An Economics for Future Generations: Reconciling Individualism with Posterity and the Common Good

This podcast episode features Robert Dugger, a founding father of the Institute for New Economic Thinking (INET), discussing the organization's origins and his core philosophy centered on intergenerational responsibility. The conversation begins with the shortcomings of the TARP legislation and the ideological void that emerged from the 2008 financial crisis, prompting the "Queen's Question" about how economists missed such a significant event. Dugger posits that INET's mission, and indeed a central challenge for America, is to shift focus from individual short-term profit objectives – the "ourselves" in the Constitution's preamble – to the long-term well-being of "our posterity" and society as a whole. He argues that current economics, driven by individualism and short-termism, leads to inequitable and unsustainable policies, citing examples like tax policy failures and the "IBG UBG" (I'll be gone, you'll be gone) mentality on Wall Street.

Dugger traces the historical evolution of this tension, from the Abrahamic covenant's emphasis on descendants to the Enlightenment's focus on individual rights, as expressed in the Declaration of Independence and Adam Smith's "Wealth of Nations." He highlights that while the framers of the Constitution embraced Enlightenment individualism, they also possessed a strong sense of "enlightenment generationalism," intending the Constitution to secure liberty for future generations. This generational perspective, he contends, has been progressively lost, particularly with the rise of free-market fundamentalism championed by figures like Milton Friedman, which culminated in the 2008 crisis. The host, Rob Johnson, adds that internal forces like resistance to civil rights and libertarian streaks within counter-culture movements also contributed to this shift towards individualism and diminished governance.

The discussion then turns to contemporary efforts to reintroduce the responsibility to posterity, particularly through legal challenges. Dugger mentions lawsuits where young people have sued state governments for failing to provide adequate education (Michigan) and for malpractice in environmental protection (Juliana v. United States in Oregon). These cases, though often dismissed or settled unsatisfactorily, represent crucial attempts to establish legal standing and constitutional obligations to future generations, drawing on concepts like the trust doctrine. He emphasizes that these legal battles, while messy, signify a necessary societal shift towards embedding the idea of posterity into the DNA of government and leadership.

Ultimately, Dugger asserts that the ability of modern society to materially worsen conditions for future generations – through environmental degradation, fiscal debt, and inadequate social support – violates the fundamental principle of stewardship. He sees movements like Black Lives Matter as expressions of a claim to community and participation for both current and future generations, pushing for a broader interpretation of "ourselves and our posterity." The hope for reintroducing this reverence for posterity lies in the work of initiatives like INET's Young Scholars Initiative and in fostering a leadership that prioritizes intergenerational equity across all policy domains, recognizing the constitutional power of the word "posterity."

"The purpose of the constitution is to secure the blessings of liberty for ourselves and our posterity."

"What we've had both in the the snl problem in the late 80s and early 90s and the uh downturn of uh the internet era... and more and quite recently with the um uh great recession in 2008 2009... economics... is an economic that is driven by uh individual profit uh objectives short-termism uh and leads to policies that are inequitable and unsustainable."

"The code expression on wall street was ibg ubg meaning i'll be gone you'll be gone so we gotta press it hard now the upside is ours and it's heads we win tails somebody else loses and we'll be doing something else."

"What people forget is that Jefferson and the other framers and Adam Smith and all of the uh sort of enlightenment economic thinkers in England went home at night and on the table in the in the in their homes was a bible... so they had a very strong sense that they were part of a long a stream of generations."

"The whole problem of quote unquote new economic theory is to move away from the economics that is based solely on enlightenment individualism... which is what we saw in the 2008 downturn what we saw in the snl crisis and what we're seeing now in the response to uh covid 19."

"Milton Friedman that um the um purpose of business is to maximize profits that there is no social obligation of business to anything other than simply to maximize profits that was not the high water mark that was the trumpet sounding the night basically signaling that all those who believe in these free market uh unconstrained market activities are free now to go forward."

"If we to if we want to understand how that second word in the that second word posterity is going to be incorporated into economic thinking with those young people that will uh tell us how to do it."

"We violated the most fundamental principle of stewardship we're not leaving to the next generation as good or better than we received."