My Amazon Review of Alan Greenspan's and Adrian Wooldridge's "Capitalism in America: A History"

The Building of America

Former Fed chairman Alan Greenspan and Economist editor Adrian Wooldridge have written a long needed upbeat history of capitalism in America. It is a history of creative destruction that glorifies the spirit of enterprise that built our country from 13 struggling colonies to a continent spanning behemoth. The authors glorify the exploits of Thomas Edison, John Deere, Bill Gates, Samuel Morse and Henry Ford.

Of course all of this did not happen in a vacuum. America is blessed with a temperate climate, fertile soil, navigable waterways and enormous mineral deposits. Perhaps more important our nation was born when enlightenment values were beginning to flower. As a result we ended up with a constitution that limited government and protected property rights that allowed enterprise to flourish.

The villains of the piece are trade unions and a political/intellectual elite who would rather substitute their judgement for that of the markets. Although the authors do discuss the origins of the 2008 financial crisis, they underestimate the role of financial markets in undermining the very economy Greenspan and Wooldridge are extolling. Hence the need for a modicum of regulation. Moreover the authors ignore the political corruption that ran rampant during the Gilded Age, the 1920s and our era of today.

Although the authors through many barbs at government, in reality they are Hamiltonian conservatives in that they favor broad based policies to support the economy. Those included support for the railroads, the Homestead Act, and land grant colleges all of which played a role in the great explosion of growth in the post-Civil War era.

The authors end their book on sour note fearing that the growing burden of regulation and entitlement costs will sap the dynamism of the economy going forward. I believe that is a necessary condition, but it is not sufficient to restore capitalism’s dynamism. What is needed are huge investments in basic research, education and infrastructure and that means more, not less government.

I would note that this book is nowhere near as detailed as Robert Gordon’s “The Rise and Fall of American Growth,” but it is shorter and an easier read and it is an antidote to the anti-capitalist screed of Richard White’s “The Republic for which it Stands"

The full Amazon review appears at: https://www.amazon.com/review/RPCTI0AOP2XWV/ref=pe_1098610_137716200_cm_rv_eml_rv0_rv