The Party Is over

The Great Gatsby recognises the essential role of the economy in human experience.

Listener: 8 January 2011

Keywords: Business & Finance; Literature and Culture; Political Economy & History;

On occasions, Auckland has outbreaks of Great Gatsby parties. This name alludes to the classic F Scott Fitzgerald novel, narrated by Nick Carraway who lives on New York’s Long Island, in a house between “old money” Tom and Daisy Buchanan and “new money” Jay Gatsby.

Gatsby loves Daisy, but years earlier lost her to Tom, because of his humble origins. To show off his subsequent success to Daisy (whose voice was “full of money”), Gatsby puts on lavish parties in his fabulous house. “I [Nick] believe that on the first night I went to Gatsby’s house I was one of the few guests who had actually been invited. People were not invited – they went there.”

The novel is set in the flapper times of 1922, or the “Jazz Age”, as Fitzgerald coined it, with its prohibition and heavy drinking, and its superficiality, insincerity, transience – “you can’t live forever, you can’t live for ever” – and dazzling decadence, itself a reaction to the brutality of the Great War. All the main protagonists come from the rural Midwest, to which Nick returns at the end of the novel. “I see now that this has been a story of the West, after all – Tom and Gatsby, Daisy and Jordan and I, were all Westerners, and perhaps we possessed some deficiency in common which made us subtly unadaptable to Eastern life.” More bluntly, they were corrupted by New York.

That was not how it seemed at the time. The American economy was booming (the British one was not), and it was easy to enjoy the consequences of the boom without asking questions like where Gatsby obtained his mysterious colossal wealth. Tom thinks it is bootlegging, but in fact Jay was selling counterfeit bonds. In later times he could have been selling legal but equally worthless financial securities – the novel’s financials still resonate.

Yet although the novel has been turned into films, an opera and plays (including a New Zealand version written by Ken Duncum and produced at the Court and Circa theatres last year), it became a classic only after World War II.

By then the phoniness of the Roaring Twenties was evident following the Great Depression that it precipitated; as Holden Caulfield – of another great American novel, Jerome Salinger’s The Catcher in the Rye – would have observed. Aside from narrator Nick, the only honest thing in the tragedy is Jay’s love for Daisy. To pursue it he has to take on a phoney role.

The underlying economy is phoney, too. How often do we overlook, when reading fiction (or history), that the consumption necessary for the story depends on income.

Sure, there are myriads that involve inheritance, land or advantageous wealthy marriage, but those that involve working are much less common. Too often the narration is vague about where the income that pays for the consumption comes from, or it assumes a convenient source, such as inherited wealth (or, in the case of The Bone People, a lottery; in the second half of The Women’s Room it is alimony) that facilitates the leisure on which the story depends. If the main characters worked for a living, they might not have time for the action in the novel.

By contrast, The Great Gatsby recognises the essential role of the economy in human experience. Although Gatsby’s financial activities are necessarily obscure, they underpin the story. (The Buchanan money is inherited. Nick is an honest Wall Street bond dealer and makes only a modest living.) Remarkably, over 80 years ago Fitzgerald portrayed this integral relationship.

Perhaps it was easier to recognise the truth in the American economy, which has been far more prone to dramatic booms and busts than, say, the less-volatile British one. (Perhaps because it has been better regulated. Ironically the Blair-Brown Government abandoned that regulation, and now the British economy is in a proper mess.)

Our Great Gatsby parties occur when the economy is in an unsustainable financial boom. The next time you see one, move your investment into bonds, but make sure they’re not counterfeit.