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THOMAS NOWOTNY
sector without real function. For purchasing power is not automatically
transferred from the private into the public sector. Citizens do not con–
sume public goods, and they do not agree to higher taxes simply for the
purpose of keeping the capitalist machine humming. Voters do not easily
and automatically yield part of what could be their private consumption
to politicians and public administrators. Thus the public sector will grow
only if there is a real demand for its growth. In the long run such de–
mand must correspond not to political whim or fashion but to deep and
real needs. We may therefore assume that such need exists, that increasing
wealth is accompanied by increasing needs for the services provided by
the public rather than the private sector of the economy.
The cost of the growing public sector may be viewed either as an
increasing burden on the increasingly wealthy nations, or as solidly prof–
itable investments in the economic future. It is of course not possible to
distinguish clearly between these two modes of explanation: if a damaged
machine needs repair the necessary expenditures might either be con–
sidered a waste or an "investment." And the political and ideological
conclusion will differ depending upon our preferred explanation. People
obviously enjoy being wealthy. The wealthy live longer; they read more;
spend more on charity; care more for emotional ties with spouses and
children, etc. Thus it is not readily evident that increasing wealth creates
social damages that call for ever costlier repairs. The damages caused by
the economic machine are not the ones stigmatized by the early Marxists
who conceptualized industrial growth at the expense of mass–
pauperization. Nonetheless, and while the "old" social questions recede,
new ones become ever more intractable: rising unemployment, ag–
gression, suicide, drug addiction: an explosive increase in the number of
single parent families. Inequality, too, is again on the increase. Remedies
are elusive, and they are costly. In most instances it is the public sector
that is called upon to act. In fact, the public sector becomes responsible
for things people (for many good reasons) no longer want to be
responsible for themselves - such as caring for the aged and toddlers. In
addition, costs are directly shifted from the private to the public sector:
repairing an environment damaged by industry; retraining workers for
new jobs; building roads for privately-produced cars. In this view the
public sector would only partly remedy the ills caused by economic
modernization, and the costs would be disproportionately high. Such a
view induces pessimism not only about the future of "capitalism," but
also about the future of "social progress."
In the last analysis so-called progress might turn out to be a mirage -
as increasing wealth is balanced by increasing social pathology and by an
ever-larger public sector that increasingly burdens the productivity of the
private one. Such a pessimistic assessment, however, can present only part
