4 comments about The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest, and the Business Cycle (Social Science Classics Series).

1. This book provides a useful corrective to some of the shortcomings of the so-called Austrian theory of Capital and the Business Cycle. Schumpeter, who studied under the great Austrian economists Bohm-Bawerk, was too much of an independent thinker to be part of an economic movement or school. The Theory of Economic Development is his declaration of independence from Austrian capital theory. In the book, he introduces a theory of development and the business cycle that shocked his more orthodox colleagues. Economic development, Schumpeter argues, involves transferring capital from old businesses using established methods of production to businesses using new, innovative methods. Schumpeter's special insight comes in trying to explain how the transfer of capital from the old to the new takes place. Schumpeter argued that it takes place through credit expansion. Through the fractional reserve system, banks are able to create credit, quite literally out of thin air. This money is lent to businesses specializing in new methods of production, who then bid up the price of production goods and consumer goods in their effort to pay for the production goods they require. Thus a form of inflationary spoliation takes place at the expense of established businesses and consumers. Although Schumpeter does not draw the spoliation inference from his theory, it is nonetheless there in the text for all who can see. Credit expansion is a form of spoliation, a form of robbery hardly distinguishable from counterfeiting. But what is unique about the capitalist engine of production is how it uses spoliation in the service of progress. And not merely spoliation through credit expansion, but spoliation through protectionism, stock manipulation, corporate welfare, cartels and monopolies, and outright fraud and manipulation. Schumpeter's book sheds light on just one aspect of this spoliation, and from this stems the book's vital importance to economic theory.



2. In this important book Schumpeter explains the ECONOMIC origins of business cycles. In a convincing way Schumpeter argues that business cycles are inevitable in a developing economy.
   
   This does not mean that there are no other causes of business fluctuations such as changes in commercial policy, wars, inflationary government finance or panics. But these constitute non-economic data and cannot be explained by economic theory.
   
   Conventional macroeconomic theory tends to explain business cycles by some kind of error and focus on correcting this error either by active policy or by advocating a hands-off policy. In this view business cycles have no function.
   
   In a stationary ,non-developing economy (i.e. absence of innovations) there would be very little uncertainty. If you and your competitors have been selling essentially the same product in the same market year in year out and if this were to apply to all products and services would there be any economic risk (fires, epidemics and tax increases are non-economic data) left ? Were there any true economic causes, i.e. causes that economics can explain, of business cycles in the Dark Ages ?
   
   There is still something to be said for Keynesian theory (although not for policy) in that uncertainty does influence investment decisions and that because of uncertainty in a monetary economy some hoarding of purchasing power does occur. But these are mere symptoms of underlying endogenous business cycles caused by the inflationary investment booms - "animal spirits" if you like - invoked by the swarms of innovating firms, e.g. the internet bubble, and the deflationary busts that follow when the old firms die off and yesterday's innovators become part of the stationary cycle. Schumpeter explains the origins of economic uncertainty.
   
   What Schumpeter teaches us is that booms and recessions are necessary phenomena in developing economies, that can't be removed or corrected if we are not to thwart the creation of new wealth by innovation. Recessions are the price we pay for long term economic growth. However, recessions can lead to unnecessary panics that cause unnecessary harm to the economy. Here governments or central banks are able to, and should in my view, correct.
   
   I hope you enjoyed this review and welcome any comments.



3. Schumpeter had an expression that intuitively sums up in a few choice words quite a few of the theoretical concepts of J M Keynes and the empirical/statistical breakthroughs of Benoit Mandelbrot.Unfortunately,Schumpeter lacked the technical training in mathematics,statistics and probability that he needed in order to give a rigorous exposition of his intellectual and intuitive discoveries.Those few choice words are"regular irregularity".Looking at the data available to him early in the 20th century,Schumpeter was able to categorically argue ,correctly ,that price movements over time in different markets and changes in investment over the business cycle could NOT be modeled by assuming that a normal probability distribution could be applied.Schumpeter was the first economist to make a clearcut distinction between risk(applying a normal probability distribution with a stable mean and variance(standard deviation))and uncertainty.Uncertainty would automatically arise over time due to the regular irregularity of constant(nonconstant)technological innovation,change and advance over time.It is quite easy to see that Mandelbrot's nonparametric two variable constructs, measuring discontinuity and short run/long run persistence/dependence(as opposed to the normal distributions assumptions of continuity and independence),are described by Schumpeter's"regular irregularity".Unfortunately,instead of breaking with the classical and neoclassical schools of economics,as both Keynes and Mandelbrot did,Schumpeter decided to remain a loyal soldier,downplaying his severe disagreements.This was Schumpeter's great error.He recognized the severe limitations of the standard price adjustment equilibrium demand and supply analysis,but went along anyway.The potential reader will find chapter 6 of Schumpeter's book alone to be worth the price of admission needed to obtain access to Schumpeter's brilliant breakthroughs.



