road to serfdom

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pages: 494 words: 132,975

Keynes Hayek: The Clash That Defined Modern Economics by Nicholas Wapshott

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., p. 58. 35 Hayek quoted Keynes, “The Economics of War in Germany,” Economic Journal, vol. 25, September 1915, p. 450, referring to the “nightmare” of reading a German author advocating the continuation of the military ethos in peacetime industrial life. Collected Works, vol. 2: Road to Serfdom, p. 195, footnote. 36 F. A. Hayek, Preface to the original edition of The Road to Serfdom, in Collected Works, vol. 2: Road to Serfdom, p. 37. 37 Collected Works, vol. 2: Road to Serfdom, pp. 148–149. 38 Ibid. 39 Ibid., p. 214. 40 Hayek, Preface to the 1976 edition of The Road to Serfdom, in Collected Works, vol. 2: Road to Serfdom, p. 55. 41 Collected Works, vol. 2: Road to Serfdom, pp. 58–59. 42 Ibid., p. 105. 43 Hayek, Preface to the 1956 American edition of The Road to Serfdom, in Collected Works, vol. 2: Road to Serfdom, p. 37. 44 Letter from Keynes to Hayek, April 4, 1944, LSE Archives, London. 45 Collected Writings, vol. 17: Activities 1920–2: Treaty Revision and Reconstruction (Macmillan for the Royal Economic Society, London, 1977), pp. 385–387. 46 Chicago Round Table, quoted in Ebenstein, Friedrich Hayek, p. 126. 47 Collected Works, vol. 2: Road to Serfdom, p. 148. 48 Collected Writings, vol. 17: Activities 1920–2, pp. 385–387. 49 Interview of Hayek by Thomas W.

“At that very moment Keynes became the great figure and I was gradually forgotten as an economist.”86 As he put it some forty years later, “In the middle 1940s—I suppose I sound very conceited—I think I was known as one of the two main disputing economists: there was Keynes and there was I. Now, Keynes died and became a saint; and I discredited myself by publishing ‘The Road to Serfdom,’ which completely changed the situation.”87 FOURTEEN The Wilderness Years Mont-Pèlerin and Hayek’s Move to Chicago, 1944–69 Hayek did little to build on the popular success of The Road to Serfdom in America. He was a reluctant public figure and found that the acclamation he received on his book tour disturbed his decorum. “I was asked to come over to give five series of lectures at five universities,” he recalled. “I imagined very sedate academic lectures, which I had written out very carefully. . . . While I was on the high seas, the condensation of The Road to Serfdom in the Reader’s Digest appeared. So when I arrived I was told . . . I was to go on a public lecture tour around the country.

Hayek’s venture into doomsday prognostication in The Road to Serfdom was also cited as evidence that he lacked the intellectual rigor expected at the Chicago School. According to John Nef, chairman of Chicago’s Committee on Social Thought, some Chicago economists believed The Road to Serfdom “too popular a work for a respectable scholar to perpetrate. It was all right to have him at Chicago so long as he was not associated with the economists.”42 In the fall of 1950, at the suggestion of Nef, Hayek became professor of social and moral science in the Committee on Social Thought, a chair funded in part by the Volcker fund. Despite the rebuff, Hayek accepted the post. Hayek wanted to kick-start his counterrevolution by writing a work that would be as popularly received as The Road to Serfdom. As his biographer Alan Ebenstein explained, “He hoped The Constitution of Liberty would be [Adam Smith’s] The Wealth of Nations of the twentieth century.”43 Over the next nine years he worked on and off on a work that would explain why the rule of law is the best way to safeguard individual liberties from governments.

 

pages: 483 words: 134,377

The Tyranny of Experts: Economists, Dictators, and the Forgotten Rights of the Poor by William Easterly

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Quoted in Daniel Yergin and Joseph Stanislaw, The Commanding Heights: The Battle Between Government and the Marketplace That Is Remaking the Modern World (New York: Simon and Schuster, 1998), 150–51. 48. Hayek, Road to Serfdom, 1750. 49. Ibid., 1202. 50. Ibid., 1829. 51. F. A. Hayek, ed., Collectivist Economic Planning: Critical Studies on the Possibilities of Socialism by N.G. Pierson, Ludwig von Mises, Georg Halm, and Enrico Barone (London: Routledge and Kegan Paul, 2011), Kindle edition, locations 152–57. 52. Hayek, Constitution of Liberty, 1980. 53. Hayek, Road to Serfdom, 180. 54. Gunnar Myrdal, Development and Under-Development: A Note on the Mechanism of National and International Inequality (Cairo: National Bank of Egypt, 1956), 63 and 65. 55. Quoted in Bauer, Dissent on Development, 187. 56. Ibid., 206. 57. Ibid., 207. 58. Ibid., 189. 59. Hayek, Road to Serfdom, 2216. 60. Hayek, Constitution of Liberty, 13831. 61. Hayek, Road to Serfdom, Kindle location 4350. 62.

In truth, as we have already seen above, there is ample evidence that Hayek was not the conservative ideologue his critics claimed. The Road to Serfdom advocated such nonconservative ideas as a minimum income guaranteed by the state: “there can be no doubt that some minimum of food, shelter, and clothing, sufficient to preserve health and the capacity to work, can be assured to everybody.”22 In fact, Hayek condemned some of the very people he was identified with by his critics. In the pages of the 1956 version of The Road to Serfdom, he said British Conservatives were “paternalistic, nationalistic, and power-adoring . . . traditionalistic, anti-intellectual, and often mystical.”23 Hayek himself acknowledged after the fact that he had attracted some followers with whom he did not agree, at some cost to himself: “the manner in which [The Road to Serfdom] was used [in the United States] vividly brought home to me the truth of Lord Acton’s observation that ‘at all times sincere friends of freedom have been rare, and its triumphs have been due to minorities, that have prevailed by associating themselves with auxiliaries whose objects often differed from their own; and this association, which is always dangerous, has sometimes been disastrous.’”24 My argument here is not meant to address any debate on right versus left in US domestic policy.

German History in Documents and Images, Volume 7, Nazi Germany, 1933–1945, Decree of the Reich President for the Protection of the People and State (“Reichstag Fire Decree”), February 28, 1933, http://germanhistorydocs.ghi-dc.org/pdf/eng/English%203_5.pdf, accessed September 4, 2013. 19. Hayek, Road to Serfdom, 5974, 5991. 20. Wenar, Hayek on Hayek, 1011–14. 21. F. A. Hayek, Studies on the Abuse and Decline of Reason, ed. Bruce Caldwell, Volume 13, The Collected Works of F. A. Hayek (Chicago: University of Chicago Press, 2010), Kindle edition, locations 8903–8908. 22. Hayek, Road to Serfdom, 3601. 23. Ibid. 1225. 24. Ibid. 1140. 25. Clifford Geertz, “Myrdal’s Mythology,” Encounter 33, Number 1 (July 1969): 29–33; quote is from page 31. 26. Myrdal, International Economy, 201. 27. Hayek, Road to Serfdom, 1814. 28. Ibid. 1753. 29. Ibid. 1814. 30. Allan Carlson, The Swedish Experiment in Family Politics: The Myrdals and the Interwar Population Crisis (New Brunswick, NJ: Transaction Publishers, 1990), 94, 95, 90. 31.

 

Goddess of the Market: Ayn Rand and the American Right by Jennifer Burns

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anti-communist, bank run, barriers to entry, centralized clearinghouse, collective bargaining, desegregation, feminist movement, financial independence, George Gilder, invisible hand, jimmy wales, Joseph Schumpeter, knowledge worker, laissez-faire capitalism, lone genius, Menlo Park, minimum wage unemployment, Mont Pelerin Society, new economy, offshore financial centre, Ponzi scheme, profit motive, RAND corporation, rent control, road to serfdom, rolodex, Ronald Reagan, side project, Stewart Brand, The Chicago School, The Wisdom of Crowds, union organizing, urban renewal, white flight, Whole Earth Catalog

Like Rand, he warned, “The forces which have destroyed freedom in Germany are also at work here.”10 He shared her distrust of “the common good” and titled one of his chapters “Individualism and Collectivism.” The reception of their work was also similar, for Hayek was snubbed by intellectuals yet embraced by businessmen and other Americans nervous about the implications of the New Deal. Both The Fountainhead and Road to Serfdom were even made into comic books, a testimony to their wide appeal. The Road to Serfdom launched Hayek on a remarkable career as an intellectual and organizer that would culminate with his winning the 1974 Nobel Prize in Economics. The book’s popularity caught the attention of the Kansas City–based Volker Fund, a newly active libertarian foundation, which eventually helped Hayek secure a position at the University of Chicago, a lone academic redoubt for libertarian ideas.

Fones-Wolf, Selling Free Enterprise: The Business Assault on Labor and Liberalism, 1945–60 (Chicago: University of Illinois Press, 1994). 9. “Balzar’s Hot Bargains for Cool Meals,” August 5–7, 1946, Hollywood, CA, ARP 095–49x; Ralph C. Nehls to AR, December 18, 1949, ARP 004–15A; The Houghton Line, April-May 1944, ARP 092–12x. 10. F. A. Hayek, The Road to Serfdom (Chicago: University of Chicago Press, 1944), 3. For the reception of Road to Serfdom, see Alan Ebenstein, Friedrich Hayek (Chicago: University of Chicago Press, 2001). Hayek’s career and thought are described in Bruce Caldwell, Hayek’s Challenge: An Intellectual Biography of F. A. Hayek (Chicago: University of Chicago Press, 2003). 11. It is hard to exaggerate the institutional centrality of the University of Chicago to diverse strains of conservative thought.

A top executive at the Meeker Company, a leather goods company in Joplin, Missouri, distributed copies of Roark’s courtroom speech to his friends and business acquaintances.9 Much as Rand had always wished, capitalists were finally promoting her work of their own volition. Business conservatives were also drawn to another best-selling book attacking state control of the economy, F. A. Hayek’s Road to Serfdom. Written for a British audience, Hayek’s book unexpectedly caught the attention of Americans, and he was mobbed by enthusiastic crowds when he toured the United States in 1944. Hayek made arguments very similar to those Rand had advanced during her post-Willkie activism. He tied his laissez-faire beliefs to the broader international situation, arguing that any movement toward state regulation of the economy would ultimately culminate in full-blown socialism and dictatorship.

 

pages: 662 words: 180,546

Never Let a Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown by Philip Mirowski

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Andrei Shleifer, asset-backed security, bank run, barriers to entry, Basel III, Berlin Wall, Bernie Madoff, Bernie Sanders, Black Swan, blue-collar work, Bretton Woods, Brownian motion, capital controls, Carmen Reinhart, Cass Sunstein, central bank independence, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, complexity theory, constrained optimization, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, dark matter, David Brooks, David Graeber, debt deflation, deindustrialization, Edward Glaeser, Eugene Fama: efficient market hypothesis, experimental economics, facts on the ground, Fall of the Berlin Wall, financial deregulation, financial innovation, Flash crash, full employment, George Akerlof, Goldman Sachs: Vampire Squid, Hernando de Soto, housing crisis, Hyman Minsky, illegal immigration, income inequality, incomplete markets, invisible hand, Jean Tirole, joint-stock company, Kenneth Rogoff, knowledge economy, l'esprit de l'escalier, labor-force participation, liquidity trap, loose coupling, manufacturing employment, market clearing, market design, market fundamentalism, Martin Wolf, Mont Pelerin Society, moral hazard, mortgage debt, Naomi Klein, Nash equilibrium, night-watchman state, Northern Rock, Occupy movement, offshore financial centre, oil shock, payday loans, Ponzi scheme, precariat, prediction markets, price mechanism, profit motive, quantitative easing, race to the bottom, random walk, rent-seeking, Richard Thaler, road to serfdom, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, savings glut, school choice, sealed-bid auction, Silicon Valley, South Sea Bubble, Steven Levy, technoutopianism, The Chicago School, The Great Moderation, the map is not the territory, The Myth of the Rational Market, the scientific method, The Wisdom of Crowds, theory of mind, Thomas Kuhn: the structure of scientific revolutions, Thorstein Veblen, Tobin tax, too big to fail, transaction costs, War on Poverty, Washington Consensus, We are the 99%, working poor

., p. 3; Arnsperger, Critical Political Economy, p. 90. 144 Hayek, The Road to Serfdom, p. 164. 145 Hayek, The Constitution of Liberty, p. 376; Hayek, The Road to Serfdom, p. 77, 30, 290–91. What is regarded as wickedly radical in science studies, is propounded as eminently conservative by the Hayek wing of neoliberalism. 146 Hayek, The Constitution of Liberty, p. 378, my italics. This explains why neoliberals tend to diverge from their predecessors: “most nineteenth century liberals were guided by a naïve overconfidence in what mere communication of knowledge could achieve” (p. 377). 147 Hayek, The Road to Serfdom, pp. 204–5. 148 Hayek reveled in the tough-minded stance of the scholar who disparaged any recourse to the Third Way, most notoriously in his denunciation of the welfare state as just the slippery “Road to Serfdom.” This sets him apart from his contemporary figures like Walter Lippmann, or Keynes, or their modern epigones like Cass Sunstein or Joseph Stiglitz. 149 Hayek, The Constitution of Liberty, p. 377, 112, 110, 22. 150 Schneider, “The Role of the Category of Ignorance in Sociological Theory,” p. 498. 151 Ibid., p. 500. 152 Hayek entertained the possibility of blaming “the engineers” for the frustration of the neoliberal project in his Counterrevolution of Science (1952), but subsequently came around to the position that it was politically unwise to demonize such a powerful constituency in the twentieth-century economy.

When doctrines persist against all odds, say, in a worldwide economic crisis; when knowledge and power converge in stasis, then surely there is something that demands explication. Do Zombies Dream of Eternal Rest? In the throes of the red-misted nightmare, it looks as if the crisis, otherwise so virulent and corrosive, didn’t manage to kill even one spurious economic notion. This is not exactly news. John Quiggin has entertainingly dubbed the phenomenon Zombie Economics, and deserves kudos for stressing this point. Incongruously, Friedrich Hayek’s Road to Serfdom has returned to best-seller lists after a long hiatus. Even Ayn Rand has apparently enjoyed a new lease on (undead) life. One can readily agree with Colin Crouch: “What remains of Neoliberalism after the financial crisis? The answer must be ‘virtually everything.’”19 Similarly, a glut of crisis books has been pouring from every possible digital delivery system of publishers. They fall from the presses, not stillborn, but clone-dead.

Although it is undeniably the case that all manner of secondhand purveyors of ideas on the right would wish to crow that “market freedom” promotes their own brand of religious righteousness, or maybe even the converse, it nonetheless debases comprehension to conflate the two by disparaging both as “fundamentalism”—a sneer unfortunately becoming commonplace on the left. It seems very neat and tidy to assert that neoliberals operate in a modus operandi on a par with religious fundamentalists: just slam The Road to Serfdom (or if you are really Low-to-No Church, Atlas Shrugged) on the table along with the King James Bible, and then profess to have unmediated personal access to the original true meaning of the only (two) book(s) you’ll ever need to read in your lifetime. Counterpoising morally confused evangelicals with the reality-based community may seem tempting to some; but it dulls serious thought. It may sometimes feel that a certain market-inflected personalized version of Salvation has become more prevalent in Western societies, but that turns out to be very far removed from the actual content of the neoliberal program.

 

pages: 298 words: 95,668

Milton Friedman: A Biography by Lanny Ebenstein

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affirmative action, banking crisis, Berlin Wall, Bretton Woods, Deng Xiaoping, Fall of the Berlin Wall, fiat currency, floating exchange rates, Francis Fukuyama: the end of history, full employment, Hernando de Soto, hiring and firing, inflation targeting, invisible hand, Joseph Schumpeter, labour market flexibility, Lao Tzu, liquidity trap, means of production, Mont Pelerin Society, Ponzi scheme, price stability, rent control, road to serfdom, Ronald Coase, Ronald Reagan, school choice, school vouchers, secular stagnation, Simon Kuznets, stem cell, The Chicago School, The Wealth of Nations by Adam Smith, Thorstein Veblen

This was Friedman’s first trip outside of the United States. He considers his attendance at this meeting to have been important in his growing interest in public policy from an explicitly libertarian, or classical liberal, point of view. Others from Chicago to attend this meeting were Frank Knight, Aaron Director, and Friedrich Hayek. Hayek, the author of the 1944 international best-seller The Road to Serfdom, had organized the meeting. He joined the Committee on Social Thought at the University of Chicago in 1950, and Friedman attended his seminar frequently; it became another source of his expanding interest in the philosophical foundations of free private property capitalism. Friedman continued to participate in national public policy issues through the 1950s, and his involvement skyrocketed in the 1960s.

It says much about Friedman that his two major popular works have “free” in their titles: Capitalism and Freedom and Free to Choose. Many passages in Capitalism and Freedom contain echoes of Mill, especially from On Liberty, Mill’s great classical liberal and libertarian work. Capitalism and Freedom is a linear descendent of the freedom philosophy enunciated in On Liberty. Together with On Liberty and The Road to Serfdom, Capitalism and Freedom is one of the great brief works in libertarian thought and policy. Animating all these works is their emphasis on the individual—on the importance of each individual and on the moral necessity to treat each human being as someone of utmost worth. Friedman’s focus is individual human freedom. Like Mill, Friedman emphasizes the importance of genius and writes that the great accomplishments in history “were the product of individual genius.”10 Mill’s parallel statement in On Liberty was: “There are but few persons, in comparison with the whole of mankind, whose experiments, if adopted by others, would be likely to be any improvement on established practice.

When Friedman writes that “[e]ven though the men who wield this [state] power initially be of good will and even though they be not corrupted by the power they exercise, the power will both attract and form men of a different stamp,”23 he could practically be paraphrasing Hayek, who held that in a collectivist society, “the worst get on top.”24Like Hayek, Friedman terms his own position liberal (in a nineteenth-century sense), not conservative. Friedman refers to Hayek in the text of Capitalism and Freedom: “Recognizing the implicit threat to individualism, the intellectual descendants of the Philosophical Radicals—Dicey, Mises, Hayek, and Simons, to mention only a few—feared that a continued movement toward centralized control of economic activity would prove The Road to Serfdom, as Hayek entitled his penetrating analysis of the process.” When Friedman says that “the great threat to freedom is the concentration of power,”25 he expresses an idea similar to that of Hayek, who said: “It is not the source but the limitation of power which prevents it from being arbitrary.”26 From America’s founding fathers, Friedman was impressed, like so many others, by the idea of limited government.

 

pages: 385 words: 111,807

A Pelican Introduction Economics: A User's Guide by Ha-Joon Chang

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The Austrian school was started by Carl Menger (1840–1921) in the late nineteenth century. Ludwig von Mises (1881–1973) and Friedrich von Hayek (1899–1992) extended the school’s influence beyond its homeland. It gained international attention during the so-called Calculation Debate in the 1920s and the 1930s, in which it battled the Marxists on the feasibility of central planning.14 In 1944, Hayek published an extremely influential popular book, The Road to Serfdom, which passionately warned against the danger of government intervention leading to the loss of fundamental individual liberty. The Austrian school is these days in the same laissez-faire camp with the free-market wing (today the majority) of the Neoclassical school, producing similar, if somewhat more extreme, policy conclusions. However, methodologically it is very different from the Neoclassical school.

The market for carbon emission permits was created only in the 1990s.16 By calling the market a spontaneous order, the Austrians are seriously misrepresenting the nature of the capitalist economy. The Austrian position against government intervention is too extreme. Their view is that any government intervention other than the provision of law and order, especially protection of private property, will launch the society on to a slippery slope down to socialism – a view most explicitly advanced in Hayek’s The Road to Serfdom. This is not theoretically convincing; nor has it been borne out by history. There is a huge gradation in the ways market and the state combine across countries and within countries. Chocolate bars in the US are provided in a much more market-oriented way than is primary school education. South Korea may rely more on market solutions than Britain does in the provision of health care, but the case is the reverse in water or railways.

Individuals can produce whatever will make money for them, using any method of production that maximizes profit, whether footballs made by child workers or microchips made with hi-tech machinery. There is no higher authority – king, pope or the planning minister – to tell individuals what they should want and produce. On this basis, many free-market economists have argued that there is an inseparable link between the freedom of individual consumers to choose and their broader political freedom. Friedrich von Hayek’s seminal critique of socialism, The Road to Serfdom, and Milton Friedman’s passionate advocacy of the free-market system, Free to Choose, are famous examples. Moreover, the individualist view provides a paradoxical but very powerful moral justification of the market mechanism. We as individuals all make choices only for ourselves, the story goes, but the result is the maximization of social welfare. We don’t need individuals to be ‘good’ to run an efficient economy that benefits all its participants.

 

pages: 275 words: 77,955

Capitalism and Freedom by Milton Friedman

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affirmative action, Berlin Wall, central bank independence, Corn Laws, Deng Xiaoping, floating exchange rates, Fractional reserve banking, full employment, invisible hand, Joseph Schumpeter, liquidity trap, market friction, minimum wage unemployment, price discrimination, rent control, road to serfdom, Ronald Reagan, secular stagnation, Simon Kuznets, the market place, The Wealth of Nations by Adam Smith, union organizing

The result of that experiment had been foreshadowed by a number of similar experiments on a smaller scale: Hong Kong and Taiwan versus mainland China; West Germany versus East Germany; South Korea versus North Korea. But it took the drama of the Berlin Wall and the collapse of the Soviet Union to make it part of conventional wisdom, so that it is now taken for granted that central planning is indeed The Road to Serfdom, as Friedrich A. Hayek titled his brilliant 1944 polemic. What is true for the United States and Great Britain is equally true for the other Western advanced countries. In country after country, the initial postwar decades witnessed exploding socialism, followed by creeping or stagnant socialism. And in all these countries the pressure today is toward giving markets a greater role and government a smaller one.

No, the different reception of the later book and the success of the TV series are common consequences of the change in the climate of opinion. The ideas in our two books are still far from being in the intellectual mainstream, but they are now, at least, respectable in the intellectual community and very likely almost conventional among the broader public. The change in the climate of opinion was not produced by this book or the many others, such as Hayek’s Road to Serfdom and Constitution of Liberty, in the same philosophical tradition. For evidence of that, it is enough to point to the call for contributions to the symposium Capitalism, Socialism and Democracy issued by the editors of Commentary in 1978, which went in part: “The idea that there may be an inescapable connection between capitalism and democracy has recently begun to seem plausible to a number of intellectuals who once would have regarded such a view not only as wrong but even as politically dangerous.”

This tendency to collectivism was greatly accelerated, both in England and elsewhere, by the two World Wars. Welfare rather than freedom became the dominant note in democratic countries. Recognizing the implicit threat to individualism, the intellectual descendants of the Philosophical Radicals Dicey, Mises, Hayek, and Simons, to mention only a few—feared that a continued movement toward centralized control of economic activity would prove The Road to Serfdom, as Hayek entitled his penetrating analysis of the process. Their emphasis was on economic freedom as a means toward political freedom. Events since the end of World War II display still a different relation between economic and political freedom. Collectivist economic planning has indeed interfered with individual freedom. At least in some countries, however, the result has not been the suppression of freedom, but the reversal of economic policy.

 

pages: 261 words: 64,977

Pity the Billionaire: The Unexpected Resurgence of the American Right by Thomas Frank

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Affordable Care Act / Obamacare, bank run, big-box store, bonus culture, collateralized debt obligation, collective bargaining, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Deng Xiaoping, financial innovation, housing crisis, invisible hand, Naomi Klein, obamacare, payday loans, profit maximization, profit motive, road to serfdom, Ronald Reagan, shareholder value, strikebreaker, The Chicago School, The Myth of the Rational Market, Thorstein Veblen, too big to fail, union organizing, Washington Consensus, white flight, Works Progress Administration

Parsing a recent performance by his former fave British rock band Muse on his radio show in February 2011, the host declared that he had changed his mind about the group, that for all their rebel lyrics they didn’t get what the conservative revival was about after all. Why didn’t they get it? Because they were Europeans. And Europeans, as everyone knew, have had very few glimpses of real freedom. Even when England won the Second World War, they didn’t go into freedom. That’s where the Road to Serfdom came from. Because Winston Churchill and many others all said, wait, what are you doing? We’re going the wrong direction. And it didn’t go to freedom, it went to the Road to Serfdom. Beck is correct that The Road to Serfdom, the famous 1944 book by the Austrian economist Friedrich Hayek, was written as a critique of British politics, a warning that Labour Party socialism might lead eventually to totalitarianism. The book’s weakest point, as critics have observed over the years, is that Hayek’s main prediction never came true.

See also deregulation; and specific agencies attack on Depression and enforcement and financial crisis and Obama and Rand and utopian capitalism vs. Republican Party elections of 1994 and elections of 2008 and elections of 2010 and expectations of, in 2008 TARP and Tea Party and revival of Return of Depression Economics, The (Krugman) Rivera, David Road to Serfdom, The (Hayek) Romer, Christina Romney, Mitt Roosevelt, Franklin Beck and “forgotten man” and Obama and RFC and Ryan and Rothenberg, Stu Rubin, Robert Rules for Radical Conservatives (“Kahane”) “ruling class” Rush Limbaugh Is a Big Fat Idiot (Franken) Ryan, Paul same-sex marriage Samuelson, Robert Santelli, Rick Saving Freedom (DeMint) Schlesinger, Arthur Schwarzenegger, Arnold Schweikert, David Schweitzer, Mark Securities and Exchange Commission (SEC) Seldes, Gilbert Sex Pistols Shane, Scott Shlaes, Amity shock therapy Slouching Towards Gomorrah (Bork) “Small Business Bill of Rights” small business.

 

pages: 282 words: 80,907

Who Gets What — and Why: The New Economics of Matchmaking and Market Design by Alvin E. Roth

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Affordable Care Act / Obamacare, Airbnb, algorithmic trading, barriers to entry, Berlin Wall, bitcoin, Build a better mousetrap, centralized clearinghouse, computer age, crowdsourcing, deferred acceptance, desegregation, experimental economics, first-price auction, Flash crash, High speed trading, income inequality, Internet of things, invention of agriculture, invisible hand, Jean Tirole, law of one price, Lyft, market clearing, market design, medical residency, obamacare, proxy bid, road to serfdom, school choice, sealed-bid auction, second-price auction, second-price sealed-bid, Silicon Valley, spectrum auction, Spread Networks laid a new fibre optics cable between New York and Chicago, Steve Jobs, The Wealth of Nations by Adam Smith, two-sided market

. [>] Nigeria: For information about kidney disease in Africa, see Saraladevi Naicker, “End-Stage Renal Disease in Sub-Saharan Africa,” Ethnicity & Disease 19, no. 1 (2009): 13. 12. FREE MARKETS AND MARKET DESIGN [>] tablecloths: I recall discussing tablecloths as an indicator of restaurant types years ago with my late colleague Gerald Salancik, at the University of Illinois. [>] The Road to Serfdom: All the quotes in this section are from F. A. Hayek, The Collected Works of F. A. Hayek, vol. 2, The Road to Serfdom: Text and Documents—The Definitive Edition, ed. Bruce Caldwell (Chicago: University of Chicago Press, 2007). [>] liberal: Hayek in fact wrote of the confusion of terms: “Indeed, what in Europe is or used to be called ‘liberal’ is in the USA today with some justification called ‘conservative’; while in recent times the term ‘liberal’ has been used there to describe what in Europe would be called socialism.

Free Markets How do we square market design with the notion of the “free market” that so many people hold dear? In chapter 1, I made the analogy between a free market with effective rules and a wheel that can rotate freely because it has an axle and well-oiled bearings. I could have been paraphrasing the iconic free-market economist Friedrich Hayek, who in his 1944 free-market manifesto The Road to Serfdom wrote, “There is, in particular, all the difference between deliberately creating a system within which competition will work as beneficially as possible and passively accepting institutions as they are.” He understood that markets need effective rules in order to work freely. Hayek also understood that there is a place for economists to help in understanding how to design markets. Using the word liberal in a slightly different way than we do today (he meant something closer to what we might call libertarian), Hayek wrote, “The attitude of the liberal towards society is like that of the gardener who tends a plant and, in order to create the conditions most favorable to its growth, must know as much as possible about its structure and the way it functions.”

