] Dante’s time and, after two centuries of rise and one of heavy fall, Shakespeare’s time were two low points in how much bread the wage of an ordinary European could buy. Think of India and China in their worst eras, with coolies pulling rickshaws, the way porters in Italy and England once carried the rich in sedan chairs.^[11]

The only hope, said Malthus, and that a faint one, was to keep population down by restraining reproduction, the preventive checks, an exercise of reason in the right institutional context, about which Emmett notes Malthus was a tiny bit hopeful. A grim form of state-enforced preventive checks, far from Malthus’s preferences in the matter, became in the 1960s the policy of India and China, I have noted, inspired by eugenic ideas hatched in Germany, Britain, and the United States in the late nineteenth century and implemented wholesale in Scandinavia and Germany and some U.S. states by fascists and progressives in the 1930s. Yet with fixed land and turtle-slow technological change such preventive checks could not in the long run help all that much. No wonder the classical economists were pessimistic about the prospects for a significant betterment in the human condition. “No possible form of society,” Malthus had written gloomily in 1798, “could prevent the almost constant action of misery upon a great part of mankind, if in a state of inequality, and upon all, if all were equal.”^[12]

No wonder, too, that Malthus-out-of-Townsend was the inspiration for Darwin’s brutally accurate theory of natural selection. Plants and animals have no way of applying “reason” to interrupt the career of nature. Their rate of betterment, being slow and biological rather than quick and social, is never frenetic enough to overcome the immiserizing force of diminishing returns after entry into a niche. Therefore adult coots (Fulica atra) have evolved to grow impatient after a few days with their large broods, and to drown the weaker chicks, leaving two or three out of the eight or so hatched.^[13] Preventive checks. Humans do the same, as one can see from the imbalances in many poor countries between surviving girls as against boys. Drown the infant girls.

An alternative mechanism of homeostasis (Greek: “identical position”), tending to the same, sad, $3-a-day conclusion, posited that larger populations made for denser settlements, which by overcoming fixed costs of movement made for cheaper transport, which had the unhappy side effect of spreading disease.^[14] Smallpox was spread by such densities of humans and of their domestic animals, as later was the White Plague of tuberculosis. Look at ebola in 2014, leaping from country to country by airplane. The Black Death may be another case in point. It arose in densely populated China, or perhaps among the Mongols further north and west, spreading during the 1330s throughout the Chinese Empire and undermining the prestige of the Mongols ruling there. By 1348 it spread widely in Europe, killing, as in China and intermediate points, more than a third of the population and shaking the social order.^[15] The Black Death, by Malthusian logic, sharply raised the real wage all over Eurasia. And in dense places the recurrences of the plague, which ended in northern Europe only around 1700, kept people fearfully off balance. The economic historian Guido Alfani argues that Italy continued to be hit by plague even after 1700, in the countryside as much as in the towns, at the moment that northwestern Europe was beginning to prosper a little.^[16]

The other mechanism keeping the poor in poverty was class violence, such as Rousseau adumbrated in his seminal attack in 1754 on private property. Half a century later, Malthus, though a friend of private property, viewed property as characteristic of the uneven distribution of income in a “civilized,” that is, an arable-crop, society.^[17] Although bands of hunters-gatherers and independent-minded herder/highlanders might escape lordship, arable farmers in their dense and fixed populations in the lowlands could not. If you followed the plow you followed the local lord, perforce. Marshall Sahlins and other anthropologists have long observed that compared to an arable farmer a hunter-gatherer typically had an easier life, at least in the Holocene, after the ice, and in warm places. He worked fewer hours a week for his food than someone tied down to the abundance of crops. The abundance, according to the logic of lordship, went to priests and knights and other people able to make good with sword and horse their claim to ownership of the land. It did not go to most of our ancestors, the poor.^[18] The philosopher Gerald Gaus notes the consequence, namely, “the extraordinarily rapid displacement over most of the world of small-scale egalitarian culture with agricultural-based states and empires that were hierarchically organized. This political development almost reversed, in the blink of an eye, the egalitarian culture in which humans evolved.”^[19]

Farmers were ideal victims for any specialist in violence who happened along, expropriating any surplus over $3-a-day bare subsistence.^[20] That a temporary surplus in the ripening fields was easy to detect added to the hazards of immobility.^[21] Land-based nomads on horses, such as the Mongols, led by a Mongolian Genghis or a Turco-Mongolian Tamerlane, preyed on farmers such as the Iranians or the Chinese or the Russians, becoming their long-term khans.^[22] Sea-based nomads or pirates likewise went where the money was, as did the mysterious Sea Peoples of the late second millennium BCE in the eastern Mediterranean, or the Vikings two millennia later in the North Sea and the Baltic and beyond, or the well-organized descendants of the Vikings, the Normans, who ranged even further afield. In short, if diminishing returns or disease-breeding density didn’t do the sad trick of keeping most of us at $3 a day, violent hierarchy did.