4. The Theory of Economic Development represents a high point in the history of economic science. Schumpeter had a clear understanding of the difference between static and dynamic issues in economics, and an appropriate appreciation of the latter. This book also shows how advanced Schumpeter's thinking was. On page 10 Schumpeter appears to anticipate the modern definition of economics- 20 years before Robbins wrote his Nature and Significance of Economic Science (was this in the original edition, or just in my 1934 reprint?). Chapter one sorts out Say's Law of Markets in detail, and explains its static nature. Chapter two explains economic development in correct dynamic terms (unlike the pseudo-dynamics of Neoclassical growth theory). Schumpeter is able to explain dynamics because he examines entrepreneurship (and vice versa). Schumpeter also leaves room for real institutions, especially financial markets.
   
   I can honestly say that I learned some new and important things from reading this book, despite the facts that I have a PhD in economics and took my first economics class 21 years ago. Unfortunately, most economists would learn more from reading this book than I. This is a sad commentary on the current state of affairs in economics. Schumpeter was interested in matters of great consequence and thought about them deeply. There is simply no comparison between Schumpeter's insightful analysis and the tedious and purely imaginary intellectual constructs of Solow influenced math modelers. There is a clear difference between Schumpeter's analysis and the intellectual gymnastics of modern mathurbationists. Schumpeter was a true professional.
   
   I was somewhat surprised by the extent to which Schumpeter's ideas fit with the ideas of Mises, Kirzner, and Lachmann. Schumpeter is often seen as an Austrian born Walrasian instead of as an Austrian economist in the Menger-Mises-Hayek tradition. There are clear Austrian influences on Schumpeter's thinking, though he was not a Mises clone. I was already impressed with Capitalism, Socialism, and Democracy. Schumpeter was a true genius, and an economist on par with Ricardo and Hayek. Read this book to learn some development economics, and a little intellectual history too.

5 comments about The Reckoning.

1. If "The Reckoning" is not a classic then certainly it is an authoritative account of Nissan's assault on the U.S. market (and Ford's subsequent demise). The account of the Big Three's arrogance has been told many times since Halberstam published this book, but Halberstam deserves a lot of credit for so much of his book being so relevant to what American automakers are facing today. Insert big SUVs and big trucks any time Halberstam talks about Big Cars = Big Profits and you've got a pretty good idea of what's going on today with Ford and GM and their reluctance to come out with small, fuel-efficient vehicles in favor of high-margin SUVs. It is necessary to point out, though, that even though American auto executives were truly arrogant and complacent with their market share, Japanese manufacturing (lean production) was a paradigm shift. In order to compete on quality with the Japanese American auto would have had to spend billions of dollars on new plants and capital equipment (in essence, almost "betting the farm" that Demings' TQM was the wave of the future). The Japanese had the distinct advantage of having to start from scratch.



2. The Reckoning is a wonderful book that shows how the United States lost its dominance in the automobile industry. In true Halberstam fashion MacNamara is one of the main villains but through stunning research Halberstam paints a very clear picture of what happened. Japans attention to detail and innovation overshadow America's downfall. The big three are unable to respond and those who are running the Japanese business in the United States who were far more inventive. This book is still relevant even in today's world.



3. I'm really not into cars. However, I happened onto The Reckoning because of having read and liked earlier Halberstam books but ... and found it to be one of the best I have ever read, an absolutely great book. On more than one occasion, I have talked way too much about the remarkable stories it includes, way too long. The Ford:Nissan comparative history is a good mechanism, but the stories are the really great part - the totally hilarious (the salesman in the Port of LA changing the nameplates, trying to explain about the brakes and the engine blankets to the Japanese engineers); the absolutely tragic (Ford and his son, Edsel); the truly remarkable (the business dream team after WWII, the family actions after Edsel's death), the bizarre (pulling the chassis through a barn with a rope and measuring the elapsed time, any color as long as it's black) etc., etc. Lots of car and manufacturing and labor relations stuff, but a really readable book for anyone. And I am truly not into cars ...



4. This book is a masterpiece of narrative journalism. Based on five years of research and interviews, it tells the story of how the Japanese came to dominate the American car industry by telling the stories of key individuals, in the U.S. and Japan, who played important roles in that story. Halberstam is such a skilled writer that every one of these people comes alive on the page; you will meet the Fords and their Japanese counterparts at Nissan, and executives, car designers, union leaders, and workers in both countries. Along the way, as you get to know these people, you will learn the story not only of the automobile industry but also of American business in general, the story of how American companies abandonned the making of quality products under pressure from finance people (trained at the nation's leading business schools) who care only about stock position and short-term profits. There can be no better primer for anyone who wants to understand the economic history of America in the second-half of the twentieth century. Read it and weep--and then take a look at Eamon Fingleton's "In Praise of Hard Industry" (also published under the title "Unsustainable").



