I. Introduction

The twentieth century began in the years just after the end of the American
Civil War in 1865. The twentieth century came to an end in the years
around the chronological beginning of the third millennium.
The twentieth century began in the years just after America’s Civil War
because it was then that three of the most important trends that were to
make the twentieth century what it was took their shape. In 1867 the
Pacific Mail Steamship company began regularly-scheduled service
between San Francisco and Hong Kong. In 1881 the world’s first steelhulled ocean liner—Cunard’s S.S. Servia—entered service.1 It was in
those years immediately after 1865 the metal-hulled steam-powered transoceanic passenger and cargo ships began the large-scale intercontinental
movement of people and of staple goods—not preciosities like ivory, apes,
and peacocks, but instead goods like flour, meat, machines, furniture, and
textiles.2 It was in those years, also, that the first reliable and durable
transoceanic telegraph cables were laid.3 The near-instantaneous
transmission of information around the globe made possible by the longdistance telegraph—and its successors in communications technologies—
had profound impact on economics, technology, and culture. The largescale flows of goods, people, and information around the entire world have
been the heart of the twentieth-century process now called “globalization.”
However, it is the third of the important trends that took shape
immediately after the Civil War that is probably the most important of all.
See William H. Miller (1997), The Liners: A Voyage of Discovery (New York:
Motorbooks International: 0760304653).
See Kevin O’Rourke and Jeffrey Williamson (1998), Globalization and History: The
Evolution of a Nineteenth Century Atlantic Economy (Cambridge: MIT Press:
The first transatlantic cable laid in 1858 barely functioned at all, and was completely
useless within months. See “History of the Atlantic Cable and Submarine Telegraphy”
<http://www.atlantic-cable.com/ (December 23, 2001)>, Tom Standage (1999), The
Victorian Internet (London: Berkley Pub Group: 0425171698), and Neal Stephenson
(1996), “Mother Earth, Mother Board,” Wired 4:12 (December).
They saw the invention of invention. As of the middle of the nineteenth
century, it was not at all clear that the pace of productivity growth and
technological change seen in the classic British Industrial Revolution
could be sustained. That century-long burst of technological progress in
steam, textile machinery, and metalworking might have been nearing its
end. But technological progress did not slow. The leading sectors of the
first half of the nineteenth century were replaced by others—steelmaking,
chemistry, electricity, the internal combustion engine—and it became clear
that the Industrial Revolution had seen not just the invention of a few
interesting and productive new technologies but the invention of a
scientific-social-economic system that generated a sustained and so-far
permanent chain of inventions, innovations, and productivity
improvements that extended across virtually the entire economy.4 The
burst of textile, metalworking, and steam-related inventions of the British
classic Industrial Revolution were no flash in the pan. The sustained and
interlocking processes of scientific research, technological development,
and industrial innovation that have been most important of all in shaping
the history of the twentieth century.5 How much larger is GDP per capita
in the world today than it was back in the twentieth century? Is the world
sevenfold richer? Fourteenfold richer? Twentyonefold richer? Does the
question have any meaning?6 That the twentieth century has seen the
collective wealth of humankind increase so much is primarily due to the
magic of these interlocking rings of scientific research, technological
development, industrial innovation—and the market economies that have
made industrial innovation so profitable and directed so much energy and
effort toward it.
The twentieth century came to an end at the chronological beginning of the
See W. Arthur Lewis (1978), Growth and Fluctuations 1870-1913 (London: Allen and
See David Mowery and Nathan Rosenberg (1998), Paths of Innovation: Technological
Change in Twentieth Century America (Cambridge: Cambridge University Press:
For some reflections, see William Nordhaus (1997), “Do Real Output and Real Wage
Measures Capture Reality? The History of Lighting Suggests Not,” in Timothy Bresnahan
and Robert Gordon, eds., The Economics of New Goods (Chicago: University of Chicago
Press), and Richard Easterlin (1998), Growth Triumphant? The Twenty-First Century in
Historical Perspective (Ann Arbor: University of Michigan Press: 0472085530).
third millennium because it was then that the key dilemmas that appear
likely to shape the history of the twenty-first century took their form. The
East Asian, Argentinian, and other financial crises of the late 1990s broke
confidence in both the East Asian state-led and the neoliberal openness-led
development models. The belief that economic development would be
rapid and straightforward once an economy had managed to successfully
replicate the institutional structures and development strategies of the East
Asian economies went down in flames in 1997-1998. The belief that
economic development would be rapid and straightforward once an
economy had managed to successfully adopt the neoliberal advice of the
“Washington consensus” went down in flames in the other financial crises
of the 1990s. A country like Argentina had successfully implemented
perhaps 80% of the neoliberal development agenda, and yet it ended 2001
in deep economic trouble. No international financial and political
architecture can be viewed with approval and confidence if 80%
implementation is not enough for development success.
