The Moral Consequences of Economic Growth | Benjamin M. Friedman

Summary of: The Moral Consequences of Economic Growth
By: Benjamin M. Friedman

Introduction

In ‘The Moral Consequences of Economic Growth’, Benjamin M. Friedman explains that economic growth is not just about raising material standards; it also profoundly affects society’s moral values. With economic growth comes a society that is more open, tolerant, fair, and democratic, while stagnation leads to repression and bigotry. This transformation is evident in the political liberty, civil rights, and racial equality across Western democracies and the developing world. This introduction unpacks the necessary connection between growth and societal improvement, providing readers with a deeper understanding of the moral implications of economic fluctuations.

Beyond Material Benefits

Economic growth has been traditionally associated with material advantages. However, its supporters often overlook its profound impact on social and political values. Economic growth facilitates societal openness, tolerance, fairness, and democracy. In contrast, economic stagnation promotes authoritarianism, bigotry, and regression. This association between economic growth and social values is evident in all Western democracies and developing nations, including China. Despite its profound impact on societal values, economic growth proponents find it challenging to counter arguments against it because they usually focus solely on its material benefits.

The Connection Between Economic Growth and Society’s Moral Tone

American history reveals a link between economic growth and societal moral improvement. Society tends to be more generous, open, and tolerant during periods of economic growth. However, during periods of economic decline and stagnation, Americans become cautious, reserved, risk-averse, and more concerned with protecting themselves. This shift towards narrowness and restricted opportunities is accompanied by a negative national tone, prejudice, intolerance, and a reversal of social progress. The post-World War II economic boom saw unprecedented consumer demand, the relocation of the population to the suburbs, progress in science and technology, and a national spirit of optimism. It also witnessed the opening of US society to new immigrants and significant progress towards the moral ideals of the Enlightenment. However, the stagnation of the 1970s reversed this tide of social progress, resulting in a cramped, crabbed national mood and a broad movement towards intolerance. The trend continued in the 1980s, with Americans becoming suspicious of government interference in the economy and a societal emphasis shifting towards rolling back affirmative action.

The Correlation Between Economic Growth and Social Progress

The relationship between economic growth and social progress is evident in the histories of America, Britain, France, and Germany. Societies that experienced economic growth implemented socially progressive measures such as expanding the electorate, granting women’s voting rights, and offering universal healthcare coverage. On the other hand, societies that stagnated gave birth to movements and laws that exhibited xenophobia, anti-Semitism, and discrimination against refugees. Economic growth resulted in the unification and reformation of countries such as Germany, France, and Britain. Meanwhile, periods of stagnation saw the ascendance of oppressive powers such as the Nazis. The correlation between economic growth and social progress is evident: periods of prosperity lead to progressive societal changes, while periods of stagnation are marked by regression and repression.

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