Heilbroner Global Trends

Puget Sound eJournal of Economics
Erik Steighner
October 5, 2001
IPE 201 – Balaam
Paper #1
Global Trends and the Future of Capitalism
“A society whose historical journey is entrusted to the guiding hand of Tradition sleepwalks through history,” wrote a pensive Robert Heilbroner in his 1993 work 21st Century Capitalism.1
Now the new century has dawned, and it is certain that no one is feeling the least bit drowsy.
Actors on the world stage are actively reevaluating, refining, and even replacing a host of capitalist traditions. And increasingly, no single player can claim to have the starring role. Even a hegemon like the United States has suffered a “striking loss in global economic leadership” in recent years.2
Different societies
Heilbroner’s true colors show when it comes time for predictions, and he believes that “the future of American capitalism in the twenty-first century [. . .] hinges on the capacity to perceive the public sector, as did Adam
Smith, in terms of an indispensable source of strength for a private economy, not as a wasteful drag on it.”18 Heilbroner’s cleverness lies in his ability to take the modern ideas of liberals like John
Maynard Keynes and reconcile them with the basic tenets of liberalism as professed by Smith. This approach isn’t altogether surprising—during his college years Heilbroner studied with Keynes’
“first apostle in the United States,” Alvin Hansen.19 Heilbroner isn’t afraid to let the government guide the economy—in fact, he believes it is essential to continued prosperity. Even hitherto unattainable Keynesian goals like full employment have strengthened the interests of capital,
Heilbroner argues, therefore serving not a radical but a conservative political end.20 He bemoans the fact that government spending is seen as consumption rather than investment, and insists that taxes must be raised to promote growth, while national institutions keep wage increases
According to Heilbroner, the system misrepresents both the public and private sectors and subsequently allocates tasks poorly, is inadequately prepared to

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handle the internalization of production and economic challenges, and is subject to the irrationality inherent in its motivating drive. He agrees that “one cannot contemplate [capitalism’s] deficiencies and expect the order as a whole to make the passage through the twenty-first century unscathed.”21
But if not capitalism, then what? Could it be that the concept of “progress” will be absent from society, and “an achieved socialism will simply be the sum of many individual lives pursued within a benign social setting?”22 Probably, Heilbroner argues—he guesses that society’s search for new understandings “will embody something connected with the idea of socialism. By ‘socialism’ I mean a society unmistakably disconnected from the very idea of economic determinism.”23 Before rushing to call Heilbroner a Marxist, though, it is important to note that he is reasonably certain this change will not happen in the next hundred years, and even then, he admits that its nature