See also trust eBay, 117–19 of restaurants, 220 residency programs for doctors, 7–8, 73, 134–50 couples in, 144–49 empowerment of applicants in, 76–78 gastroenterologist fellowships, 75–78 orthopedic surgeons, 78–80 rural vs. urban, 149–50 resource allocation, 4 restaurants market designs for, 217–20 reservations for, 105 safety of, 220–22 signaling by, 181 risk. See safety of market participation; simplicity; trust Road to Serfdom, The (Hayek), 226–27 Robertson, John, 41–42 Rose Bowl, 61, 63 Roth-Peranson algorithm, 148–49 rules, 7. See also regulation cheating and, 93–98 for college bowl games, 60–65 for judicial clerkships, 92–96 unraveling markets and, 68 Rural Hospitals Theorem, 149–50 safety of market participation, 11, 113–30 in auctions, 182–84, 186–87 clearinghouses and, 112 credit cards in, 23 early transactions and, 60–80 in gastroenterology fellowships, 76–78 information sharing and, 122–28 in Boston Public Schools, 122–28 in clearinghouses, 112 for kidney exchanges, 34, 36, 37, 47–49 market efficiency and, 119–21 for medical residencies, 137–43, 150–51 in New York City schools, 109–10, 112, 153–61 in Internet marketplaces, 105 in kidney exchanges, 34, 36, 47–49, 51–52 for medical residencies, 137–43 privacy and, 119–22 reputation and, 115–16 for restaurants, 220–22 same-sex marriage, 198–99 Scarf, Herb, 32–34 Scheibe, Peter, 38–39 Scheibe, Susan, 38–39 school matching, 8, 165–67 Boston Public Schools, 11, 122–28, 162–65 in China, 165–66 constraints in, 158–61 deferred acceptance algorithm in, 157–61 inequality of schools and, 166–67 New York City school system, 8, 106–10, 112, 122, 153–61 parent preferences in, 150–51 safety of sharing preferences in, 124–30, 153–54 unraveled markets in, 73–74 searches, 6 Securities and Exchange Commission, 85 self-control, 67–68, 74–78 judicial clerkships and, 91, 93–98 as solution to early transactions, 79–80, 135–36 self-interest, 52 sex trade, 114, 214–15 Shapley, Lloyd, 32–34, 141–43, 158 Shim, John, 86, 88, 239 Shmida, Avi, 13 shopping malls, 221 signals and signaling, 6, 169–92 in auctions, 180–89 cheap talk in, 176–77 in college admissions, 169, 170–73 costly, 177–89 of desirability, 178–79 of interest, 178–80 in Internet dating sites, 169, 175–77 in job markets, 173–75 opportunity cost of, 179–80 by restaurants, 181 simplicity, 11, 26–27 in commodity markets, 15–17 in communication, 169–92 in kidney exchanges, 51–52 in navigating the system, 124–26 slavery, 199–200, 201 slippery slope, 204 smartphones Internet market congestion and, 99–106 as marketplaces, 21–22 payment systems with, 24, 26–27 privacy and, 192 Smith, Adam, 7, 206–7 social media, 169 Sönmez, Tayfun, 8, 35, 37–38, 43–44 on Boston school choice, 126–28 Sotomayor, Marilda, 146 South Korea, 171 speed of transactions, 81–99 communication and, 99–106 congestion and, 99–112 in financial markets, 82–89 in judicial clerkships, 90–98 price-based competition vs., 85–88 telegraph and the cotton market, 89–90 Spread Networks, 83 stable outcomes, 139–43, 157–58 Standage, Tom, 89 standardization, 17–20, 22 Standard & Poor’s 500 (SPY), 82–89 Starbucks, 18, 19 Starzl, Thomas, 34 stockbrokers, 48 strategic decisions, 10–11 allowing time for, 92–93, 154 congestion and, 99–106 for judicial clerkships, 69–70, 92–98 on marriage, 70–74 in school matching, 124–30, 153–55, 161, 163–65 speed of information in, 89–90 StubHub, 104 Sugar Bowl, 62 surrogate babies, 201–2 taxi drivers, 114 telegraph, 89–90 thick markets, 8–9 Amazon, 21 for college bowl games, 63–64 for commodities, 17 congestion in, 9–10, 99–112 credit card, 23–24 differentiation in, 18–20 early transactions and, 57–80 early transactions in, 57–80 in financial markets, 82–89 for kidney transplants, 49–51 New York City school system, 107–10 platform changes and, 26–27 for restaurants, 217–20 self-reinforcing, 21 signaling in, 179 transaction speed in, 81–99 ticket re-sales, 104 timing of transactions in college bowl games, 59–65 congestion and, 80, 99–112 in Internet marketplaces, 101–6 Internet markets and, 20–26 market thickness and, 8–9 too fast, 81–99 too soon, 57–80 trading cycles, 32–41 transactions early, 57–80 monetization of, 202–5 protected, 198 time to evaluate, 9–11 timing of (See timing of transactions) trading cycles and, 32–41 trust in Boston Public Schools system, 123–28 at eBay, 117–19 gastroenterology fellowships and, 76–78 in Internet marketplaces, 105 in New York City school system, 108–10, 112 regulation and, 222–23 reliability and, 116 reputation and, 115–16 Uber, 103–4, 116 UberX, 104 United Network for Organ Sharing (UNOS), 50 University of Cincinnati Medical Center, 39–41 University of Oklahoma Sooners, 59 University of Pittsburgh, 34, 45, 174–75 University of Toledo Medical Center, 29–30 UNOS, 50 unraveled/unraveling markets.

 

pages: 105 words: 18,832

The Collapse of Western Civilization: A View From the Future by Naomi Oreskes, Erik M. Conway

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anti-communist, correlation does not imply causation, en.wikipedia.org, energy transition, invisible hand, laissez-faire capitalism, market fundamentalism, means of production, oil shale / tar sands, road to serfdom, Ronald Reagan, stochastic process, the built environment, the market place

Perhaps because of the horrible violence in the East, many Western intellectuals came to see everything associated with communism as evil, even— and crucially for our story—modest or necessary forms of intervention in the marketplace such as progressive taxation and environmental regulation, and humanitar-ian interventions such as effective and affordable regimes of health care and birth control. Neoliberalism was developed by a group of thinkers— most notably Austrian Friedrich von Hayek and American Milton Friedman—who were particularly sensitive to the issue of repressive centralized government. In two key works, von Hayek’s Road to Serfdom and Friedman’s Capitalism and Freedom, they developed the crucial “neo-” component of neoliberalism: the idea that free market systems were the only economic systems that did not threaten individual liberty. Neoliberalism was initially a minority view. In the 1950s and 1960s, the West experienced high overall prosperity, and individual nations developed mixed economies that suited their own national cultures and contexts.

On twentieth- and twenty-first-century subsidies for fossil fuel production, see http://www.oecd.org/document/57/0, 3746,en_2649_37465_45233017_1_1_1_37465,00.html; and John Vidal, “World Bank: Ditch Fossil Fuel Subsidies to Address Climate Change,” The Guardian, September 21, 2011, http://www.guardian. co.uk/environment/2011/sep/21/world-bank-fossil-fuel-subsidies. 12. Friedrich August von Hayek, The Road to Serfdom, Text and Documents: The Definitive Edition, ed. Bruce Caldwell (Chicago: University of Chicago Press, 2007), 87. Epilogue 1. For estimates of populations at or near sea level at the turn of the twenty-first century, see Don Hinrichsen, “The Coastal Population Explosion,” in The Next 25 Years: Global Issues, prepared for the National Oceanic and Atmospheric Administration Coastal Trends Workshop, 1999, http://oceanservice.noaa.gov/websites/ retiredsites/natdia_pdf/3hinrichsen.pdf; and http://oceanservice.

 

pages: 545 words: 137,789

How Markets Fail: The Logic of Economic Calamities by John Cassidy

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Albert Einstein, Andrei Shleifer, anti-communist, asset allocation, asset-backed security, availability heuristic, bank run, banking crisis, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, Black-Scholes formula, Bretton Woods, British Empire, capital asset pricing model, centralized clearinghouse, collateralized debt obligation, Columbine, conceptual framework, Corn Laws, correlation coefficient, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Daniel Kahneman / Amos Tversky, debt deflation, diversification, Elliott wave, Eugene Fama: efficient market hypothesis, financial deregulation, financial innovation, Financial Instability Hypothesis, financial intermediation, full employment, George Akerlof, global supply chain, Haight Ashbury, hiring and firing, Hyman Minsky, income per capita, incomplete markets, index fund, invisible hand, John Nash: game theory, John von Neumann, Joseph Schumpeter, laissez-faire capitalism, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, Louis Bachelier, mandelbrot fractal, margin call, market bubble, market clearing, mental accounting, Mikhail Gorbachev, Mont Pelerin Society, moral hazard, mortgage debt, Naomi Klein, Network effects, Nick Leeson, Northern Rock, paradox of thrift, Ponzi scheme, price discrimination, price stability, principal–agent problem, profit maximization, quantitative trading / quantitative finance, race to the bottom, Ralph Nader, RAND corporation, random walk, Renaissance Technologies, rent control, Richard Thaler, risk tolerance, risk-adjusted returns, road to serfdom, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, shareholder value, short selling, Silicon Valley, South Sea Bubble, sovereign wealth fund, statistical model, technology bubble, The Chicago School, The Great Moderation, The Market for Lemons, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, unorthodox policies, value at risk, Vanguard fund

Alvin Hansen, the dean of American Keynesians, had a point when he wrote in The New Republic, “This kind of writing is not scholarship. It is seeing hobgoblins under every bed.” In The Road to Serfdom and in his other works, Hayek neglected to account for some serious failures of the market system. In the 1930s and 1940s, it was already glaringly obvious that ordinary people needed decent medical care, breathable air, and money to retire on, and that the market had failed to provide these things. Why was that? Hayek didn’t offer an answer; he didn’t even seem particularly interested in the question. The alarmist thesis of The Road to Serfdom didn’t get much purchase in Britain, where there was widespread public support for the welfare state, but in the United States, where suspicion of government ran deep, Hayek was hailed as a visionary.

Like Keynes, Beveridge was a member of the Liberal Party rather than a socialist. He agreed with Keynes that capitalism needed adult supervision: left untended, it had produced a worldwide slump and, ultimately, fascism. Hayek never accepted the argument that fascism was a capitalist phenomenon. He saw Stalin and Hitler as two suits in the same closet, and the closet was marked “collectivism.” He dedicated his book The Road to Serfdom “To the Socialists of All Parties,” a clear reference to National Socialism. Much of the book was devoted to central planning. Hayek repeated the arguments about prices and information that he had made in his academic papers, but his main concern was to develop their political implications. When the government has to decide how many pigs are to be raised or how many buses are to be run, these decisions cannot be deduced purely from economic principles, Hayek said.

“It was not reviewed by any American publication other than The American Economic Review,” Friedman later recalled. “I was a full professor at the University of Chicago. I was very well known in the academic world—it is inconceivable that a book on the other side by someone in that same position would not have been reviewed in every publication, the New York Times, the Chicago Tribune.” In many ways, Capitalism and Freedom was an American version of Hayek’s Road to Serfdom. Like Hayek, Friedman portrayed the choices facing democratic societies in stark and simplistic terms. “Fundamentally, there are only two ways of coordinating the economic activities of millions,” he wrote. “One is central direction involving the use of coercion—the technique of the army and of the modern totalitarian state. The other is voluntary co-operation of individuals—the technique of the marketplace.”

 

pages: 576 words: 105,655

Austerity: The History of a Dangerous Idea by Mark Blyth

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accounting loophole / creative accounting, balance sheet recession, bank run, banking crisis, Black Swan, Bretton Woods, capital controls, Carmen Reinhart, Celtic Tiger, central bank independence, centre right, collateralized debt obligation, correlation does not imply causation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency peg, debt deflation, deindustrialization, disintermediation, diversification, en.wikipedia.org, ending welfare as we know it, Eugene Fama: efficient market hypothesis, eurozone crisis, financial repression, fixed income, floating exchange rates, Fractional reserve banking, full employment, German hyperinflation, Gini coefficient, global reserve currency, Growth in a Time of Debt, Hyman Minsky, income inequality, interest rate swap, invisible hand, Irish property bubble, Joseph Schumpeter, Kenneth Rogoff, liquidationism / Banker’s doctrine / the Treasury view, Long Term Capital Management, market bubble, market clearing, Martin Wolf, moral hazard, mortgage debt, mortgage tax deduction, Occupy movement, offshore financial centre, paradox of thrift, price stability, quantitative easing, rent-seeking, reserve currency, road to serfdom, savings glut, short selling, structural adjustment programs, The Great Moderation, The Myth of the Rational Market, The Wealth of Nations by Adam Smith, Tobin tax, too big to fail, unorthodox policies, value at risk, Washington Consensus

As Joan Robinson recalled, Hayek gave a talk at Cambridge shortly after he arrived at which R. F. Kahn asked, “If I went out tomorrow and bought a new overcoat, that would increase unemployment?” “Yes,” said Hayek, “but … it would take a very long mathematical argument to explain why.”41 By 1944, Hayek found himself similarly ignored, in semiretirement, writing on the dangers of socialism in his epic The Road to Serfdom. Hayek’s earlier Prices and Production, his Meisterwerk on business cycle theory, like Schumpeter’s 1939 Business Cycles, arrived dead at the presses. First ignored and then defeated in Europe, Austrian ideas survived in America, where their popularity has ebbed and flowed for nearly a century. Although battered and beaten-down by the Keynesian revolution after World War II, Austrian ideas never quite disappeared from the American scene.

Gillian Tett, “Beware Hidden Costs as Banks Eye ‘Grexit,’” Financial Times, May 24, 2012, http://www.ft.com/intl/cms/s/0/73c76b8a-a5b4–11e1-a3b4–00144feabdc0.html#axzz241THBegL. 73. Dani Rodrik, One Economics, Many Recipes (Princeton, NJ: Princeton University Press, 2007); David R. Cameron, “The Expansion of the Public Economy: A Comparative Analysis,” American Political Science Review 72, 4 (December 1978): 1243–1261. 74. Friedrich Hayek, The Road to Serfdom (Chicago: University of Chicago Press, 1994). 75. Paul De Grauwe, “Fighting the Wrong Enemy,” Vox, May 19’ 2010, http://new.voxeu.org/article/europe-s-private-versus-public-debt-problem-fighting-wrong-enemy. INTRODUCTION TO CHAPTERS FOUR, FIVE, AND SIX 1. John Maynard Keynes, The General Theory of Employment, Interest and Money (Orlando: Harcourt Brace 1964), 3. 2. And even here, it is contentious.

Tales of Two Small European Countries”, 169, 170, 171, 176, 209–210 Glitnir, 237 global asset bubbles, 233 fig, 7.1 Global South austerity in, 164 gold standard, 179 and a democracy, 197 and austerity, 180–205 and Germany, 196 and Japan, 197–199 United Kingdom and, 189–191, Goldman Sachs, 32, 48, 58 government intervention, 147–148, 148–152 Great Depression, 119, 128, 186 Great Moderation, 145, 149 Greece, 1, 2, 3, 4, 222 austerity in, 176–177 bailouts in, 71–73, 221 debt in, 6 Eurozone Current Account Imbalances, 78 fig. 3.1 Eurozone Ten-Year Government Bond Yields, 80 fig. 3.2 fiscal adjustment in, 173 government debt 2006–2012, 47 fig. 2.3 sovereign debt of, 62–64, 108 Greenspan, Alan, 60, 149, 150 Grossmann-Doerth, Hans, 135 Guajardo, Jamie, 214 Haldane, Andy, 37 Hamada, Koichi, 198 Hamaguchi, Prime Minister, 199 Harberler, Gottfried, 148 Harding, Warren G., 187 Hayek, Friedrich August, 90, 92, 120, 144 and the New Liberals, 118 and the Nobel Prize in economics, 145 model of credit crunches and collapses, 146–147 Prices and Production, 144 Road to Serfdom, The, 144 hedging. See risk management techniques Helferding, Rudolph, 195 Helleiner, Eric, 232 Hellwig, Christian, 160 Henderson, Hubert “Can Lloyd George Do It?” (with Keynes), 123, 124–125 Henry, James, 244 Hirschman, Albert, 39, 100, 108, 109 Holland, 4 Hoover, Herbert, 119, 187 Hubbard, Glenn, 243 Hume, David, 17, 100–101, 167 on government debt, 107, 108–109 “On Money”, 107 producing austerity, 114–115 relationship between and market and the state, 115–122, 123 Hungary and austerity, 221 hyperinflation in the 1920s, 56 Hutchinson, Martin, 207, 209 Iceland bailout in, 231 economic strategies in, 235–240 Stock Exchange, 237 inflation, 240, 241 ING, 83 Inoue, Junnosuke, 198, 200 Inside Job, (documentary), 21 interest rate swaps, 234 international capital-flow cycle, 11 International Monetary Fund, 3, 17, 45, 55 and austerity, 122, 206, 213, 221 and bailouts, 71–73, 221 and loans to Ireland, 235 and the Bretton Woods institutions, 162–163 and the consolidation in Denmark, 207 and the hidden “Treasury View”, 163–165 and the situation in Iceland, 238–239 and the success of the REBLL states, 216 and “the Washington consensus”, 102, 161–163, 164 Polak model, 163–165 World Economic Outlook, 212, 215 See also Kahn, Dominique Strauss Ireland, 3, 4, 5, 205, 222 austerity in, 17, 169–170, 179, 205, 206 expansion, 207–208, 209 bailout in, 221, 231 capital-flow cycle in, 11 economic strategies in, 235–240 Eurozone current account imbalances, 78 fig. 3.1 Eurozone Ten-Year Government Bond Yields, 80 fig. 3.2 fiscal adjustment in, 173 government debt 2006–2012, 46, 47, 53, 62, 65, 66 real estate in rise in prices, 27, 64–68 Italy, 1, 3, 4, 5, 222 Eurozone Current Account Imbalances, 78 fig. 3.1 Eurozone Ten-Year Government Bond Yields, 80 fig. 3.2 fiscal adjustment in, 173 government debt 2006–2012, 47, 53, 62 slow growth crisis, 68–71 slow-growth problem, 69 sovereign debt of, 108 Janeway, Bill, 125 Jayadev, Arjun, 212, 213 Japan and Keynesianism, 225 and the London Naval Treaty, 199, d austerity in, 17, 178–180, 197–200, 204 Bank of Japan, 197 Seiyukai party, 199 Showa Depression, 198 See also Hamaguchi, Prime Minister; Korekiyo, Takahashi Johnson, Simon, 11, 72 Kahn, Dominique Strauss, 222 Kahn, R.

 

pages: 461 words: 128,421

The Myth of the Rational Market: A History of Risk, Reward, and Delusion on Wall Street by Justin Fox

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Albert Einstein, Andrei Shleifer, asset allocation, asset-backed security, bank run, Benoit Mandelbrot, Black-Scholes formula, Bretton Woods, Brownian motion, capital asset pricing model, card file, Cass Sunstein, collateralized debt obligation, complexity theory, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, discovery of the americas, diversification, diversified portfolio, Edward Glaeser, endowment effect, Eugene Fama: efficient market hypothesis, experimental economics, financial innovation, Financial Instability Hypothesis, floating exchange rates, George Akerlof, Henri Poincaré, Hyman Minsky, implied volatility, impulse control, index arbitrage, index card, index fund, invisible hand, Isaac Newton, John Nash: game theory, John von Neumann, joint-stock company, Joseph Schumpeter, libertarian paternalism, linear programming, Long Term Capital Management, Louis Bachelier, mandelbrot fractal, market bubble, market design, New Journalism, Nikolai Kondratiev, Paul Lévy, pension reform, performance metric, Ponzi scheme, prediction markets, pushing on a string, quantitative trading / quantitative finance, Ralph Nader, RAND corporation, random walk, Richard Thaler, risk/return, road to serfdom, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, shareholder value, Sharpe ratio, short selling, side project, Silicon Valley, South Sea Bubble, statistical model, The Chicago School, The Myth of the Rational Market, The Predators' Ball, the scientific method, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Thomas Kuhn: the structure of scientific revolutions, Thomas L Friedman, Thorstein Veblen, Tobin tax, transaction costs, tulip mania, value at risk, Vanguard fund, volatility smile, Yogi Berra

Both Friedman and Stigler later said that the crucial turning point in their thinking came when they read Friedrich Hayek’s The Road to Serfdom. Hayek had studied economics in Vienna in the 1920s and moved in 1931 to the London School of Economics—an originally socialist institution that had become a bastion of free market thought. During the war, LSE shifted its operations to Cambridge, where Hayek and John Maynard Keynes shared air raid warden shifts, became friends, and talked politics. Having experienced the socialist “Red Vienna” of the 1920s and watched the Nazi takeover of his homeland from afar, Hayek was appalled by the equanimity, even enthusiasm, with which Keynes and other English liberal intellectuals greeted the growth of government. Hayek wrote The Road to Serfdom with a British academic audience in mind, and in Britain it did not penetrate much beyond that audience.

As Columbia English professor and literary critic Lionel Trilling put it, liberalism had become “not only the dominant but even the sole intellectual tradition” in the United States.3 Yet here was an urbane intellectual arguing that the seemingly inexorable trend toward more government control of the economy was not just unnecessary but a mortal threat to freedom. It was a worldview-shifting revelation. For many others it was Ayn Rand’s 1943 bestseller The Fountainhead that had this effect, but economists understandably gravitated toward one of their own. Subsequent events did not play out quite as Hayek warned in his book. “It is a fair reading of The Road to Serfdom to say that forty years more of the march toward socialism would lead to major losses of the political and economic freedom of individuals,” Stigler wrote in 1988. “Yet in those forty years we have seen that continuous expansion of the state in Sweden and England, even in Canada and the United States, without consequences for personal freedom so dire as predicted.”4 Hayek soon put forward another argument that has held up far better—and was more directly applicable to the work of economists.

Resurrected Irving Fisher’s monetary theories, helped persuade economists to start with theories, not data, and became a leading proponent of free markets. Winner of the 1976 economics Nobel. William Peter Hamilton Editor of the Wall Street Journal in the early decades of the twentieth century. Popularized and expanded upon the chart-reading Dow theory of his predecessor Charles Dow. Friedrich Hayek Austrian economist whose anti-big-government book, Road to Serfdom (1944), inspired Milton Friedman and many other libertarians, and whose 1945 article, “The Use of Knowledge in Society,” helped inspire the efficient market hypothesis. Moved to the University of Chicago in 1950 but never played a big role in the Chicago school. Co-winner of the 1974 economics Nobel. Benjamin Graham Money manager who pioneered careful analysis of stocks and bonds and then, as a part-time professor at Columbia University and coauthor, with David L.

 

pages: 232 words: 77,956

Private Island: Why Britain Now Belongs to Someone Else by James Meek

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Affordable Care Act / Obamacare, Berlin Wall, business continuity plan, call centre, clean water, Deng Xiaoping, Etonian, HESCO bastion, housing crisis, illegal immigration, Martin Wolf, medical bankruptcy, Mikhail Gorbachev, post-industrial society, pre–internet, price mechanism, risk tolerance, road to serfdom, Ronald Reagan, Skype, sovereign wealth fund, Washington Consensus, working poor

Her great political inspiration, apart from her father, was the Austrian economist Friedrich Hayek’s 1944 book, The Road to Serfdom, written in Cambridge during the war. Hayek was regarded as an able economist; he eventually won a Nobel Prize for it. But The Road to Serfdom isn’t an economics book. It’s a book about society, the recent past and human nature that bears the same relation to sociology, history and psychology as Atlas Shrugged bears to literature. It is devoted to the idea that Winston Churchill later nodded to, catastrophically for him, in the 1945 election campaign, when he said Labour would have to fall back on ‘some form of Gestapo’ to implement its welfare and nationalisation programme. Churchill was thrown out of office, and Labour won a huge majority. The Road to Serfdom claims that socialism inevitably leads to communism, and that communism and Nazi-style fascism are one and the same.

 

pages: 840 words: 202,245

Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present by Jeff Madrick

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accounting loophole / creative accounting, Asian financial crisis, bank run, Bretton Woods, capital controls, collapse of Lehman Brothers, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, desegregation, disintermediation, diversified portfolio, Donald Trump, financial deregulation, fixed income, floating exchange rates, Frederick Winslow Taylor, full employment, George Akerlof, Hyman Minsky, income inequality, index fund, inflation targeting, inventory management, invisible hand, laissez-faire capitalism, locking in a profit, Long Term Capital Management, market bubble, minimum wage unemployment, Mont Pelerin Society, moral hazard, mortgage debt, new economy, North Sea oil, Northern Rock, oil shock, price stability, quantitative easing, Ralph Nader, rent control, road to serfdom, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, Ronald Reagan: Tear down this wall, shareholder value, short selling, Silicon Valley, Simon Kuznets, technology bubble, Telecommunications Act of 1996, The Chicago School, The Great Moderation, too big to fail, union organizing, V2 rocket, value at risk, Vanguard fund, War on Poverty, Washington Consensus, Y2K, Yom Kippur War

Aaron found his way to London where Simons had made an introduction for him to his good friend Friedrich von Hayek, the Austrian economist, who was teaching at the London School of Economics. Director, like many others, became a devotee. When Director returned to Chicago, he convinced the University of Chicago Press to publish the American edition of Hayek’s new British best seller, The Road to Serfdom, for which Director wrote a favorable review for a journal. Hayek, a serious academic, turned The Road to Serfdom into a fear-inspiring polemic. Its central message was that a growing welfare state in Europe would inevitably lead to totalitarianism, the rise of Nazi Germany fresh in the public’s mind. The welfare state would also weaken the nation’s economy by undermining markets, which were the only means by which to send signals to producers about the quantities and quality of goods and services.

They named the group after the small Swiss town in which they convened, Mont Pelerin, near Vevey, Switzerland. The formation of the Mont Pelerin Society was financed by Europeans and a highly conservative tax-exempt American foundation, the William Volker Charitable Fund of Kansas City, founded by prosperous right-wing local businessmen. The fund also helped finance the Foundation for Economic Education, which published the Friedman-Sigler paper on rent control. After the remarkable success of The Road to Serfdom, the Volker Fund attempted to bring Hayek from London to an American university. The fund’s president, Harold Luhnow, was determined to underwrite an Americanized version of the Hayek book—though there was already a condensed version of it published by Reader’s Digest. But finding a suitable university position for Hayek turned out to be difficult, and he was not interested in rewriting his book for an American audience.

If America did not return to the right path, “a thousand years of darkness” lay ahead, he said, with biblical overtones. In a speech first delivered in 1952, he said, “I, in my own mind, have thought of America as a place in the divine scheme of things that was set aside as a promised land.” Martin Anderson, a principal economic adviser during his presidency, wrote that he gave Reagan Hayek’s Road to Serfdom and Friedman’s Capitalism and Freedom, and that he read these, among other books. Some claimed they saw copies of the Hayek and Friedman books dog-eared in his library. But Lou Cannon wrote that Anderson was exaggerating when he implied that Reagan read broadly. Still, he clearly took ideas from Hayek, notably the danger to individual liberty of growing government, and the inevitability of Nazi-style dictatorship under a welfare state.

 

pages: 1,205 words: 308,891

Bourgeois Dignity: Why Economics Can't Explain the Modern World by Deirdre N. McCloskey

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Admiral Zheng, agricultural Revolution, Albert Einstein, BRICs, British Empire, butterfly effect, Carmen Reinhart, clockwork universe, computer age, Corn Laws, dark matter, David Ricardo: comparative advantage, Donald Trump, Edward Lorenz: Chaos theory, European colonialism, experimental economics, financial innovation, Fractional reserve banking, full employment, George Akerlof, germ theory of disease, Gini coefficient, greed is good, Howard Zinn, income per capita, interchangeable parts, invention of agriculture, invention of air conditioning, invention of writing, invisible hand, Isaac Newton, James Watt: steam engine, John Maynard Keynes: technological unemployment, John Snow's cholera map, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, means of production, Naomi Klein, New Economic Geography, New Urbanism, purchasing power parity, rent-seeking, road to serfdom, Robert Gordon, Ronald Coase, Ronald Reagan, Scientific racism, Scramble for Africa, Shenzhen was a fishing village, Simon Kuznets, Slavoj Žižek, spinning jenny, Steven Pinker, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, total factor productivity, transaction costs, tulip mania, union organizing, Upton Sinclair, urban renewal, V2 rocket, very high income, working poor, World Values Survey, Yogi Berra

It was not for example the better allocation that comes with better institutions, or commercialization. Yet even many good economists could not grasp that static allocation is not the key to the success of market societies. Nice though it is, efficiency — making supply equal to demand — is not the main point. Innovation is. The inefficiency of democratic socialist regimes, therefore, is a pity, but it has not yet been a catastrophe either politically or economically. It has not led down the road to serfdom, which is why Western Europe’s moderate version of socialism has proven viable.2 True, empirically, as a contingent fact about human nature, the dignities and liberties of the bourgeoisie do result in more innovation. But the “social market economies” of Finland and Holland continue to deliver pretty well, because they do not rigorously assault the dignities and liberties. The supply curves keep moving out in Holland and Sweden.

In economic scholarship an emblem of the elite’s scorn for bourgeois virtues is the treatment of Friedrich Hayek, the great libertarian economist from Austria, a naturalized Briton. Mention of Hayek can to this day evoke ignorant sneers on the left and center even of economics. While he was still at the London School of Economics, an internationally famous economic scientist, the equal in scientific reputation at the time of J. M. Keynes, he wrote, in 1944, an attack on the then immensely fashionable socialism, The Road to Serfdom. In Europe no one much minded such a popular book. But when the book appeared in the United States it caused a furor, partly because a long précis of it appeared in the vulgar and steeply right-slanting Reader’s Digest. In 1950 Hayek was denied an appointment in Economics at the University of Chicago because of The Road, and spent his years at Chicago in the Committee on Social Thought. But lawyers and at length educated businesspeople adhered to the market values that Hayek admired, against both left and right.

