Capitalism in America: A History, reviewed

By @SimonCocking review of  Capitalism in America: A History by Alan Greenspan and Adrian Wooldridge, Allen Lane (UK), Penguin Press. Shortlisted for the Financial Times and McKinsey Business Book of the Year Award.

In Capitalism in America, Greenspan reviews the US economy over the course of its history. In partnership with the celebrated Economist journalist and historian Adrian Wooldridge, he unfolds a tale involving vast landscapes, titanic figures, triumphant breakthroughs, enlightenment ideals as well as terrible moral failings. Every crucial debate is here – from the role of slavery in the antebellum Southern economy to the real impact of FDR’s New Deal to America’s violent mood swings in its openness to global trade and its impact.

America’s genius has been its tolerance for the effects of creative destruction, the ceaseless churn of the old giving way to the new, driven by new people and new ideas. Often messy and painful, creative destruction has also lifted almost all Americans to standards of living unimaginable to even the wealthiest citizens of the world a few generations past. Now productivity growth has stalled again, stirring up the populist furies. Will the United States preserve its preeminence, or see its leadership pass to other, inevitably less democratic powers.

The recent funeral of George Bush Snr produced the rare occasion of four ex presidents all sitting on one pew, in various degrees of discomfort. With Carter and Clinton, as well as Trump, Obama, and also George W Bush in attendance too, it was an apt reminder of the different impacts on the US and global economy of various past Democrat and Republican presidents. Greenspan’s book is a timely attempt to consider the bigger picture again.

For those of you too young to remember Alan Greenspan was the chair of the US Federal Reserve, which he held from 1987 to 2006. He was born in 1926, and so it an impressive 92 years old, and still producing interesting books like this. This is very much a paean to America, its history, its growth, is progress, its creative destruction. It is a condensed account of the history of the growth of the nation that the US has now become today. As an American History major myself, it was interesting to review this story, at a whistlestop speed, and you certainly felt like the authors were knitting together a narrative from the comfortable perspective of hindsight.

What is more up for debate is what all this means for the US in the future. Was the election of Trump symptomatic of a country that has lost its authority and place in the world, with the rise of China, and even India and Africa. Or perhaps he can ‘make America great again’. The US remains a huge country, with many of the world’s leading tech power houses, and yet, as Greenspan mentions, it could be facing another period of stagflation again. Too large and too inert to be able to change and adapt effectively. The book is an interesting and provocative read, even if the authors seem a little too optimistically disposed towards the US’s ability to remedy the huge challenges it currently faces in terms of the latest wave of creative destruction sweeping across the globe.

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