5. David Halberstam wrote in 1986 his view of the history of the carmaking industry. He focuses on Ford and Nissan. Other players get mentions here and there, but no more than that. While a broader look at the whole carmaking industry might seem better, Halberstam's approach works.
   
   No one writes this kind of history any more. Rather than lecture, Halberstam brings out details that tell the story themselves. He picks people and follows their careers, mistakes and successes, as they make their contribution to carmaking.
   
   Halberstam does not do everything perfectly. His approach has its flaws. He will boil down someone's life to a few pages, or even paragraphs, which makes the complex more simple than it should be. And much of what he writes can only be speculation -- how is he to know what Henry Ford was thinking back in the early 1900s?
   
   That said, this book captured my interest. Most books like this written 20 years ago are hard to get through. They are way past their shelf life.
   
   Not so with this one. I picked it up because I'm interested in carmaking. I put it down admiring it not just for how it treats carmaking, but for how it treats history. Well worth reading.

5 comments about Money Game.

1. I found it a great book.
   it's not "technical", but showed me many new things and approaches to the market.
   it's not a novel, but I assure I laughed out loud in the middle of the night!
   it's not about "psychology", but the last chapter made me understand much more about my inner thoughts on me-as-a-trader than a whole book...
   
   I would recommend for the ones who, having red about ten books on "how to trade, and be a millionare....", would like to taste something different.
   but only if they like, also, reading good books.



2. "If I really had a system for making money in the market and it worked all the time, first of all, I wouldn't tell anybody and second of all, I would soon have just about all the money there is." Adam Smith p. 122
   
   Thank you for being so honest. Amazingly this book has helped me more than all the other "How to make millions in the stock market" books I have read. It is well-written and filled with information, humor, advice and wisdom. It touches on everything from the fabled Mister Johnson (I have a strong suspicion that Peter Lynch got his inspiration for One Up On Wall Street from this book) to charting and random walk theory. The reader is encouraged to find his own trading style and use the wealth of information from the book. Highly recommended.



3. It's an actually must-read for all investors. This is an extreme excellent book and can be treated as one of the first pioneer books about behavior finance. All the ideas in the book are what behavior finance scholars try to model. If things work, we don't need to construct a fancy model to prove them. We can just describe them as the author of the book did. I can safely conclude there are more than 10 NEW papers which could be done based on the book alone.



4. As a teenager I read this book when it first hit the shelves. It started my early education in managing money and great nonfiction writing. The Money Game is a series of vignettes and stories about people trying to achieve fortune and fame and peace of mind on Wall Street. It is not a textbook, although you will learn the fundamental principles of fear and greed and the basics of investment strategies as told through a specific story or person.
   
   While The Money Game is a book about money, it is an excellent example of first rate nonfiction writing. In my own writing throughout a long publishing life in academic publication, I have returned to The Money Game for examples of well structured chapters and nicely turned sentences. 'Adam Smith' (the pseudonym for George Goodman) is one of the best writers I've encountered. His style is made more apparent through reading the following companion book to The Money Game, Super Money. If you read both books back to back, the structure and style jumps out almost like a teacher writing an equation on the board.



5. Market and economies of countries are changing... This book is written long back...no more effective as per current trends. Author has told the things that a layman knows how to trade now a days.
   
   I will say better interested people should go for new authors that provide a better views as per current money trends.
   
   Very dissapointing book for me.

No comments about Pioneering Portfolio Management: An Unconventional Approach to Institutional Investment, Fully Revised and Updated.

4 comments about The Limits to Capital, New Edition.

1. I was attracted to this work becaues i'm interested in Marx and have read another of Harvey's books "The Condition of Postmodernity." Harvey is an erudite scholar who's formal education is in georgraphy, but his research has produced accessable and powerful studies beyond his origins. "Limits to Captial" is a complete and balanced account of Marx's economic work centering upon his major text "Das Kaptial." Harvey has does a intense study of Marx and Marxist scholarship (Lenin, Rose Luxingberg, and others) to produce a systematic and dialetical account of Marx's critique of Captialism. Even though harevy pays attention to the importance of Hegelian dialetics this book is accessable to to readers who do not have strong philosophic of economic backgrounds. If your are interested in Marx and/or captialism this is an excelent inroad to begin your studies. A detaled biblography of cited sources is a gem for continuted research. His book on postmodernity is also excelent.