In fact, it did, in fascism and communism, and in a longerrunning form in the clerisy’s disdain for the bourgeoisie. All were annoyed reactions to innovation. The worry is the old one of “the cultural contradictions of capitalism,” as Daniel Bell put it in 1978, anticipated by Schumpeter’s gloomy prediction in 1942 — one of the 369 darkest years of a dark decade — that the future lay with socialism, and Hayek’s of 1944 that the clerisy were advocating a road to serfdom, or Aron’s in 1955 that Marxism was the “opiate of the intellectuals.” Expressed as hope rather than worry the reversion in rhetoric to central planning socialism is Karl Polanyi’s “great transformation,” the “double movement” in which society reacts against innovation and reestablishes a suitably embedded and conservative economy under central government control. By now you will know that I would regard a loss of bourgeois and innovative rhetoric as a deep worry, not a hope, and that one purpose of my hopeful sestet on “The Bourgeois Era” is to argue against accepting such a loss.

 

pages: 273 words: 34,920

Free Market Missionaries: The Corporate Manipulation of Community Values by Sharon Beder

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anti-communist, battle of ideas, business climate, corporate governance, en.wikipedia.org, full employment, income inequality, invisible hand, liquidationism / Banker’s doctrine / the Treasury view, minimum wage unemployment, Mont Pelerin Society, new economy, price mechanism, profit motive, Ralph Nader, rent control, risk/return, road to serfdom, Ronald Reagan, school vouchers, shareholder value, structural adjustment programs, The Chicago School, the market place, The Wealth of Nations by Adam Smith, Thomas L Friedman, Torches of Freedom, trade liberalization, traveling salesman, trickle-down economics, Upton Sinclair, Washington Consensus, young professional

An effective ideology will mobilise political supporters to share the general beliefs and goals of a party, interest group or politician. PETER SELF2 In 1947, a group of 37 like-minded people from the US, Britain and Europe – economists, historians and journalists – met in a fashionable resort at Mont Pèlerin in Switzerland. They had been invited there by Friedrich von Hayek, an Austrian-born economic theoretician who worked at the London School of Economics. Hayek’s 1944 book The Road to Serfdom, was said to be ‘the first intellectually respectable defense of free-market doctrine to have appeared in decades’. The book, which argued that government planning leads to dictatorship and that free markets should reign, was republished in condensed form by Reader’s Digest. The Book-of-the-Month Club distributed over a million copies. In it Hayek looked back to the glories of free market England in the 19th century, ignoring the mass poverty and atrocious working conditions of the ‘dark satanic mills’.

The first was the Institute of Economic Affairs (IEA) which promoted a laissez-faire libertarian view, keeping the economic fundamentalism ‘alive when academic opinion had pronounced it brain-dead’.10 Lord Anthony Fisher conceived of the idea of the IEA at the prompting of Friedrich von Hayek in the early 1950s, having visited the Foundation for Economic Education (FEE) in the US. According to Ralph Harris, a director of the IEA and member of the Mont Pèlerin Society, ‘The institute started in 1957, you could say the direct result of the Mont Pèlerin Society, of The Road to Serfdom, of Hayek’s ideas of freedom and competitive enterprise.’ It set out to gain wide acceptance for the ‘philosophy of the market economy’ through communications directed at the opinion leaders such as intellectuals, politicians, business people and journalists. It started as a one-person operation and at its height in the 1980s reached 15 full-time employees with a half-million-pound budget provided mainly by about 250 companies, including large transnational firms.11 The IEA began by producing pamphlets based on Hayek and Friedman’s ideas, as well as analyses of various policies in the light of those ideas.

It was founded in 1974 by Keith Joseph, an active member of the IEA, and Margaret Thatcher, who had also been associated with the IEA. Joseph, a former Tory minister, who is credited with Thatcher’s conversion to economic fundamentalism, is reported to have been converted himself when he took a suitcase of IEA-recommended books and pamphlets by Friedman and Hayek on holiday with him. Margaret Thatcher had read Hayek’s Road to Serfdom while at Oxford 112 FREE MARKET MISSIONARIES and it is said to have ‘made a lasting impression on her’. Thatcher also became a member of the Mont Pèlerin Society.14 In the mid-1970s, not long after becoming Leader, she visited the Conservative Party’s research department. . . . She reached into her briefcase and pulled out a book. It was Hayek’s The Constitution of Liberty. She held it up for all to see.

 

pages: 184 words: 54,833

Why Orwell Matters by Christopher Hitchens

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anti-communist, British Empire, colonial rule, deindustrialization, Etonian, hiring and firing, land reform, Louis Pasteur, Mahatma Gandhi, nuclear winter, road to serfdom, Ronald Reagan, sensible shoes

It’s also why he placed great hope in the native wisdom and decency of the British, or better say the English, whose qualities he thought might resolve the problem without too much practical or theoretical difficulty. (This in turn is yet another reason why he is often despised on the Left, which abominates, or at any rate used to abominate, the simplemindedness of English empiricism.) The clearest exposition of this divided realization is contained in Orwell’s review of The Road to Serfdom, by Friedrich August von Hayek. When this short book was first published in 1944, not many people could have appreciated the influence that it was to enjoy. Hayek, a political economist of the Austrian school, had settled in England, and was by a later irony to succeed George Orwell’s old foe Harold Laski in the chair at the London School of Economics. His advice to the Conservative Party in the 1945 General Election was widely thought to have been calamitous, in that it encouraged Winston Churchill to make a hugely incautious speech warning that Labour’s welfarist plans would require a form of ‘Gestapo’ to enforce them.

That was out of tune with the spirit of the times, and the British Tories were to remain nervously social-democratic until the late 1970s, when Margaret Thatcher broke the political consensus. Among her chosen advisors and mentors was Hayek, who has been of incalculable influence in the revival of free-market theory in Europe and America. (I remember the surprise I felt when hearing him praised by the Yugoslav dissident Milovan Djilas in Belgrade in 1977.) Orwell’s review of The Road to Serfdom, which appeared in the Observer, could almost have been the crib from which Churchill derived his later speech:Shortly, Professor Hayek’s thesis is that Socialism inevitably leads to despotism, and that in Germany the Nazis were able to succeed because the Socialists had already done most of their work for them: especially the intellectual work of weakening the desire for liberty. By bringing the whole of life under the control of the State, Socialism necessarily gives power to an inner ring of bureaucrats, who in almost every case will be men who want power for its own sake and will stick at nothing in order to retain it.

 

pages: 780 words: 168,782

Strange Rebels: 1979 and the Birth of the 21st Century by Christian Caryl

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anti-communist, Ayatollah Khomeini, Berlin Wall, Bretton Woods, British Empire, colonial rule, Deng Xiaoping, financial deregulation, financial independence, friendly fire, full employment, income inequality, industrial robot, Internet Archive, land reform, land tenure, Mahatma Gandhi, means of production, Mikhail Gorbachev, Mohammed Bouazizi, Mont Pelerin Society, new economy, New Urbanism, oil shock, open borders, open economy, Plutocrats, plutocrats, price stability, rent control, road to serfdom, Ronald Reagan, single-payer health, special economic zone, The Chicago School, union organizing, upwardly mobile, Winter of Discontent, Xiaogang Anhui farmers, Yom Kippur War

Just before the 1945 election, Oxford’s student conservatives published a paper declaring that “Liberal Capitalism is as dead as Aristocratic Feudalism,” and welcoming “a state without privilege where each shall enrich himself through the enrichment of all.”16 No one can recall Margaret Roberts taking up a stand that radically differed from this stance. She later claimed to have read Friedrich von Hayek’s Road to Serfdom during her last year at Oxford. If so, it had little visible effect on her public positions. But she was eager to make her mark. Upon her graduation she got a job as a chemist with a food company, where she worked on the development of cake frostings and pie fillings. This position, however, was merely a placeholder for someone of her ambitions. The Conservative Party, to which she remained loyal, was eager to field more female candidates, and she soon got her chance to campaign for a seat in Parliament.

The man who had convened them was an Austrian economist, Friedrich von Hayek, who taught at the London School of Economics (LSE). (He knew Keynes well. During the war, when Hayek was lecturing at Cambridge, he had shared fire-warden duties with his celebrated counterpart.) Hayek was particularly worried about the way that his academic colleagues had provided intellectual support for wartime planning that concentrated economic decision making in the state. A few years earlier he had published a book called The Road to Serfdom, an articulate polemic about the perils of liberty in a world where planners increasingly reigned. Most of those in the British establishment dismissed the book’s ideas. (That did not stop it from becoming a surprise best-seller in the United States.) Most of the men—and they were, in fact, all men—who came together to form the Mont Pèlerin Society (named after the resort where they met) drew their intellectual sustenance from three particular universities: the London School of Economics, the University of Chicago, and the University of Vienna.

After earning a degree in engineering at Trinity College, Cambridge, he had shown a knack for business by opening his own car rental company in the late 1930s. During the war he made a name for himself with inventions for the Royal Air Force, and once it was over he went back into business—this time, oddly enough, in farming, at which he became a tremendous success. Like many others, he was deeply impressed by Hayek’s Road to Serfdom, and a few years after the war’s end he sought out the author for advice. Fisher wanted to contribute to the fight against socialism. Hayek advised him to forget about a career in politics. What was needed, he said, was a “scholarly research organization” that could argue the case for free-market economics and disseminate its conclusions to the broadest possible audience.9 In 1955, Fisher, with the help of some like-minded colleagues, founded the Institute for Economic Affairs.

 

pages: 287 words: 81,970

The Dollar Meltdown: Surviving the Coming Currency Crisis With Gold, Oil, and Other Unconventional Investments by Charles Goyette

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bank run, banking crisis, Ben Bernanke: helicopter money, Berlin Wall, Bernie Madoff, Bretton Woods, British Empire, Buckminster Fuller, California gold rush, currency manipulation / currency intervention, Deng Xiaoping, diversified portfolio, Elliott wave, fiat currency, fixed income, Fractional reserve banking, housing crisis, If something cannot go on forever, it will stop, index fund, Lao Tzu, margin call, market bubble, McMansion, money: store of value / unit of account / medium of exchange, mortgage debt, oil shock, peak oil, pushing on a string, reserve currency, rising living standards, road to serfdom, Ronald Reagan, Saturday Night Live, short selling, Silicon Valley, transaction costs

Employment expanded as the economy added 6 million new jobs between 1950 and 1960, while the unemployment rate fell from 10.3 percent to 1.2 percent. Over the decade annual economic growth averaged 8 percent. Industrial production soared by 25 percent in 1950 alone, and by 18 percent the next year. Germany was rebuilt; prosperity was restored. Truly it was an economic miracle. During the postwar occupation of Germany, the American and British authorities banned F. A. Hayek’s seminal 1944 book The Road to Serfdom, for fear it would offend the Soviets. Hayek’s work described the way in which a central economic authority’s planning put a government at war with its own citizens, how it must become increasingly coercive in order to prevail, and how the coercive machinery of the central plan, once erected, can be employed to any coercive end. Violation of price controls was a capital offense in Diocletian’s Rome and in the French Reign of Terror.

New York: Macmillan, 1974. Bryce, Robert. Gusher of Lies: The Dangerous Delusions of “Energy Independence.” New York: PublicAffairs, 2008. Fleckenstein, William A., with Frederick Sheehan. Greenspan’s Bubbles: The Age of Ignorance at the Federal Reserve. New York: McGraw Hill, 2008. Grant, James. Mr. Market Miscalculates: The Bubble Years and Beyond. Mount Jack-son, VA: Axios Press, 2008. Hayek, Friedrich A. The Road to Serfdom. Chicago: University of Chicago Press, 1944. Hazlitt, Henry. The Inflation Crisis, and How to Resolve It. New Rochelle, NY: Arlington House, 1978. Jastrom, Roy W. The Golden Constant. New York: John Wiley and Sons, 1977. Johnson, Chalmers. Nemesis: The Last Days of the American Republic. New York: Metropolitan Books, 2006. ———. The Sorrows of Empire: Militarism, Secrecy, and the End of the Republic.

 

pages: 330 words: 77,729

Big Three in Economics: Adam Smith, Karl Marx, and John Maynard Keynes by Mark Skousen

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Albert Einstein, banking crisis, Berlin Wall, Bretton Woods, business climate, David Ricardo: comparative advantage, delayed gratification, experimental economics, financial independence, Financial Instability Hypothesis, full employment, Hernando de Soto, housing crisis, Hyman Minsky, inflation targeting, invisible hand, Isaac Newton, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, Joseph Schumpeter, laissez-faire capitalism, liquidity trap, means of production, microcredit, minimum wage unemployment, open economy, paradox of thrift, price stability, pushing on a string, rent control, Richard Thaler, rising living standards, road to serfdom, Robert Shiller, Robert Shiller, rolodex, Ronald Coase, Ronald Reagan, school choice, secular stagnation, Simon Kuznets, The Chicago School, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, Tobin tax, unorthodox policies

Ludwig von Mises, the dean of the Austrian school, wrote little about Keynes; his magnum opus, Human Action (1966), makes only a handful of references. Friedrich Hayek, the leading anti-Keynesian in the 1930s, made the strategic error of ignoring The General Theory when it came out in 1936, a decision he later regretted. During World War II, Hayek lost interest in economics and went on to write about political philosophy in works such as The Road to Serfdom (1944) and The Constitution of Liberty (1960). Other free-market economists, such as Henry Hazlitt and Murray Rothbard, wrote largely from outside the profession and had marginal influence. How did Friedman almost single-handedly change the intellectual climate back from the Keynesian model to the neoclassical model of Adam Smith? After acquiring academic credentials, he focused on scholarly technical work, particularly empirical evidence to test the Keynesian model.

New York: Hart. . 1992. The 100: A Ranking of the Most Influen tial Persons in History. 2d ed. New York: Citadel. Hayek, Friedrich. 1935 [1931]. Prices and Production. 2d ed. London: George Routledge and Sons. , ed. 1935. Collectivist Economic Planning. London: George Routledge and Sons. . 1939 [1929]. "The 'Paradox' of Thrift." In Profits, Interest and Investment. London: Routledge, 199-263. . 1944. The Road to Serfdom. Chicago: University of Chicago Press. . 1960. The Constitution of Liberty. Chicago: University of Chicago Press. . 1976. "Introduction: Carl Menger." In Principles of Economics, ed. Carl Menger. New York: New York University Press. . 1984. The Essence of Hayek, ed. Chiaki Nishiyama and Kurt R. Leube. Stanford, CA: Stanford University Press. Hazlitt, Henry. 1959. The Failure of the "New Economics."

 

pages: 288 words: 16,556

Finance and the Good Society by Robert J. Shiller

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bank run, banking crisis, barriers to entry, Bernie Madoff, capital asset pricing model, capital controls, Carmen Reinhart, Cass Sunstein, cognitive dissonance, collateralized debt obligation, collective bargaining, computer age, corporate governance, Daniel Kahneman / Amos Tversky, Deng Xiaoping, diversification, diversified portfolio, Donald Trump, Edward Glaeser, eurozone crisis, experimental economics, financial innovation, full employment, fundamental attribution error, George Akerlof, income inequality, invisible hand, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, land reform, loss aversion, Louis Bachelier, Mahatma Gandhi, Mark Zuckerberg, market bubble, market design, means of production, microcredit, moral hazard, mortgage debt, Occupy movement, passive investing, Ponzi scheme, prediction markets, profit maximization, quantitative easing, random walk, regulatory arbitrage, Richard Thaler, road to serfdom, Robert Shiller, Robert Shiller, Ronald Reagan, self-driving car, shareholder value, Sharpe ratio, short selling, Simon Kuznets, Skype, Steven Pinker, telemarketer, The Market for Lemons, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, Vanguard fund, young professional, Zipcar

Political scientist Benedict Anderson has asserted that the modern nation-state is an “imagined community,” standing in place of family.5 But it is only an imagined community, since the people in it have never met most of the other people in it and have no relationship whatsoever with them. Those who advocate sharing with others face a problem: generosity seems to require a sense of community. Friedrich Hayek, in his 1944 book The Road to Serfdom, discerned a “universal tendency of collectivist policy to become nationalistic.”6 The imagined community has to be elevated to people’s constant attention to encourage their sympathy with or acquiescence in the collectivist policy. Of course, when Hayek wrote in 1944 his prime example was the German National Socialists, the Nazis. But he argued that promotion of the idea of a national community was a universal tendency.

Empires so vast as to defy the intimate understanding of any one man tend to become playthings for manipulation.1 Douglas was part of President Franklin D. Roosevelt’s New Deal: Roosevelt nominated him to the Supreme Court in 1939. The New Deal was a relatively humanizing social force, even as it retained the real strength and integrity that characterize the best financial solutions. This loss of a sense of individual participation in society was the concern that occupied Friedrich Hayek in his 1944 book The Road to Serfdom. He tended to focus on excessive government intervention as the source of the problem, rather than the practices of big business, but he also spoke of government being captured by big business.2 Excessive reliance on such large controlling entities, Hayek believed, leads to a defeated attitude, the attitude of serfs. It may seem odd that his major treatise on capitalism was published near the end of World War II, a time when one might think society would have been occupied by much more pressing concerns.

In Edward Glaeser, ed., The Governance of Not-for-Profit Organizations, 45–70. Chicago: University of Chicago Press. Harbough, William T. 1998. “The Prestige Motive for Making Charitable Transfers.” American Economic Review 88(2):277–88. Harriss, C. Lowell. 1951. History and Policies of the Home Owners’ Loan Corporation. New York: National Bureau of Economic Research. Hayek, F. A. 1944. The Road to Serfdom. London: Routledge. ———. 1945. “The Use of Knowledge in Society.” American Economic Review 35(4):519– 30. Heckman, James J., and Pedro Carneiro. 2003. “Human Capital Policy.” In James J. Heckman and Alan B. Krueger, Inequality in America: What Role for Human Capital Policies?, 77–239. Cambridge, MA: MIT Press. Hellman, Thomas, and Manju Puri. 2002. “Venture Capital and the Professionalization of Start-Up Firms: Empirical Evidence.”

 

pages: 388 words: 125,472

The Establishment: And How They Get Away With It by Owen Jones

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anti-communist, Asian financial crisis, bank run, battle of ideas, Big bang: deregulation of the City of London, bonus culture, Bretton Woods, British Empire, call centre, capital controls, Capital in the Twenty-First Century by Thomas Piketty, centre right, citizen journalism, collapse of Lehman Brothers, collective bargaining, don't be evil, Edward Snowden, Etonian, eurozone crisis, falling living standards, Francis Fukuyama: the end of history, full employment, glass ceiling, hiring and firing, housing crisis, inflation targeting, investor state dispute settlement, James Dyson, laissez-faire capitalism, market fundamentalism, Monroe Doctrine, Mont Pelerin Society, moral hazard, night-watchman state, Northern Rock, Occupy movement, offshore financial centre, open borders, Plutocrats, plutocrats, profit motive, quantitative easing, race to the bottom, rent control, road to serfdom, Ronald Reagan, shareholder value, short selling, sovereign wealth fund, stakhanovite, statistical model, The Wealth of Nations by Adam Smith, transfer pricing, union organizing, unpaid internship, Washington Consensus, Winter of Discontent

Edward Royle, Modern Britain: A Social History 1750–2011, 3rd edn (London, 2012), p. 12. 7. http://www.churchofengland.org/about-us/structure/churchcommissioners/assets/property-investments/rural.aspx. 8. http://www.theosthinktank.co.uk/files/files/Reports/Voting%20and%20Values%20in%20Britain%2011%20FINAL%20 (2).pdf. 9. www.parliament.uk/briefing-papers/SN01250.pdf. 10. http://www.runnymedetrust.org/blog/49/15/Record-number-of-BME-MPS.html. 11. http://www.boardsforum.co.uk/boardwatch.html. 12. http://raceforopportunity.bitc.org.uk/about-race-opportunity/campaign-aims. 13. http://www.civilservice.gov.uk/about/resources/monitoring-diversity. 14. Jon Ronson, The Psychopath Test: A Journey through the Madness Industry (London, 2012). 1. THE OUTRIDERS 1. F. A. Hayek, The Road to Serfdom (London, 1944), p. 10. 2. Richard Cockett, Thinking the Unthinkable: Think-Tanks and the Economic Counter-Revolution, 1931–1983 (London, 1995), p. 100. 3. George J. Stigler, Memoirs of an Unregulated Economist (New York, 1988), pp. 144–5. 4. Hayek, Road to Serfdom, p. 9. 5. Milton Friedman, Capitalism and Freedom (Chicago, 1962), p. 5. 6. Donald Sassoon, One Hundred Years of Socialism: The West European Left in the Twentieth Century (London, 1996), p. 140. 7. The Economist, 23 November 2006. 8. Sassoon, One Hundred Years of Socialism, p. 118. 9.

The abandonment of laissez-faire economics – or the belief that the state withdrawing itself from economic life was a guarantee of prosperity and freedom – had, he claimed, threatened the very foundations of liberty: ‘We have progressively abandoned that freedom in economic affairs without which personal and political freedom has never existed in the past.’1 Published towards the end of World War II, Hayek’s seminal book The Road to Serfdom was a sensational success. Hundreds of thousands of copies were sold in Britain and other Western countries, and a condensed version was published in Reader’s Digest in April 1945.2 The book’s popularity was of little comfort to Hayek. Despite the huge interest in his work, he wrote to a co-thinker, ‘I am by no means optimistic about the immediate future. The prospects for Europe seem to me as dark as possible.’

 

pages: 636 words: 202,284

Piracy : The Intellectual Property Wars from Gutenberg to Gates by Adrian Johns

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banking crisis, Berlin Wall, British Empire, Buckminster Fuller, business intelligence, Corn Laws, demand response, distributed generation, Douglas Engelbart, Edmond Halley, Ernest Rutherford, Fellow of the Royal Society, full employment, Hacker Ethic, Howard Rheingold, informal economy, invention of the printing press, Isaac Newton, James Watt: steam engine, John Harrison: Longitude, Marshall McLuhan, Mont Pelerin Society, new economy, New Journalism, Norbert Wiener, pirate software, Republic of Letters, Richard Stallman, road to serfdom, Ronald Coase, software patent, South Sea Bubble, Steven Levy, Stewart Brand, Ted Nelson, the scientific method, traveling salesman, Whole Earth Catalog

As it became clear that the war would be won, realization dawned among opponents of state intervention like Plant that the “threat” loomed of a Labour government in Britain. Clement Attlee’s party was committed to nationalizing key industries and creating a socialized health service. Friedrich Hayek’s Road to Serfdom and Karl Popper’s Open Society and Its Enemies became the two bestknown statements of the position against such policies, Hayek in particular warning of a slippery slope from state planning to totalitarianism. The Road to Serfdom backfired at the time, being widely read as hyperbolic. When Labour did take power, Hayek and his allies retreated and formed themselves into the Mont Pèlerin Society, a group dedicated to economic liberalism in what they perceived to be a hostile world. Polanyi was a foundermember.

Polanyi passionately upheld this view of what he called “pure science,” in almost religious tones (and he was a noted theologian). Bernal’s camp, he concluded, had “surrendered” to a philosophy that would destroy science. He was as opposed to science with a social purpose as Hayek and Popper were to industry with a social purpose. Polanyi’s assault on patenting was all the more remarkable in this context. “Patent Reform” appeared in the Review of Economic Studies in autumn 1944, shortly after The Road to Serfdom. It seemed to mark a sharp departure from everything he and they defended. Polanyi certainly contended that patents misrepresented creativity and corrupted research – that was unsurprising. But he argued that the distortions were so great that they outweighed even the dangers of state intervention. The system could only be fixed by change so radical as to amount to its destruction, he maintained.

This in turn gave way to The Autonomy of Science, which advanced a sweeping threestage view of the history of science extending back centuries. Elements of this then reappeared in what might seem a radically different text, on Economic Planning. Finally, Polanyi turned the book on planning into a volume named Full Employment in Theory and Practice. And this last did appear in print, as Full Employment and Free Trade, in 1945 – constituting the third part of a triptych with Hayek’s Road to Serfdom and Popper’s Open Society. Only much later would fragments of the other projects resurface, most notably in Personal Knowledge. Throughout these pivotal years arguments about patents formed one of the few common threads, linking each new project to the last. Even the fullemployment work culminated with them: their abolition was central to creating a moral form of free trade that it claimed was essential to sustaining low unemployment.

 

pages: 391 words: 102,301

Zero-Sum Future: American Power in an Age of Anxiety by Gideon Rachman

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Asian financial crisis, bank run, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Bretton Woods, BRICs, capital controls, centre right, clean water, collapse of Lehman Brothers, colonial rule, currency manipulation / currency intervention, deindustrialization, Deng Xiaoping, Doha Development Round, energy security, failed state, Fall of the Berlin Wall, financial deregulation, Francis Fukuyama: the end of history, full employment, global reserve currency, greed is good, Hernando de Soto, illegal immigration, income inequality, invisible hand, Jeff Bezos, laissez-faire capitalism, market fundamentalism, Martin Wolf, Mexican peso crisis / tequila crisis, Mikhail Gorbachev, moral hazard, mutually assured destruction, Naomi Klein, offshore financial centre, open borders, open economy, Peace of Westphalia, peak oil, pension reform, Plutocrats, plutocrats, price stability, RAND corporation, reserve currency, rising living standards, road to serfdom, Ronald Reagan, shareholder value, Sinatra Doctrine, sovereign wealth fund, special economic zone, Steve Jobs, Stewart Brand, The Chicago School, The Great Moderation, The Myth of the Rational Market, Thomas Malthus, trickle-down economics, Washington Consensus, Winter of Discontent

It was the integration of global markets that was bringing about unprecedented reductions in global poverty and underpinning the long boom in the developed world. Free markets and free men—economic freedom and political freedom—were also inextricably linked. It was no accident that the two economic gurus of Thatcher and Reagan—Friedrich Hayek and Milton Friedman—were deeply concerned with human liberty. Hayek’s most famous work was an attack on the power of the state called The Road to Serfdom. A collection of Friedman’s most important lectures was given the title Capitalism and Freedom. Even for the likes of Clinton and Blair, neither of whom was a devotee of Hayek or Friedman, globalization served moral ends. For Bill Clinton in particular it was a force for greater global peace and prosperity. And regardless, it was pointless to try to block the progress of globalization. Clinton believed that a new world was being created by the inexorable and unstoppable power of new technologies. 12 PROGRESS BILL GATES AND THE TRIUMPH OF TECHNOLOGY The Age of Optimism was defined and shaped by a technological revolution.

