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Why Should We Care?: Saturday Twentieth Century Economic History Weblogging

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Why should you care about how our history and the history of our parents and grandparents and great-grandparents--the history of the long twentieth century, 1870-2010--will appear to people five and more centuries into the future?

First of all, it makes a very good story. And it makes an even better story because the story is real. We are gossiping animals—we have evolved to like to tell and hear stories about what is happening and has happened to our friends and not-friends. We like this so much. We like this so much that out of our time that is not spent hewing wood and drawing water we spend a very large chunk gossiping and listening to gossip about not our real friends and not-friends but about imaginary friends: there is no such person as Harry Potter, and so there is no strong reason to care about what happens to him or to Severus Snape, but we do.

And the best stories to tell and listen to are the real stories, about real people: they have a depth and an import that fiction cannot reach.

Second, you never know what parts of history may turn out to be useful and very important. Ten years ago I thought that my curiosity about and interest in the Great Depression was an antiquarian diversion from my day job of understanding the interaction of economic institutions, economic policies, and economic outcomes. The fact that we had gone through the Great Depression, had learned lessons from it, and had incorporated those lessons into our institutions and policy processes meant that there was little practical use to going over it once again. Boy, was I wrong. History may not repeat itself, but it certainly does rhyme—and nothing made an economist better-prepared and better-positioned to understand what happened to the world economy between 2007 and 2013 than a deep and comprehensive knowledge of the history of the Great Depression.

And there are likely to be other nuggets in the economic history of the past that will turn out to be vitally important for understanding the future, we just do not know which nuggets they will be. So it is best to be prepared, and to become prepared by studying as many nuggets as possible.

Third, you should focus on economic history not just because it is the key axis of the twentieth century in particular but because economic history is the real history. The history of menarche—whether the people are well-enough nourished for women to go through puberty at an early age—is more important to practically everybody than the history of monarchy, because lots more people are women than are monarchs. Or, perhaps, monarchy’s principal importance is how it impacts menarche. But high politics and changing technologies shape and change how real people live—not only whether they live or die at the hands of thugs-with-guns, but what kind of life they are able to live.

And, fourth, we do need to search for and keep searching for the “lessons” of the past for the present. Today, at least where I write, our principal concerns are with the creation and maintenance of liberty and prosperity, and with understanding what our (comparative) liberty and (relative) prosperity has transformed us. Other audiences in other places and other times have had different concerns: how to ensure the triumph of the “true” theology, how to conquer one’s neighbors, or how elites can maintain political power or economic and social dominance. This is history from our particular turn-of-the-twenty-first-century viewpoint: it tells the story of the twentieth century as the story of prosperity and liberty—the partial escapes from (and at time and places the falls back down into) poverty and tyranny. This particular grand narrative is important because it touches the lives of almost everyone and because its ending is not clear. There is no immanent logic unfolding itself: nothing except our own and our descendants’ efforts and struggles can make this particular grand narrative have a happy rather than a tragic conclusion.

Yet the major theme has to be that the history of the twentieth century was—all in all—glorious. The history has an extremely depressing middle, but the ending is much more happy than tragic. Certainly this is the case when we use a relative yardstick, and compare the end of the twentieth century to all previous centuries. Yes, forms of religious strife and terror that we thought we had left behind several centuries ago are back. Yes, failures of economic policy that land countries in depression that we thought we had learned how to resolve decades ago are back. Yes, nuclear weapons and global warming pose dangers for the future of a magnitude that humanity has never before confronted. Nevertheless, all in all the North Atlantic today is a (relatively) free and prosperous region, and the rest of the world is if not free and prosperous at least closer to being so than at any time in the past.

Of course, the explosion of material wealth and liberty we have seen in the twentieth century has not solved our human problems is obvious. That the likely spread of ample material plenty and, if we are lucky, increasing democracy and freedom to much of the rest of the globe that the twenty-first century may see will not solve our human problems is obvious as well. We have little confidence today that we know how to achieve successful economic development in the world: the East Asian financial crisis of the late 1990s and the North Atlantic crisis of the late 2000s broke confidence in both the East Asian state-led and the neoliberal openness-led development models. The twenty-first century problems of global environmental management have not yet been addressed. Wars of religion are, if not back, on the horizon. And modern North Atlantic liberal democracy is not the end of history. And there is the fact that the utopia toward which we have seemed to be progressing—a prosperous, liberal, democratic one—is not to everyone’s taste, as the terror-bombers who destroyed the World Trade Center and killed 3000 people on September 11, 2001 and subsequent military-political attempts to spread or contain a new set of wars of religion have made clear.

A naive individual of a century or two ago would wonder at the events, patterns, and problems that brought the twentieth century to its end. The world at the end of the twentieth century has enough wealth to give everyone on the globe what they would regard as a rich upper-middle class style of life. Why does such a rich and powerful world still have problems? It is not at all clear that we will recognize our destination when we arrive at it, or that many of us will like it when we get there.

We must remember that we are, at best, but slouching towards utopia.

I think that this particular Grand Narrative is the most interesting take on the economic history of the twentieth century. Others are free to disagree. In my view, that others are free to disagree, and value that freedom, and have more power and resources to research, express, and communicate their disagreement worldwide than ever before—this reinforces my belief that this particular grand narrative is the most felicitous one to tell.