§

Why during the long, long run before 1800 did ordinary people do no better? Because, considering the stately pace of betterment before the Great Enrichment, the Malthusian, homeostatic equilibrium was about $3 a day. Until 1750 or 1850, and even later in the poorest places, the Reverend Malthus of the first Essay looks sadly wise.

[1] Lepenies 2014 shows that Malthus’s logic, and elevation of the logic to a “natural law,” was taken from another anti-poor-law pamphlet by Joseph Townsend thirteen years earlier.

[2] Ross Emmett and Anthony Waterman set me straight on the differences between Malthus Mark I and Malthus Mark II.

[3] Quoted in Lepenies 2014, p. 450.

[4] Voigtländer and Voth.

[5] Galor 2005.

[6] On the excellence of potatoes with milk, see Cook 2013.

[7] Startlingly, Townsend articulated exactly such a model in 1786 (Lepenies 2014).

[8] Mokyr 1983 and Ó Gráda 2010.

[9] Waterman 2012, p. 425.

[10] G. Clark 2007a, Table 4 and Figure 10.

[11] G. Clark 2007a, Figure 8.

[12] Malthus 1798, Chapter 2, end.

[13] Attenborough 1998.

[14] McGuire and Coelho 2011 is an excellent recent treatment of a large literature using such an argument.

[15] Haensch et al. 2010. In 2015 it was claimed by students of the matter that the Plague was spread from Central Asia not by flea-bearing rats but by, of all things, flea-bearing gerbils.

[16] Alfani 2013, for example on p. 427.

[17] Ross Emmett emphasizes Malthus’s notions here, Emmett n.d., p. 3.

[18] Sahlins 1972 (2004).

[19] Gaus 2013, p. 13.

[20] Olson 1993 is the seminal paper. Thus Scott 2009, and for a West African example, from my beloved colleague the late James Searing, Searing 2002.

[21] Mayshar, Moav, and Neeman 2011.

[22] Weatherford 2004; Perdue 2005, Hellie 2003, McNeill 1964, Lattimore 1940.

Until 1800, though, such a hell was what everybody except a handful of nobles and priests and merchants expected, year after terrible year. We have achieved over the past two centuries for ordinary people worldwide, materially speaking, unevenly, for the first time, a pretty good purgatory.^[1] The whole world’s average income, for example, now approaches that of present-day Brazil, or of the United States in 1941. Since 1800, in other words, and especially since 1900, the goods and services available to the average human being, and the scope for a full human life, have startlingly expanded.^[2] The event justifies its label, “the Great Enrichment.”

Never in material terms had anything so Great as the Enrichment occurred—never to the mass of a population, not in the glory of Greece or the grandeur of Rome, not in ancient Egypt or medieval China. Startlingly, Brazil is now better off, on average, than the metropolises of the mightiest world empires before 1939. In the many and burgeoning very rich countries, such as Sweden or the United States, the value of goods and services made, earned, and consumed per person, without allowing for the radically improved quality of most goods and many services (cleaner food, better medicine), is three or four times higher even than the historically unprecedented world average.

Some Swedes and some Americans are still poor. But most aren’t. The extremely high average has overwhelmed inequality so far as the standard of genuine comfort is concerned. It gives to the rich, the middling, and the poor alike a roof over their heads, plentiful food and clothing, long life expectancy, reasonable hours of work, literacy, dignity—all of which were prospects and satisfactions denied to most humans until well after 1800. The signs are good that if we keep our wits about us we can, within a few generations, achieve for everyone on earth the riches of Sweden and America. All the formerly poor can enjoy bourgeois incomes and can pursue, if they wish, the spiritual enrichment that such an income permits. We’re on the way to a pretty good material paradise.