China as interest of, 25 Thatcher compared with, 25, 31, 36, 38, 39–43, 45 recession, 16, 32, 34, 40, 77, 149 see also Great Recession regulation, financial, 111–12, 113, 200–201, 220 Reid, Michael, 73, 78, 299n Republicans, 103, 108, 126, 157, 161, 242–43 resource shortages, 204–7, 262, 263, 272 “responsibility to protect” (R2P), 131, 230, 231 Rice, Susan, 197–98, 289 Rise and Fall of the Great Powers, The (Kennedy), 88 Road to Serfdom, The (Hayek), 118 Rogers, Mike, 266 Rohatyn, Felix, 111 Romania, 67, 68 Roosevelt, Franklin, 38, 282 Rubin, Robert, 112, 117–18 Rudd, Kevin, 218 Rumsfeld, Donald, 104, 125, 209 rupee, Indian, 83 Russia, 35, 59, 60, 96, 117, 165, 199, 240, 243, 255, 273, 274, 275, 290 antiglobalization in, 160 authoritarianism of, 174, 175, 176, 234–38, 240–41, 248, 249 in BRICs, 76–77, 196 democracy in, 130, 146, 168, 237–38, 283 financial crisis in (1998), 107–8, 159, 237 global government and, 217, 218, 223 global problems and, 205, 206, 280 NATO and, 235, 236, 312n–13n as nuclear power, 224, 287, 288 UN and, 225–26, 245 win-win world and, 129–30 Rwanda, 131, 132, 208, 231 Saakashvili, Mikheil (Misha), 233–35 Sachs, Jeffrey, 209, 213, 217 Sakharov, Andrei, 58 Salinas de Gortari, Carlos, 74, 116 Sarkozy, Nicolas, 2, 8, 191, 194, 219, 269–70 Saudi Arabia, 204, 217, 221, 241, 272 savings and loan scandal, 296n Schlesinger, James, 204 Schroeder, Gerhard, 115 Schuman Declaration (1950), 219 Scowcroft, Brent, 180–81, 305n Seattle, Wash., antiglobalization in, 155–56 Senate, U.S., 90, 222 Siberia, 240, 274 Sinatra Doctrine, 64–65 Singapore, 60, 137–40, 143, 213 Singh, Manmohan, 15, 54, 79–83, 102–3, 116, 225, 243 Single European Act (1986), 49–51 Smith, Adam, 2, 17, 82, 113, 192 Smoot-Hawley tariffs, 267 socialism, 15–16, 30, 64, 81 British, 35, 36, 38, 49 in France, 46–49 Solana, Javier, 151 Solidarity, 66, 67 Somalia, 132, 209, 210, 256–57, 273 South Africa, 69–70, 176, 193, 244–45, 246, 262 South Korea, 6, 18, 60, 82, 142, 143, 159, 186, 187, 195, 273 sovereign wealth funds (SWFs), 193, 247 Soviet bloc, 6, 102 collapse of, 17, 18, 35–36, 58–59, 63–71, 76, 128 Soviet Union, 7, 34, 41, 87, 88, 167, 183, 233, 279, 285 Brezhnev Doctrine and, 64, 67 China compared with, 59–61 collapse of, 4, 11, 15, 19, 21, 43, 54, 69–70, 84, 85, 88, 90, 93, 100, 102, 105, 164, 261, 282 Fukuyama’s study of, 99–100 Gorbachev’s reforms in, 15, 16, 25, 27, 42, 53–61, 68, 100, 297n Nehru’s visit to, 81 Soviet bloc collapse and, 58–59, 61, 65–66 U.S. competition with, 131, 282, 284, 291 Spain, Spanish, 8, 72, 147, 165, 188, 235, 270 global government and, 219, 221, 226, 228 Spence, Jonathan, 23–24 Sri Lanka, 223, 231, 274 Stalin, Joseph, 27, 236, 237 Starbucks, 155, 261 State Department, U.S., 99, 100, 117, 188 State of Emergency (Buchanan), 260 Steinberg, James, 5, 129 Stiglitz, Joseph, 157, 159, 160, 314n stock market, 83, 218 in Japan, 18–19, 88–89 U.S., 2–3, 4, 40, 96–97, 107, 110, 165 Strauss-Kahn, Dominique, 152, 219 Sudan, 195, 205, 223, 226, 227, 231, 246, 247, 248, 275, 289 Sullivan, Andrew, 280 Summers, Larry, 7, 117–18, 156, 184 Suskind, Ron, 168 Sweden, 150, 156 Switzerland, 96, 101, 269 Taiwan, 60, 82, 136–37, 143, 186, 237, 249 Talbott, Strobe, 126, 217, 304n Taliban, 167, 239, 252 tariffs, 74, 75, 77, 83, 265, 266, 267 taxes, 49, 94, 109, 115, 216, 236, 267 cuts in, 17, 32, 35, 38, 39, 74, 75, 83, 116 Tax Reform Act (1986), 38 Tbilisi, 233, 234 Tea Party movement, 268 technology, 27, 56, 87, 111, 118–28, 131, 174, 203, 271 climate change and, 203, 204, 286–87 global warming and, 125–26 gloomy predictions and, 125, 204, 206 India and, 6, 81, 84–85, 141 peace and, 5–6, 126 U.S., 93, 95, 118–26, 165, 167, 184, 187, 261 see also information technology television, 119, 124, 135, 234–37, 285 Tennyson, Alfred, Lord, 225 Tequila crisis (1994), 77 terror, war on, 96, 165, 198, 199, 211, 212, 244, 245 terrorism, 36, 161–62, 166, 174, 198, 199, 210, 220, 257, 258, 259, 280 nuclear proliferation and, 211–12 in Pakistan, 211, 212, 251, 252, 256, 313n see also 9/11 Tett, Gillian, 123 Texas A&M, 179–81 Thailand, 6, 60, 142, 143, 159–60 Thatcher, Margaret, 16–17, 29–36, 39–52, 54, 69, 74, 89, 114, 136, 191, 279 Falklands War and, 34, 43, 76 France and, 45–46, 48, 49 Hayek and, 118 as “iron lady,” 34, 42, 45 M.

 

pages: 518 words: 107,836

How Not to Network a Nation: The Uneasy History of the Soviet Internet (Information Policy) by Benjamin Peters

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Albert Einstein, Andrei Shleifer, Benoit Mandelbrot, bitcoin, Brownian motion, Claude Shannon: information theory, cloud computing, cognitive dissonance, computer age, conceptual framework, crony capitalism, crowdsourcing, cuban missile crisis, Daniel Kahneman / Amos Tversky, David Graeber, Dissolution of the Soviet Union, double helix, Drosophila, Francis Fukuyama: the end of history, From Mathematics to the Technologies of Life and Death, hive mind, index card, informal economy, invisible hand, Jacquard loom, Jacquard loom, John von Neumann, Kevin Kelly, knowledge economy, knowledge worker, linear programming, mandelbrot fractal, Marshall McLuhan, means of production, Menlo Park, Mikhail Gorbachev, mutually assured destruction, Network effects, Norbert Wiener, packet switching, pattern recognition, Paul Erdős, Peter Thiel, RAND corporation, rent-seeking, road to serfdom, Ronald Coase, scientific mainstream, Steve Jobs, Stewart Brand, stochastic process, technoutopianism, The Structural Transformation of the Public Sphere, transaction costs, Turing machine

David Remnick, “Soviet Union’s Shadow Economy: Bribery, Barter, and Black Market,” Seattle Times, September 22, 1990, accessed April 15, 2015, http://community.seattletimes.nwsource.com/archive/?date=19900922&slug=1094485. 66. Seth Benedict Graham, “A Cultural Analysis of the Russo-Soviet ‘Anekdot,’” Ph.D. diss., University of Pittsburgh, 2003; Remnick, “Soviet Union’s Shadow Economy.” 67. Two of the most classic cold war critics in the West include Friedrich Hayek, The Road to Serfdom (Chicago: University of Chicago, 1944), 4, 9–11, 28–29, 103–112, 143–145, and Milton Friedman, Free to Choose: A Personal Statement (New York: Harcourt Books, 1980). My comments here intend to both draw on and cut orthogonally across the conventional defense of free markets. 68. A sampling of popular literature on the informal economic activities in the late Soviet Union includes Yuri Brokhin, Hustling on Gorky Street (London: W.

“A Cyborg Manifesto: Science, Technology, and Socialist-Feminism in the Late Twentieth Century.” In Simians, Cyborgs and Women: The Reinvention of Nature. Edited by Donna Haraway. New York: Routledge, 1991. Haraway, Donna, ed. Simians, Cyborgs and Women: The Reinvention of Nature. New York: Routledge, 1991. Harrison, Mark. “Soviet Economic Growth since 1928: The Alternative Statistics of G. I. Khanin.” Europe-Asis Studies 45 (1) (1993): 141–167. Hayek, Friedrich. The Road to Serfdom. Chicago: University of Chicago Press, 1944. Hayles, N. Katherine. How We Became Posthuman: Virtual Bodies in Cybernetics, Literature, and Informatics. Chicago: University of Chicago Press, 1999. Hazard, John N. Communists and Their Law: A Search for the Common Core of the Legal Systems of the Marxian Socialist States. Chicago: University of Chicago, 1969. Heidegger, Martin. The Question concerning Technology and Other Essays.

 

pages: 741 words: 179,454

Extreme Money: Masters of the Universe and the Cult of Risk by Satyajit Das

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affirmative action, Albert Einstein, algorithmic trading, Andy Kessler, Asian financial crisis, asset allocation, asset-backed security, bank run, banking crisis, banks create money, Basel III, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Black Swan, Bonfire of the Vanities, bonus culture, Bretton Woods, BRICs, British Empire, capital asset pricing model, Carmen Reinhart, carried interest, Celtic Tiger, clean water, cognitive dissonance, collapse of Lehman Brothers, collateralized debt obligation, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, debt deflation, Deng Xiaoping, deskilling, discrete time, diversification, diversified portfolio, Doomsday Clock, Emanuel Derman, en.wikipedia.org, Eugene Fama: efficient market hypothesis, eurozone crisis, Fall of the Berlin Wall, financial independence, financial innovation, fixed income, full employment, global reserve currency, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, happiness index / gross national happiness, haute cuisine, high net worth, Hyman Minsky, index fund, interest rate swap, invention of the wheel, invisible hand, Isaac Newton, job automation, Johann Wolfgang von Goethe, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, Kevin Kelly, labour market flexibility, laissez-faire capitalism, load shedding, locking in a profit, Long Term Capital Management, Louis Bachelier, margin call, market bubble, market fundamentalism, Marshall McLuhan, Martin Wolf, merger arbitrage, Mikhail Gorbachev, Milgram experiment, Mont Pelerin Society, moral hazard, mortgage debt, mortgage tax deduction, mutually assured destruction, Naomi Klein, Network effects, new economy, Nick Leeson, Nixon shock, Northern Rock, nuclear winter, oil shock, Own Your Own Home, pets.com, Plutocrats, plutocrats, Ponzi scheme, price anchoring, price stability, profit maximization, quantitative easing, quantitative trading / quantitative finance, Ralph Nader, RAND corporation, random walk, Ray Kurzweil, regulatory arbitrage, rent control, rent-seeking, reserve currency, Richard Feynman, Richard Feynman, Richard Thaler, risk-adjusted returns, risk/return, road to serfdom, Robert Shiller, Robert Shiller, Rod Stewart played at Stephen Schwarzman birthday party, rolodex, Ronald Reagan, Ronald Reagan: Tear down this wall, savings glut, shareholder value, Sharpe ratio, short selling, Silicon Valley, six sigma, Slavoj Žižek, South Sea Bubble, special economic zone, statistical model, Stephen Hawking, Steve Jobs, The Chicago School, The Great Moderation, the market place, the medium is the message, The Myth of the Rational Market, The Nature of the Firm, The Predators' Ball, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, trickle-down economics, Turing test, Upton Sinclair, value at risk, Yogi Berra, zero-coupon bond

Keynes’ General Theory of Employment, Interest and Money, Hayek believed, was primarily motivated by the political and economic problems of the period. Keynesian economics would not solve the problems but would create inflation. Keynes was equally critical of Hayek’s work, commenting that one article started “with a mistake” and then moved on to “bedlam.” Another article constituted “a farrago of nonsense.” Although he got on well with the Austrian personally, and thought Hayek’s 1944 The Road to Serfdom was “a grand book,” Keynes was unpersuaded, concluding: “what rubbish his theory is.”5 Joseph Schumpeter’s worldview was shaped by his role as Austria’s minister of finance, paying off debts incurred in the collapse of central European financial institutions. Intending to be the world’s greatest economist, lover, and horseman, the colorful, thrice-married Austrian acknowledged only having to work at his horsemanship.

Jacob Viner attacked Keynes’ lack of objectivity and judiciousness, dismissing him as a prophet and a politician. Henry Simons, another protégé of Knight, saw Keynes as “the academic idol of...cranks and charlatans...and [the General Theory] as the economic bible of a fascist movement.”13 Frederick Hayek proved a key figure in discrediting Keynes and in the resurgence of free markets. His Road to Serfdom attacked government intervention in the economy. His 1960 book The Constitution of Liberty argued that the power and role of government should be limited to maintaining individual liberty. Hayek criticized the welfare state and the role of unions. His influence on Chicago was strengthened through the Mont Pelerin Society, a collaboration of 36 like-minded scholars seeking to revive the liberal tradition.

See Zimbabwe Richard, Cliff, 157 Richistan, 41 Rio Tinto, 58 Rise and Decline of Nation, The, 294 Rishengchang as a financial center, 84 risk, 35 Bank of International Settlement (BIS), 74-75 banks, 67-70 basis, 213 capital asset pricing model (CAPM), 117 catastrophe, 232 central banks, 281-282, 300-302 concentrations, 273 converting, 270 derivatives, 208-209, 218-219 AIG, 230-234 design of, 225 Fiat, 222-223 first-to-default (FtD) swaps, 220-221 Greece, 223, 225 Harvard case studies, 214-215 hedging, 216-217 Italy, 215-216 LTOBs (tender option bonds), 222 municipal bonds, 211-214 price movements, 210-211 sovereign debt, 236-238 TARDIS trades, 217-218 economic growth, 295-296 exotic products, 73-74 financial groupthink, 296-297 hedge funds, 246 of individual securities and portfolios, 117 insurance, 124 management, 126, 130, 274 reduction, 122-124 risk-free portfolios, 121 securitization, 170-172 taming, 120-122 tranches, 175 unification of, 130 riyals, 21 RJR Nabisco, 139, 149-150, 155 Ro, Arundhati, 365 Road to Serfdom, The, 103 roads, 158 Roark, Howard, 294 Robbins, Larry, 259 Robeldo, Alfredo, 215 Roberston, Julian, 243 Roberts, George, 157 robo signing, 272 Rochefoucauld, François Duc de La, 349 Rockefeller, John D., 338 Rockne, Knute, 97 Rogers, Will, 42-43, 332, 348 rogue traders, 227 Rohatyn, Felix, 148 Rolling Stone magazine, 364 Rolling Stones, the, 164 Rolls Royce jet engines, 24 Rome, 295 Roosevelt, Franklin Delano, 279, 290, 365 Ropes & Gray, 244 Roseman, Joel, 255 Rosenbaum, Alisa.

 

pages: 558 words: 168,179

Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right by Jane Mayer

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affirmative action, Affordable Care Act / Obamacare, anti-communist, Bakken shale, bank run, battle of ideas, Berlin Wall, Capital in the Twenty-First Century by Thomas Piketty, carried interest, centre right, clean water, Climategate, Climatic Research Unit, collective bargaining, crony capitalism, David Brooks, desegregation, diversified portfolio, Donald Trump, energy security, estate planning, Fall of the Berlin Wall, George Gilder, housing crisis, hydraulic fracturing, income inequality, invisible hand, job automation, low skilled workers, market fundamentalism, Mont Pelerin Society, More Guns, Less Crime, Nate Silver, New Journalism, obamacare, Occupy movement, offshore financial centre, oil shale / tar sands, oil shock, Plutocrats, plutocrats, Ralph Nader, Renaissance Technologies, road to serfdom, Ronald Reagan, school choice, school vouchers, The Bell Curve by Richard Herrnstein and Charles Murray, The Chicago School, the scientific method, University of East Anglia, Unsafe at Any Speed, War on Poverty, working poor

“It was a stew pot of ideas,” recalled diZerega, who later became a liberal academic, “but if you grew up with more money than God, and felt weird about it, this version of history, where the robber barons were heroes, would certainly make you feel a lot better about it.” At the Freedom School, Charles became particularly enamored of the work of two laissez-faire economists, the Austrian theorist Ludwig von Mises and his star pupil, Friedrich Hayek, an Austrian exile, who visited the Freedom School. Hayek’s book The Road to Serfdom had become an improbable best seller in 1944, after Reader’s Digest published a condensed version. It offered a withering critique of “collectivism” and argued that centralized government planning, in which liberals were then engaged, would lead, inexorably, to dictatorship. In many respects, Hayek was a throwback, romanticizing a lost golden age of idealized unfettered capitalism that arguably never existed for much of the population.

Eric Wanner, the former president of the Russell Sage Foundation, summed it up, saying, “The AEIs and the Heritages of the world represent the inversion of the progressive faith that social science should shape social policy.” According to one account, it was Hayek who spawned the idea of the think tank as disguised political weapon. As Adam Curtis, a documentary filmmaker with the BBC, tells the story, around 1950, after reading the Reader’s Digest version of Hayek’s Road to Serfdom, an eccentric British libertarian named Antony Fisher, an Eton and Cambridge graduate who believed socialism and Communism were overtaking the democratic West, sought Hayek’s advice about what could be done. Should he run for office? Hayek, who was then teaching at the London School of Economics, told him that for people of their beliefs getting into politics was futile. Politicians were prisoners of conventional wisdom, in Hayek’s view.

“This session will further assess the landscape and offer a plan to educate voters on the importance of economic freedom.” Joining Noble on the panel was Tim Phillips, the president of Americans for Prosperity, who unveiled his group’s plan to spend an unheard-of $45 million on a few targeted midterm races. In the evening, conference goers were treated to a rousing dinner speech from the Fox News host Glenn Beck titled, in homage to Hayek, “Is America on the Road to Serfdom?” Finally, topping off the night was a “cocktails and dessert reception,” hosted by DonorsTrust. Whitney Ball, the head of the organization that offered donors a politically safe way to give big and anonymously, later explained her attendance at the event succinctly: It’s a “target-rich environment.” On the final day, the donors engaged in auction-like bids over lunch, one-upping each other with their seven-figure pledges amid laughter and applause.

 

pages: 391 words: 22,799

To Serve God and Wal-Mart: The Making of Christian Free Enterprise by Bethany Moreton

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affirmative action, anti-communist, Berlin Wall, big-box store, Bretton Woods, Buckminster Fuller, collective bargaining, corporate personhood, deindustrialization, desegregation, Donald Trump, estate planning, Fall of the Berlin Wall, Frederick Winslow Taylor, George Gilder, global village, informal economy, invisible hand, market fundamentalism, Mont Pelerin Society, mortgage tax deduction, Naomi Klein, new economy, New Urbanism, post-industrial society, postindustrial economy, prediction markets, price anchoring, Ralph Nader, RFID, road to serfdom, Ronald Reagan, Silicon Valley, Stewart Brand, strikebreaker, The Wealth of Nations by Adam Smith, union organizing, walkable city, Washington Consensus, white flight, Whole Earth Catalog, Works Progress Administration

By the time he connected with SIFE, Young held an endowed chair in free enterprise at the University of Â�Tennessee–Martin, where his activities included directing a “Kinder-Â� Nomics” course for preschoolers and a Business and Economics Leader210 “STUDENTS CHANGING TH E W ORL D” ship Camp for high-Â�school students.83 Some brought explicit interests in Christianity to their scholarly work, like the adviser at Western Kentucky University who analyzed “the areas of money management dealt with in the Holy Bible.”84 SIFE’s focus on public outreach and especially on schoolchildren meant that the economic concepts in play remained extremely basic: Â�profits are benÂ�eÂ�fiÂ�cial; government is wasteful; Â�unions are illegitimate; corporations are natural persons; free markets abhor environmental regulation but not cartels, monopsony contracts, or military-Â�supported access to foreign raw materials. Even at schools that taught economics as a theoretical discipline, SIFE invariably entered through the business departments. A small number of committed ideologues provided some of the fire in SIFE’s belly, but only at a remove from the core theories they represented. SIFE students read “I, Pencil,” not The Wealth of Nations nor even The Road to Serfdom. Sometimes, however, the students veered toward contradictions between their ideological models and conÂ�flicting economic values. In the midst of the intense focus on entrepreneurial heroism and government profligacy, Malone College’s 1987 projÂ�ect stood out for its explicit reference to the basis of the postindustrial economy. The program they presented that year in more than thirty elementary, junior high, and high schools was boldly titled “Consumer Sovereignty.”

See also Migrants IndeÂ�penÂ�dent Retail Grocers Association, 26 IndeÂ�penÂ�dent stores, 18, 21–23, 30, 45, 53, 143–144 Individualism, 44, 51–53, 99, 103–104, 209, 246 Industrial economy, 5, 50, 54, 57, 65, 67, 73, 84, 87 Industrial capÂ�italism, 14, 124 Industrialism, 7–17, 21, 39–40, 46, 50–52, 54, 60, 65, 136, 153, 220, 268–269, 308n59 Industrial work, 80–81, 84, 87, 99, 108–109, 113, 121, 125, 136 Inflation, 2, 125–126, 142, 145, 165, 183, 343n23 Innovation, 7, 12, 147, 155–159, 190–191 Instituto Centroamericano de Administración de Empresas, 243 Instituto Tecnológico y de Estudios Superiores de Monterrey, 219 Insurance: unemployment, 54, 184; health, 71, 297n29; life, 71 International Conference on World Evangelization, 239–240, 250, 340n69 International Mass Retailers Association, 257–259 InterVarsity Christian Fellowship, 87–88, 97 Hallmark Cards, 174, 200, 216 Halt the Deficit campaign, 202–205 Hard/soft management, 109, 111, 271 Harding University (formerly Harding College), 163–168, 174, 182, 193–195, 199, 208–209, 211, 217, 228, 231–232, 234–235, 243–245 Hargis, Billy James, 166 Harvey, Paul, 222, 248 Hatch, Orrin, 185 Hayek, Friedrich von, 175, 195; The Road to Serfdom, 211 Health care/insurance, 1, 4, 30, 71–72, 115, 297n29 Helms, Jesse, 185 Heritage Foundation, 199, 214–215, 330n27 High schools, 145–148, 167, 174, 194, 196, 211, 217 Hillbillies, 11, 42 Hobbs, NM, 173–175 Homosexuality, 3, 9, 112, 118–121 Honduras, 50, 235, 252–253 Hoover Institute, 169, 214 Household labor, 50–54, 80, 84, 114–116, 123, 183, 292n6, 309n67 Housing, 2, 115, 264–266 Houston, TX, 31–33, 39 Human relations.

 

pages: 790 words: 150,875

Civilization: The West and the Rest by Niall Ferguson

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Admiral Zheng, agricultural Revolution, Albert Einstein, Andrei Shleifer, Atahualpa, Ayatollah Khomeini, Berlin Wall, BRICs, British Empire, clean water, collective bargaining, colonial rule, conceptual framework, Copley Medal, corporate governance, credit crunch, David Ricardo: comparative advantage, Dean Kamen, delayed gratification, Deng Xiaoping, discovery of the americas, Dissolution of the Soviet Union, European colonialism, Fall of the Berlin Wall, Francisco Pizarro, full employment, Hans Lippershey, haute couture, Hernando de Soto, income inequality, invention of movable type, invisible hand, Isaac Newton, James Hargreaves, James Watt: steam engine, John Harrison: Longitude, joint-stock company, Joseph Schumpeter, land reform, land tenure, Louis Pasteur, Mahatma Gandhi, market bubble, Martin Wolf, means of production, megacity, Mikhail Gorbachev, new economy, probability theory / Blaise Pascal / Pierre de Fermat, profit maximization, purchasing power parity, quantitative easing, rent-seeking, reserve currency, road to serfdom, Ronald Reagan, savings glut, Scramble for Africa, Silicon Valley, South China Sea, sovereign wealth fund, special economic zone, spice trade, spinning jenny, Steve Jobs, Steven Pinker, The Great Moderation, the market place, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, Thomas Malthus, Thorstein Veblen, total factor productivity, trade route, transaction costs, transatlantic slave trade, transatlantic slave trade, upwardly mobile, uranium enrichment, wage slave, Washington Consensus, women in the workforce, World Values Survey

It was because centralized economic planning, though indispensable to success in the nuclear arms race, was wholly unsuited to the satisfaction of consumer wants. The planner is best able to devise and deliver the ultimate weapon to a single client, the state. But the planner can never hope to meet the desires of millions of individual consumers, whose tastes are in any case in a state of constant flux. This was one of the many insights of Keynes’s arch-rival, the Austrian economist Friedrich von Hayek, whose Road to Serfdom (1945) had warned Western Europe to resist the chimera of peacetime planning. It was in meeting (and creating) consumer demands that the American market model, revitalized during the war by the biggest fiscal and monetary stimulus of all time, and sheltered by geography from the depredations of total war, proved to be unbeatable. A simple example illustrates the point. Before the war most clothes were made to measure by tailors.

