The day Keynes looked far away
John Maynard Keynes, so focused on the short- to medium-term that he left us the phrase "in the long run we shall all be dead," spoke at least once about the long term. It was in 1930 at a lecture at the Ateneo de Madrid. In the midst of an economy in deep depression and suffering from "a severe attack of economic pessimism," he expressed surprisingly optimism about the "economic possibilities of our grandchildren" (the title of the lecture). He said: "We are suffering, not from the rheumatism of old age, but from the growing pains generated by very rapid change." The expression "technological unemployment" is introduced in this lecture. Keynes concludes by adding (I paraphrase) that "the rate at which we shall arrive at plenitude (bliss) economic will depend on our ability to control demographics, our determination to avoid wars and civil strife, and our faith in science."
A hundred years on, and broadly speaking, we can say that Keynes's optimism was justified that is has reached no population multiplied by four, however, the science factor has made possible a remarkable growth in the standard of living. as well as another serious attack of economic pessimism.
I think the pessimism that was unjustified in 1930 is also unjustified now, and that the key factors that will determine the pace of approach, not toward Keynes's "plenty" but toward a situation of sustainable progress (including a zero carbon footprint), are the same ones Keynes points out: demographics, demographics, demographics. Let's review them, looking to the future.
1. Demographics.I take the global population as what it is, and I don't judge whether it's excessive or not. What I am certain of is that, if politics and science are to do the job, it's imperative to limit its growth. And in that regard, optimism is justified. Demographers anticipate a maximum growth of 25% in the coming decades. However, this population will be unevenly distributed, which will generate intense migration processes and strong tensions. How global governance is able to manage these will determine the pace of progress.
2. Keynes's 100th birthday saw the catastrophe of World War II. It would be interesting to speculate about where we might be today if we had been spared that opportunity. In any case, we cannot afford to gamble our future on the possibility of surviving another conflict like this. On this point, I want to be optimistic, although I cannot be absolutely so. Neither recent precedents, nor world history—the Pax Romana, many years ago—nor current events give rise to optimism. But let us be optimistic. Now, does being optimistic today about global governance that facilitates progress mean the same thing it meant for Keynes in 1930? I don't think so: the economic interdependencies of the present demand, given the current challenges, that multilateral cooperation go beyond simply avoiding wars and civil conflicts. And in that other, more demanding aspect, we cannot be optimistic today.
3. If, despite massive population growth, a world war, and several revolutions, the global economy has prospered so much in Keynes's 100 years, it must be because scientific advances have made it possible and because a very high level of international cooperation has not been indispensable. Looking to the future, there is no reason to think that the frontiers of science and technology will not continue to expand if we dedicate effort and resources to them. Furthermore, the demographic challenge is more manageable: the growth rate is approaching zero. These are two favorable aspects. But we have one unfavorable one: the structures—now in decline—of global governance. Challenges such as climate change (think of emissions rights) or the possibility of influencing how the world adopts new technologies (think of the regulation of AI, or the extent to which strictly military technologies are prioritized or not) depend on good multilateral cooperation to a greater degree than in the past. If we don't have it, the engine of science will be weakened.