WASHINGTON, DC – The great economist John Maynard Keynes argued in his 1930 essay “Economic Possibilities for Our Grandchildren” that “mankind is solving its economic problem.” The accumulation of capital and the advancement of technology had put living standards on an upward trajectory that, according to Keynes, would end “the struggle for subsistence” within a hundred years.
The prospect of solving this economic problem filled Keynes with dread. Humanity, he asserted, “will be deprived of its traditional purpose.” Keynes worried about “the readjustment of the habits and instincts of the ordinary man, bred into him for countless generations, which he may be asked to discard within a few decades,” and predicted that society would experience “a general ‘nervous breakdown.’”
I was reminded of Keynes’s essay when reading Brink Lindsey’s important new book, The Permanent Problem: The Uncertain Transition from Mass Plenty to Mass Flourishing. Lindsey, a senior vice president at the Niskanen Center, argues that Keynes’s predictions have come to pass: Wealthy liberal democracies have essentially solved the problem of material provision – and are now experiencing a nervous breakdown.
In Lindsey’s telling, individuals in rich democracies are overweight, addicted to their phones, and have declining literacy skills, as well as IQ and SAT scores. Compared to past generations, they experience worse mental-health outcomes, have fewer close friends, and spend more time alone and less time having sex. They are also less likely to marry, procreate, and attend religious services, while being more likely to overdose on drugs. These societies exhibit reduced dynamism, slowing productivity growth, rising class divides, and diminishing trust in government and support for liberal democracy.
“To put it bluntly,” Lindsey writes, “society is falling apart.”
Lindsey’s assessment is consistent with post-liberal commentators’ arguments that democratic capitalism is exhausted, a failed experiment and an obstacle to human flourishing.
Capitalism is not exhausted. The argument that it is has a root in the widespread anxiety during the waning years of the last decade about advanced economies’ ability to continue innovating. That concern seems wildly misplaced in our current age of wonders, with GLP-1 drugs for diabetes and weight loss, as well as rapid progress on treatments for life-threatening diseases like Alzheimer’s and cancer. Then there is generative AI, which even the most pessimistic forecasts expect will increase trend productivity growth noticeably over the next decade.
The post-liberal critique does indeed identify many areas of genuine concern, but it does not tell the whole story – namely, that wealthy democratic societies are doing better than ever across many important and broad measures. For example, life expectancy in the United States is rising again, after a dip during the pandemic, and is higher now than it was during the 1990s, when support for neoliberalism was at its peak. Moreover, the mortality rate from heart disease in the US fell by 66% from 1970 to 2022, while the country’s rate of violent crime has been halved over the past three decades.
By 2021, US households had historically unparalleled access to information, with 95% owning a computer and 90% subscribing to broadband internet. Workers have substantially more vacation days than in the past. From 1980 to 2013, air passenger fatalities fell from 100 per 100 billion passenger-miles to less than one.
Has mass affluence led to a society that is “falling apart?” Hardly. American society was much less affluent and in much worse shape in the 1850s – to the point that a civil war erupted in 1861. France today is much more stable than during the Reign of Terror. At the global level, society was more stable – and much wealthier – during the 2010s than the 1910s.
The “permanent problem” for man, Keynes wrote in 1930, is not the struggle for subsistence. It is “how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well.”
Post-liberal commentators think that democratic capitalism has failed on this score. Lindsey, who shares much of their critique but (to my knowledge) still considers himself a liberal, seems to agree, writing: “When the challenge was beating back material scarcity, capitalism delivered; now, however, when the task is to convert material plenty into widespread spiritual riches, it is floundering.”
But Keynes (and Lindsey) made a crucial conceptual error by assuming that the struggle for subsistence precedes the struggle to live well. It is more accurate to think of them as occurring concurrently. After all, serious moral philosophy dates back to the 5th century BC, even though the ancient Greeks had not mastered material provision.
At the individual level, we see this in our own lives. Young families work hard to build and grow income streams, but their lives do not exist in one dimension. They feel the weight of “pressing economic cares” while simultaneously trying to live wisely and well.
Nor should we conclude – as Keynes predicted and Lindsey affirms – that the struggle for subsistence is behind us. Living at the subsistence level is much more expensive in 2026 than it was in 1799, when 67-year-old George Washington, a fabulously wealthy man for his day, died of a throat ailment that today would be easily treated with airway support and antibiotics. In this sense, we have not solved the “economic problem” – and likely never will – because the goods and services considered to be baseline necessities will grow and expand over time.
Two things are true: Relative to our ancestors, we occupy a world of material abundance. And we are not living as wisely or as well as we could. But the former has not caused the latter. Every society has struggled with the question of how to live well. We are a fallen people in a fallen world – a condition we have struggled to explain since Adam and Eve’s expulsion from the Garden of Eden. We know that today’s post-liberal thinkers are struggling as well, because their argument is so self-evidently wrong.
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Michael R. Strain
Michael R. Strain, Director of Economic Policy Studies at the American Enterprise Institute, is the author, most recently, of The American Dream Is Not Dead (But Populism Could Kill It) (Templeton Press, 2020).