H. 103–4 empires see imperialism; individual empires Encümen-i Daniş (Assembly of Knowledge), Ottoman empire 89 Engels, Friedrich 207, 209, 210–11, 228 England 4, 18, 37 China and 47–9 exploration, voyages of 36 France and 23, 24, 39 Industrial Revolution 10, 13, 21, 28–9, 70 Ireland and 24, 105, 203n London see London slavery (chattel slavery) in 130, 132 see also Britain; British empire English Civil Wars 104, 105, 106, 107, 115, 150, 152 the Enlightenment 76–9, 81 environmental issues 17, 293–4, 299 Epp, Franz Xavier Ritter von 188–9 Erasmus, Desiderius xxiii Erdely, Eugene 190 Eugene of Savoy, Prince 56 eugenics 176–7 in Germany 176–81, 189–90, 191; in German Namibia 176–81; genocide in 179–80, 188 Euler, Leonard 84 Euphrates river/valley 17 Europe competition between states 36–42 geography 36–7 Islamic envoys to 86–7 US and 16 see also individual countries European integration 14–15, 239 Everett, Edward 137 exploration, voyages of 9, 23, 38 Chinese 28–33, 48 English 36 marine chronometers for 70 as missionary endeavours 39 Portuguese 33–5, 39, 53, 130 Spanish 35–6 Faidherbe, Louis, governor of Senegal 164, 165, 166 fashion/clothing 197–8, 219–20, 225, 237, 246, 255 communist attitude to 249–50 in Japan 220–21, 222, 223, 225 jeans 240–44, 246–9, 250 machine made 217–18, 237 for men 216, 220–21, 230 military uniforms 215–16, 229, 233, 234, 237 for women 216, 220, 246; Islamic 253–5, 253n see also consumerism Fashoda incident, Sudan (1898) 173 Feng Youlan: History of Chinese Philosophy 27 Feraios, Rigas 213 Fermat, Pierre de 66 Ferrier, Thomas 121, 122 Ferry, Jules, Prime Minister of France 172 Fertile Crescent concept 17 film industry 230, 231 Filmer, Sir Robert: Patriarcha 108 financial systems 7, 14, 139 in Asia 7, 252–3, 277–8 banking 230–31 capitalism see capitalism cash nexus concept 206–7 consumer credit 238 in Europe 106–7, 161 markets/market economy 205–6, 276–7 money supply 38 monopolies 38 taxation 38, 44, 106, 107, 117, 210–11, 288 see also economic …; Great Depression First World War (1914–18) 16, 92, 148–9, 181, 182, 227 African colonial troops in 181–9; French 183–7; German 182 casualty figures 181, 183, 186, 187 Dardanelles 85 Gallipoli 91, 182 Rudyard Kipling on 187–8 Fischer, Eugen 180–81, 189 Human Heredity … 189 food see diet food supplies 22, 200–201 famine 44, 46 see also agriculture foreign aid, to Africa 145–6 France 4, 16, 36, 37, 83, 85 American Revolution and 117 Britain and 140, 160, 161, 173 economic crises 149–50, 161 England and 23, 24, 39 the Enlightenment 77–8 in First World War 182–3, 185–7 Huguenots 39, 41, 76 Italy and 159 literacy rates 77 living standards 24–5 the Marseillaise 156, 156n under Napoleon Bonaparte 119, 142, 156–61 Paris 5, 77, 215 property rights 152 Russia and 160 Spain and 119 student unrest 245 see also French … Frauenfeld, Alfred 193 Frederick the Great of Prussia 73–4 The Anti-Machiavel 75, 79–80 as an intellectual 79–80 Political Testaments 73, 80 as a scientific patron 71, 79–80, 84 French army, in First World War 182–3, 185–7 mutiny in 186–7 French empire 148, 159, 160, 195 in Africa 163–75, 176, 188, 190–91; segregation in 174–5 colonial armies 164; in First World War 183–7 Ecole Coloniale 165, 166–7, 172 extent of 144 institutional structure 172–3 legal system 165–6 male suffrage in 163 in North America (Louisiana Purchase) 163, 160–61 slavery, abolition of 163–4 unrest in 163, 175 French Revolution 119, 142, 149–57, 161–2 Edmund Burke on 149, 150–52, 152n, 155, 156 causes of 149–50, 153 Declaration of the Rights of Man 150, 151 executions during 152–3 political system during 152–3 as a religious conflict 151, 152, 153, 154 Rousseau and 151–2 the Terror 153, 155–6 Alexis de Tocqueville on 153–4 see also France … French West Africa 170–71, 174, 191 Freud, Sigmund 16 on civilization 272–3 on religion 270–71, 272 Frisch, Otto 235 Galileo Galilei 65, 66, 83, 84 Galton, Francis 176–7 Kantsaywhere 177n Gandhi, Mahatma 217 on Western civilization 141, 144, 171, 195 on Western medicine 146, 149 Garibaldi, Giuseppe 229 Le Gazetier Cuirassé 79 genocide 179–80, 188, 193, 194, 234 see also eugenics German army, in First World War 182–3, 185–7 colonial troops 182 German empire 144 in Africa 176–81, 188–90, 191; legal system 177, racial issues 176, 177–81; rebellion in 178–9 Nazi, in Eastern Europe 189–90, 191–5 German nationalism 213, 214 Germany 11, 16, 38, 159 division of, post-1945 243; Berlin Wall 249, 251 economic growth/output 231, 232–3 eugenics in 176–81 living standards 232–3 Nazi regime 189–90, 191–5, 231–4; see also Hitler, Adolf as a printing centre 61 Reformation 38 Russia and 192, 194, 231–2 as a scientific centre 175–6 Gibbon, Edward 78 The History of the Decline and Fall of the Roman Empire 257–9, 291–2 Gide, André 174 Gilbert, William 65 Ginsburg, Allen 247 globalization 239 gold, from South America 99, 101–2, 130 golf 28 Goltz, Colmar Freiherr von de (Goltz Pasha) 91 Gorbachev, Mikhail 250 Göring, Heinrich (father of Hermann Göring) 176, 189 Göring, Hermann 176, 189, 193 Graham, Billy 273–4 Great Britain see Britain Great Depression 229–31 Greece 15, 17, 21 Greek nationalism 213, 228 Greer, Germaine 246 Gregory VII, Pope 60 Grijns, Gerrit 170 Grimm, Hans: People without Space 189 Grosseteste, Robert 60 Guettard, Jean-Etienne 66 Guizot, François xxvii Gutenberg, Johann 60–61 Habsburg empire 8–9, 53, 144 Ottoman empire’s invasion of (1683) 52, 54–7 Vienna, siege of (1683) 52, 53, 55, 57 see also Austria Haiti 120, 128, 160 Hamakari, battle of (1904) 179 Hammond, Mac 275 Hardy, Georges 166 Hargreaves, James 200 Harrison, John 70 Harvey, William 66 Haussmann, Baron Georges 215 Havel, Václav 248–9 Hawaii 144 Hayek, Friedrich von 301 Road to Serfdom 237 health issues 7, 12, 14, 44, 68, 175–6 antibiotics 148 Black Death/plague 4, 23, 25, 54, 169, 175 death 25–6 definition 13 diet and 170 eugenics see eugenics European diseases, spread of 99, 101 hospitals: Islamic 51 medical schools 53 native medicine/healers 171–2 public health 147, 148, 171–2, 177, 205 sanitation 23, 147, 179 tropical diseases 148, 168–70, 173; mortality rate from 168; research on 169–70, 174 vaccination 14, 147, 148, 170, 173, 175 Western medicine, benefits of 146–8, 168–75, 191 witch doctors 171, 172 health transition concept 147–8 Heck, Walter 233 Hegel, Georg Wilhelm Friedrich 159, 207, 212 Helvétius, Adrien 78 Hempel, Carl xx Hendel, Ann Katrin 250 Henry V, King of England 23, 24, 39 Henry VIII, King of England 72, 103–4 Henry the Navigator, King of Portugal 39 Himmler, Heinrich 190, 192, 193–4 Hirohito, Crown Prince of Japan 220, 225–6 Hispaniola (island) 101–2 history teaching of xviii–xx limitations of xx–xxii Hitler, Adolf 189–90, 194, 231 Hossbach memorandum 233 see also Germany, Nazi regime Ho Chi Minh 167 Hobbes, Thomas 24, 73 on liberty 107–8 Hoffmann, Erich 175–6 Hogg, James xxvi Holbach, baron Paul-Henri Thiry d’ 79 homicide rates 24, 25, 105 Hong Kong 105, 169 Hong Xiuquan 279–80 Hooke, Thomas 67, 70 Micrographia 64 How, Millicent (English migrant to South Carolina) 103, 106, 111–12 Hu Jintao 287–8 Huguenots 39, 41, 76 human rights 8 Hume, David 77, 78 Hungary 251 Huntington, Samuel, on Western civilization 15, 16, 312–13 Hus, Jan 61 Hussein, Saddam xvi Hutton, James 66 Ibrahim, Muktar Said 288–9 illiteracy see literacy rates imperialism 8–10, 13, 14, 15, 142–95, 302–3 in Africa 14, 139, 145, 146, 148, 163–75; see also individual countries in America see America … colonial armies/troops 164, 181–9 communications, difficulty of 170–71, 181–2 as conquest 99–102 European diseases spread by 99, 101 growth/decline of 3, 4, 5, 13, 38, 142, 144–5 impact of 8, 45, 46, 144–6, 173–4, 190–95 institutional structures and 103–5 Lenin on 144 as a term of abuse 144, 145 Mark Twain on 144 Western 14, 15, 96–140, 142–95 Western medicine, benefits of to overseas colonies 146–8, 168–75, 191 see also individual empires Inca empire, Spanish conquest of 98, 99–102 income levels see living standards; wages India 5, 9, 17, 36 as British colony 144, 264 China and 29, 32 as independent state 224–5 Portugal and 34, 35, 39 science/technology 11 textile industry 2245 Indian Medical Service 169–70 Indian Ocean 29, 32, 33 Indo-China, as a French colony 167, 191 Indonesia 240 Industrial Revolution 13, 21, 28–9, 70, 198–205 in Britain 10, 13, 21, 28–9, 70, 199–200, 203–5 consumerism, increase caused by 201–2 definition 198–9 spread of 204–5, 225, 264 industrialization 10, 14, 216–18 in China 225, 284, 285 inequality see living standards infant mortality see life expectancy Inoue Kaoru 226 institutional structures 11–14 cultural 77 financial/economic see financial systems imperialism and 103–5, 112, 172–3, 287 of Islamic fundamentalism 288, 289, 290n Islamic 289, 290, 290n Iran 94–5, 255 Ireland 11, 227, 203n England and 24, 105 iron/steel industry 200–201 Islam 3, 8, 9, 16, 60 calligraphy, importance of 68 Europe, envoys sent to 86–7 health issues: hospitals 51; medical schools 53 the Koran 63 population figures 290 printing, attitude to 68, 86 religious conflict 71 in Turkey 253–5 the West and 39, 50–57, 63, 85–90, 255 women’s clothing 253–5, 254n see also Ottoman empire; religious issues Islamic education 51 Islamic fundamentalism 93–5, 93n, 255, 258, 288–91 institutional structure 288, 289, 290n Islamic migration 290, 290n Islamic science/technology 51–7, 264 astronomy 68–9 attitudes to 67–9 Roger Bacon on 52 modernization of 88–9, 92, 94–5 optics 51–2 Israel 92–5, 246–7 Jerusalem 93, 93n, 94 science/technology in 93–4 see also Jews Italian city-states/Italy 4, 25, 28, 159, 182 France and 159 Under Mussolini 228 Naples 26, 159 as a printing centre 63 Rome 17; March on (1922) 228–9 in Second World War 233–4 Venice 38–9 see also Roman empire Italian colonies 144 Italian unification 212–13, 214–15, 228 Iwakura Tomomi 221 Jamaica 120, 123 as a British colony 148 Jansen, Zacharias 65 Japan 5, 9, 42 China and 226, 233, 234 fashion/clothing 220–21, 222, 223, 225 living standards 45–6 modernization of 90, 218, 221–5, 226, 239, 257; internal opposition to 222 Russia and 226 textile industry 223–4 US and 221; in Second World War 233–5 Western influence on 5, 7, 15, 221–5 women in 222 Japanese armed forces 226, 234 Java 170 jeans, as a symbol of consumerism 240–49, 250 Jefferson, Thomas 134 Jerusalem 93, 93n, 94 Jews 3, 76 as entrepreneurs 216–17, 217n, 262n as intellectuals 235, 235n in Palestine 92–3 persecution of 38–9; in Germany 92, 214, 234, 235 Max Weber on 262 see also Israel Jiang Zemin 287 Jiao Yu and Liu Ji: Huolongjing 28 Jirous, Ivan 248 John Paul II, Pope 252 Johnson, Blind Willie 18 Johnson, Samuel 2, 10 Kahn, Albert 196, 196n Kamen, Dean 145n Kant, Immanuel 76, 79, 80–81 Critique of Pure Reason 76 Kara Mustafa Köprülü (‘the black’), Grand Vizier 52, 54–5, 56, 71, 86 Karaca, Nihal Bengisu 254 Kaufman, Henry xvi Kemal, Mustafa see Atatürk, Kemal Kennedy, Paul: The Rise and Fall of the Great Powers 298 Keynes, John Maynard 7, 230, 231, 237 Khan, Dr A.

 

pages: 421 words: 125,417

Common Wealth: Economics for a Crowded Planet by Jeffrey Sachs

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agricultural Revolution, air freight, back-to-the-land, British Empire, business process, carbon footprint, clean water, colonial rule, corporate social responsibility, correlation does not imply causation, demographic transition, Diane Coyle, Edward Glaeser, energy security, failed state, Gini coefficient, Haber-Bosch Process, income inequality, income per capita, intermodal, invention of agriculture, invention of the steam engine, invisible hand, Joseph Schumpeter, knowledge worker, labor-force participation, labour mobility, low skilled workers, microcredit, oil shale / tar sands, peak oil, profit maximization, profit motive, purchasing power parity, road to serfdom, Ronald Reagan, Simon Kuznets, Skype, statistical model, The Wealth of Nations by Adam Smith, Thomas Malthus, trade route, transaction costs, unemployed young men, War on Poverty, women in the workforce, working-age population

A contrasting view, very popular in Sweden and some other social welfare states, holds that precisely because capitalism is so turbulent, a social safety net is vitally needed to win the public’s support for an economy in constant flux. The argument goes that without social insurance, the public would be likely to demand protectionism and nonmarket guarantees of employment. Another major criticism of the social welfare state from the right is that it represents a direct threat to personal freedoms. Economist Friedrich Hayek argued in his influential work The Road to Serfdom that large-scale involvement of the state in the economy would lead to the collapse of individual freedoms. Although he first aimed those criticisms at the centrally planned communist economies and their controls on industry, he later extended them to the so-called social democracies with their expensive welfare policies. The U.S. and European political right wing regularly depicts social spending as a threat to economic efficiency and personal liberties.

New Scientist, July 28, 2007. Hansen, James, et al. “Climate Change and Trace Gases.” Philosophical Transactions of the Royal Society A 365 (May 2007): 1925–54. Hansen, James, et al. “Dangerous Human-Made Interference with Climate: a GISS ModelE Study.” Atmospheric Chemistry and Physics (2007): 2287–312. Hardin, Garrett. “The Tragedy of the Commons.” Science 162 (1968): 1243–48. Hayek, Friedrich A. von. The Road to Serfdom. Chicago: University of Chicago Press, 1944. Hiro, Dilip. Blood of the Earth: The Battle for the World’s Vanishing Oil Resources. New York: Nation Books, 2006. Hirschman, Albert. The Rhetoric of Reaction: Perversity, Futility, Jeopardy. Cambridge, MA: The Belknap Press of Harvard University Press, 1991. Hopkin, Michael. “Oceans in Trouble as Acid Levels Rise.” Nature News, June 30, 2005.

 

pages: 464 words: 116,945

Seventeen Contradictions and the End of Capitalism by David Harvey

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accounting loophole / creative accounting, bitcoin, Branko Milanovic, Bretton Woods, BRICs, British Empire, business climate, California gold rush, call centre, central bank independence, clean water, cloud computing, collapse of Lehman Brothers, colonial rule, Credit Default Swap, David Ricardo: comparative advantage, deindustrialization, demographic dividend, Deng Xiaoping, deskilling, falling living standards, fiat currency, first square of the chessboard, first square of the chessboard / second half of the chessboard, Food sovereignty, Frank Gehry, future of work, global reserve currency, Guggenheim Bilbao, income inequality, informal economy, invention of the steam engine, invisible hand, Isaac Newton, Jane Jacobs, Jarndyce and Jarndyce, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Just-in-time delivery, knowledge worker, low skilled workers, Mahatma Gandhi, market clearing, Martin Wolf, means of production, microcredit, new economy, New Urbanism, Occupy movement, peak oil, phenotype, Plutocrats, plutocrats, Ponzi scheme, quantitative easing, rent-seeking, reserve currency, road to serfdom, Robert Gordon, Ronald Reagan, short selling, Silicon Valley, special economic zone, The Wealth of Nations by Adam Smith, Thomas Malthus, Thorstein Veblen, transaction costs, Tyler Cowen: Great Stagnation, wages for housework, Wall-E, women in the workforce, working poor, working-age population

The freedom that regulation creates is denounced as unfreedom; the justice, liberty and welfare it offers are decried as a camouflage of slavery … This means the fullness of freedom for those whose income, leisure and security need no enhancing, and a mere pittance of liberty for the people, who may in vain attempt to make use of their democratic rights to gain shelter from the owners of property.’6 Thus does Polanyi construct a telling rebuttal to the central theses of Friedrich Hayek’s Road to Serfdom, written in 1942–3 but to this day a bible of the libertarian right and a mightily influential text (having sold more than 2 million copies). Clearly at the root of the dilemma lies the meaning of freedom itself. The utopianism of liberal political economy ‘gave a false direction to our ideals,’ notes Polanyi. It failed to recognise that ‘no society is possible in which power and compulsion are absent nor a world in which force has no function’.

., Disposable Women and Other Myths of Global Capitalism, New York, Routledge, 2006 Index Numbers in italics indicate Figures. 2001: A Space Odyssey (film) 271 A Abu Ghraib, Iraq 202 acid deposition 255, 256 advertising 50, 121, 140, 141, 187, 197, 236, 237, 275, 276 Aeschylus 291 Afghanistan 202, 290 Africa and global financial crisis 170 growth 232 indigenous population and property rights 39 labour 107, 108, 174 ‘land grabs’ 39, 58, 77, 252 population growth 230 Agamben, Giorgio 283–4 agglomeration 149, 150 economies 149 aggregate demand 20, 80, 81, 104, 173 aggregate effective demand 235 agribusiness 95, 133, 136, 206, 247, 258 agriculture ix, 39, 61, 104, 113, 117, 148, 229, 239, 257–8, 261 Alabama 148 Algerian War (1954–62) 288, 290 alienation 57, 69, 125, 126, 128, 129, 130, 198, 213, 214, 215, 263, 266–70, 272, 275–6, 279–80, 281, 286, 287 Allende, Salvador 201 Althusser, Louis 286 Amazon 131, 132 Americas colonisation of 229 indigenous populations 283 Amnesty International 202 anti-capitalist movements 11, 14, 65, 110, 111, 162 anti-capitalist struggle 14, 110, 145, 193, 269, 294 anti-globalisation 125 anti-terrorism xiii apartheid 169, 202, 203 Apple 84, 123, 131 apprenticeships 117 Arab Spring movement 280 Arbenz, Jacobo 201 Argentina 59, 107, 152, 160, 232 Aristotelianism 283, 289 Aristotle 1, 4, 200, 215 arms races 93 arms traffickers 54 Arrighi, Giovanni 136 Adam Smith in Beijing 142 Arthur, Brian: The Nature of Technology 89, 95–9, 101–4, 110 artificial intelligence xii, 104, 108, 120, 139, 188, 208, 295 Asia ‘land grabs’ 58 urbanisation 254 assembly lines 119 asset values and the credit system 83 defined 240 devalued 257 housing market 19, 20, 21, 58, 133 and predatory lending 133 property 76 recovery of 234 speculation 83, 101, 179 associationism 281 AT&T 131 austerity xi, 84, 177, 191, 223 Australia 152 autodidacts 183 automation xii, 103, 105, 106, 108, 138, 208, 215, 295 B Babbage, Charles 119 Bangkok riots, Thailand (1968) x Bangladesh dismantlement of old ships 250 factories 129, 174, 292 industrialisation 123 labour 108, 123, 129 protests against unsafe labour conditions 280 textile mill tragedies 249 Bank of England 45, 46 banking bonuses 164 electronic 92, 100, 277 excessive charges 84 interbank lending 233 and monopoly power 143 national banks supplant local banking in Britain and France 158 net transfers between banks 28 power of bankers 75 private banks 233 profits 54 regional banks 158 shell games 54–5 systematic banking malfeasance 54, 61 Baran, Paul and Sweezy, Paul: Monopoly Capitalism 136 Barcelona 141, 160 barrios pobres ix barter 24, 25, 29 Battersea Power Station, London 255 Battle of Algiers, The (film) 288 Bavaria, Germany 143, 150 Becker, Gary 186 Bernanke, Ben 47 Bhutan 171 billionaires xi, 165, 169, 170 biodiversity 246, 254, 255, 260 biofuels 3 biomedical engineering xii Birmingham 149 Bitcoin 36, 109 Black Panthers 291 Blade Runner (film) 271 Blankfein, Lloyd 239–40 Bohr, Niels 70 Bolivia 257, 260, 284 bondholders xii, 32, 51, 152, 158, 223, 240, 244, 245 bonuses 54, 77, 164, 178 Bourdieu, Pierre 186, 187 bourgeois morality 195 bourgeois reformism 167, 211 ‘Brady Bonds’ 240 Braudel, Fernand 193 Braverman, Harry: Labor and Monopoly Capital 119 Brazil a BRIC country 170, 228 coffee growers 257 poverty grants 107 unrest in (2013) 171, 243, 293 Brecht, Bertolt 265, 293 Bretton Woods (1944) 46 brewing trade 138 BRIC countries 10, 170, 174, 228 Britain alliance between state and London merchant capitalists 44–5 banking 158 enclosure movement 58 lends to United States (nineteenth century) 153 suppression of Mau Mau 291 surpluses of capital and labour sent to colonies 152–3 welfare state 165 see also United Kingdom British Empire 115, 174 British Museum Library, London 4 British Petroleum (BP) 61, 128 Buffett, Peter 211–12, 245, 283, 285 Buffett, Warren 211 bureaucracy 121–2, 165, 203, 251 Bush, George, Jr 201, 202 C Cabet, Étienne 183 Cabral, Amilcar 291 cadastral mapping 41 Cadbury 18 Cairo uprising (2011) 99 Calhoun, Craig 178 California 29, 196, 254 Canada 152 Cape Canaveral, Florida 196 capital abolition of monopolisable skills 119–20 aim of 92, 96–7, 232 alternatives to 36, 69, 89, 162 annihilation of space through time 138, 147, 178 capital-labour contradiction 65, 66, 68–9 and capitalism 7, 57, 68, 115, 166, 218 centralisation of 135, 142 circulation of 5, 7, 8, 53, 63, 67, 73, 74, 75, 79, 88, 99, 147, 168, 172, 177, 234, 247, 251, 276 commodity 74, 81 control over labour 102–3, 116–17, 166, 171–2, 274, 291–2 creation of 57 cultural 186 destruction of 154, 196, 233–4 and division of labour 112 economic engine of 8, 10, 97, 168, 172, 200, 253, 265, 268 evolution of 54, 151, 171, 270 exploitation by 156, 195 fictitious 32–3, 34, 76, 101, 110–11, 239–42 fixed 75–8, 155, 234 importance of uneven geographical development to 161 inequality foundational for 171–2 investment in fixed capital 75 innovations 4 legal-illegal duality 72 limitless growth of 37 new form of 4, 14 parasitic forms of 245 power of xii, 36, 47 private capital accumulation 23 privatisation of 61 process-thing duality 70–78 profitability of 184, 191–2 purpose of 92 realisation of 88, 173, 192, 212, 231, 235, 242, 268, 273 relation to nature 246–63 reproduction of 4, 47, 55, 63, 64, 88, 97, 108, 130, 146, 161, 168, 171, 172, 180, 181, 182, 189, 194, 219, 233, 252 spatiality of 99 and surplus value 63 surpluses of 151, 152, 153 temporality of 99 tension between fixed and circulating capital 75–8, 88, 89 turnover time of 73, 99, 147 and wage rates 173 capital accumulation, exponential growth of 229 capital gains 85, 179 capital accumulation 7, 8, 75, 76, 78, 102, 149, 151–5, 159, 172, 173, 179, 192, 209, 223, 228–32, 238, 241, 243, 244, 247, 273, 274, 276 basic architecture for 88 and capital’s aim 92, 96 collapse of 106 compound rate of 228–9 and the credit system 83 and democratisation 43 and demographic growth 231 and household consumerism 192 and lack of aggregate effective demand in the market 81 and the land market 59 and Marx 5 maximising 98 models of 53 in a new territories 152–3 perpetual 92, 110, 146, 162, 233, 265 private 23 promotion of 34 and the property market 50 recent problems of 10 and the state 48 capitalism ailing 58 an alternative to 36 and capital 7, 57, 68, 115, 166, 218 city landscape of 160 consumerist 197 contagious predatory lawlessness within 109 crises essential to its reproduction ix; defined 7 and demand-side management 85 and democracy 43 disaster 254–5, 255 economic engine of xiii, 7–8, 11, 110, 220, 221, 252, 279 evolution of 218 geographical landscape of 146, 159 global xi–xii, 108, 124 history of 7 ‘knowledge-based’ xii, 238 and money power 33 and a moneyless economy 36 neoliberal 266 political economy of xiv; and private property rights 41 and racialisation 8 reproduction of ix; revivified xi; vulture 162 capitalist markets 33, 53 capitalo-centric studies 10 car industry 121, 138, 148, 158, 188 carbon trading 235, 250 Caribbean migrants 115 Cartesian thinking 247 Cato Institute 143 Central America 136 central banks/bankers xi–xii, 37, 45, 46, 48, 51, 109, 142, 156, 161, 173, 233, 245 centralisation 135, 142, 144, 145, 146, 149, 150, 219 Césaire, Aimé 291 CFCs (chloro-fluorocarbons) 248, 254, 256, 259 chambers of commerce 168 Chandler, Alfred 141 Chaplin, Charlie 103 Charles I, King 199 Chartism 184 Chávez, Hugo 123, 201 cheating 57, 61, 63 Cheney, Dick 289 Chicago riots (1968) x chicanery 60, 72 children 174 exploitation of 195 raising 188, 190 trading of 26 violence and abuse of 193 Chile 136, 194, 280 coup of 1973 165, 201 China air quality 250, 258 becomes dynamic centre of a global capitalism 124 a BRIC country 170, 228 capital in (after 2000) 154 class struggles 233 and competition 150, 161 consumerism 194–5, 236 decentralisation 49 dirigiste governmentality 48 dismantlement of old ships 250 dispossessions in 58 education 184, 187 factories 123, 129, 174, 182 famine in 124–5 ‘great leap forward’ 125 growth of 170, 227, 232 income inequalities 169 industrialisation 232 Keynesian demand-side and debt-financed expansion xi; labour 80, 82, 107, 108, 123, 174, 230 life expectancy 259 personal debt 194 remittances 175 special economic zones 41, 144 speculative booms and bubbles in housing markets 21 suburbanisation 253 and technology 101 toxic batteries 249–50 unstable lurches forward 10 urban and infrastructural projects 151 urbanisation 232 Chinese Communist Party 108, 142 Church, the 185, 189, 199 circular cumulative causation 150 CitiBank 61 citizenship rights 168 civil rights 202, 205 class affluent classes 205 alliances 143, 149 class analysis xiii; conflict 85, 159 domination 91, 110 plutocratic capitalist xiii; power 55, 61, 88, 89, 92, 97, 99, 110, 134, 135, 221, 279 and race 166, 291 rule 91 structure 91 class struggle 34, 54, 67, 68, 85, 99, 103, 110, 116, 120, 135, 159, 172, 175, 183, 214, 233 climate change 4, 253–6, 259 Clinton, President Bill 176 Cloud Atlas (film) 271 CNN 285 coal 3, 255 coercion x, 41–4, 53, 60–63, 79, 95, 201, 286 Cold War 153, 165 collateralised debt obligations (CDOs) 78 Collins, Suzanne: The Hunger Games 264 Colombia 280 colonialism 257 the colonised 289–90 indigenous populations 39, 40 liberation from colonial rule 202 philanthropic 208, 285 colonisation 229, 262 ‘combinatorial evolution’ 96, 102, 104, 146, 147, 248 commercialisation 262, 263, 266 commodification 24, 55, 57, 59–63, 88, 115, 140, 141, 192, 193, 235, 243, 251, 253, 260, 262, 263, 273 commodities advertising 275 asking price 31 and barter 24 commodity exchange 39, 64 compared with products 25–6 defective or dangerous 72 definition 39 devaluation of 234 exchange value 15, 25 falling costs of 117 importance of workers as buyers 80–81 international trade in 256 labour power as a commodity 62 low-value 29 mobility of 147–8 obsolescence 236 single metric of value 24 unique 140–41 use value 15, 26, 35 commodity markets 49 ‘common capital of the class’ 142, 143 common wealth created by social labour 53 private appropriation of 53, 54, 55, 61, 88, 89 reproduction of 61 use values 53 commons collective management of 50 crucial 295 enclosure of 41, 235 natural 250 privatised 250 communications 99, 147, 148, 177 communism 196 collapse of (1989) xii, 165 communist parties 136 during Cold War 165 scientific 269 socialism/communism 91, 269 comparative advantage 122 competition and alienated workers 125 avoiding 31 between capitals 172 between energy and food production 3 decentralised 145 and deflationary crisis (1930s) 136 foreign 148, 155 geopolitical 219 inter-capitalist 110 international 154, 175 interstate 110 interterritorial 219 in labour market 116 and monopoly 131–45, 146, 218 and technology 92–3 and turnover time of capital 73, 99 and wages 135 competitive advantage 73, 93, 96, 112, 161 competitive market 131, 132 competitiveness 184 complementarity principle of 70 compounding growth 37, 49, 222, 227, 228, 233, 234, 235, 243, 244 perpetual 222–45, 296 computerisation 100, 120, 222 computers 92, 100, 105, 119 hardware 92, 101 organisational forms 92, 93, 99, 101 programming 120 software 92, 99, 101, 115, 116 conscience laundering 211, 245, 284, 286 Conscious Capitalism 284 constitutional rights 58 constitutionality 60, 61 constitutions progressive 284 and social bond between human rights and private property 40 US Constitution 284 and usurpation of power 45 consumerism 89, 106, 160, 192–5, 197, 198, 236, 274–7 containerisation 138, 148, 158 contracts 71, 72, 93, 207 contradictions Aristotelian conception of 4 between money and the social labour money represents 83 between reality and appearance 4–6 between use and exchange value 83 of capital and capitalism 68 contagious intensification of 14 creative use of 3 dialectical conception of 4 differing reactions to 2–3 and general crises 14 and innovation 3 moved around rather than resolved 3–4 multiple 33, 42 resolution of 3, 4 two modes of usage 1–2 unstable 89 Controller of the Currency 120 corporations and common wealth 54 corporate management 98–9 power of 57–8, 136 and private property 39–40 ‘visible hand’ 141–2 corruption 53, 197, 266 cosmopolitanism 285 cost of living 164, 175 credit cards 67, 133, 277 credit card companies 54, 84, 278 credit financing 152 credit system 83, 92, 101, 111, 239 crises changes in mental conceptions of the world ix-x; crisis of capital 4 defined 4 essential to the reproduction of capitalism ix; general crisis ensuing from contagions 14 housing markets crisis (2007–9) 18, 20, 22 reconfiguration of physical landscapes ix; slow resolution of x; sovereign debt crisis (after 2012) 37 currency markets, turbulence of (late 1960s) x customary rights 41, 59, 198 D Davos conferences 169 DDT 259 Debord, Guy: The Society of the Spectacle 236 debt creation 236 debt encumbrancy 212 debt peonage 62, 212 decentralisation 49, 142, 143, 144, 146, 148, 219, 281, 295 Declaration of Independence (US) 284 decolonisation 282, 288, 290 decommodification 85 deindustrialisation xii, 77–8, 98, 110, 148, 153, 159, 234 DeLong, Bradford 228 demand management 81, 82, 106, 176 demand-side management 85 democracy 47, 215 bourgeois 43, 49 governance within capitalism 43 social 190 totalitarian 220, 292 democratic governance 220, 266 democratisation 43 Deng Xiaoping x depressions 49, 227 1930s x, 108, 136, 169, 227, 232, 234 Descartes, René 247 Detroit 77, 136, 138, 148, 150, 152, 155, 159, 160 devaluation 153, 155, 162 of capital 233 of commodities 234 crises 150–51, 152, 154 localised 154 regional 154 developing countries 16, 240 Dhaka, Bangladesh 77 dialectics 70 Dickens, Charles 126, 169 Bleak House 226 Dombey and Son 184 digital revolution 144 disabled, the 202 see also handicapped discrimination 7, 8, 68, 116, 297 diseases 10, 211, 246, 254, 260 disempowerment 81, 103, 116, 119, 198, 270 disinvestment 78 Disneyfication 276 dispossession accumulation by 60, 67, 68, 84, 101, 111, 133, 141, 212 and capital 54, 55, 57 economies of 162 of indigenous populations 40, 59, 207 ‘land grabs’ 58 of land rights of the Irish 40 of the marginalised 198 political economy of 58 distributional equality 172 distributional shares 164–5, 166 division of labour 24, 71, 112–30, 154, 184, 268, 270 and Adam Smith 98, 118 defined 112 ‘the detail division of labour’ 118, 121 distinctions and oppositions 113–14 evolution of 112, 120, 121, 126 and gender 114–15 increasing complexity of 124, 125, 126 industrial proletariat 114 and innovation 96 ‘new international division of labour’ 122–3 organisation of 98 proliferating 121 relation between the parts and the whole 112 social 113, 118, 121, 125 technical 113, 295 uneven geographical developments in 130 dot-com bubble (1990s) 222–3, 241 ‘double coincidence of wants and needs’ 24 drugs 32, 193, 248 cartels 54 Durkheim, Emile 122, 125 Dust Bowl (United States, 1930s) 257 dynamism 92, 104, 146, 219 dystopia 229, 232, 264 E Eagleton , Terry: Why Marx Was Right 1, 21, 200, 214–15 East Asia crisis of 1997–98 154 dirigiste governmentality 48 education 184 rise of 170 Eastern Europe 115, 230 ecological offsets 250 economic rationality 211, 250, 252, 273, 274, 275, 277, 278, 279 economies 48 advanced capitalist 228, 236 agglomeration 149 of dispossession 162 domination of industrial cartels and finance capital 135 household 192 informal 175 knowledge-based 188 mature 227–8 regional 149 reoriented to demand-side management 85 of scale 75 solidarity 66, 180 stagnant xii ecosystems 207, 247, 248, 251–6, 258, 261, 263, 296 Ecuador 46, 152, 284 education 23, 58, 60, 67–8, 84, 110, 127–8, 129, 134, 150, 156, 168, 183, 184, 185, 187, 188, 189, 223, 235, 296 efficiency 71, 92, 93, 98, 103, 117, 118, 119, 122, 126, 272, 273, 284 efficient market hypothesis 118 Egypt 107, 280, 293 Ehrlich, Paul 246 electronics 120, 121, 129, 236, 292 emerging markets 170–71, 242 employment 37 capital in command of job creation 172, 174 conditions of 128 full-time 274 opportunities for xii, 108, 168 regional crises of 151 of women 108, 114, 115, 127 see also labour enclosure movement 58 Engels, Friedrich 70 The Condition of the English Working Class in England 292 English Civil War (1642–9) 199 Enlightenment 247 Enron 133, 241 environmental damage 49, 61, 110, 111, 113, 232, 249–50, 255, 257, 258, 259, 265, 286, 293 environmental movement 249, 252 environmentalism 249, 252–3 Epicurus 283 equal rights 64 Erasmus, Desiderius 283 ethnic hatreds and discriminations 8, 165 ethnic minorities 168 ethnicisation 62 ethnicity 7, 68, 116 euro, the 15, 37, 46 Europe deindustrialisation in 234 economic development in 10 fascist parties 280 low population growth rate 230 social democratic era 18 unemployment 108 women in labour force 230 European Central Bank 37, 46, 51 European Commission 51 European Union (EU) 95, 159 exchange values commodities 15, 25, 64 dominance of 266 and housing 14–23, 43 and money 28, 35, 38 uniform and qualitatively identical 15 and use values 15, 35, 42, 44, 50, 60, 65, 88 exclusionary permanent ownership rights 39 experts 122 exploitation 49, 54, 57, 62, 68, 75, 83, 107, 108, 124, 126, 128, 129, 150, 156, 159, 166, 175, 176, 182, 185, 193, 195, 208, 246, 257 exponential growth 224, 240, 254 capacity for 230 of capital 246 of capital accumulation 223, 229 of capitalist activity 253 and capital’s ecosystem 255 in computer power 105 and environmental resources 260 in human affairs 229 and innovations in finance and banking 100 potential dangers of 222, 223 of sophisticated technologies 100 expropriation 207 externality effects 43–4 Exxon 128 F Facebook 236, 278, 279 factories ix, 123, 129, 160, 174, 182, 247, 292 Factory Act (1864) 127, 183 famine 124–5, 229, 246 Fannie Mae 50 Fanon, Frantz 287 The Wretched of the Earth 288–90, 293 fascist parties 280 favelas ix, 16, 84, 175 feminisation 115 feminists 189, 192, 283 fertilisers 255 fetishes, fetishism 4–7, 31, 36–7, 61, 103, 111, 179, 198, 243, 245, 269, 278 feudalism 41 financial markets 60, 133 financialisation 238 FIRE (finance, insurance and real estate) sections 113 fishing 59, 113, 148, 249, 250 fixity and motion 75–8, 88, 89, 146, 155 Food and Drug Administration 120 food production/supply 3, 229, 246, 248, 252 security 253, 294, 296 stamp aid 206, 292 Ford, Martin 104–8, 111, 273 foreclosure 21, 22, 24, 54, 58, 241, 268 forestry 113, 148, 257 fossil fuels 3–4 Foucault, Michel xiii, 204, 209, 280–81 Fourier, François Marie Charles 183 Fourierists 18 Fourteen Points 201 France banking 158 dirigiste governmentality under de Gaulle 48 and European Central Bank 46 fascist parties 280 Francis, Pope 293 Apostolic Exhortation 275–6 Frankfurt School 261 Freddie Mac 50 free trade 138, 157 freedom 47, 48, 142, 143, 218, 219, 220, 265, 267–270, 276, 279–82, 285, 288, 296 and centralised power 142 cultural 168 freedom and domination 199–215, 219, 268, 285 and the good life 215 and money creation 51 popular desire for 43 religious 168 and state finances 48 under the rule of capital 64 see also liberty and freedom freedom of movement 47, 296 freedom of thought 200 freedom of the press 213 French Revolution 203, 213, 284 G G7 159 G20 159 Gallup survey of work 271–2 Gandhi, Mahatma 284, 291 Gaulle, Charles de 48 gay rights 166 GDP 194, 195, 223 Gehry, Frank 141 gender discriminations 7, 8, 68, 165 gene sequences 60 General Motors xii genetic engineering xii, 101, 247 genetic materials 235, 241, 251, 261 genetically modified foods 101 genocide 8 gentrification 19, 84, 141, 276 geocentric model 5 geographical landscape building a new 151, 155 of capitalism 159 evolution of 146–7 instability of 146 soulless, rationalised 157 geopolitical struggles 8, 154 Germany and austerity 223 autobahns built 151 and European Central Bank 46 inflation during 1920s 30 wage repression 158–9 Gesell, Silvio 35 Ghana 291 global economic crisis (2007–9) 22, 23, 47, 118, 124, 132, 151, 170, 228, 232, 234, 235, 241 global financialisation x, 177–8 global warming 260 globalisation 136, 174, 176, 179, 223, 293 gold 27–31, 33, 37, 57, 227, 233, 238, 240 Golden Dawn 280 Goldman Sachs 75, 239 Google 131, 136, 195, 279 Gordon, Robert 222, 223, 230, 239, 304n2 Gore, Al 249 Gorz, André 104–5, 107, 242, 270–77, 279 government 60 democratic 48 planning 48 and social bond between human rights and private property 40 spending power 48 governmentality 43, 48, 157, 209, 280–81, 285 Gramsci, Antonio 286, 293 Greco, Thomas 48–9 Greece 160, 161, 162, 171, 235 austerity 223 degradation of the well-being of the masses xi; fascist parties 280 the power of the bondholders 51, 152 greenwashing 249 Guantanamo Bay, Cuba 202, 284 Guatemala 201 Guevara, Che 291 Guggenheim Museum, Bilbao 141 guild system 117 Guinea-Bissau 291 Gulf Oil Spill (2010) 61 H Habermas, Jürgen 192 habitat 246, 249, 252, 253, 255 handicapped, the 218 see also disabled Harvey, David The Enigma of Capital 265 Rebel Cities 282 Hayek, Friedrich 42 Road to Serfdom 206 health care 23, 58, 60, 67–8, 84, 110, 134, 156, 167, 189, 190, 235, 296 hedge funds 101, 162, 239, 241, 249 managers 164, 178 Heidegger, Martin 59, 250 Heritage Foundation 143 heterotopic spaces 219 Hill, Christopher 199 Ho Chi Minh 291 holocausts 8 homelessness 58 Hong Kong 150, 160 housing 156, 296 asset values 19, 20, 21, 58 ‘built to order’ 17 construction 67 controlling externalities 19–20 exchange values 14–23, 43 gated communities ix, 160, 208, 264 high costs 84 home ownership 49–50 investing in improvements 20, 43 mortgages 19, 21, 28, 50, 67, 82 predatory practices 67, 133 production costs 17 rental markets 22 renting or leasing 18–19, 67 self-built 84 self-help 16, 160 slum ix, 16, 175 social 18, 235 speculating in exchange value 20–22 speculative builds 17, 28, 78, 82 tenement 17, 160 terraced 17 tract ix, 17, 82 use values 14–19, 21–2, 23, 67 housing markets 18, 19, 21, 22, 28, 32, 49, 58, 60, 67, 68, 77, 83, 133, 192 crisis (2007–9) 18, 20, 22, 82–3 HSBC 61 Hudson, Michael 222 human capital theory 185, 186 human evolution 229–30 human nature 97, 198, 213, 261, 262, 263 revolt of 263, 264–81 human rights 40, 200, 202 humanism 269 capitalist 212 defined 283 education 128 excesses and dark side 283 and freedom 200, 208, 210 liberal 210, 287, 289 Marxist 284, 286 religious 283 Renaissance 283 revolutionary 212, 221, 282–93 secular 283, 285–6 types of 284 Hungary: fascist parties 280 Husserl, Edmund 192 Huygens, Christiaan 70 I IBM 128 Iceland: banking 55 identity politics xiii illegal aliens (‘sans-papiers’) 156 illegality 61, 72 immigrants, housing 160 imperialism 135, 136, 143, 201, 257, 258 income bourgeois disposable 235 disparities of 164–81 levelling up of 171 redistribution to the lower classes xi; see also wages indebtedness 152, 194, 222 India billionaires in 170 a BRIC country 170, 228 call centres 139 consumerism 236 dismantlement of old ships 250 labour 107, 230 ‘land grabs’ 77 moneylenders 210 social reproduction in 194 software engineers 196 special economic zones 144 unstable lurches forward 10 indigenous populations 193, 202, 257, 283 dispossession of 40, 59, 207 and exclusionary ownership rights 39 individualism 42, 197, 214, 281 Indonesia 129, 160 industrial cartels 135 Industrial Revolution 127 industrialisation 123, 189, 229, 232 inflation 30, 36, 37, 40, 49, 136, 228, 233 inheritance 40 Inner Asia, labour in 108 innovation 132 centres of 96 and the class struggle 103 competitive 219 as a double-edged sword xii; improving the qualities of daily life 4 labour-saving 104, 106, 107, 108 logistical 147 organisational 147 political 219 product 93 technological 94–5, 105, 147, 219 as a way out of a contradiction 3 insurance companies 278 intellectual property rights xii, 41, 123, 133, 139, 187, 207, 235, 241–2, 251 interest compound 5, 222, 224, 225, 226–7 interest-rate manipulations 54 interest rates 54, 186 living off 179, 186 on loans 17 money capital 28, 32 and mortgages 19, 67 on repayment of loans to the state 32 simple 225, 227 usury 49 Internal Revenue Service income tax returns 164 International Monetary Fund (IMF) 49, 51, 100, 143, 161, 169, 186, 234, 240 internet 158, 220, 278 investment: in fixed capital 75 investment pension funds 35–6 IOUs 30 Iran 232, 289 Iranian Revolution 289 Iraq war 201, 290 Ireland dispossession of land rights 40 housing market crash (2007–9) 82–3 Istanbul 141 uprising (2013) 99, 129, 171, 243 Italy 51,161, 223, 235 ITT 136 J Jacobs, Jane 96 James, C.L.R. 291 Japan 1980s economic boom 18 capital in (1980s) 154 economic development in 10 factories 123 growth rate 227 land market crash (1990) 18 low population growth rate 230 and Marshall Plan 153 post-war recovery 161 Jewish Question 213 JPMorgan 61 Judaeo-Christian tradition 283 K Kant, Immanuel 285 Katz, Cindi 189, 195, 197 Kenya 291 Kerala, India 171 Keynes, John Maynard xi, 46, 76, 244, 266 ‘Economic Possibilities for our Grandchildren’ 33–4 General Theory of Employment, Interest, and Money 35 Keynesianism demand management 82, 105, 176 demand-side and debt-financed expansion xi King, Martin Luther 284, 291 knowledge xii, 26, 41, 95, 96, 100, 105, 113, 122, 123, 127, 144, 184, 188, 196, 238, 242, 295 Koch brothers 292 Kohl, Helmut x L labour agitating and fighting for more 64 alienated workers 125, 126, 128, 129, 130 artisan 117, 182–3 and automation 105 capital/labour contradiction 65, 66, 68–9, 146 collective 117 commodification of 57 contracts 71, 72 control over 74, 102–11, 119, 166, 171–2, 274, 291–2 deskilling 111, 119 discipline 65, 79 disempowering workers 81, 103, 116, 119, 270 division of see division of labour; domestic 196 education 127–8, 129, 183, 187 exploitation of 54, 57, 62, 68, 75, 83, 107, 108, 126, 128, 129, 150, 156, 166, 175, 176, 182, 185, 195 factory 122, 123, 237 fair market value 63, 64 Gallup survey 271–2 house building 17 housework 114–15, 192 huge increase in the global wage labour force 107–8 importance of workers as buyers of commodities 80–81 ‘industrial reserve army’ 79–80, 173–4 migrations of 118 non-unionised xii; power of 61–4, 71, 73, 74, 79, 81, 88, 99, 108, 118–19, 127, 173, 175, 183, 189, 207, 233, 267 privatisation of 61 in service 117 skills 116, 118–19, 123, 149, 182–3, 185, 231 social see social labour; surplus 151, 152, 173–4, 175, 195, 233 symbolic 123 and trade unions 116 trading in labour services 62–3 unalienated 66, 89 unionised xii; unpaid 189 unskilled 114, 185 women in workforce see under women; worked to exhaustion or death 61, 182 see also employment labour markets 47, 62, 64, 66–9, 71, 102, 114, 116, 118, 166 labour-saving devices 104, 106, 107, 173, 174, 277 labour power commodification of 61, 88 exploitation of 62, 175 generation of surplus value 63 mobility of 99 monetisation of 61 private property character of 64 privatisation of 61 reserves of 108 Lagos, Nigeria, social reproduction in 195 laissez-faire 118, 205, 207, 281 land commodification 260–61 concept of 76–7 division of 59 and enclosure movement 58 establishing as private property 41 exhausting its fertility 61 privatisation 59, 61 scarcity 77 urban 251 ‘land grabs’ 39, 58, 77, 252 land market 18, 59 land price 17 land registry 41 land rents 78, 85 land rights 40, 93 land-use zoning 43 landlords 54, 67, 83, 140, 179, 251, 261 Latin America ’1and grabs’ 58, 77 labour 107 reductions in social inequality 171 two ‘lost decades’ of development 234 lawyers 22, 26, 67, 82, 245 leasing 16, 17, 18 Lebed, Jonathan 195 Lee Kuan-Yew 48 Leeds 149 Lefebvre, Henri 157, 192 Critique of Everyday Life 197–8 left, the defence of jobs and skills under threat 110 and the factory worker 68 incapable of mounting opposition to the power of capital xii; remains of the radical left xii–xiii Lehman Brothers investment bank, fall of (2008) x–xi, 47, 241 ‘leisure’ industries 115 Lenin, Vladimir 135 Leninism 91 Lewis, Michael: The Big Short 20–21 LGBT groups 168, 202, 218 liberation struggle 288, 290 liberty, liberties 44, 48–51, 142, 143, 212, 276, 284, 289 and bourgeois democracy 49 and centralised power 142 and money creation 51 non-coercive individual liberty 42 popular desire for 43 and state finances 48 liberty and freedom 199–215 coercion and violence in pursuit of 201 government surveillance and cracking of encrypted codes 201–2 human rights abuses 202 popular desire for 203 rhetoric on 200–201, 202 life expectancy 250, 258, 259 light, corpuscular theory of 70 living standards xii, 63, 64, 84, 89, 134, 175, 230 loans fictitious capital 32 housing 19 interest on 17 Locke, John 40, 201, 204 logos 31 London smog of 1952 255 unrest in (2011) 243 Los Angeles 150, 292 Louis XIV, King of France 245 Lovelace, Richard 199, 200, 203 Luddites 101 M McCarthyite scourge 56 MacKinnon, Catherine: Are Women Human?

