In a 1930 essay titled “Economic Possibilities for our Grandchildren,” John Maynard Keynes predicted that in 100 years, “assuming no wars and no important increase in population,” the standard of living in “progressive countries” would be “between four and eight times as high” as it was then. His most optimistic scenario is being realized. In 2022, real GDP per capita (equivalent to income per capita) in the US has already been multiplied by 7.3, with eight years to go (see Bureau of Economic Analysis, National Income and Product Accounts, Table 7.1, revised March 30, 2023). Even if the rate of growth is only 1% per year between now and 2030, real GDP per capita will then be 7.9 times that of 1930. Keynes also believed that with such high incomes, the economic scarcity problem of mankind would be solved and the question would be what to do with one’s free time. This part of his forecast has not held up well. Somewhat similarly, the 1960s and 1970s hippies thought they were reentering the Garden of Eden, if only capitalism could be destroyed. San Francisco’s Blue House, sung by Maxime Le Forestier, is a reminder of the dream. Keynes is more difficult to forgive.
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