2. David Harvey is actually a geographer, but from reading this book, one would think him one of the great political economists. Based on this work alone, he should be in the popular range of Stiglitz, Schumpeter, Milton Friedman etc., but it is not likely that such 'honor' will ever befall a Marxist theorist. Nevertheless everyone interested in Marxist economics, for whatever reasons, simply must read this book.
   
   Harvey's discussion of capitalism from a Marxist perspective is extraordinary clear, sharp and thorough. So much in fact that it is probably the most consistently in-depth exposition of capitalism from every aspect since "Capital" itself. This also makes it hard to review it, since one hardly knows where to begin.
   
   Fortunately for political economy newbies (and this book is definitely the best kind of "introductory overview" you could give to an intellectual person), Harvey starts at the same point "Capital" starts, then works his way through. First he gives a clear exposition of the general framework of Marxist theory: the law of value, the differences between value, use value and exchange value, the mode of production etc. All this is done quite well, though there are of course many many such general descriptions available in print. Harvey does seem to skip over the "transformation problem" somewhat, which may annoy those who consider it a major hurdle. Harvey, in my view with good reason, does not.
   
   The next two chapters discuss production, distribution, surplus value and its realization and the relation to supply and demand. Particularly useful here are his explanations of the importance of the concept of value composition of capital, and the reduction of skilled to simple labour, where he addresses one of Von Böhm-Bawerk's better critiques of Marxism.
   
   The next part of the book is perhaps the core of the book. Here, Harvey delves into the organization of capital, the various forms which it can take and how these interrelate, and the tendency of the rate of profit to fall. He shows how the various manifestations of capital can interfere with each other's functioning and how this creates the tendency towards crises. He then posits the problem of overaccumulation (rather than underdevelopment) as the first 'layer' or 'cut' of crisis theory.
   
   After the reader has grasped all this, the second crucial part of the book follows in a rapid manner, introducing first the problematic of fixed capital and its relation to the law of value, and then the role of credit in capitalism. The first is not very satisfactorily resolved and is in my view probably the weakest part of his theory. Alan Freeman has since given a quite different solution to the same issue, but that does not seem to really solve the problem either. Perhaps this is one of the things Marxist political economy has yet to fully solve.
   
   Harvey's demonstration of the role of credit is however masterful and extremely enlightening for the many who are confused by the vast array of forms in which credit appears in modern society. His emphasis on the importance of understanding the so-called "fictitious capital", that is advanced capital not yet backed by actual value through production, allows him to show the second major appearance of crises in capitalism as well as explaining the theory of rent in Marxism, which forms the subject of the chapter thereafter. He corrects Marx' somewhat excessively anti-distributive theory of rent and explains the role of agricultural technology. Harvey is in many parts of this chapter rather confusing in his terminology, but a careful reader can certainly grasp the issue.
   
   At the end of the book Harvey can finally follow up on his own area of expertise. By explaining the role of spatial and temporal relations in the flow of capital and the necessity of 'exporting' the internal contradictions of capitalist social relations, he is able to form a theory of imperialism that is largely in accordance with that of Lenin, but without the theory of underdevelopment. It also puts a good perspective on Marx & Engels' many journalistic articles about India and colonialism. Finally he combines this with the earlier two aspects to form the third 'cut' of capitalist crisis theory, which takes every aspect of capitalism in its modern appearance into account.
   
   On the whole, Harvey has done an unparallelled and magisterial work in creating an exposition of capitalism that is at once as in-depth as "Capital" and much clearer (and shorter!) than that, although of course without Marx no such thing could ever have been made.
   There are a few things nevertheless not covered (fully) in the book. Harvey pays surprisingly little attention to urban geography and (sub)urbanization as a factor in capitalism. Furthermore his theory of the state is a hodgepodge of different roles, which he never unites into one whole. Finally, people experienced in handling Marxist theory might have problems with Harvey's generally structuralist approach, which leaves relatively very little room for the autonomous significance of class struggle. Harvey mostly relegates that to the fields of production processes and labour mobility. Because of this, Lebowitz' "Beyond Capital" should probably be read alongside it as a complementary contribution, analyzing the same from the side of wage-labour.



3. In my opinion, Limits to Capital is the best path to Marx's political economy, and in a sense it's an update of Capital. Harvey explains Marx, and introduces some new concepts such as 'spatial fix', 'socially necessary turnover time of capital' etc. Together with Mandel's Late Capitalism, Limits to Capital is the most significant contribution to Marx by a contemporary writer. (The radical geography journal Antipode had a special issue for the 20th year of Limits to Capital.)
   