Look at the numbers.^[3] Average daily expenditures by Haitians and Afghans, expressed in present-day U.S. prices at “purchasing power parity”—and so allowing for inflation and the relevant exchange rates among currencies—are well below $3 a day, which before 1800 was what the average human more or less everywhere expected to make, earn, and consume.^[4] So it had been, always, back to the caves. Imagine living each day on the cost, spread over all your activities, of a half gallon of milk. If you’ve been to Liberia or Afghanistan it’s not hard to imagine. Today, after two centuries of increase, recently accelerating, the world figure, an average that includes even the extraordinarily poor Liberians and Afghans, has arrived at an unprecedented $33 a day—roughly, I say, the Brazilian level.^[5]

Like all the figures, the $3 and the $33 are corrected, I emphasize, for exchange rates and inflation. They are expressed, as the economists put it, in “real” terms, and therefore are comparable—or comparable enough for the scientific point being made here. The figures are supposed to include (however imperfectly when applied to earlier economies) not only what you buy in the marketplace but whatever goods and services you make or grow for yourself.^[6] No one should put faith in the second or third digits of such an estimate, which may variously under- and overestimate the value of homework, care work, the environment, better health, and better quality of goods. But for the economic and historical science attempted here the great alteration of the first digit suffices. It is stunning.

Since 1800 the ability of humans to feed and clothe and educate themselves, even as the number of humans increased by an astonishing factor of seven, has risen, per human, by an even more astonishing factor of ten. Do the math, then, of total production. We humans now produce and consume seventy—7 × 10—times more goods and services worldwide than in 1800. Some people view this figure with alarm and speak of environmental degradation. But the news is mainly good. With seventy times more production, no wonder we can cultivate new economies of scale and reap their benefits through free trade. And no wonder we can harness the ingenuity of the larger population to get better antibiotics and better automobiles. No wonder we can clean up the air and the water, and turn forests into nature preserves.

In the best-run countries, such as France or Japan or Finland, all of which not so long ago were $3-a-day poor, real income per person, conventionally measured, has by now increased to roughly $100 a day. Income has risen, that is, not by 30 percent but by a factor of thirty (I will repeat the point until you feel it on your pulse), which is to say many hundreds of percent. It is not a doubling or a tripling of the material scope of a human life. Such routine increases, desirable as they are, have occurred many times before in world history, only to fall back again to $3 a day when the good times passed. Income now is thirty to one hundred times more than our ancestors could manage, and no falling back about it. The OECD, the Organisation for Economic Co-operation and Development, a club of reasonably well-off free-trade democracies with average earnings of about $100 a day per person, has now thirty-four members, containing nearly one-sixth of the world’s population.^[7] To be overprecise about the fifth-grade arithmetic involved, a factor of thirty for income growth in the OECD countries from 1800 to the present means a rise of 2,900 percent. Think conservatively of the Enrichment, if you wish, and call the increase merely 2,000 or 1,500 percent. Any such order of magnitude of enrichment justifies the word “great.”

The Enrichment since 1800 shows in all the evidence. (It better, if it’s so Great.) Real per-person income in Brazil is now, I repeat, about the same as it was in the world-beating United States in 1941, or in the still-recovering postwar Britain in 1959.^[8] Two centuries ago fully four out of five U.S. adults worked to grow food for their families and for the remaining nonagricultural fifth. Now a single American farmer feeds three hundred people. Since 1800 worldwide life expectancy at birth has doubled. World literacy is tending toward 100 percent. On Indian TV in 2014 an optimistic advertisement noted that for every adult illiterate in that bettering if still very poor country there are seven little children who can read a story. The scope of human life has widened, and bids fair to go on widening. All the instruments agree that most humans are massively better off now than their ancestors were two centuries ago.^[9]

You will perhaps doubt that the Great Enrichment happened, or that it was so great, or that it will continue—or doubt that it is justified, in view of environmental decay and consumerist excess. But the evidence, regarded without prejudice, is overwhelming. From about 1800 to the present the world’s economy did something good, which looks to be permanent and looks to be justified. If contrary to the evidence we cling to our prejudices about economic history—our view that the Industrial Revolution was impoverishing, or that the Great Enrichment was an irremediable environmental disaster, or that Europe is rich only because of poverty in the Third World, or that the new rich are always getting relatively richer, or that after all any enrichment is vulgar—we will mistake how we got here and will give mistaken advice on how to move forward. We will betray the remaining poor of the world.

