The Affluent Society

John Kenneth Galbraith’s work of economic history, The Affluent Society is (1958), outlines how World War II reshaped America’s public and private sector wealth for the worse. The book received praise from critics for tackling conventional thought and offering new solutions to economic problems. Galbraith, who passed away in 2006, was a leading advocate for both democratic socialism and twentieth-century American liberalism. He taught at Harvard University for many years, and he served in President Franklin Roosevelt’s administration. Notably, he was a twice-winner of the Presidential Medal of Freedom.

In The Affluent Society, Galbraith addresses a major problem in American society—overconsumption of goods. Put simply, the American people buy things they don’t need, and things they don’t really want because advertisers tell them that they do need these things. We live in a society where advertisers and marketers control our spending habits.

The problem, Galbraith asserts, is that we can’t keep relying on outdated economic theories to explain the modern world, because these outdated theories never conceived a world quite like this one. Early economists, such as Adam Smith, never imagined a world where the supply and demand model is so warped.



Before, Galbraith notes, supply rose to meet demand. Businesses gave people what they needed to survive, such as food and shelter. Now, supply controls demand. Businesses create demand by advertising their products in such a way that people can’t wait to purchase them. This strange and problematic model, Galbraith contends, is doomed to fail.

Galbraith examines the supply and demand problem in some detail. He pinpoints a shift in American economics ever since the end of World War II. After the War, production rates soared. Everyone believed that a country capable of mass-production was a wealthy one. It didn’t matter what the country produced, so long as it produced something. The difficulty, however, is that people have to buy these unnecessary products. Someone must convince them to do so. The “someone” is advertising.

In The Affluent Society, Galbraith considers what was so different about pre-World War II society and why things changed so drastically. Before the War, and during the eighteenth and nineteenth centuries, most Americans lived in poverty. They didn’t have disposable wealth to spend on luxury goods. Even if they devised the best advertising strategies in the world, businesses couldn’t convince people to buy things they didn’t need.



After the War, production shifted to luxury goods and leisure. People wanted to show off their wealth by purchasing the latest premium products. Producers quickly rose to this demand. We are now at a place where there is far too much supply and not enough demand. Businesses live in furious competition with each other, which is just as unhealthy as no competition at all.

The major problem with this supply and demand model is how it damages the public sector. Investors heavily buy into the private sector, fueling business growth. The public sector struggles because people stop investing in it. The government doesn’t spend enough money on public sector needs, such as healthcare. We now live in a society where capitalism controls everything.

Consequently, the private sector creates new desires for us. We confuse desiring something, such as new shoes, with a real need. When we buy those new shoes, we have bought into the vicious cycle. Businesses rely on us to keep spending money. Galbraith asserts that there are ways to break this cycle, but we must completely reimagine our understanding of the economy to do so.



Because of public and private sector imbalances, Galbraith says, we have lost sight of poor individuals who don’t have disposable income. When we keep investing in the private sector, we take vital services away from the public sector and the people who need those services the most. The North American economy alienates people who can’t spend money, and those people get poorer as businesses get richer.

Even in affluent areas, Galbraith observes, we see the problem with the warped economy. In a street lined with mansions, the roads are full of potholes, public transport is overcrowded, and pollution is everywhere. We prioritize non-essentials, such as new smartphones and televisions, instead of spending money on essential services.

The Affluent Society doesn’t simply dissect the problems with America’s economy. It offers possible solutions to these problems. For example, we should tax consumption heavier, to put people off buying so many products they don’t need. Buying less also tackles global recycling and environmental problems. We should also invest in public institutions, such as schools and hospitals.



At its heart, The Affluent Society is a call to America to reverse its economic model. America must focus on equality and general wellbeing because this is where our true needs lie. By focusing less on commercialism and more on fulfilling basic needs, we will tackle the growing debt crisis and the seemingly insurmountable environmental problems we face today.