 

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The Master Switch: The Rise and Fall of Information Empires by Tim Wu

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accounting loophole / creative accounting, Alfred Russel Wallace, Apple II, barriers to entry, British Empire, Burning Man, Cass Sunstein, Clayton Christensen, don't be evil, Douglas Engelbart, Howard Rheingold, Hush-A-Phone, informal economy, intermodal, Internet Archive, invention of movable type, invention of the telephone, invisible hand, Jane Jacobs, Joseph Schumpeter, Menlo Park, open economy, packet switching, PageRank, profit motive, road to serfdom, Ronald Coase, shareholder value, Silicon Valley, Skype, Steve Jobs, Steve Wozniak, Telecommunications Act of 1996, The Chicago School, The Death and Life of Great American Cities, the market place, The Wisdom of Crowds, too big to fail, Upton Sinclair, urban planning

The same ideas that had inspired Henry Ford and Theodore Vail had, in the realm of politics, led to Hitler and Stalin. And so a general repudiation of the whole logic of centralization was a natural fact of the Cold War era. It was an Austrian economist who would provide the most powerful critique not just of central planning but of the Taylorist fallacies underlying it. Friedrich Hayek, author of The Road to Serfdom, is a patron saint of libertarians for having assailed not only big government, in the form of socialism, but also central planning in general.8 For what he found dangerous about the centralizing tendencies of socialism applies equally well to the overbearing powers of the corporate monopolist. Hayek would have agreed with Vail’s claim, as with the Soviets’, up to a point: ideally, planning should eliminate the senseless duplication that flows from decentralized decision making.

“A Protocol for Packet Network Intercommunication” in Jeremy M. Norman, ed., From Gutenberg to the Internet: A Sourcebook on the History of Information Technology (Novato, CA: historyofscience.com, 2005) 871–90. 7. As quoted in Alfred L. Malabre, Jr., Lost Prophets: An Insider’s History of the Modern Economists (Cambridge, MA: Harvard Business Press, 1994), 220. 8. Friedrich A. Hayek, The Road to Serfdom (London: George Routledge & Sons, 1944). 9. This quote comes from Friedrich A. Hayek, Individualism and Economic Order (Chicago: University of Chicago Press, 1948), 77. 10. Leopold Kohr, The Breakdown of Nations (London: Routledge & Paul, 1957), ix. 11. Schumacher’s idea of “enoughness” stemmed from his studies of what he called “Buddhist economics.” See Ernst F. Schumacher, Small Is Beautiful: Economics As If People Mattered (New York: Harper & Row, 1973). 12.

 

pages: 524 words: 143,993

The Shifts and the Shocks: What We've Learned--And Have Still to Learn--From the Financial Crisis by Martin Wolf

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air freight, anti-communist, Asian financial crisis, asset allocation, asset-backed security, balance sheet recession, bank run, banking crisis, banks create money, Basel III, Ben Bernanke: helicopter money, Berlin Wall, Black Swan, bonus culture, Bretton Woods, call centre, capital asset pricing model, capital controls, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, central bank independence, collateralized debt obligation, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, currency peg, debt deflation, deglobalization, Deng Xiaoping, diversification, double entry bookkeeping, en.wikipedia.org, Erik Brynjolfsson, Eugene Fama: efficient market hypothesis, eurozone crisis, Fall of the Berlin Wall, fiat currency, financial deregulation, financial innovation, financial repression, floating exchange rates, forward guidance, Fractional reserve banking, full employment, global rebalancing, global reserve currency, Growth in a Time of Debt, Hyman Minsky, income inequality, inflation targeting, invisible hand, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, labour mobility, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, margin call, market bubble, market clearing, market fragmentation, Martin Wolf, Mexican peso crisis / tequila crisis, moral hazard, mortgage debt, new economy, North Sea oil, Northern Rock, open economy, paradox of thrift, price stability, private sector deleveraging, purchasing power parity, pushing on a string, quantitative easing, Real Time Gross Settlement, regulatory arbitrage, reserve currency, Richard Feynman, Richard Feynman, risk-adjusted returns, risk/return, road to serfdom, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, Second Machine Age, secular stagnation, shareholder value, short selling, sovereign wealth fund, special drawing rights, The Chicago School, The Great Moderation, The Market for Lemons, the market place, The Myth of the Rational Market, the payments system, The Wealth of Nations by Adam Smith, too big to fail, Tyler Cowen: Great Stagnation, very high income, winner-take-all economy

In a splendid book, Economics After the Crisis: Ends and Means (Cambridge, MA, and London: MIT Press, 2012), p. 72, Lord (Adair) Turner argues that ‘Economic freedom on both the consumption side and the production side – not only the right to choose what to consume but also the right to set up a new company, to work for oneself, and to compete with new ideas – should be recognized as a desirable objective in and of itself, not because of any prosperity dividend it delivers.’ 18. Friedrich Hayek put this point in the opposite way: ‘whoever has sole control of the means must also determine which ends are to be served’. See Friedrich Hayek, The Road to Serfdom (Chicago: Chicago University Press, 1944), pp. 68–9. INTRODUCTION: ‘WE’RE NOT IN KANSAS ANY MORE’ 1. A version of this chapter’s discussion of the legacy of the financial crisis appears in ‘Afterword: How the Financial Crises Have Changed the World’, in Robert C. Feenstra and Alan M. Taylor, eds, Globalization in an Age of Crisis: Multilateral Economic Cooperation in the Twenty-First Century (Chicago: University of Chicago Press, 2013). 2.

‘The Dog and the Frisbee’, Paper given at the Federal Reserve Bank of Kansas City’s 36th Economic Policy Symposium, ‘The Changing Policy Landscape’, Jackson Hole, Wyoming, 31 August 2012. http://www.bankofengland.co.uk/publications/Documents/speeches/2012/speech596.pdf. Haldane, Andrew G., Simon Brennan and Vasileios Madouros. ‘What is the Contribution of the Financial Sector: Miracle or Mirage?’, in Adair Turner et al., The Future of Finance: The LSE Report (London: London School of Economics and Political Science, 2010). http://harr123et.files.wordpress.com/2010/07/futureoffinance-chapter21.pdf, Figure 19. Hayek, Friedrich. The Road to Serfdom, (Chicago: Chicago University Press, 1944). Herndon, Thomas, Michael Ash and Robert Pollin. ‘Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff’, 15 April 2013. http://www.peri.umass.edu/fileadmin/pdf/working_papers/working_papers_301-350/WP322.pdf. Hicks, John R. ‘Mr Keynes and the “Classics”: A Suggested Interpretation’, Econometrica, vol. 5, no. 2 (April 1937).

 

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The Health Gap: The Challenge of an Unequal World by Michael Marmot

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active transport: walking or cycling, Affordable Care Act / Obamacare, Atul Gawande, Bonfire of the Vanities, Broken windows theory, Capital in the Twenty-First Century by Thomas Piketty, Carmen Reinhart, Celtic Tiger, centre right, clean water, congestion charging, correlation does not imply causation, Doha Development Round, epigenetics, financial independence, future of work, Gini coefficient, Growth in a Time of Debt, illegal immigration, income inequality, Indoor air pollution, Kenneth Rogoff, Kibera, labour market flexibility, lump of labour, Mahatma Gandhi, meta analysis, meta-analysis, microcredit, New Urbanism, obamacare, paradox of thrift, race to the bottom, Rana Plaza, RAND corporation, road to serfdom, Simon Kuznets, Socratic dialogue, structural adjustment programs, the built environment, The Spirit Level, trickle-down economics, urban planning, Washington Consensus, Winter of Discontent, working poor

The challenge is to rescue ‘freedom’ from a polarised political debate. Commentators of the political ‘right’ prize the freedom of the individual over the controls of the state. The economist Milton Friedman called his influential book calling for free markets and freedom from state intervention Free to Choose. Putting a more negative slant on a similar idea, Friedrich von Hayek called his book The Road to Serfdom. Once the state gets involved in economic decision-making, individual liberty is eroded and we are on the road to serfdom. When neoliberalism is looking for intellectual flag-bearers these two fit the bill. Libertarians, articulately represented by Robert Nozick in his Anarchy, State, and Utopia, argue that only a minimal state limited to protecting people against force and fraud and enforcing contracts is justified. Anything else is an intolerable erosion of freedom.

 

Crisis and Leviathan: Critical Episodes in the Growth of American Government by Robert Higgs, Arthur A. Ekirch, Jr.

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Alistair Cooke, clean water, collective bargaining, credit crunch, declining real wages, endowment effect, fiat currency, full employment, hiring and firing, income per capita, Joseph Schumpeter, laissez-faire capitalism, manufacturing employment, means of production, minimum wage unemployment, Plutocrats, plutocrats, post-industrial society, price discrimination, profit motive, rent control, rent-seeking, Richard Thaler, road to serfdom, Ronald Reagan, Simon Kuznets, strikebreaker, The Wealth of Nations by Adam Smith, total factor productivity, transaction costs, transcontinental railway, union organizing, Upton Sinclair, War on Poverty, Works Progress Administration

Herman, Corporate Control, Corporate Power (New York: Cambridge University Press, 1981), pp. 164-172. Every major industrial economy has relatively more government ownership of industry than the United States; and the extent of government ownership has not changed markedly during the post-World War II era in the United States. 11. Charlotte Twight, America's Emerging Fascist Economy (New Rochelle, N.Y.: Arlington House, 1975), Chap. 1; Friedrich A. Hayek, The Road to Serfdom (Chicago: University of Chicago Press, 1944), p. 4. 12. Richard Gillam, "The Peacetime Draft: Voluntarism to Coercion," Yale RetView 57 Oune 1968), reprinted in The Military Draft: Selected Readings on Conscription, ed. Martin Anderson (Stanford: Hoover Institution Press, 1982), p. 113. 13. Alonzo L. Hamby, Liberalism and Its Challengers: FDR to Reagan (New York: Oxford University Press, 1985), p. 307; Frank Freidel, America in the Twentieth Century, 4th ed.

Boston: Houghton Mifflin, 1956. - - . The Anatomy of Power. Boston: Houghton Mifflin, 1983. Greer, Douglas F. Business, Government, and Society. New York: Macmillan, 1983. Hansen, john Mark. "The Political Economy of Group Membership." American Politic,;# Science Review 79 (March 1985). Hardin, Russell. Collective Action. Baltimore: johns Hopkins University Press, 1982. Hayek, Friedrich A. The Road to Serfdom. Chicago: University of Chicago Press, 1944. - - . The Constitution of Liberty. Chicago: University of Chicago Press, 1960. Hechter, Michael. "A Theory of Group Solidarity." In The Micro-foundations of Macrosociology, ed. Michael Hechter. Philadelphia: Temple University Press, 1983. Heertje, Arnold, ed. Schumpeter's Vision: Capitalism, Socialism and Democracy after 40 Years. New York: Praeger, 1981.

 

pages: 478 words: 126,416

Other People's Money: Masters of the Universe or Servants of the People? by John Kay

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Affordable Care Act / Obamacare, asset-backed security, bank run, banking crisis, Basel III, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Swan, Bonfire of the Vanities, bonus culture, Bretton Woods, call centre, capital asset pricing model, Capital in the Twenty-First Century by Thomas Piketty, cognitive dissonance, corporate governance, Credit Default Swap, cross-subsidies, dematerialisation, diversification, diversified portfolio, Edward Lloyd's coffeehouse, Elon Musk, Eugene Fama: efficient market hypothesis, eurozone crisis, financial innovation, financial intermediation, fixed income, Flash crash, forward guidance, Fractional reserve banking, full employment, George Akerlof, German hyperinflation, Goldman Sachs: Vampire Squid, Growth in a Time of Debt, income inequality, index fund, inflation targeting, interest rate derivative, interest rate swap, invention of the wheel, Irish property bubble, Isaac Newton, London Whale, Long Term Capital Management, loose coupling, low cost carrier, M-Pesa, market design, millennium bug, mittelstand, moral hazard, mortgage debt, new economy, Nick Leeson, Northern Rock, obamacare, Occupy movement, offshore financial centre, oil shock, passive investing, peer-to-peer lending, performance metric, Peter Thiel, Piper Alpha, Ponzi scheme, price mechanism, purchasing power parity, quantitative easing, quantitative trading / quantitative finance, railway mania, Ralph Waldo Emerson, random walk, regulatory arbitrage, Renaissance Technologies, rent control, Richard Feynman, risk tolerance, road to serfdom, Robert Shiller, Robert Shiller, Ronald Reagan, Schrödinger's Cat, shareholder value, Silicon Valley, Simon Kuznets, South Sea Bubble, sovereign wealth fund, Spread Networks laid a new fibre optics cable between New York and Chicago, Steve Jobs, Steve Wozniak, The Great Moderation, The Market for Lemons, the market place, The Myth of the Rational Market, the payments system, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Tobin tax, too big to fail, transaction costs, tulip mania, Upton Sinclair, Vanguard fund, Washington Consensus, We are the 99%, Yom Kippur War

., and Sarfraz, S., 2013, ‘Largest 100 Banks in the World’, SNL Financial LC, 23 December. 4. Mirrlees, J.A., et al., 2011, Tax by Design, Oxford, Oxford University Press. 5. I have written such a book, but a long time ago; Kay, J.A., and King, M.A., 1979, The British Tax System, Oxford, Clarendon Press, 5th edn, 1992. 6. Von Mises, L., 1927, Liberalismus, Jena, Gustav Fischer. Hayek, F.A., 1944, The Road to Serfdom, London, Routledge & Kegan Paul. 7. This argument is developed powerfully in Bhidé, A., 2011, A Call for Judgment, Oxford, Oxford University Press. 8. Attributed to Clifford Stoll and Gary Schubert in Keeler, M.R., 2006, Nothing to Hide, Lincoln, NE, iUniverse, Inc., p.112. 9. Though the authorities have discretion not to prosecute, which it is to be hoped they would have exercised. US law, as laid down in the Supreme Court judgement in the Dirks case, requires fraudulent intent; for conviction under European law it is sufficient that the information is price-sensitive – which the fraud certainly was – and that the person knew he was in unauthorised possession of it. 10.