   However, Harvey revisioned some of his thought later, with 'The New Imperialism'. He introduced the notion of 'accumulation by dispossession', I don't know why, limiting the 'reproduction on an enlarged scale', and thereby limiting the validity of class conflict. This imperialism issue blurs all the contemporary accounts of capital accumulation. He is now an Arendtian. Good luck with that, but we miss the Harvey of Limits to Capital.



4. 
   Tough read but essential, November 2, 2008
   By J. Johanning "bussho" - See all my reviews
   
   I'd give it 5 stars if it were a somewhat easier read (afraid that a lot of people who would benefit it will give up following the argument), but it may be the best commentary on Marx's economic theory available. It's a difficult book only because Marx's theory is itself complex, and it is complex because reality is.
   
   In these times of crisis in our economy, worse than anything for almost a century, it is essential for us to understand why events are happening as they are, and while Marxian economic theory is obviously not perfect, I think it is far closer to true than most of what you can see in print today. Harvey not only gives us an accurate interpretation of Marx, but goes beyond him and amends him in many respects. Read and learn.

2 comments about The End of Laissez-Faire: The Economic Consequences of the Peace (Great Minds Series).

1. Having never read Keynes before, and having only heard politicians and pundits either lionize or pillory him, I am in awe of the depth and substance of his thinking. This book, written after World War I is, in my opinion, required reading for all who would analyze our current politico-economic situation. I can't wait to get more of his stuff.



2. J.M. Keynes worked harder to destroy capitalism and free markets than any other man (except for perhaps Karl Marx). Born with a silver spoon in his mouth, he never had to create wealth, he simply wanted to re-distribute the wealth that others had created. His anti-capitalism, anti-free-market, socialist model continues to this day. Keynes never considered the act of taking income and property by force (or threat of force) from one group to give to another group (of his choice) immoral. American politicians today are Keynesians.
   
   Michael Beitler, Ph.D.
   Author, "Rational Individualism: A Moral Argument for Limited Government & Capitalism"

5 comments about Economics Explained: Everything You Need to Know About How the Economy Works and Where It's Going.

1. I'll tell you what this book is: it's a primer on financial markets for people who already have a strong background in economics (say, college courses in micro and macro) and are looking to transmute that knowledge into the kind of practical know-how that will help them make money with their investments.
   
   The authors do not specifically recommend specific investments or brokerage houses, no; it's more of a general review of economics, though with a constant view towards putting that knowledge into practical and profitable use in a variety of situations.
   
   Well, once you understand that, the book isn't so great, despite one of the authors (Heilbroner) being just famous for his excellent "The Worldly Philosophers." Plus the thing's out of date, being (among other things) pre-tech bubble burst.
   
   However, I can help you: if you need a book that does what this book is trying to do, perhaps the best one I know of is "How the Economy Works," by Edmund A. Mennis. Also immensely useful is the "Guide to Economic Indicators" by the editors of the British magazine, the Economist (also useful for Americans). Both are available on Amazon.
   
   If, however, you are merely looking for an entertaining and informative precis of contemporary economic issues and aren't planning on doing anything knowledge-requiring with your money, this book simply will not do. The writing is stuffy, the coverage is incomplete, and the explanations are way too elliptical for a novice.
   
   For this last purpose, seek out instead Charles Wheelan's "Naked Economics."



2. This is an excellent introduction to today's economics. It covers the basics like supply and demand, inflation, savings and investment, but also covers more modern concepts like privatization and the public sector, globalization and money and banking. It touches on a few traditional economic personalities - Smith, Marx and Keynes. It discusses the national debt and deficit spending and all the major things most people are talking about in today's average world. If you know nothing about economics but want to learn, this is the book for you. If you know all about economics but want to review the basics this book is for you. This book even discusses the ethics and morality of our modern day capitalism which I thought was rather refreshing.



3. I ordered the wrong book so I never used this book. However, the supplier was very easy to work with.



4. The authors achieve their goal in this short, concise book which seeks to explain basic economics to the layperson. They do a very good job of explaining economic terminology and giving examples to explain various concepts. This is a worthwhile start for someone who wants to learn more about economics. The authors admit from the beginning that they personally have a liberal bias. I think that admission is admirable. Honestly they do a good job of trying to argue for both sides of the issue. However, their personal liberal views do come out at times. This book should probably be accompanied by one from either Thomas Sowell or Milton Friedman.



5. Successfully accomplishing what it set out to achieve, I must conclude this book is a triumph. It is no secret the book is intended only as an introduction to basic economics, and thus accordingly the book goes no further than what is covered among preliminary collegiate level macroeconomic courses.
   