The prejudices, which is to say our justifying discourses, would not matter if the issue were divergent judgments about, say, the latest ice cream flavors from Ben and Jerry’s. We could then, in the easygoing American phrase, “agree to disagree.” Chocolate Therapy versus AmeriCone Dream. Whatever. But the judgment about whether the System has worked for ordinary people, and why or why not, is too important to leave to personal fancy or to prideful skepticism or to a political identity adopted in late adolescence, never to be reconsidered in the light of new evidence or mature understanding, reaffirmed daily by the particular group of shouters and sneerers we tune into on cable TV. If we are to help the remaining poor of the world, as ethically speaking we should, the political judgment needs to be made soberly and scientifically.

The Great Enrichment is the most important secular event since the invention of agriculture. It has restarted history. It will end poverty, as for a good part of humankind it already has. Surprisingly, though, economists and historians from left or right or center can’t explain it. Perhaps their sciences and their politics need revision.

§

Our great-great-great-great-great-great-grandparents were very poor, which had in turn been the lot of their ancestors since time out of mind. In the sweat of thy face shalt thou eat bread, till thou return unto the ground; for out of it wast thou taken. The good old days, in other words, were for ordinary people horrible to a degree that is hard now for residents of $80-a-day countries such as Italy or New Zealand to appreciate. The historian David Gilmour notes that from 1375 to 1795 the great city of Florence experienced famine prices every five years or so.^[10] In 1879 the French literary historian Hippolyte Taine expressed the horror in a vivid metaphor: “The people are like a man walking through a pond with water up to his chin. . . . Old-fashioned charity and newfangled humanity try to help him out, but the water is too high. Until the level falls and the pond finds an outlet, the wretched man can only snatch an occasional gulp of air and at every instant he runs the risk of drowning.”^[11] The British writer and literary historian Graham Robb, who quotes Taine, details the poverty of parts of rural France even in the improving nineteenth century. Over the winter in Burgundy the vineyard men hibernated, and not merely figuratively. An official reported in 1844 that “these vigorous men will now spend their days in bed, packing their bodies tightly together in order to stay warm and to eat less food.”^[12] Robb remarks that in French agriculture in the nineteenth century “slowness was not an attempt to savor the moment.” Economists have long recognized that the world’s poorest agriculturalists often run out of energy before they run out of money, the more so when they are afflicted by malaria and tuberculosis and other debilitating diseases.^[13] The ploughman homeward plods his weary way. “A ploughman who took hours to reach a field,” writes Robb, “was not necessarily admiring the effect of morning mist. . . . He was trying to make a small amount of strength last for the working day, like a cartload of manure spread over a large field.” Even in fast-enriching Sweden, whose economy grew after the liberalization of the 1860s faster than any economy except Japan’s, the novelist Vilhelm Moberg remarked of his childhood around 1900 in the countryside that he could bring to mind only the long summers. In winter “the children in a smallholder’s cabin . . . were too badly clothed to stand the cold. . . . Life in winter was quite literally shut in: we dozed by the open fire and slept through many hours of the [very long Scandinavian] night: it was, for children, a quiet vegetating in the darkness under the low cabin.”^[14]

The Australian poet and cultural-literary critic Clive James struck the right note. During the nineteenth century tuberculosis afflicted the poor especially, but also the middle and upper classes. The aristocrat Alexis de Tocqueville, for example, died of it in 1859, as in 1850 had his bourgeois-liberal ally Frédéric Bastiat.^[15] The working-class poet John Keats died of it too, in 1821, age twenty-five, before his pen had gleaned his teeming brain. James wrote, “Today’s young tourists of a literary bent, when they pass, on the Spanish Steps in Rome, the window of [Keats’s] last resting place, are being granted insight into the fearful realities of a world without antibiotics.” (In 1943 the recently invented penicillin was two years away from being widely available for civilian use. My own kidneys bear the damage from the only alternative, sulfa drugs, of which the correct dose for an injured infant was poorly understood.) To grasp “the suddenness and randomness of God’s wrath” in former times, James writes, we need to get inside the lives of our ancestors, “a trick of the mind . . . by which we can imagine how it must have felt when the only possible way to view reality without the benefit of religious faith was to despair.”^[16] In 1917 in a backwater of a definitely enriching Sweden, the potato crop failed and some of the poorer people starved to death.^[17]

