Understanding the true lesson of “Abundance”
The British left now seems to have heard of tbe book “Abundance”.
So it’s interesting that for her summer beach reading Rachel Reeves picked Abundance, the American journalists Ezra Klein and Derek Thompson’s blueprint for the more permanent rebuilding of hope and joy. It’s a pro-growth, techno-optimist rallying cry for progressives to reinvent themselves as purveyors of plenty and good times in contrast to the right’s crabby, mean-spirited “scarcity mindset” – which revolves around the belief that there isn’t enough good stuff to go round and therefore the priority is snatching it back off immigrants or the poor or whatever bewildered former ally Donald Trump accuses of ripping America off.
As ever the British left isn’t understanding what’s put in front of them in plain language. The message from Klein and Thompson is that there’s a reason the US is not as rich as it could be:
Klein and Thompson argue convincingly that for decades western consumers have been fobbed off with an abundance of stuff we fleetingly want – fast fashion, cheap flights, more streamed content than anyone has time to watch – but a paucity of stuff we actually need, such as affordable homes near where the good jobs are, or cheap green energy. Where the authors will divide the room, however, is by claiming that’s partly down to years of liberal politicians attaching well-meaning strings to public building projects, from environmental protections to procurement rules to US zoning laws for housing, which although noble in intent collectively make it impossible to build. It was Reeves’s jolting recent description of red tape as a “boot on the neck” of business that first made me wonder if she’d read the fervently deregulatory Abundance. Though it focuses on the California housing crisis, there are enough relatable stories – the nimby neighbours fighting affordable homes because they’d prefer more car parking, or the decades wasted failing to build a high-speed rail link between Los Angeles and San Francisco – for it to have done the rounds at Westminster and among Australian progressives too.
That is all true as well. The reason we cannot have nice things is because there’s a vast bureaucracy, a vast system of veto points, allowing prodnoses to prevent us from having nice things. Therefore the way to have nice things is to kill that bureaucracy, that system, that prevents us from doing so.
It is also possible to make much the same point in a slightly different way. Polly Toynbee has spent decades telling us we must all be more like Sweden. It’s true, the Swedish dispensation isn’t quite to our taste but it’s not a terrible outcome. But the Swedes have grasped this same problem about abundance.
It is possible to have a micromanaged society, a planned one. If that’s then going to have much growth then it needs to also do rather little redistribution of incomes. Equally, it’s possible to have a highly redistributive society but if that’s going to have much growth then it needs to allow economic experimentation. It’s not possible - simply because humans don’t work that way - to have the planned and redistributive society and the growth, those nice things in the future.
The Scandinavians are, by all the usual measures, more free market and more capitalist societies than the UK or even US. They also have buttock clenching levels of taxation and redistribution. As we say, not our choice but they are societies that work. The British left is trying to have both the micromanagement by bureaucracy and also the Scandi levels of redistribution and income inequality. This is not a choice that works.
Which is the lesson of Abundance. Also, the lesson reality keeps trying to teach people. You have to choose. It is not possible to have it all. If the British left wants that Polly T dream then it must actually move to being more like Sweden. Which means assassinating most of the bureaucracy to allow the economic growth that can then be taxed.
Of course, we’d prefer - even, we advocate for - gralloching both the bureaucracy and the redistribution so that we can all have truly abundant amounts of nice things.
Tim Worstall