   The authors provide an ample collection of clear and tidy explanations supported with examples presenting a complete comprehensive overview of economic concepts that are at the core of macroeconomics. You can almost feel the strain of the writers trying to refrain from providing any political slant, and to a degree they accomplish this quite well. I applaud the effort because when encountering the political aspects of economics, it is typically rare to find an engaging discussion or explanation without a large degree of bias. However, they do not accomplish it entirely, and this will be evident. I felt they properly defused this by being up front about their bias as well as giving equal time to opposing views. I completed this book with a sincere belief that a fair assessment of all views was provided when relevant.
   
   I would recommend this book to anyone needing either a refresher in basic economics or one looking to obtain a comprehensive understanding to build an economic foundation.

1 comments about The World in Depression, 1929-1939, Revised and Enlarged edition (History of the World Economy in the Twentieth Century).

1. This book is outstanding at describing the economics of the Great Depression. In his time, Kindleberger was regarded by many as the highest authority on the economics of the Great Depression. He also was a regular economist of the highest order. (Check out his other books.) This book is outstanding analysis of the Great Depression.
   
   Kindleberger explains that the reason for the Depression was a lack of a stable international economic structure. In other words, the financial structure we enjoy today simply did not exist at the time. The flawed international system could only have led to a financial crisis eventually.
   
   The financial world used a flawed gold standard - and this book describes why it was a disaster. Great Britain (and finance minister Winston Churchill specifically) played a leading role in implementing the flawed international system. Then when the depression hit, Great Britain quickly dumped the gold standard - hypocrosy - and recoverd the soonest. Herbert Hoover rigidly stick to the gold standard. FDR dumped it once becoming president, and it brought about a recovery. But a full recovery from the great depths of the Great Depression did not occur until the massive spending of World War II.
   
   Why did this all happen? There simply was no financial structure in place to exact a powerful enough of a force on the global financial system. Great Britain had abdicated the leadership role and the United States was yet unwilling to assume that role. Nations turned inward (and I would add that countries that devalued quickly faired best).
   
   Macroeconomics had not yet been developed. Keynes General Theory only came out in the mid-1930's, and then it was largely unknown. Friedman would not develop his monetary theory until well after the Great Depression had ended.
   
   The book is not the only explanation of the Great Depression, nor pretends to be, but is a highly valid one and should be considered by anyone seriously interested in the subject. This book is a classic for the subject.

3 comments about Mindful Economics: How the US Economy Works, Why it Matters, and How it Could be Different.

1. This book is the perfect counterbalance to mainstream economics. Magnuson provides real world information about the US economy and its history, and suggests ways to begin building real economic alternatives. The book contains much useful information and is accessible to people who have no background in economics. Mindful Economics is very informative and an interesting read.



2. This book is perhaps the best economics book I have ever read. It covers so much, is beautifully written and is just amazing. You'll learn so much from his work.
   
   I am an economics major with a poly sci minor, and, this book is just so much macro/mirco concepts nothing has come close.



3. For decades now, economic history has been deliberately suppressed in colleges and universities by a group of very deluded academics who worship Ayn Rand and her ideology of selfishness. Margaret ("There is no society") Thatcher and Alan (It's not my fault) Greenspan are among her devotees. Also known as the Chicago School, they launched their first major master plan using Pinochet in Chile in 1977 to overthrow the democratically elected socialist Allende (on 9/11 of that year, by the way. It was a disaster but they called it a success. (Mission Accomplished!) Various members of these minions went on to loot national currencies from Wall Street, and indoctrinate our country into a embracing selfish greed and gains at the unjust expense of others.
   
   Then we were hoodwinked into NAFTA and CAFTA. Banks went national and credit was released from it's cage with no training. Extremely important and effective legislation from the 1930's that protected us by keeping separate the various components of financial and insurance worlds were repealed. Crazy hyper-leveraged financial instruments made unsustainable debt levels a game of hot potato. What is worse though is that we are being mentally manipulated and tricked by opposite-speak everywhere we turn. We are being deprived even of unambiguous language to describe economic and political subjects.
   
   "Free Markets" are anything but democratic, or "free" for that matter. When we say we want to bring democracy to a country, we really mean forcing them to sell us their resources at pennies on the dollar and stripping the country of its assets. It doesn't matter, Democrat or Republican, "Wealth Creation" is really "Debt Creation," and both parties will strive to protect financial paper, no matter how inflationary, at the expense of productive capital and the general prosperity of all Americans except a very few. (Ralph Nader is the only candidate who has for 40 years demonstrated that he is capable of resisting the puppet strings of Wall Street, and by the way, he is on the ballot in 45 states, most likely including yours. You have no more excuses!!)
   
