My initial interest in this book stemmed from a stray thought I had back in 2014, when I was chatting with a friend about a question on how to define economic growth: What exactly is this “economic growth” we’re always talking about? Is the proud economic growth we’ve had since the Reform and Opening-Up simply equivalent to an increase in GDP? For an individual, the money I earn is paid by others, so where do those others get their money? What truly constitutes growth?
These questions seem to have bothered me for a long time, yet I’ve never delved deep into them. With so many other puzzles about the world and so much pain in life, what does this little question matter? Finishing this book didn’t answer my questions, but I feel I’ve gained a deeper understanding.
The so-called “problem of economic growth” sounds like it’s being discussed within a defined scope, but these two words don’t point to any objective object in our lives. Both “economy” and “growth” are already highly abstracted concepts, much like “Marxism,” “critical theory,” or “political correctness”—they have become highly alienated signifiers. People no longer discuss the issues behind the concepts; they just debate the concepts themselves as right or wrong. This seems to be because words like “economy” and “growth” have long played the role of absolutely correct, objective things within our discourse system. Just as Foucault’s theory of knowledge-power claims, they have been jointly developed and cultivated by the intellectual and power-holding classes, becoming the foundation of mass cognition.
Thinking back to my confusion then, what I really wanted to know was, why are we all Homo sapiens, with no change in the species in decades, yet the quality of life before 1979 and today is so vastly different? Are these changes the “growth” behind it all? Will this growth continue to exist in the future? Although the book didn’t provide answers, it fortunately offered great inspiration.
America, this God-given land, is truly a “Promised Land.” Such a literary phrase, used by Obama as the title of his memoir, perfectly fits his image as a well-educated, elite leftist. But this promised land, during the Westward Expansion in the early 19th century, also made Americans of that time suffer greatly. Europeans heading west from New England lived on Indian land, herding horses, and living hard lives in sod houses—perhaps not so different from the harsh lives of ancient Chinese peasants. But starting in 1870, the Second Industrial Revolution brought earth-shattering changes to America, and the tremendous economic growth over the 100 years to 1970 was, in solid terms, a miracle in human history.
The book spends a considerable length describing the living conditions of Americans in 1870. Whether it was the cities littered with horse manure and garbage, or the primitive living conditions in the countryside, it’s hard to imagine this was just 150 years ago. A particularly profound detail: in New York in 1870, already an international metropolis, the earliest skyscrapers had appeared. The 70-meter-tall Western Union Building was a great structure of its time, and tens of thousands of new immigrants had moved into buildings, but they still had to manually carry water from the ground floor to their homes and manually dump sewage into the drains. The streets were filled with manure from carriage horses, and with no electrical system, the streets were still lit by fuel lamps. So, urban life at the time was filled with pollution, crowding, and filth; in contrast, rural life was primitive and relatively clean. The 1904 publication of The Jungle fully depicted how hellish the meatpacking system was before the advent of refrigerated transport.
And in just 70 years, by the time the US entered World War II, newly built residential areas in America already had complete public facilities like running water, sewage, and power grids, as well as all sorts of essential modern appliances like cars, refrigerators, and air conditioners. Looking around our homes today, almost all the household facilities and appliances, apart from digital electronic devices—including electric lights, vacuum cleaners, radios, washing machines, refrigerators, and even air conditioners (although televisions were in production before WWII, they were only mass-produced and sold afterward, and microwaves became common after their invention in the 70s)—could already be seen in new American homes in 1940. Meanwhile, New York’s representative building had become the 443.2-meter-tall Empire State Building. And 30 years later, by 1970, Americans were living the highest quality of life in human history.
The same people, but it only took 100 years to achieve the greatest “economic growth” in human history. What factors caused this? The book describes a great deal of historical facts, data, and literature, but the core reasons, written across hundreds of pages, are two words: technology and management.
The first dimension is technology. The two industrial revolutions yielded enormous results in America. The boundaries of human understanding of the natural world expanded tremendously. Based on the greatest scientific discoveries in human history, humanity finally tamed electrical energy. As the widespread saying goes, the degree of energy utilization represents the development level of a civilization. Humanity had finally mastered electricity, in addition to thermal energy. All development based on this energy finally culminated in the dawn of atomic energy.
In the other dimension: management. Ford’s paternalistic management style guided social progress, and is now the unconscious object of imitation for Yu Donglai. The science of management was invented in America, was unprecedentedly strengthened during WWII, and reached its peak during the Cold War. Through a more goal-oriented management system, human efficiency was amplified to an unprecedented degree.
All this allowed people who, 100 years earlier, were largely in states of hunger, filth, and disease, to perform similar or even simpler labor, yet 100 years later, escape hunger, live in clean and tidy environments, and obtain long, healthy lives. At its root, economic growth is just about achieving what Marx called the free and full development of every individual.
Of course, different countries have different resource endowments. Australia and New Zealand can sell resources and livestock and still let their ordinary people live good lives. But for a geographically large country, becoming a master of technology and management is, to some extent, a responsibility to lead humanity toward a better life.
America’s 100 years of development was certainly a miracle, and China’s 40 years since the 1980s is also a miracle, leaping from an agricultural civilization to an internet society in one step. That we could also complete such a transformation further proves that by pragmatically learning good technology and good management, any country can quickly catch up on its lessons and catch up with the teacher. However, to truly surpass the teacher and move towards innovation is another question entirely.
As for the Third Industrial Revolution after 1970, the author believes its change to the world was very limited compared to the first two, with the rise in total factor productivity confined to the 10 years from 1994-2004. However, for many Chinese people, these 10 years were a revolution that simultaneously overlapped with the achievements of the previous two industrial revolutions. Therefore, perhaps Chinese people can appreciate the world changing “a thousand miles in a day” even more than Americans.
On predicting the future, the author, of course, spent considerable space expressing that prediction is a very difficult thing, and offered many suggestions on how to improve social productivity. But overall, counting from the book’s publication in 2016, eight years have passed. Among the emerging technologies, only artificial intelligence has shone brightly in 2024, showing potential far exceeding other technologies. And on management and social issues, the suggestions regarding drugs and the prison system have been somewhat validated by the legalization of marijuana. However, can this truly solve the difficult problem of America’s current growth dilemma?
The puzzle of economic growth, when returned to its essence, is the puzzle of improving the quality of life for the ordinary masses. Yet when we look around us today, are technology and management really the bottlenecks for improving quality of life? I’m afraid the problem of distribution is the biggest predicament right now. On either bank of the Pacific, the limitations on individual development brought about by distribution problems are the biggest obstacle to improving the quality of life for the masses.
The right bank’s [America’s] issues with healthcare, loans, and race, and the left bank’s [China’s] issues with consumption, aging, and corruption, are all problems of distribution. After the growth brought by technology and management on the right bank was completed in the 70s, it seems to have been trapped in a distribution dilemma ever since, constantly squeezing the limits of management through globalization, praying for growth through a new round of technological breakthroughs. Luckily, the Third Industrial Revolution in the 90s brought a new round of growth. However, this time the growth was not only smaller in scope but also in magnitude, so it fell into a predicament again after 2015. Will the approaching artificial intelligence be a new revolution? Will it bring new growth? We don’t know yet, but the right bank has always hoped for breakthroughs in technology and management to solve its problems. Perhaps the right bank’s system, capital, and culture will continue to bring technological and managerial breakthroughs. Today, the left bank has arrived at a similar situation, and it too hopes to achieve new growth through technological breakthroughs. I wonder if a breakthrough will descend upon the left bank this time.