., 2010, ‘The $100 Billion Question’, remarks at the Institute of Regulation and Risk, Hong Kong, 30 March. Haldane, A.G., 2010, ‘Patience and Finance’, Oxford China Business Forum, Beijing, 2 September. Haldane, A., Brennan, S., and Madouras, V., 2010, ‘What is the Contribution of the Financial Sector?’, in The Future of Finance, ed. Turner, A., et al., London, London School of Economics. Harris, R., 2012, The Fear Index, London, Arrow Books. Hayek, F.A., 1944, The Road to Serfdom, London, Routledge & Kegan Paul. Henderson, P.D., 1977, ‘Two British Errors: Their Probable Size and Some Possible Lessons’, Oxford Economic Papers, 29 (2), July, pp. 159–205. Herndon, T., Ash, M., and Pollin, R., 2013, ‘Does High Public Debt Consistently Stifle Economic Growth? A Critique of Reinhart and Rogoff’, University of Amherst, Political Economic Research Institute Working Paper 322.

 

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Life Inc.: How the World Became a Corporation and How to Take It Back by Douglas Rushkoff

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affirmative action, Amazon Mechanical Turk, banks create money, big-box store, Bretton Woods, car-free, colonial exploitation, Community Supported Agriculture, complexity theory, computer age, corporate governance, credit crunch, currency manipulation / currency intervention, David Ricardo: comparative advantage, death of newspapers, don't be evil, Donald Trump, double entry bookkeeping, easy for humans, difficult for computers, financial innovation, Firefox, full employment, global village, Google Earth, greed is good, Howard Rheingold, income per capita, invention of the printing press, invisible hand, Jane Jacobs, John Nash: game theory, joint-stock company, Kevin Kelly, laissez-faire capitalism, loss aversion, market bubble, market design, Marshall McLuhan, Milgram experiment, moral hazard, mutually assured destruction, Naomi Klein, new economy, New Urbanism, Norbert Wiener, peak oil, place-making, placebo effect, Ponzi scheme, price mechanism, price stability, principal–agent problem, private military company, profit maximization, profit motive, race to the bottom, RAND corporation, rent-seeking, RFID, road to serfdom, Ronald Reagan, short selling, Silicon Valley, Simon Kuznets, social software, Steve Jobs, Telecommunications Act of 1996, telemarketer, The Wealth of Nations by Adam Smith, Thomas L Friedman, too big to fail, trade route, trickle-down economics, union organizing, urban decay, urban planning, urban renewal, Vannevar Bush, Victor Gruen, white flight, working poor, Works Progress Administration, Y2K, young professional

It was a leap, but one supported by the decade’s leading psychologists, and one that provided the leaders of the free world with a social model capable of confronting the financial and ideological challenges of managing the postwar industrial economy. While the Soviets struggled to build a centralized bureaucracy that could administrate the needs of all people, free economies turned to the market. In 1944, an Austrian economist named Friedrich Hayek had just finished his seminal work, The Road to Serfdom, in which he argued to his British and American colleagues that all forms of collectivism lead to tyranny. According to Hayek, any central planner will prove incapable of managing resources without resorting to coercive means. The people, desperate for leadership capable of putting bread on the table, would welcome dictatorship and voluntarily surrender their personal and economic freedoms to the promise of greater efficiency.

Bentley Macleod, and Daniel Parent, “Performance Pay and Wage Inequality,” Departmental Working Papers from McGill University, Department of Economics, at http://econpapers.repec.org/paper/mclmclwop/2006-08.htm (accessed May 1, 2008); and, most important to my own argument, Alfie Kohn, No Contest: The Case Against Competition (Boston: Houghton Mifflin, 1992). 149 In 1944, an Austrian economist Friedrich Hayek, The Road to Serfdom (Chicago: University of Chicago Press, 1947). 151 A Paranoid Schizophrenic’s Legacy Robert Boyd and Peter J. Richerson, “Solving the Puzzle of Human Cooperation,” in Evolution and Culture, ed. Stephen C. Levinson and Pierre Jaisson, 105-32 (Cambridge, Mass.: MIT Press, 2005). 151 The think-tank logicians at Rand Rand corporation, or Research and Development Corporation, is a global policy think tank created originally for the U.S.

 

pages: 214 words: 57,614

America at the Crossroads: Democracy, Power, and the Neoconservative Legacy by Francis Fukuyama

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affirmative action, Ayatollah Khomeini, Berlin Wall, Bretton Woods, cuban missile crisis, David Brooks, European colonialism, failed state, Francis Fukuyama: the end of history, Internet Archive, Mikhail Gorbachev, Monroe Doctrine, mutually assured destruction, New Journalism, race to the bottom, RAND corporation, rent-seeking, road to serfdom, Ronald Reagan, Ronald Reagan: Tear down this wall, transaction costs, uranium enrichment, War on Poverty, Washington Consensus

Thus Strauss was neither antipolitical nor antistatist; he, like Aristotle, believed that humans were political by nature and reached their full flourishing only by participating in the life of the city. This is why the Straussian wing of the neoconservative movement always had a problem with libertarian conservatives. Libertarians understand freedom only negatively, as freedom The Neoco?iservative Legacy from government power. In the words of Adam Wolfson, "Libertarians rise to the defense of every conceivable freedom but that of self-government. ... To the neoconservative, the true road to serfdom lies in the efforts of libertarian and left-wing elites to mandate an anti-democratic social policy all in the name of liberty. But it is a narrow, privatized liberty that is secured. An active and lively interest in public affairs is discouraged as a result. Everything is permitted except a say in the shaping of the public ethos." 14 Thus, while Straussians and neoconservatives more broadly were tactically allied with traditional conservatives and libertarians on issues like welfare reform, they understood the problem very differently.

 

State-Building: Governance and World Order in the 21st Century by Francis Fukuyama

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Asian financial crisis, Berlin Wall, Bretton Woods, centre right, corporate governance, demand response, Doha Development Round, European colonialism, failed state, Fall of the Berlin Wall, Francis Fukuyama: the end of history, George Akerlof, Hernando de Soto, Nick Leeson, Potemkin village, price stability, principal–agent problem, rent-seeking, road to serfdom, Ronald Coase, structural adjustment programs, technology bubble, The Market for Lemons, The Nature of the Firm, transaction costs, Washington Consensus

Presidents, Parliaments, and Policy (Cambridge, England: Cambridge University Press). Harriss, John, and Hunter, Janet, et al. 1995. The New Institutional Economics and Third World Development (London: Routledge). Hartcher, Peter. 1998. The Ministry (Boston: Harvard Business School Press). Hassner, Pierre 2002. “Definitions, Doctrines, Divergences,” National Interest No. 69 (fall): 30–34. Hayek, Friedrich A. 1956. The Road to Serfdom (Chicago: University of Chicago Press). ——. 1945. “The Use of Knowledge,” American Economic Review 35(4): 519–30. Heiberg, Marianne, 1994. Subduing Sovereignty: Sovereignty and the Right to Intervene (London: Pinter Publishers). Herbst, Jeffery. 2000. States and Power in Africa (Princeton, NJ: Princeton University Press). Hirschman, Albert O. 1970. Exit, Voice, and Loyalty: Responses to Decline in Firms, Organizations, and States (Cambridge, MA: Harvard University Press).

 

pages: 225 words: 11,355

Financial Market Meltdown: Everything You Need to Know to Understand and Survive the Global Credit Crisis by Kevin Mellyn

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asset-backed security, bank run, banking crisis, Bernie Madoff, bonus culture, Bretton Woods, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, cuban missile crisis, disintermediation, diversification, fiat currency, financial deregulation, financial innovation, financial intermediation, fixed income, Francis Fukuyama: the end of history, global reserve currency, Home mortgage interest deduction, Isaac Newton, joint-stock company, liquidity trap, London Interbank Offered Rate, margin call, market clearing, moral hazard, mortgage tax deduction, Northern Rock, offshore financial centre, paradox of thrift, pattern recognition, pension reform, pets.com, Plutocrats, plutocrats, Ponzi scheme, profit maximization, pushing on a string, reserve currency, risk tolerance, risk-adjusted returns, road to serfdom, Ronald Reagan, shareholder value, Silicon Valley, South Sea Bubble, statistical model, The Great Moderation, the payments system, too big to fail, value at risk, very high income, War on Poverty, Y2K, yield curve

If, on the other hand, the ‘‘new normal’’ is a world of resurgent state socialism—the polite term is ‘‘social democracy’’—all bets are off. Capital markets and capital itself are then in for a long hard siege that could last a generation. At the very least, the financial markets might need to weather a lost decade like the New Deal era. If you wait for financial markets to bounce back, you are discounting the political risk, something that real history suggests is always unwise. One radical budget can set a country on the road to serfdom as the Austro-American economist von Hayek dubbed the drift towards democratic socialism. We have just passed such a budget and heard proposed a blueprint for federal government control of healthcare, energy, transportation, including the auto industry, and, above all, the commanding heights of finance. Even at its most radical state, Roosevelt’s New Deal was never so audacious about changing the very fabric of American life to suit one man’s vision.

 

pages: 192 words: 72,822

Freedom Without Borders by Hoyt L. Barber

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accounting loophole / creative accounting, Affordable Care Act / Obamacare, Albert Einstein, banking crisis, diversification, El Camino Real, estate planning, fiat currency, financial independence, fixed income, high net worth, illegal immigration, interest rate swap, obamacare, offshore financial centre, passive income, quantitative easing, reserve currency, road to serfdom, too big to fail

The author is founder of World Service Authority and has an interesting personal story of individual sovereignty. The Virtues of Selfishness: A New Concept of Egoism, by Ayn Rand. A Signet Book, New American Library, New York, 1964. How I Found Freedom in an Unfree World, by Harry Browne. Avon Books, New York, 1974. The New Approach to Freedom, by E. C. Riegel. The Heather Foundation, San Pedro, CA, 1976. The Road to Serfdom: A Classic Warning against the Dangers to Freedom Inherent in Social Planning, by F. A. Hayek. University of Chicago Press, Chicago, 1976. Flight from Inflation: The Monetary Alternative, by E. C. Riegel. The Heather Foundation, Los Angeles, 1978. Mark Skousen’s Complete Guide to Financial Privacy. Alexandria House Books, Alexandria, VA, 1979. The Market for Liberty, by Morris and Linda Tannehill.

 

pages: 710 words: 164,527

The Battle of Bretton Woods: John Maynard Keynes, Harry Dexter White, and the Making of a New World Order by Benn Steil

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Albert Einstein, Asian financial crisis, banks create money, Bretton Woods, British Empire, capital controls, currency manipulation / currency intervention, currency peg, deindustrialization, European colonialism, facts on the ground, fiat currency, financial independence, floating exchange rates, full employment, global reserve currency, imperial preference, invisible hand, Isaac Newton, John Maynard Keynes: Economic Possibilities for our Grandchildren, Joseph Schumpeter, Kenneth Rogoff, margin call, means of production, money: store of value / unit of account / medium of exchange, Monroe Doctrine, New Journalism, open economy, Potemkin village, price mechanism, price stability, psychological pricing, reserve currency, road to serfdom, seigniorage, South China Sea, special drawing rights, The Great Moderation, the market place, trade liberalization, Works Progress Administration

There must have been some small part of him that rejected this option not because it was futile, but because it would have meant conceding the death of his brainchild—the Clearing Union. On the voyage over, Keynes and the British team, which included Eady, Robbins, and several Bank of England and Foreign Office officials, produced two “boat drafts” dealing with the fund and the bank. Keynes also found time for some leisure reading, which included Friedrich Hayek’s newly published The Road to Serfdom. Keynes penned a response to Hayek, in which he, surely to the chagrin of many of his disciples, called it “a grand book.… Morally and philosophically I find myself in agreement with virtually the whole of it; and not only in agreement, but in a deeply moved agreement.” Keeping to form, however, Keynes then launched a critique, devoting several paragraphs to defending his “middle course” against Hayek’s argument that substituting government planning for markets inevitably led to the loss of individual freedom, as well as declining prosperity.

Dollar report and, 337; Atlantic Charter and, 14, 119, 121, 127; Austerity, Temptation, and Justice alternatives and, 276–79; beggar-thy-neighbor, 31, 144; Beveridge Plan and, 307; Bretton Woods and, 1 (see also Bretton Woods); Clayton’s European integration plan and, 311–16; deficit spending and, 28–29, 46, 189, 278, 358; deflationary, 24, 46, 48, 76–78, 94, 137–38, 142, 144–45, 165, 178, 345; Economic Cooperation Act and, 315; exchange controls and, 178; General Agreement on Tariffs and Trade (GATT) and, 314, 383n7; Gold Reserve Act and, 28, 33–34; gold standard and, 1, 20, 23–25 (see also gold standard); imperial preference and, 14, 115, 121–23, 179–81, 191, 225, 265, 288, 313, 315, 355, 362; Import Duties Act and, 84; import restrictions and, 178; International Monetary Fund (IMF) and, 2, 7, 127, 214, 216, 218, 226–28, 256, 288, 290, 297–301, 304, 310, 315–17, 324, 331–39, 342, 344, 348, 356–58, 366–69, 400n14, 403n93, 404n16; Johnson Act and, 106; Joint Statement by Experts and, 175–85, 187, 191; Joint Statement of Principles and, 198, 210, 215, 248; Keynes Plan and, 138 (see also Keynes Plan); laissez-faire, 20, 74, 77, 93, 140–41, 167, 287–88, 335; Lend-Lease Act and, 3, 14, 105–16 (see also Lend-Lease Act); Marshall Plan and, 7, 107, 142, 312–17, 358, 362–63; The Means to Prosperity and, 86–87; monetary reform and, 4; monetary stabilization, 33 (see also stabilization); Morgenthau Plan and, 177, 266–74, 315, 322, 360; Morrison-Grady Plan and, 307; Munich Agreement and, 50, 100; Nazi-Soviet Pact and, 56–57, 293, 324–25; Neutrality Act and, 106; New Deal and, 1, 6, 21, 32–33, 39, 49, 87, 89, 108, 113, 125, 128, 135, 156, 206–7, 255, 303, 362, 368; New Economic Policy and, 337; Ottawa Agreements and, 120; postwar global peace and, 1; price controls and, 95–96, 311, 331, 338; “Program to Prevent Germany from Starting a World War III” and, 267–68; Silver Purchase Act and, 47, 376n81; Stabilization Fund and, 34, 37, 125, 128, 131, 133, 147, 149, 153, 159, 163, 170, 173, 175–76, 231, 236–37, 254; Treaty of Rome and, 315; Treaty of Versailles and, 71, 363; Tripartite Agreement and, 32–33, 37, 49, 110, 256; Truman Doctrine and, 309; U.S. dollar and, 31 (see also U.S. dollar); White Plan and, 6, 126, 143 (see also White Plan); World Bank and, 127–28, 211, 216, 226, 228, 230, 240, 298–300, 316, 355, 359, 391n127; Yalta accords and, 294 politics: American Communist Party and, 294–96, 360; communism and, 36, 38–39, 43, 45, 97, 99, 225, 239, 288, 293–96, 308–9, 318–21, 324, 328, 330, 347, 356–58, 360, 365, 375n67; Conservative Party and, 276, 369; democracy and, 41–43, 53, 100, 107, 130, 245, 267; Democratic Party and, 6, 19, 105–6, 176, 188, 206–7, 311, 317, 338, 355, 357, 359, 363, 367–68; dollar diplomacy and, 172, 273, 301, 330, 332; espionage and, 36, 273, 298–99, 324, 356, 359–60, 366–68, 376n77; fascism and, 13, 55, 85, 97, 99, 295; House of Commons and, 107, 184, 283, 305; House of Lords and, 85, 169, 184–88, 204, 212, 285, 307; House Special Committee on Un-American Activities (HUAC) and, 296, 318–22; imperialism and, 40, 97, 117, 121, 125, 178, 184, 188, 260, 263, 281, 284, 306; impromptu diplomacy and, 203; internationalists and, 1, 25–26, 39, 140–41, 315; Iron Curtain and, 306–7; isolationism and, 40, 47, 99, 106, 121, 176, 184, 206, 255, 259–60, 306; Keynes and, 65–66, 74, 82–83, 85, 88, 93, 95; Keynesian New Deal Democrats and, 6; Labour Party and, 31, 43, 78, 85, 95, 276, 279, 284, 306, 308, 355–56, 359; League of Nations and, 10, 25–26, 44, 127, 130, 223, 369, 404n28; Marxism and, 39, 83, 86, 88; Mount Washington Hotel and, 10; Nazis and, 56–57, 95, 100, 102, 108, 112, 201, 226, 234, 271–72, 288, 293, 307, 324–25, 356; Nye Commission and, 99, 102; Paris Peace Conference and, 10, 71, 202, 363; partisanship and, 207–8, 245; Pearl Harbor attack and, 53–58; Popular Front and, 32; postwar global peace and, 1–2; protectionism and, 74, 82–83, 87, 135, 226, 311, 313, 334, 338, 362; Republican Party and, 10, 19, 105–6, 176, 188, 206–7, 258, 260, 271, 307–8, 311, 319, 321, 361, 363, 367, 369; Silver Purchase Act and, 47, 376n81; sterling area countries and, 115, 151, 178–81, 185, 191–92, 280, 282, 286; technocrats and, 3, 5, 22, 36, 125, 144, 280, 285; Ten-Point Note and, 55; Treaty of Non-Aggression and, 95; United Nations and, 14, 127, 163, 169, 202, 205, 213, 260, 301, 308, 332; White’s passion for, 17, 19; Wilson’s Fourteen Points and, 71; Zionists and, 306, 359 Popular Front, 32 POWs, 126 Pravdin, Vladimir, 327, 365 price controls, 95–96, 311, 331, 338 Progressive Party, 19, 317 protectionism, 74, 82–83, 87, 135, 226, 311, 313, 334, 338, 362 purchasing power, 29, 92, 95, 342, 345, 384n12 Quarterly Journal of Economics, 92 Queen Elizabeth (ship), 283 Queen Mary (ship), 304 quotas: Bretton Woods negotiations over, 218, 222, 224, 229–48; China and, 235–37, 242–44; France and, 242; India and, 242, 244; Keynes and, 230–31, 237, 243–47; Luxford and, 232, 237, 241–43, 246; Morgenthau and, 229, 231–34, 238–48; Robbins and, 229, 233–34, 242–43, 247; Russia and, 232–44, 247–48; Stepanov and, 233–34, 239–44, 247–48; Vinson and, 242–44; White and, 229–48 Raisman, Jeremy, 243 Reading, Lord (Rufus Isaacs), 69, 365 recession, 33, 46–47, 89, 122, 165, 331, 341 Red Army, 95, 201, 238 reform: Keynes and, 64–65, 75, 137 (see also Keynes Plan); London’s financial center and, 64–65; U.S. Treasury and, 4; White Plan and, 6, 126, 143, 158–59, 164–66, 169–70, 177, 184 (see also White Plan) renminbi, 343, 345 Republican Party, 10, 19, 105–6, 176, 188, 206–7, 258, 260, 271, 307–8, 311, 319, 321, 361, 363, 367, 369 Reserve City Bankers Association, 253–54 Richard (aka Jurist, Lawyer), 291 River Ammonoosuc, 11–12 Road to Serfdom, The (Hayek), 192 Robbins, Lionel: on American delegation, 214, 221, 225; Bank for International Settlements (BIS) and, 227–28; free trade and, 365; Keynes and, 12, 31, 82–83, 140, 170, 192–93, 203, 205, 218–19, 224, 279, 282–83, 392n6; Lend-Lease and, 225; quotas and, 229, 233–34, 242–43, 247; Mount Washington Hotel and, 9; on Norwegian delegation, 226; Vinson and, 242 Robertson, Dennis, 86, 170, 187, 203, 205, 215–16, 251–52, 365, 393n53 Rockefellers, 11, 27 Ronald, Nigel, 226–28, 366 Roosevelt, Franklin Delano (FDR) 365; bankers and, 27; Berle and, 293, 356; Blum and, 32; blunt monetary tactics of, 26–27; Bretton Woods speech of, 13; British war debts and, 102–8; Chamberlain and, 26; Chambers’ confession and, 293; Churchill and, 102–3, 114, 118–23, 129, 201, 261–65, 268, 270–72, 281; death of, 276; devaluation and, 30; distrust of Britain, 25–27; domestic affairs and, 47; espionage and, 295; exchange rate and, 26; federal spending and, 47; Fireside Chats of, 172; global military aggression and, 47; gold-buying operation of, 27–28; Gold Reserve Act and, 28, 33–34; gold standard and, 25, 27, 33; Hull and, 30; Hyde Park estate of, 32; internationalism and, 25–26; isolationism and, 47; Japanese invasions and, 55; Keynes and, 26, 96–97; League of Nations and, 25–26; Lend-Lease and, 108 (see also Lend-Lease Act); lingering Bretton Woods issues and, 253, 259–72, 276, 293–94; London Economic Conference and, 26, 29, 33; macroeconomics and, 262; The Means to Prosperity and, 86–87; Morgenthau Plan and, 267, 269–70; National Recovery Administration and, 87; New Deal and, 21, 87, 206; Octagon and, 261; Pearl Harbor attack and, 53; postwar policy and, 267, 269–70; “Quarantine the Aggressors” speech and, 47; Quebec Agreement and, 261–65, 268, 270–72, 281; questionable legal maneuvering by, 101–2; Sherwood and, 99–100; Ten-Point Note and, 55; Tobey and, 10; ultimatum to Japan and, 55–56; undervalued currencies and, 25–26; U.S. dollar and, 26–28, 108; U.S.

 

pages: 336 words: 90,749

How to Fix Copyright by William Patry

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A Declaration of the Independence of Cyberspace, barriers to entry, big-box store, borderless world, business intelligence, citizen journalism, cloud computing, crowdsourcing, death of newspapers, en.wikipedia.org, facts on the ground, Frederick Winslow Taylor, George Akerlof, Gordon Gekko, haute cuisine, informal economy, invisible hand, Joseph Schumpeter, Kickstarter, knowledge economy, lone genius, means of production, new economy, road to serfdom, Ronald Coase, Ronald Reagan, semantic web, shareholder value, Silicon Valley, The Chicago School, The Wealth of Nations by Adam Smith, trade route, transaction costs, trickle-down economics, web application, winner-take-all economy

For a more liberal approach to the three-step test, see the July 17, 2008 “A Balanced Interpretation of the Three-Step Test in Copyright Law,” available at: http://www.ip.mpg.de/ww/de/pub/ aktuelles/declaration_on_the_three_step_.cfm. 11. C/508, July 16, 2009 (ECJ) [2009] ECDR 16, ably discussed in Jonathan Griffiths, Unsticking the centre-piece—the liberation of European copyright law?, 1 (2010) JIPITEC 87, paragraph 1. 12. See Article 5 of the Directive. 13. The reference is to Hayek’s Road to Serfdom. 14. The general distinction between an exemption and a privilege is that with an exemption if you fall into a class of people covered by the exemption you are entitled to its benefits. With privileges, there is no class-based entitlement; rather each person must, on an ad hoc basis, prove their entitlement. The distinction does not hold in all cases, though, and sometimes the terms are used interchangeably. 15.

 

pages: 328 words: 92,317

Machinery of Freedom: A Guide to Radical Capitalism by David Friedman

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back-to-the-land, Fractional reserve banking, hiring and firing, jitney, laissez-faire capitalism, Machinery of Freedom by David Friedman, means of production, rent control, road to serfdom, Ronald Coase, Ronald Reagan, Stewart Brand, The Wealth of Nations by Adam Smith, transaction costs, urban renewal, Vernor Vinge, Whole Earth Catalog

An explanation of evolutionary biology and sociobiology — the economics of genes. One of the most interesting books I have read in recent years. Paul Goodman, People or Personnel: Decentralizing and the Mixed System (New York: Random House, 1965). Hard to classify. Paul Goodman was not the leftist some leftists think he was; he was a libertarian and an anarchist. His books are variable, with a lot of good ideas. Friedrich A. Hayek, The Road to Serfdom (Chicago: University of Chicago Press, 1944). Hayek argues that a centrally planned economy must lead to totalitarianism. Sonia Orwell and Ian Angus, eds., The Collected Essays, Journalism and Letters of George Orwell. (New York: Harcourt Brace, 1968). Orwell is my favorite political essayist. He was a socialist with libertarian sympathies, who recognized many of the problems with socialism but saw no better alternative.

 

pages: 317 words: 87,566

The Happiness Industry: How the Government and Big Business Sold Us Well-Being by William Davies

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1960s counterculture, Airbnb, business intelligence, Cass Sunstein, corporate governance, dematerialisation, experimental subject, Exxon Valdez, Frederick Winslow Taylor, Gini coefficient, income inequality, invisible hand, joint-stock company, market bubble, mental accounting, nudge unit, profit maximization, randomized controlled trial, Richard Thaler, road to serfdom, Ronald Coase, Ronald Reagan, science of happiness, sentiment analysis, sharing economy, Slavoj Žižek, smart cities, Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, Steve Jobs, The Chicago School, The Spirit Level, theory of mind, urban planning

In 2007, three UK education authorities sent 100 British teachers to visit the Penn Resilience Project, so as to recreate it in the UK. 6‘Work for World Peace Starting Now – Google’s “Jolly Good Fellow” Can Help’, huffingtonpost.com, 27 March 2012. 7Sarah Knapton, ‘Stressed Council House Residents Get £2,000 Happiness Gurus’, telegraph.co.uk, 9 October 2008. 8Fabienne Picard, Didier Scavarda and Fabrice Bartolomei, ‘Induction of a Sense of Bliss by Electrical Stimulation of the Anterior Insula’, Cortex 49: 10, 2013; ‘Pain “Dimmer Switch” Discovered by UK Scientists’, bbc.com, 5 February 2014. 9Gary Wolf, ‘Measuring Mood: Current Research and New Ideas’, quantifiedself.com, 11 February 2009. 10Friedrich Nietzsche, Twilight of the Idols and The Anti-Christ, New York: Penguin, 1990, 33. 11Campbell and Simmons, ‘At Davos, Rising Stress Spurs Goldie Hawn Meditation Talk’. 12See Richard Wilkinson and Kate Pickett, The Spirit Level: Why More Equal Societies Almost Always Do Better, London: Allen Lane, 2009. Work by Carles Muntaner explores this issue further. 13Gallup, State of the Global Workplace Report 2013, 2013 14Adam Kramer, Jamie Guillory and Jeffrey Hancock, ‘Experimental Evidence of Massive-Scale Emotional Contagion Through Social Networks’, Proceedings of the National Academy of the Sciences 111: 24, 2014. 15F. A. Hayek, The Road to Serfdom, London: Routledge, 1944. 1 Knowing How You Feel 1‘Hume was in all his glory, the phrase was consequently familiar to everybody. The difference between me and Hume was this: the use he made of it was to account for that which is, I to show what ought to be.’ Quoted in Charles Milner Atkinson, Jeremy Bentham: His Life and Work, Lenox, Mass.: Hard Press, 2012, 30. 2See Philip Schofield, Catherine Pease-Watkin and Michael Quinn, eds., Of Sexual Irregularities, and Other Writings on Sexual Morality, Oxford: Oxford University Press, 2014. 3Quoted in Atkinson, Jeremy Bentham: His Life and Work, 109. 4Ibid., 222. 5Jeremy Bentham, The Principles of Morals and Legislation, Amherst, NY: Prometheus Books, 1988, 20. 6Ibid., 70. 7Joanna Bourke, The Story of Pain: From Prayer to Painkillers, Oxford: Oxford University Press, 2014. 8Junichi Chikazoe, Daniel Lee, Nikolaus Kriegeskorte and Adam Anderson, ‘Population Coding of Affect Across Stimuli, Modalities and Individuals’, Nature Neuroscience, 17: 8, 2014. 9This is not undisputed, but for a convincing argument for Bentham’s monistic philosophy, see Michael Quinn, ‘Bentham on Mensuration: Calculation and Moral Reasoning’, Utilitas 26: 1, 2014. 10Bentham, The Principles of Morals and Legislation, 9. 11Ibid., 29–30. 12Immanuel Kant, ‘An Answer to the Question “What is Enlightenment?”’