So it was from the beginning to 1800, and in most places for many a painful year thereafter. In the opening lines of Christ Stopped at Eboli (1945), the painter, doctor, and writer Carlo Levi described the poverty he saw when he was banished by the fascist state in 1935–1936 to a pair of villages in far southern Italy—”that other world, hedged in by custom and sorrow, cut off from History and the State, eternally patient, . . . that land without comfort or solace, where the peasant lives out his motionless civilization on barren ground in remote poverty, and in the presence of death.”^[18]

It was an ancient and terrible business, as it is still in Chad and Bangladesh, and on the homeless streets of Chicago and Amsterdam, too. For nearly all of humanity’s time on earth the average amount of food and education and antibiotics and the rest per person stayed at subsistence, at $1 or $3 or $5 a day expressed in today’s prices, or in exceptional times, briefly, $6 or $8 a day. Thus it had been, in 1800, during the two thousand or so centuries since the mitochondrial Eve (and about the same span, approximate contemporary, as has recently been discovered, since her good friend the Y-chromosome Adam^[19]). Or during the thousand or so centuries since the invention of full language. Or during the hundred or so centuries since the invention of agriculture. Or during the eight or so centuries since commerce had revived in the West. Or during the three or so centuries since Europeans had ventured by sea to Africa and India and the New World. Pick whatever period down to 1800 you want. For a long, long time nothing much happened to the economic misery of the average Jill.

She and her friend Jack could perhaps trap or purchase a little meat to go with their bread, or pick nuts to go with their grubs, but they lived in a wretched little hovel, or a tent, or a cave. Poor people (and some not-so-poor people) lived in literal caves even in France and Italy until well after World War II, for example at Matera in the arch of Italy’s foot. Jill before 1800 had two sets of clothing at most, or a string skirt. In the Jericho of Pre-Pottery Neolithic times, around 10,000 BCE, 40 percent of the burials were of infants or children.^[20] In ancient Rome, on the 50-50 bet that a Jill survived to age fifteen, she could expect then to live on to age fifty-two—as against eighty-five for the same bet now.^[21] Nowadays in rich countries, and in many very poor countries, almost all of a woman’s children survive to the fifteen-year-old starting line. In ancient Rome, by contrast, a third of Jill’s numerous children died before their first birthdays.

It had ever been so, as it is now in rural Ethiopia (one of the African cradles of Homo sapiens). Real income might go up for a while. In the richest parts of China and Europe in their most prosperous times it might rise for a while to $6 or $8 a day.^[22] But as my mother’s generation puts it, “even $7 a day is no bag of bluebirds.” And then it would revert to $3 a day.

The old imperialist vision of China and India as always and anciently and particularly overrun with starvelings is a recent back-projection. The back-projectiing had unhappy consequences during the 1960s and 1970s in the eugenic excesses of the family-limitation movement and of the Chinese single-child policy.^[23] The historian Niall Ferguson, for example, favors the back-projection, despite recent work by historians such as Takeshi Hamashita and Christopher A. Bayly showing that trade in the Chinese seas and the Indian Ocean was large, and that in the eighteenth century the lands around them were prospering.^[24] For most of history a dense population such as that in the lower Yangtze Valley or the lower Rhine or the lower Ganges signaled that a place was doing comparatively well in aggregate—albeit less wonderfully well for the Jack or Jill at the bottom of the ruck. The Ganges Plain, for example, was rich around 1600, at the height of the Mughal Empire, when the economic historians Stephen Broadberry and Bishnupriya Gupta reckon it reached 61.5 percent of the British GDP per capita—admitting that British real income was then at one of its lowest points.^[25] But in most eras the people of north India were $3- or $1-a-day poor on average, as were all the other commoners on the planet since the beginning. The economic historian Bozhong Li makes a case that the Netherlands and the lower Yangtze were qualitatively comparable in 1800, though he does not in the paper venture on direct comparisons of incomes.^[26] In a paper with Jan Luiten van Zanden, though, he concludes that by 1800 Dutch real income per person was double that of this richest of Chinese regions.^[27]

Doubling or even tripling was possible, then, an instance of (Adam) Smithian growth, as the economic historians put it, coming up to the world-beating standard of Holland in 1800. But the vastly greater enrichment since 1800, a growth by factors of ten or thirty or one hundred, was out of the question. One hundred percent, yes, maybe 200 percent, if you were in the Scottish Highlands and reformed your society to match the habits of Holland. But 9,900 percent? Never.

