“If the state is the executive committee of the great corporation and the planning system, it is partly because neoclassical economics is its instrument for neutralizing the suspicion that this is so.”

— John Kenneth Galbraith

Power and the Useful Economist (1973)
Context: This is what economics now does. It tells the young and susceptible (and also the old and vulnerable) that economic life has no content of power and politics because the firm is safely subordinate to the market and the state and for this reason it is safely at the command of the consumer and citizen. Such an economics is not neutral. It is the influential and invaluable ally of those whose exercise of power depends on an acquiescent public. If the state is the executive committee of the great corporation and the planning system, it is partly because neoclassical economics is its instrument for neutralizing the suspicion that this is so.

Adopted from Wikiquote. Last update June 3, 2021. History

Help us to complete the source, original and additional information

Do you have more details about the quote "If the state is the executive committee of the great corporation and the planning system, it is partly because neoclass…" by John Kenneth Galbraith?

John Kenneth Galbraith207

American economist and diplomat 1908–2006

Related quotes

“A cabinet is a combining committee,—a hyphen which joins, a buckle which fastens, the legislative part of the state to the executive part of the state. In its origin it belongs to the one, in its functions it belongs to the other.”

Walter Bagehot book The English Constitution

No. I, "The Cabinet", p. 14
The English Constitution (1867)

“The executive of the modern State is but a committee for managing the common affairs of the whole bourgeoisie.”

Karl Marx (1818–1883) German philosopher, economist, sociologist, journalist and revolutionary socialist

“All executive departments and agencies of the Federal Government are authorized and directed to cooperate with the Committee in its work, and to furnish the Committee such information or the services of such persons as the Committee may require in the performance of its duties.”

Harry Truman (1884–1972) American politician, 33rd president of the United States (in office from 1945 to 1953)

Executive Order 9981 (1948)

“The equilibrium price level is determined at the point where the money market is in equilibrium. The temporary suspension of Walras' Law, far from making economic nonsense, thus appears as the crucial "trick" by which the tatonnement process is decomposed in two parts.
This analysis confirms that for a neoclassical general equilibrium system with neutral money there is indeed a consistent decomposition procedure, based on appropriate compensation principles, permitting the determination of real variables in the real sector while the price level is determined in the monetary sector. However, the amount of intellectual effort which, in the wake of Lange and Patinkin, was devoted to this issue, is entirely out of proportion to its economic significance. The real economic question is not whether a system can be dichotomized, but whether money is neutral.”

Jürg Niehans (1919–2007) Swiss economist

Source: The theory of money, 1978, p. 12

“Recently I asked three corporate executives what decisions they had made in the last year that they would not have made were it not for their corporate plans. All had difficulty in identifying one such decision. Since each of their plans were marked 'secret' or 'confidential', I asked them how their competitors might benefit from the possession of their plans. Each answered with embarrassment that their competitors would not benefit. Yet these executives were strong advocates of corporate planning.”

Russell L. Ackoff (1919–2009) Scientist

Source: 1960s, A concept of corporate planning, 1969, p. 1 as cited in: Henry Mintzberg (1994) Rise and Fall of Strategic Planning. p. 98.

“The rise of the modern corporation has brought a concentration of economic power which can compete on equal terms with the modern state - economic power versus political power, each strong in its own field. The state seeks in some aspects to regulate the corporation, while the corporation, steadily becoming more powerful, makes every effort to avoid such regulation… The future may see the economic organism, now typified by the corporation, not only on an equal plane with the state, but possibly even superseding it as the dominant form of social organization. The law of corporations, accordingly, might well be considered as a potential constitutional law for the new economic state, while business practice is increasingly assuming the aspect of economic statesmanship.”

Adolf A. Berle (1895–1971) American diplomat

Source: The Modern Corporation and Private Property. 1932/1967, p. 357 (1967, p. 313)

Norman Thomas (1884–1968) American Presbyterian minister and socialist

Three New Deals: Reflections on Roosevelt's America, Mussolini's Italy, and Hitler's Germany, 1933-1939, Wolfgang Schivelbusch, (2006) Metropolitan Books, pp. 28-29.

“The decisive weakness in neoclassical and neo-Keynesian economics is not the error in the assumptions by which it elides the problem of power. The capacity for erroneous belief is very great, especially where it coincides with convenience. Rather, in eliding power — in making economics a nonpolitical subject — neoclassical theory destroys its relation to the real world. In that world, power is decisive in what happens. And the problems of that world are increasing both in number and in the depth of their social affliction. In consequence, neoclassical and neo-Keynesian economics is relegating its players to the social sidelines where they either call no plays or use the wrong ones. To change the metaphor, they manipulate levers to which no machinery is attached.”

John Kenneth Galbraith (1908–2006) American economist and diplomat

Power and the Useful Economist (1973)

“The corporation as an organizational form is an enormously productive social invention. Partly because of its success it is under increasing attack from various quarters, often under the guise of “protecting” investors from self-interested managers. Some of these attacks are successful simply because the corporation is a poorly understood entity. This paper discusses what the corporation is, what it is not, and how certain misconceptions about the corporate form are fostered by its critics as part of their attack.”

Michael Jensen (1939) American economist

William H. Meckling and Michael C. Jensen, 'Reflections on the Corporation as a Social Invention,' in Controlling the Giant Corporation: A Symposium(Center for Research in Government Policy and Business, Graduate School of Management, University of Rochester, 1982

“The Committee shall continue to exist until such time as the President shall terminate its existence by Executive order.”