   Joel Magnuson's work is one of the greatest steps I have seen toward restoring economic literacy to America. This is a marvelous text that is easy to read and understand without oversimplifying anything. He tears the curtain from the Wizard's booth and reveals the humbug of micro and macro economic mathmatics, among so many other things. He offers lists of questions to ask the Chicago School instructors in class as each subject comes up. If you like making your professors and instructors actually earn their share of the higher education booty, you will love this feature. It is also reasonably priced, unlike most college texts that are obscenely over-priced in their anything-but-free market bookstores.
   
   Buy extra copies of this book. You will want to lend them out and give them away as I do.

5 comments about The Real Wealth of Nations: Creating a Caring Economics.

1. This book was my first interaction with the work of Dr. Eisler and I was deeply moved by the concept of partnership and the need to place a higher value on caring and traditionally 'feminine' values.
   
   The finance major in me was left very impressed at times, and rather disappointed at other times throughout the book. Dr. Eisler makes use of some great examples of companies that increase productivity, decrease turnover and breed hierarchies of actualization, specifically naming a software company that had daycare on site. She also discusses some great examples of how Scandanavian countries include fathers in the child-raising process, citing an example that requires couples having children take a combined 16 weeks off to care for the child and at least 6 of those weeks must be the working parent.
   
   I was a little disappointed that she used life expectancy and GDP as measures of how well women were treated in different countries. Her point is well taken, but statistics betray her. She discusses France and Kuwait having similar GDPs, but France having significantly more gender equality thus yielding longer lives, etc. This specific example is true enough, but women are treated much more as equals in Scandanavian countries than they are in Japan, and yet they live longer in Japan.
   
   She is rightfully very critical of executive compensation, short-term thinking, materialism and the ongoing dispute about what resources should be in public hands and which should be in private hands that plague globalization. She correctly points out that many resources and services can be most efficiently provided locally. As I turned the pages, I was hoping she would address some of the benefits of globalization, which in fact have gone a long way establish peace. Certainly the U.S. government worked hard to establish good relations with Pakistan and India, begging them to get along instead of prolonging the bloodshed over Kashmir. However, some of the greatest forces for good in that situation were none other than large, globalized communications firms with infrastructure and employees in both countries. Relative peace was brought about by these companies who provide employment and stability in these regions who had senior leaders sit down with government leaders and explain that their nervousness over their continued fighting would compel many investors to withdraw. Had Dr. Eisler mentioned this example (or countless others) I think she would have been able to more precisely point out improvements in globalization, rather than simply deducing that globalization isn't always the best solution.
   
   Dr. Eisler's diagrams of the missing pieces in measuring economics was most insightful and useful, as were the statistics she provided that showed spending more education now equals spending less on prisons later.
   
   Dr. Eisler risks alienating people who would be predisposed to be some of her most avid supporters when she takes excerpts out of religious texts and adlibs her opinions as if they were facts represented in the religious text. There is certainly no doubt that atrocities have been committed by those claiming religious titles, rights and missions, but even most of the examples she sites as the paragons of domination (the Taliban, the Ayatollah in Iran, Hitler and Stalin) are primarily secular in nature (the Ayatollah being the only religious figure). As a Christian, I will tell you that I want to vomit when I hear Falwell attribute 9/11 to feminism or Robertson attribute Katrina to tolerance of homosexuality. I will also tell you that 'love your neighbor as thyself' is very much a cornerstone of partnership (and there are many more examples of these).
   
   Dr. Eisler is also rightfully critical of the Bush Administration and their unilateral foreign policy, preemptive warfare doctrine, fiscal irresponsibility and environmental 'blinders.' I agree with most of her criticisms, usually for different reasons than the those she mentions. Having read an interview she gave after 9/11 where she surprises the interviewer by indicating that war against terrorism is necessary, I have to wonder what her opinion is of how western countries should address Iran. It's certainly valid to criticize preemptive warfare, but what if one of the premier dominators in the world is pursuing a nuke? Do we wait until he gains equal military power? Do we allow him to disconnect his society from the rest of the world where women continue to be subject to circumcision and mistreatment if they are not sufficiently subordinate?
   
   In this review I went to some lengths to justify my critiques, whereas I think my praise of Dr. Eisler's work speaks for itself. It may appear that I spent much more time discussing my critiques, and that is the reason why.
   
   This book is by far one of the best I've ever read and I hope someday to see it included as required reading in grade school curriculums (3rd grade or so).



2. Along with "The chalice and the Blade" and "Sacred Pleasure" this is the most profound, important and amazing book i have ever read - it changed my life! this should be a compulsory course at all self-respecting universities. Everyone in the world should either read or be aware of what these three books are talking about, then we'll not only have hope but a blueprint for a better world. i have half the mind to post it to our prime minister right now :)
   
   thank you Dr Eisler, from me and all the people and future generations that will benefit from your determination, knowledge and work!!!