You can tell the same story on a smaller geographical scale about what is now Belgium and the Netherlands. In 1568 the Low Countries were rich by the miserable standards of Europe, which is why Philip II of Spain wanted to go on taxing the place. Tax revenues from his Dutch- and French-speaking subjects thereabouts sometimes exceeded his silver revenues from the New World (though neither was enough to prevent the European hegemon from engaging in controlled defaults on numerous occasions, so uncertain were the fortunes of Spanish wars^[28]). Two and a half centuries later, by 1820, the Netherlands was still the richest place in the world, with Britain only recently equaling it, while the southern part of the Low Countries (what was shortly to become Belgium) was smartly industrializing—but still at merely $6 or $8 a day. It meant ample bread but not much meat. Secondhand clothing if you were poor. Untreatable disease. Some education, but for most people not beyond a little reading of the Bible or the latest scandal sheet. Few books, few panes of glass, few shoes, horses, chairs—all expensive in hours of labor to get. No bag of bluebirds.

You would not want $3 a day, or $7, even if everyone around you had the same. When people can vote with their feet to escape it, they do. Most North Koreans who can, do. The Nigerian men selling handbags on the streets of Venice (Vu cumprà? “Wanna buy?”) have done so most courageously. More descendants of the people in Carlo Levi’s pair of mezzogiorno towns, Aliano and Grassano, now live in Argentina than in their home district of Lucania.^[29] Levi’s people, residing in the middle of the Italian foot, had heard the improbable boast of the city of Eboli (over to the west, on the shin of the Italian leg) that Christ had stopped there (Cristo si è fermato a Eboli). The hopeless Lucanese in the 1930s remodeled the boast into a bitter antijoke. Yes, Christ had stopped in Eboli—but he had gone no further, not bothering to take the branch line east to visit Lucania. Levi, who as an Italian and Jew and antifascist had little patience with the widespread modern notion of the State as benevolent savior, writes:

None of the pioneers of Western civilization brought here his sense of the passage of time, his deification of the State or that ceaseless activity which feeds upon itself [thus the Great Enrichment]. No one has come to this land except as an enemy, a conqueror, or a visitor devoid of understanding.^[30]

[1] When I use the phrase “pretty good” here, as I will often do again often, I am referring to the Ohio State political scientist John Mueller’s lucid book Capitalism, Democracy, and Ralph’s Pretty Good Grocery (1999), which in turn refers to the comically modest marketing in Garrison Keillor’s hometown of Lake Wobegon. For example, “If you can’t find it at Ralph’s Pretty Good Grocery, you can probably get along without it.”

[2] The figures are Angus Maddison’s estimate of world income before 1800 in 1990 prices, brought up by me to the prices of 2010 or so. Maddison 2001, appendix B, table 21, p. 264.

[3] I use throughout for recent times the readily available figures of real income per person in U.S.-equivalent prices from the World Bank, the International Monetary Fund, and the so-called Penn Tables (devised by Alan Heston and colleagues at the University of Pennsylvania). The Penn Tables are conceptually the best, but in truth there is little at stake in the choice among the three. Roughly speaking—which suffices for present purposes—they tell the same story. For example, for 2012 the World Bank and for 2010 the IMF both put Brazilian real GDP at about $33 a head per day, 24 percent of the U.S. level in the corresponding year (and equal, as I have noted, to the average for the world). For 2010 the Penn Tables put it at $27 a head, or 21 percent of the their estimate of the U.S. level. A difference between 24 and 21 percent does not change any conclusion here or elsewhere in the book. We are dealing throughout with rough figures of how much people make, earn, and consume. The three sets of estimates (and a fourth, from the CIA, giving much the same results) are conveniently gathered (for 2011/2012) at http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita.

[4] “Make, earn, and consume” because in a correct accounting (but see note 53) the figures would show that what an economy produces is the same to the last cent as what its people earn as income and what they consume, whether in the marketplace, in homework, or in leisure. The figures are from the IMF and World Bank, in 2010. Gregory Clark (2009) argues that Maddison’s figure of a little over a dollar a day in 1800 is too low for subsistence.