 

pages: 357 words: 95,986

Inventing the Future: Postcapitalism and a World Without Work by Nick Srnicek, Alex Williams

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3D printing, additive manufacturing, air freight, algorithmic trading, anti-work, back-to-the-land, banking crisis, battle of ideas, blockchain, Bretton Woods, call centre, capital controls, carbon footprint, Cass Sunstein, centre right, collective bargaining, crowdsourcing, cryptocurrency, David Graeber, decarbonisation, deindustrialization, deskilling, Doha Development Round, Elon Musk, Erik Brynjolfsson, Ferguson, Missouri, financial independence, food miles, Francis Fukuyama: the end of history, full employment, future of work, gender pay gap, housing crisis, income inequality, industrial robot, informal economy, intermodal, Internet Archive, job automation, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, late capitalism, low skilled workers, manufacturing employment, market design, Martin Wolf, means of production, minimum wage unemployment, Mont Pelerin Society, neoliberal agenda, New Urbanism, Occupy movement, oil shale / tar sands, oil shock, patent troll, pattern recognition, post scarcity, postnationalism / post nation state, precariat, price stability, profit motive, quantitative easing, reshoring, Richard Florida, rising living standards, road to serfdom, Robert Gordon, Ronald Reagan, Second Machine Age, secular stagnation, self-driving car, Slavoj Žižek, social web, stakhanovite, Steve Jobs, surplus humans, the built environment, The Chicago School, Tyler Cowen: Great Stagnation, universal basic income, wages for housework, We are the 99%, women in the workforce, working poor, working-age population

Grossberg, eds, Marxism and the Interpretation of Culture (Chicago: University of Illinois Press, 1990). 26.Ibid., p. 356. 27.Schumacher, Small Is Beautiful; Carl Honoré, In Praise of Slow: Challenging the Cult of Speed (New York: HarperSanFrancisco, 2005). 28.Rosa Luxemburg, The Essential Rosa Luxemburg: Reform or Revolution and the Mass Strike, ed. Helen Scott (Chicago: Haymarket, 2008), p. 68. 29.Friedrich Hayek, The Road to Serfdom (London: Routledge, 1962); and ‘The Theory of Complex Phenomena’, in Michael Martin and Lee McIntyre, eds, Readings in the Philosophy of Social Science (Cambridge, MA: MIT Press, 1964). 30.This is the question at the heart of the socialist calculation debate. See Oskar Lange and Fred M. Taylor, On the Economic Theory of Socialism (New York: McGraw-Hill, 1964); Fikret Adaman and Pat Devine, ‘The Economics Calculation Debate: Lessons for Socialists’, Cambridge Journal of Economics 20: 5 (September 1996); Allin Cottrell and Paul Cockshott, ‘Calculation, Complexity and Planning: The Socialist Calculation Debate Once Again’, Review of Political Economy 5: 1 (1993). 31.It is important to note here that ‘the left’ is an ultimately artificial if useful term, used to describe an incredibly diverse and potentially contradictory set of political and social forces.

 

pages: 370 words: 102,823

Rethinking Capitalism: Economics and Policy for Sustainable and Inclusive Growth by Michael Jacobs, Mariana Mazzucato

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3D printing, balance sheet recession, banking crisis, Bernie Sanders, Bretton Woods, business climate, Carmen Reinhart, central bank independence, collaborative economy, complexity theory, conceptual framework, corporate governance, corporate social responsibility, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, decarbonisation, deindustrialization, dematerialisation, Detroit bankruptcy, double entry bookkeeping, Elon Musk, energy security, eurozone crisis, factory automation, facts on the ground, fiat currency, Financial Instability Hypothesis, financial intermediation, forward guidance, full employment, Gini coefficient, Growth in a Time of Debt, Hyman Minsky, income inequality, Internet of things, investor state dispute settlement, invisible hand, Isaac Newton, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, labour market flexibility, low skilled workers, Martin Wolf, Mont Pelerin Society, neoliberal agenda, Network effects, new economy, non-tariff barriers, paradox of thrift, price stability, private sector deleveraging, quantitative easing, QWERTY keyboard, railway mania, rent-seeking, road to serfdom, savings glut, Second Machine Age, secular stagnation, shareholder value, sharing economy, Silicon Valley, Steve Jobs, the built environment, The Great Moderation, The Spirit Level, Thorstein Veblen, too big to fail, total factor productivity, transaction costs, trickle-down economics, universal basic income, very high income

Bump, ‘Here’s just how much the Koch Brothers are planning to spend on the 2016 election’, Washington Post, 27 January 2015. 23 W. Merkel, ‘Is capitalism compatible with democracy?’, Zeitschrift für Vergleichende Politikwissenschaft, vol. 8, no. 2, 2014, pp. 109–28; W. Streeck, ‘Comment on Wolfgang Merkel, “Is capitalism compatible with democracy?”’, Zeitschrift für Vergleichende Politikwissenschaft, vol. 9, no. 1, 2015, pp. 49–60. 24 F. A. von Hayek, The Road to Serfdom, London, Routledge, 1944; Individualism and Economic Order, London, Routledge, 1948; The Constitution of Liberty, Chicago, IL, Chicago University Press, 1960. For detailed analyses of the anti-democratic tendencies in Hayek’s thought, see Mirowski, Never Let a Good Crisis Go to Waste, and W. Streeck, Gekaufte Zeit, Berlin, Suhrkamp, 2013. 25 C. Crouch, Post-democracy, Cambridge, Polity Press, 2004. 26 C.

 

pages: 261 words: 86,905

How to Speak Money: What the Money People Say--And What It Really Means by John Lanchester

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asset allocation, Basel III, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Swan, blood diamonds, Bretton Woods, BRICs, Capital in the Twenty-First Century by Thomas Piketty, Celtic Tiger, central bank independence, collapse of Lehman Brothers, collective bargaining, credit crunch, Credit Default Swap, crony capitalism, Dava Sobel, David Graeber, disintermediation, double entry bookkeeping, en.wikipedia.org, estate planning, financial innovation, Flash crash, forward guidance, Gini coefficient, global reserve currency, high net worth, High speed trading, hindsight bias, income inequality, inflation targeting, interest rate swap, Isaac Newton, Jaron Lanier, joint-stock company, joint-stock limited liability company, Kodak vs Instagram, liquidity trap, London Interbank Offered Rate, London Whale, loss aversion, margin call, McJob, means of production, microcredit, money: store of value / unit of account / medium of exchange, moral hazard, neoliberal agenda, New Urbanism, Nick Leeson, Nikolai Kondratiev, Nixon shock, Northern Rock, offshore financial centre, oil shock, open economy, paradox of thrift, Plutocrats, plutocrats, Ponzi scheme, purchasing power parity, pushing on a string, quantitative easing, random walk, rent-seeking, reserve currency, Richard Feynman, Richard Feynman, road to serfdom, Ronald Reagan, Satoshi Nakamoto, security theater, shareholder value, Silicon Valley, six sigma, South Sea Bubble, sovereign wealth fund, Steve Jobs, The Chicago School, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, trickle-down economics, Washington Consensus, working poor, yield curve

An inflation hawk is someone who is sharply on the lookout for signs of inflation, and is at any moment likely to announce that interest rates should be raised to keep inflation down. Quantitative easing gives inflation hawks the conniptions. The opposite of a hawk is a dove. Hayek, Friedrich (1899–1992) An Austrian-born philosopher and economist who was one of the driving forces behind the rise of neoliberal economics in Britain and America. His book The Road to Serfdom, first published during the Second World War, had a strong impact: it argued that state planning and intervention in the economy had over time an inevitably negative effect on individual liberties. Central planning, in Hayek’s view, led inexorably towards totalitarianism. Hayek was an interesting thinker whose works are still readable today, and are more subtle and inflected than one might think from the cartoon version that was adopted by the political right.

 

pages: 332 words: 89,668

Two Nations, Indivisible: A History of Inequality in America: A History of Inequality in America by Jamie Bronstein

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Affordable Care Act / Obamacare, back-to-the-land, barriers to entry, Bernie Sanders, big-box store, blue-collar work, Branko Milanovic, British Empire, Capital in the Twenty-First Century by Thomas Piketty, clean water, cognitive dissonance, collateralized debt obligation, collective bargaining, Community Supported Agriculture, corporate personhood, crony capitalism, deindustrialization, desegregation, Donald Trump, ending welfare as we know it, Frederick Winslow Taylor, full employment, Gini coefficient, income inequality, interchangeable parts, invisible hand, job automation, John Maynard Keynes: technological unemployment, labor-force participation, land reform, land tenure, low skilled workers, low-wage service sector, minimum wage unemployment, moral hazard, mortgage debt, New Urbanism, non-tariff barriers, obamacare, occupational segregation, Occupy movement, oil shock, Plutocrats, plutocrats, price discrimination, race to the bottom, rent control, road to serfdom, Ronald Reagan, Scientific racism, Simon Kuznets, single-payer health, strikebreaker, too big to fail, trade route, transcontinental railway, Triangle Shirtwaist Factory, trickle-down economics, universal basic income, Upton Sinclair, upwardly mobile, urban renewal, wage slave, War on Poverty, women in the workforce, working poor, Works Progress Administration

Margo, “The Great Compression: The Wage Structure in the United States at Mid-Century,” Quarterly Journal of Economics vol. 107 no. 1 (February 1992): 1–34; Jeffrey G. Williamson and Peter Lindert, American Inequality: A Macroeconomic History (New York: Academic Press, 1980), 94. 3. Dale W. Jorgenson, “Productivity and Postwar U.S. Economic Growth,” Journal of Economic Perspectives vol. 2 no. 4 (Fall 1988): 23–41, at 24. 4. Theodore Rosenof, “Freedom, Planning, and Totalitarianism: The Reception of F.A. Hayek’s ‘The Road to Serfdom,’ ” Canadian Review of American Studies vol. 5 no. 2 (1974): 149–165. 5. Michael K. Brown, “Bargaining for Social Rights: Unions and the Reemergence of Welfare Capitalism, 1945–1952,” Political Science Quarterly vol. 112 no. 4 (1997): 645–672. 6. Leslie Lenkowsky, “Welfare Reform and the Liberals,” Commentary vol. 67 no. 3 (1979): 56–61, at 58. 7. “Layoff Cut Seen in Auto Industry,” New York Times, April 5, 1975, p. 37; Agis Salpukas, “22 of Ford Plants to Shut for Week; Closings Will Affect 55% of the Company’s Hourly Work Force in U.S.,” New York Times, January 11, 1975, L1; “Down and Out in America,” New York Times, February 9, 1975, 221. 8.

 

pages: 326 words: 103,170

The Seventh Sense: Power, Fortune, and Survival in the Age of Networks by Joshua Cooper Ramo

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Airbnb, Albert Einstein, algorithmic trading, barriers to entry, Berlin Wall, bitcoin, British Empire, cloud computing, crowdsourcing, Danny Hillis, defense in depth, Deng Xiaoping, Edward Snowden, Fall of the Berlin Wall, Firefox, Google Chrome, income inequality, Isaac Newton, Jeff Bezos, job automation, market bubble, Menlo Park, natural language processing, Network effects, Norbert Wiener, Oculus Rift, packet switching, Paul Graham, price stability, quantitative easing, RAND corporation, recommendation engine, Republic of Letters, Richard Feynman, Richard Feynman, road to serfdom, Sand Hill Road, secular stagnation, self-driving car, Silicon Valley, Skype, Snapchat, social web, sovereign wealth fund, Steve Jobs, Steve Wozniak, Stewart Brand, Stuxnet, superintelligent machines, technological singularity, The Coming Technological Singularity, The Wealth of Nations by Adam Smith, too big to fail, Vernor Vinge, zero day

In our connected age: Barbara van Schewick, “Foundations,” in Internet Architecture and Innovation (Cambridge, MA: MIT Press, 2010), 19–36. “When you decide what infrastructure to use”: Paul Graham, “Great Hackers” (July 2004), on paulgraham.com, http://www.paulgraham.com/gh.html. “Contrary to the popular belief”: Karl A. Wittfogel, Oriental Despotism: A Comparative Study of Total Power (New Haven, CT: Yale University Press, 1957). “Is there a greater tragedy”: F. A. Hayek, The Road to Serfdom (London: Routledge Classics, 2001), 5. Churchill’s famous line: Winston Churchill, speech to House of Commons, November 11, 1947, at http://hansard.millbanksystems.com/commons/1947/nov/11/parliament-bill. Chapter 3. WAR, PEACE, NETWORKS “The war you prepare for”: Victor H. Krulak, “A New Kind of War,” in First to Fight: An Inside View of the U.S. Marine Corps (Annapolis, MD: Naval Institute Press, 1984), 179.

 

pages: 111 words: 1

Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets by Nassim Nicholas Taleb

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Antoine Gombaud: Chevalier de Méré, availability heuristic, backtesting, Benoit Mandelbrot, Black Swan, complexity theory, corporate governance, currency peg, Daniel Kahneman / Amos Tversky, discounted cash flows, diversified portfolio, endowment effect, equity premium, global village, hindsight bias, Long Term Capital Management, loss aversion, mandelbrot fractal, mental accounting, meta analysis, meta-analysis, quantitative trading / quantitative finance, QWERTY keyboard, random walk, Richard Feynman, Richard Feynman, road to serfdom, Robert Shiller, Robert Shiller, shareholder value, Sharpe ratio, Steven Pinker, stochastic process, too big to fail, Turing test, Yogi Berra

.: Harvard University Press. Hacking, Ian, 1990, The Taming of Chance. Cambridge, Eng.: Cambridge University Press. Hacohen, Malachi Haim, 2001, Karl Popper, The Formative Years, 1902–1945: Politics and Philosophy in Interwar Vienna. Cambridge, Eng.: Cambridge University Press. Hayek, F. A., 1945, “The Use of Knowledge in Society.” American Economic Review, 35(4), 519–530. Hayek, F. A., 1994, The Road to Serfdom. Chicago: University of Chicago Press. Hilton, Denis, 2003, “Psychology and the Financial Markets: Applications to Understanding and Remedying Irrational Decision-making.” In Brocas and Carillo. Hirshleifer, J., and J. G. Riley, 1992, The Analytics of Uncertainty and Information. Cambridge, Eng.: Cambridge University Press. Horrobin, David, 2002, Madness of Adam and Eve: How Schizophrenia Shaped Humanity.

 

pages: 483 words: 141,836

Red-Blooded Risk: The Secret History of Wall Street by Aaron Brown, Eric Kim

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Albert Einstein, algorithmic trading, Asian financial crisis, Atul Gawande, backtesting, Basel III, Benoit Mandelbrot, Bernie Madoff, Black Swan, capital asset pricing model, central bank independence, Checklist Manifesto, corporate governance, credit crunch, Credit Default Swap, disintermediation, distributed generation, diversification, diversified portfolio, Emanuel Derman, Eugene Fama: efficient market hypothesis, experimental subject, financial innovation, illegal immigration, implied volatility, index fund, Long Term Capital Management, loss aversion, margin call, market clearing, market fundamentalism, market microstructure, money: store of value / unit of account / medium of exchange, moral hazard, natural language processing, open economy, pre–internet, quantitative trading / quantitative finance, random walk, Richard Thaler, risk tolerance, risk-adjusted returns, risk/return, road to serfdom, Robert Shiller, Robert Shiller, shareholder value, Sharpe ratio, special drawing rights, statistical arbitrage, stochastic volatility, The Myth of the Rational Market, too big to fail, transaction costs, value at risk, yield curve

[to] know less . . . and that a method . . . should be deemed superior because of our ignorance of its precise results. Yet this consideration is in fact the rationale of the great liberal principle of the Rule of Law. And the apparent paradox dissolves rapidly when we follow the argument a little further. To be impartial means to have no answer to certain questions which, if we have to decide them, we decide by tossing a coin. Friedrich A. Von Hayek. The Road to Serfdom, University of Chicago Press: Chicago, 1945 In other words, a legislator or judge can do a better job if she deals only with general principles without knowing in advance the precise effects of laws or decisions. That is why justice is blind: she hears only the facts of the case; she does not see anything else to make her prefer plaintiff or defendant. Her decision is to be based on principles, not predictions of effects.

 

pages: 482 words: 122,497

The Wrecking Crew: How Conservatives Rule by Thomas Frank

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affirmative action, anti-communist, barriers to entry, Berlin Wall, Bernie Madoff, British Empire, collective bargaining, corporate governance, Credit Default Swap, David Brooks, edge city, financial deregulation, full employment, George Gilder, guest worker program, income inequality, invisible hand, job satisfaction, Mikhail Gorbachev, Mont Pelerin Society, mortgage debt, Naomi Klein, new economy, P = NP, Plutocrats, plutocrats, Ponzi scheme, Ralph Nader, rent control, Richard Florida, road to serfdom, rolodex, Ronald Reagan, school vouchers, shareholder value, Silicon Valley, stem cell, Telecommunications Act of 1996, the scientific method, too big to fail, union organizing, War on Poverty

The description of laissez-faire can be found in the IFF’s newsletter, Freedom Bulletin 5, no. 4 (April 1991), p. 2. The issue of terra nova dedicated to Hayek was vol. 1, no. 3 (Spring 1992). See especially the Hayek memorial (p. 3) written by John Blundell, then president of the Charles G. Koch Foundation and today the vice president of the Mont Pelerin Society. The lucky South African politician who got the autographed copy of The Road to Serfdom was Mangosuthu Buthelezi, a perennial IFF favorite. The presentation is depicted in Freedom Bulletin 5, no. 5 (May 1991), p. 5. The presentation of the “Freedom Award” to Vaclav Klaus is described in Freedom Bulletin 5, no. 1 (January 1991), p. 1. 25. Or, more accurately, advocating “a return to market hunting” of deer. See Ronald Bailey, “North America’s Most Dangerous Animal,” Reason, November 21, 2001. 26.

 

pages: 376 words: 118,542

Free to Choose: A Personal Statement by Milton Friedman, Rose D. Friedman

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affirmative action, agricultural Revolution, air freight, back-to-the-land, bank run, banking crisis, Corn Laws, Fractional reserve banking, full employment, German hyperinflation, invisible hand, labour mobility, means of production, minimum wage unemployment, oil shale / tar sands, oil shock, price stability, Ralph Nader, RAND corporation, rent control, road to serfdom, school vouchers, Simon Kuznets, The Wealth of Nations by Adam Smith, union organizing, Unsafe at Any Speed, Upton Sinclair, urban renewal, War on Poverty, working poor, Works Progress Administration

The experience of recent years—slowing growth and declining productivity—raises a doubt whether private ingenuity can continue to overcome the deadening effects of government control if we continue to grant ever more power to government, to authorize a "new class" of civil servants to spend ever larger fractions of our income supposedly on our behalf. Sooner or later—and perhaps sooner than many of us expect—an ever bigger government would destroy both the prosperity that we owe to the free market and the human freedom proclaimed so eloquently in the Declaration of Independence. We have not yet reached the point of no return. We are still free as a people to choose whether we shall continue speeding down the "road to serfdom," as Friedrich Hayek entitled his profound and influential book, or whether we shall set tighter limits on government and rely more heavily on voluntary cooperation among free individuals to achieve our several objectives. Will our golden age come to an end in a relapse into the tyranny and misery that has always been, and remains today, the state of most of mankind? Or shall we have the wisdom, the foresight, and the courage to change our course, to learn from experience, and to benefit from a "rebirth of freedom"?

 

Culture and Prosperity: The Truth About Markets - Why Some Nations Are Rich but Most Remain Poor by John Kay

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Albert Einstein, Asian financial crisis, Barry Marshall: ulcers, Berlin Wall, Big bang: deregulation of the City of London, California gold rush, complexity theory, computer age, constrained optimization, corporate governance, corporate social responsibility, correlation does not imply causation, Daniel Kahneman / Amos Tversky, David Ricardo: comparative advantage, Donald Trump, double entry bookkeeping, double helix, Edward Lloyd's coffeehouse, equity premium, Ernest Rutherford, European colonialism, experimental economics, Exxon Valdez, failed state, financial innovation, Francis Fukuyama: the end of history, George Akerlof, George Gilder, greed is good, haute couture, illegal immigration, income inequality, invention of the telephone, invention of the wheel, invisible hand, John Nash: game theory, John von Neumann, Kevin Kelly, knowledge economy, labour market flexibility, late capitalism, Long Term Capital Management, loss aversion, Mahatma Gandhi, market bubble, market clearing, market fundamentalism, means of production, Menlo Park, Mikhail Gorbachev, money: store of value / unit of account / medium of exchange, moral hazard, Naomi Klein, Nash equilibrium, new economy, oil shale / tar sands, oil shock, pets.com, popular electronics, price discrimination, price mechanism, prisoner's dilemma, profit maximization, purchasing power parity, QWERTY keyboard, Ralph Nader, RAND corporation, random walk, rent-seeking, risk tolerance, road to serfdom, Ronald Coase, Ronald Reagan, second-price auction, shareholder value, Silicon Valley, Simon Kuznets, South Sea Bubble, Steve Jobs, telemarketer, The Chicago School, The Death and Life of Great American Cities, The Market for Lemons, The Nature of the Firm, The Predators' Ball, The Wealth of Nations by Adam Smith, Thorstein Veblen, total factor productivity, transaction costs, tulip mania, urban decay, Washington Consensus, women in the workforce, yield curve, yield management

And that is why The Wealth ofNations holds only the limited interest for us today that the works ofNewton have for a modern physicist or engineer. 5 Smith's important insights-such as the division of labor and the loose but prescient notion that coordination might be achieved through spontaneous order-have been absorbed and developed in the corpus of current knowledge. Friedrich von Hayekn was largely neglected in modern economic thought until he was an unexpected recipient of the Nobel Prize in 1974. In the last years ofhis life, he was lionized by business and politicalleaders. It is hard to imagine many of them had read his works. Hayek's most cited work in this context is the extravagantly titled The Road to Serfdom) a denunciation of planning and social welfare systems. Culture and Prosperity { 199} Hayek's style is at once Delphic and dogmatic. In Hayek's mind his opponents are usually not just wrong, but mentally and morally defective. But Hayek articulated more clearly than any other twentiethcentury economist the concept of spontaneous order. And-along with a fellow Austrian, Ludwig von Mises-Hayek was one of the first to see that the information problems of planned economies were intractable.

 

pages: 331 words: 60,536

The Sovereign Individual: How to Survive and Thrive During the Collapse of the Welfare State by James Dale Davidson, Rees Mogg

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affirmative action, agricultural Revolution, bank run, barriers to entry, Berlin Wall, borderless world, British Empire, California gold rush, clean water, colonial rule, Columbine, compound rate of return, Danny Hillis, debt deflation, ending welfare as we know it, epigenetics, Fall of the Berlin Wall, falling living standards, feminist movement, financial independence, Francis Fukuyama: the end of history, full employment, George Gilder, Hernando de Soto, illegal immigration, income inequality, informal economy, information retrieval, Isaac Newton, Kevin Kelly, market clearing, Martin Wolf, Menlo Park, money: store of value / unit of account / medium of exchange, new economy, New Urbanism, offshore financial centre, Parkinson's law, pattern recognition, phenotype, price mechanism, profit maximization, rent-seeking, reserve currency, road to serfdom, Ronald Coase, school vouchers, seigniorage, Silicon Valley, spice trade, statistical model, telepresence, The Nature of the Firm, the scientific method, The Wealth of Nations by Adam Smith, Thomas L Friedman, Thomas Malthus, trade route, transaction costs, Turing machine, union organizing, very high income

Some of the shrewdest observers of the mid-twentieth century became convinced on the evidence of the day that the tendency of the nation-state to centralize power would lead to totalitarian domination over all aspects of life. In George Orwell's 1984 (1949), Big Brother was watching the individual vainly struggle to maintain a margin of autonomy and self-respect. It appeared to be a losing cause. Friedrich von Hayek's The Road to Serfdom (1944) took a more scholarly view in arguing that freedom was being lost to a new form of economic control that left the state as the master of everything. These works were written before the advent of microprocessing, which has incubated a whole range of technologies that enhance the capacity of small groups and even individuals to function independently of central authority. As shrewd as observers like Hayek and Orwell were, they were unduly pessimistic.

 

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Political Order and Political Decay: From the Industrial Revolution to the Globalization of Democracy by Francis Fukuyama

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Affordable Care Act / Obamacare, Andrei Shleifer, Asian financial crisis, Atahualpa, banking crisis, barriers to entry, Berlin Wall, blood diamonds, British Empire, centre right, clean water, collapse of Lehman Brothers, colonial rule, conceptual framework, crony capitalism, deindustrialization, Deng Xiaoping, double entry bookkeeping, Edward Snowden, Erik Brynjolfsson, European colonialism, facts on the ground, failed state, Fall of the Berlin Wall, first-past-the-post, Francis Fukuyama: the end of history, Francisco Pizarro, Frederick Winslow Taylor, full employment, Gini coefficient, Hernando de Soto, Home mortgage interest deduction, income inequality, invention of the printing press, iterative process, knowledge worker, land reform, land tenure, life extension, low skilled workers, manufacturing employment, means of production, Menlo Park, Mohammed Bouazizi, Monroe Doctrine, moral hazard, new economy, open economy, out of africa, Peace of Westphalia, Port of Oakland, post-industrial society, Post-materialism, post-materialism, price discrimination, quantitative easing, RAND corporation, rent-seeking, road to serfdom, Ronald Reagan, Scientific racism, Scramble for Africa, Second Machine Age, Silicon Valley, special economic zone, stem cell, the scientific method, The Wealth of Nations by Adam Smith, Thomas L Friedman, Thomas Malthus, too big to fail, trade route, transaction costs, Tyler Cowen: Great Stagnation, women in the workforce, World Values Survey

The Kansas City Investigation: Pendergast’s Downfall, 1938–1939. Columbia: University of Missouri Press. Hartz, Louis. 1955. The Liberal Tradition in America. New York: Harcourt. ______. 1964. The Founding of New Societies. New York: Harcourt. Hausmann, Ricardo, Lant Pritchett, and Dani Rodrik. 2005. “Growth Accelerations.” Journal of Economic Growth 10(4):303–29. Hayek, Friedrich A. 1944. The Road to Serfdom. Chicago: University of Chicago Press. ______. 1976. Law, Legislation and Liberty. Chicago: University of Chicago Press. ______. 2011. The Constitution of Liberty. Definitive edition. Chicago: University of Chicago Press. Heady, Ferrel. 2001. Public Administration: A Comparative Perspective. 6th ed. New York: Marcel Dekker. Heidenheimer, Arnold J., and Peter Flora, eds. 1981. The Development of the Welfare States in Europe and America.

 

pages: 934 words: 232,651

Iron Curtain: The Crushing of Eastern Europe, 1945-1956 by Anne Applebaum

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affirmative action, anti-communist, Berlin Wall, centre right, deindustrialization, Fall of the Berlin Wall, falling living standards, hiring and firing, illegal immigration, indoor plumbing, Internet Archive, Johann Wolfgang von Goethe, land reform, language of flowers, means of production, New Urbanism, Potemkin village, price mechanism, road to serfdom, Ronald Reagan, Slavoj Žižek, stakhanovite, strikebreaker, union organizing, urban planning

Mussolini and his favorite philosopher, Giovanni Gentile, once wrote of a “conception of the State” that is “all-embracing; outside of it no human or spiritual values can exist, much less have value.”4 From Italian, the word “totalitarianism” spread into all the languages of Europe and the world. After Mussolini’s demise the concept had few open advocates, however, and the word eventually came to be defined by its critics, many of whom number among the twentieth century’s greatest thinkers.5 Friedrich Hayek’s Road to Serfdom is a philosophical response to the challenge of totalitarianism, as is Karl Popper’s The Open Society and Its Enemies. George Orwell’s Nineteen Eighty-four is a dystopian vision of a world entirely dominated by totalitarian regimes. Probably the greatest student of totalitarian politics was Hannah Arendt, who defined totalitarianism in her 1949 book, The Origins of Totalitarianism, as a “novel form of government” made possible by the onset of modernity.

 

pages: 1,327 words: 360,897

Demanding the Impossible: A History of Anarchism by Peter Marshall

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agricultural Revolution, anti-communist, Bertrand Russell: In Praise of Idleness, clean water, collective bargaining, colonial rule, David Graeber, feminist movement, garden city movement, hive mind, Howard Zinn, invisible hand, laissez-faire capitalism, land reform, land tenure, Lao Tzu, Machinery of Freedom by David Friedman, Mahatma Gandhi, means of production, Naomi Klein, open borders, Plutocrats, plutocrats, post scarcity, profit motive, Ralph Waldo Emerson, road to serfdom, Ronald Reagan, the market place, union organizing, wage slave, washing machines reduced drudgery

A conservative of the laissez-faire school, he foresaw ‘a steady progress in collectivism running into a military despotism of a severe type’.3 It would involve steadily-increasing centralization, bureaucracy, and political control of the market. The resulting State-managed economy would be so inefficient and corrupt that it would need forced labour to keep it going. Nock’s warning did not go unheeded. Friedrich A. Hayek spelt out in The Road to Serfdom (1944) the dangers of collectivism. In his restatement of classic liberalism in The Constitution of Liberty (1960), he rejected the notion of social justice and argued that the market creates spontaneous social order. But while he wished to reduce coercion to a minimum, he accepted the need for the coercion of a minimal State to prohibit coercive acts by private parties through law enforcement.