3. I missed Riane Eisler's recent talk at the PARC Forum, but the abstract was so inspiring, I bought the book. As with many (all?) the other reviewers thus far, I support the basic notion of "caring economics": elevating the valuation of traditionally feminine activities such as caring and caregiving. I support partnership over domination (though don't know what to make of "hierarchies of actualization"), and the establishment of rules, tools and schools that offer a more comprehensive accounting - and accountability - within economics, that will incorporate the social and environmental dimensions more effectively, and eliminate "externalities" - costs that corporations can pass on to "external" stakeholders (as opposed to stockholders).
   
   The other reviewers have done a great job at highlighting many of the positive aspects of this book. I wanted to offer a slightly dissenting opinion, based on three issues that bothered me. One is that I believe the book is about twice as long as it needs to be. There is considerable redundancy, and by the last few chapters, I found myself growing increasingly annoyed as she repeatedly repeated ideas and themes covered [well] in other chapters. As with some other books I've read, it strikes me as a potentially fabulous journal-length article that was stretched too far. A brief perusal of her paper on "Work, Values, Caring" available on her PartnershipWay web site suggests that this paper may cover much of the content in the book, in a much shorter space.
   
   A second shortcoming I see in the book is a lack of reference to either Milton Mayeroff's classic work ON CARING or to Yochai Benkler's more recent paradigm-shifting book, THE WEALTH OF NETWORKS: HOW SOCIAL PRODUCTION TRANSFORMS MARKETS AND FREEDOM. The book is replete with many useful references, and every author must be selective about the references she or he includes, but I would think that either of the two aforementioned books would be required reading for anyone interested in caring economics.
   
   The third shortcoming I see in this book is its rather pre-emptory dismissal of "selfish genes". I recently [finally] read THE SELFISH GENE, by Richard Dawkins, and although I like to believe in (and practice) altruism, I had to admit that Dawkins makes a compelling case for how and why our genes are selfish operators ... and thus why altruism doesn't make sense at the genetic level. Now, we are not our genes, and I like to believe we are more than simply containers for them to propagate themselves, and as our actions - and inactions - have increasingly far-reaching impacts on others throughout our increasingly interconnected planet, there may be good reasons why caring for others (who do not carry our genes) is worthwhile, and why we might want to give up domination for partnership. However, Eisler's quick dismissal of "selfish genes" in several passages leads me to wonder whether she's read Dawkins' book, or simply the other references she invokes that take a contrarian view. She seems to be attached to making "evolutionary" claims with respect to caring economics. I think the impact can be just as strong without invoking evolution ... and invoking evolution while summarily dismissing what I view as its most compelling modern articulation only weakens the impact.
   
   I hope we will be willing and able to redefine economics to take into account the social and environmental costs and benefits that are currently ignored. I believe that THE REAL WEALTH OF NETWORKS offers some compelling arguments for how and why we can do this. I do not recommend that people not read this book because of the shortcomings I cited - I am still glad I read the book. I just wanted to offer a perspective that may be of some value to others who are considering the book, or at least to help set expectations (for anyone who shares my prejudices).



4. I found the book to be well worth reading. It should be particularly helpful for those who have not been exposed to new economic visions.
   
   However, I feel that we must move beyond the think tank musings and into an action stage. Some of the hopeful stories that the author tells -- the working conditions at a North Carolina software company for example -- represent a form of working that will not even exist in a Peak Everything world.
   
   We have to re-invent the way that we live our daily lives and in doing so we should integrate the partnership concepts that the author espouses. We cannot do this with letters to our political representatives or with one more conference. These actions have proven to have little or no impact on our direction. We must physically build a new infrastructure. I would like to see the author take a leadership role -- she has the credibility -- in this next step towards a more caring economy.



5. In The Real Wealth of Nations, Dr. Riane Eisler has created a powerful piece of critical literature for the 21st century. By peeling away layers of social unconsciousness and tradition, Eisler reveals what is fundamentally wrong with today's global economic measurements and explains what is required for humankind to create a sustainable economy and peaceful future for the world.
   
   Changing the world requires more than changing the way we act; it requires changing the way we think. In easy-to-read language, Eisler helps readers do this by challenging traditional systems of thought and urges us to consciously reflect on our personal as well as societal actions. She shows how quality of life is an infinitely more important measure of happiness than monetary prosperity and that partnership rather than domination is the social structure that will allow humanity not only to survive, but to thrive.
   
   I highly recommend this thought-provoking book to anyone who wants to help create a more peaceful and fulfilling life for themselves, their children, and their grandchildren.
   
   --Ken Beller, lead author of Great Peacemakers and The Consistent Consumer