The triple environmental scares of large-scale deforestation, ozone
depletion, and global warming that struck in the 1990s were a firebell in
the night underlying the urgency of the need to develop global
environmental property and commons management institutions. We can—
perhaps—rely on democratic politics and voter education to produce an
acceptable level of environmental quality within a nation’s borders
(although perhaps only if the nation is a rich industrial democracy). But
elementary economics teaches us that global public goods can be produced
and global commons managed only by global institutions which the
twentieth century never built and never had.
Last, but not least, September 11, 2001 saw the first of the long-forecast
large-scale wholesale act of non-state terrorism with the terror attack on
and destruction of New York's World Trade Center. The acts of terror and
genocide with which the twentieth century was filled were all carried out
by states: national governments. Such actors could be restrained
(somewhat) by threats of deterrence. Over the course of the twentieth
century the ability of non-state actors—which could not be deterred—to
conduct retail-scale terrorism grew: the Irish Republican Army, the Stern
Gang, Black September, the Baader-Meinhof Gang, and so many others.
Now with Al-Qaeda we have crossed a line, and on the far side of this line
the security challenges of the twenty-first century are different.
A naive individual of two centuries ago, or of one century ago, would
wonder at the events, patterns, and problems that brought the twentieth
century to its end. Why does such a rich and powerful world still have
problems? Saudi Arabia is rich and powerful beyond the imaginings of any
of the great-great-great grandfathers of the fifteen Saudi citizens who tried
to and did fly airplanes into buildings on September 11, 2001. So why did
they believe that it was a matter of urgent necessity to die and kill on a
wholesale scale in order to try to set in motion a chain of events that would
lead to the restoration of the Medieval Caliphate? That is indeed one of my
principal themes in this book. If our increased wealth and extraordinary
production capabilities are helping us move toward utopia, our motion is
not a gallop or a trot but an awkward, slouching movement. And it is not
at all clear that we will recognize our destination when we arrive at it. That
the explosion of material wealth we have seen in the twentieth century has
not solved our human problems—that the spread of ample material plenty
to virtually the entire globe that the twenty-first century may see will not
solve our human problems—is indeed one of the major themes of this
book. It is the reason for the subtitle: “Slouching Towards Utopia.”
I have acquired many debts in the writing of this book. I am most indebted
to my best of wives, Ann Marie Marciarille. I am indebted to my children,
Michael M. DeLong and Gianna D. Marciarille, to whom I dedicate this
book. I am indebted to the National Science Foundation, the Alfred P.
Sloan Foundation, the National Bureau of Economic Research, and the
University of California at Berkeley Institute of Business and Economic
Research for financial assistance at various points during this project. My
list of intellectual debts, especially, is extremely long, getting longer, and
too long to list in total. But the ten most weighty intellectual debts to
Lawrence Summers, Barry Eichengreen, Jeffrey Williamson, Andrei
Shleifer, David Landes, Christina Romer, Claudia Goldin, Robert
Waldmann, Peter Temin, David Romer, Jeffrey Weintraub, Paul Krugman,
Paul Romer, Joel Mokyr, David Cutler, Larry Katz, Jan de Vries, Greg
Mankiw, Robert Barro, and Richard Sutch (yes, I know that’s twenty)
cannot be evaded.
Last but not least, one more comment: this—by which I mean our
collective understanding of the history of the twentieth century—is far
from finished. It is still our collective work-in-progress. So comments,
criticisms, and contradictions are very welcome: I look forward to them
from “The Second Coming”
by W.B. Yeats
...Things fall apart; the center cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity.
Surely some revelation is at hand;
Surely the Second Coming is at hand...
The Second Coming!...
... now I know
That twenty centuries of stony sleep
Were vexed to nightmare by a rocking cradle,
And what rough beast, its hour come round at last,
Slouches towards Bethlehem to be born?
—J. Bradford DeLong, Waltham, Massachusetts, November 1991Monterey, California, February 2002.
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