[5] “World,” CIA World Factbook, April 10, 2013.

[6] The economic historian Stefano Fenoaltea and the economist Philipp Lepenies have both pointed out to me recently that for short-run reasons of policy at the time, the concept of national product used by Simon Kuznets, the deviser of the modern program of income measurement, and eventually by Maddison, did not go beyond trading figures, that is, what people could buy. Homework is mostly ignored. It is a major error for the long run (as Kuznets and other students of the matter realized), since production in the home of, say, made clothing and processed food was a large part of consumption in earlier times, as was at all times the care industry for children, husbands, and parents (as the economist Nancy Folbre has persuasively argued). The money value of sheer leisure—the merry beggar singing careless by the highway—is ignored as well. That last item at least might be equal in ancient and in modern times, and its value would rise along with the opportunity cost in making goods and services (but see de Vries 2008; Voth 1998). On the other hand, much of modern consumption is understated in the same figures—the quality point I make below. Let us hope the errors offset. But not to worry, and if to worry, not to worry too much: errors at such magnitudes do not matter for anything I say here, because we are concerned with orders of (very great) magnitude. Any factor of 10 or 30 or 100 will do.

[7] http://en.wikipedia.org/wiki/Organisation_for_Economic_Co-operation_and_Development Indicators.

[8] In Maddison’s tables, which seem best for the purpose, Brazilian GDP per person in 2001, deflated to 1990 international Geary-Khamis dollars, was $5,570 (Maddison 2007, table 4c, p. 522). From Index Mundi, which collected its numbers from the annual CIA Factbook (http://www.indexmundi.com/brazil/gdp_real_growth_rate.html), one can reckon from the ratio of Brazil’s real per-capita income in 2010 to that in 2000/2002 that the Maddisonian figure for 2010 would have been about $8,021. One looks through Maddison’s tables, then, for the United Kingdom (table 1c, p. 441) and for the United States (table 2c, p. 466) to find the years in which they achieved the 2010 Brazilian level. Other methods I have tried do not yield believable results. Having visited Brazil four times briefly over the past few decades (though wholly ignorant of Portuguese), I am an Expert on Brazil; and having lived in England for a few months as a teenager in 1959 (Woodbine cigarettes, pints and quarts of Ludlow beer), and having been a small child in the United Statesin the 1940s (radio drama, penny candy), I can attest that the present result seems about right.

[9] For example, the OECD’s instruments, overlapping with mine, agree. See van Zanden et al., eds. 2014.

[10] Gilmour 2011, p. 20.

[11] Quoted in Robb 2007, p. 84.

[12] Robb 2007, p. 78.

[13] For recent expositions, see Fogel 2004; Floud et al. 2011. But on Fogel, see de Vries 2008, pp. 117–120. A judicious survey is Kelly and Ó Gráda 2012.

[14] Quoted from Moburg’s memoir in Brown 2008, pp. 9–10.

[15] Examine Wikipedia’s astonishing “List of Tuberculosis Cases” at http://en.wikipedia.org/wiki/List_of_tuberculosis_cases (the editors, to be sure, plead for “citations to reliable sources”). Beyond those mentioned in the text: Burns, Schiller, Scott, Balzac, Chopin, John C. Calhoun, nearly the entire Brontë family, Delacroix, Thoreau, Napoleon II, Robert Louis Stevenson, John Ruskin, Chekhov, and Orwell.

[16] James 2007, pp. 350, 352.

[17] Brown 2008, p. 16, the year corrected by Myllyntaus and Tarnaala 1998, p. 36.

[18] Levi 1945.

[19] Poznik et al. 2013, p. 565.

[20] Mithen 2003, p. 60.

[21] Parkin 1992.

[22] Goldstone 2009 is an excellent guide to the recent scholarship, for example pp. 80–81. I have depended on Goldstone’s little book, and look forward to a big one he is writing.

[23] Connelly 2008, chap. 4.

[24] Hamashita 2007 and Bayly 2004.

[25] Broadberry and Gupta 2012, Table 12.

[26] Li 2011.

[27] Li and van Zanden 2012.

[28] Drelichman and Voth 2014.

[29] Gilmour 2011, p. 319.

[30] Levi 1945, p. 3.