Office Hours: Six Questions
For 2024-06-12 We: Please put questions for the next round in the comments at the bottom! An experiment, as I think about useful things I can do for the weblog-supporting paid subscribers: characterizing the late-1800s as a “depressed” era; 1870 rather than 1688 or 1712 as the key moment in human history; free will & determinism in Marx’s thought; Slouching Towards Utopia as a work of 1889-1916 Second International-era Marxist thought; Malthusianism & patriarchy; & critiquing Oded Galor’s (very nice) Journey of Humanity…
1) A puzzle: The period after 1870, which you make a very convincing case as the point at which global living standards start to accelerate, is often referred to—at least in British economic history—as The First Great Depression with some suggesting this slump runs through until nearly the end of the century. What do you think is going on here?
It is indeed a great puzzle.
I see, potentially, four things going on:
The deflation up until 1896 and the coming online of the Witwatersrand gold fields really hammers those who have borrowed.
The coming of the large-scale transoceanic grain trade really hammers the staple-agricultural sector, and all those dependent on it.
The ramping-up of technological change and Schumpeterian creative destruction causes the number of economic losers and the sizes of their losses to be, in relative terms, as large as the collapse of handloom weaving in the 1830s–and that kind of collapse in left-behind sectors, which had been a one-off never seen before, becomes the rule.
For reasons I do not understand, the economic winners after 1870 are, sociologically and politically, relatively quiet. It isn’t until the start of the 1900s that we begin to see cultural and sociological salience of things like Keynes’s 1919 declaration that: “After 1870 there was developed on a large scale an unprecedented situation…. The pressure of population on food… became for the first time in recorded history definitely reversed. As numbers increased, food was actually easier to secure. Larger proportional returns from an increasing scale of production became true of agriculture as well as industry…. In this economic Eldorado, in this economic Utopia, as the earlier economists would have deemed it, most of us were brought up. That happy age lost sight of a view of the world which filled with deep-seated melancholy the founders of our political economy…. Malthus [had] disclosed a devil…. For the next [post–1870] half century he was chained up and out of sight…”