Rating: 
Summary: Magnificent, but some of its 'virtues' are flaws
Review: Reisman's work is beyond doubt a magnificent synthesis. However, those who believe that Reisman has made a significant advance in developing his 'primacy of profits' doctrine are advised to read the following exchange between Prof. Reisman and Alexander Tabarrok.Tabarrok reviews CAPITALISM in the Review of Austrian Economics, vol. 10, no. 2. Reisman replies, and Tabarrok replies in turn, in The Quarterly Journal of Austrian Economics, vol. 1, no. 3, Fall 1998. (These articles are available on the website of the Ludwig von Mises Institute. To read them you will need Adobe Acrobat Reader.) In the latter reply, Tabarrok correctly points out that Reisman offers a straw-man argument for his 'primacy of profits' doctrine. Reisman claims to be virtually the only economist in history to reject the 'primacy of wages' doctrine, but he is not. His argumentational approach on this topic, we may note, recalls that of his mentor, Ayn Rand, who was also in the habit of rejecting doctrines she had completely misunderstood and presenting her own 'insights' as unique. In fact, as Tabarrok notes in his initial review, Reisman's own positive work is excellent in many ways (which is a good deal more than can be said about Rand's). But - quoting Tabarrok - 'one annoying problem with CAPITALISM is that almost everything says about neoclassical economics is wrong'.
Rating:
Summary: Fortune magazine's review of Reisman's CAPITALISM
Review: The review is by David R. Henderson, research fellow at the Hoover Institution, and is titled THE LATEST CAPITALIST MANIFESTO. It appears in the issue of April 28, 1997, on p. 62. What follows is the verbatim text of the review, with paragraph breaks indicated by a pair of brackets[].
[]EVERY SO OFTEN A BOOK IS PUBLISHED that commands attention for its scope, ambition, and physical size. Capitalism (Jameson Books, $95.00), by Pepperdine University economist George Reisman,
is such a book: It's an exhaustive survey and an impassioned manifesto, and is the size and weight of the phone book of an extremely large city. As Reisman writes on page 61 (out of 1,046): "The remainder of this book can be summarized as demonstrating a single proposition: In every possible way, with no valid objection, the solution for the economic problem is capitalism." Reisman backs up his claim. He shows, among other things, why capitalism is necessary to end poverty, mass unemployment, and environmental
destruction.
[]Much of what Reisman covers will be familiar to students of economics, but CAPITALISM covers some of the more standard economic topics--the chaos caused by socialism, productivity as the source of large fortunes in a capitalist society, price controls--in a fresh and clever way.
[]Take price controls. Economically literate readers know that price controls, by holding prices below free-market levels, often create shortages. Reisman goes further, presenting at least three insights about the harm done by price controls.
[]First, many observers noted the apparently arbitrary distribution of gasoline due to price controls in the 197Os. In some areas of the country, people lined up for blocks to get gasoline; in others lines were very short. Reisman shows why. In a free market, companies have an incentive to get gasoline to those willing to
pay the most. A relative scarcity in, say, New Jersey, causes a higher price there, inducing oil companies to send more gasoline there: But price controls sever the link between price and supply. Why bother sending more gas to New Jersey if you can't get the higher price? Reisman writes: "It largely ceased to matter to the oil companies how their gasoline was distributed."
[]Second, Reisman shows how price controls drive prices to very high levels in uncontrolled sectors of the economy. Consider New York housing. Some apartments are rent controlled; some are not. Assume that without rent control there would be one million apartments. These apartments would be rented to the million people willing to pay the most. Now assume the government regulates rents on half the apartments--some of the people renting the controlled apartments will displace people who would have paid more. What happens to these people? Same of them will shift over to the uncontrolled market, competing with the half million people already renting in this market. As a result, rents in the uncontrolled sector are higher.
[]Third, by creating shortages, price controls change the relationship between buyer and seller. The seller no longer needs any individual buyer and thus "views the buyer as a petty chiseler seeking values without payment." The buyer "views the seller as an omnipotent tyrant whom he must beg for favors or threaten with reprisals." Reisman illustrates with a shortage-era quote printed in the New York Times from a gas station
attendant: "If he's that stupid, he waits in line an hour and doesn't know the rules, l let him get to the pump and then I break his heart."
[]Beyond such classic subjects, CAPITALISM includes much that's new, including a witty critique of the textbook model of perfect competition and Reisman's own theory of investment. His critique of environmentalism, in which he argues that environmentalists constitute the greatest current threat to capitalism, is especially vigorous. "The green movement," he writes, "is the red movement no longer in its boisterous, arrogant youth, but in its demented old age."
[]By and large, Reisman backs up his indictment of environmentalists. He quotes a National Park Service biologist who claims that people are a cancer on the earth and hopes for "the right virus to come along." Reisman notes that these aren't just ideas of the lunatic fringe; John Muir, the founder of the Sierra Club, said similar things, and mainstream environmentalists have not disowned such inhumane sentiments. Reisman also points out that the environment has changed dramatically for the better in many ways with the advance of capitalism. For example, the places in the world with the safest drinking water are places with modern purification plants. Before capitalism, streets served as sewers; before cars, horses created an enormous pollution problem. This is all obvious, but what's striking is how rarely anyone says it.
[]Overall, Capitalism is a book you would want in your library if you want to know what a consistent, intelligent advocate of capitalism would say on almost any economic issue.
Rating:
Summary: Will someone award this book a Nobel Prize, PLEASE!
Review: They SHOULD award Nobel Prizes to those who offer significant intellectual contributions to economic science. Every chapter of this book warrants such an honor. From justifying the field's existence (against the post-modernist and environmentalist attacks), to systematically organizing economic principles to grasp new incites in countless areas of economic thought, to thoroughly refuting the lethal ideas of Marx and Keynes on the basis of positive economic truth, it is an injustice that this book has not been recognized with at least one Noble Prize. Consider Dr. Reisman's orginal productivity theory of wages or his comprehensive grasp of the influences on prices (besides labor), such as intelligence in the use of capital. His invariable money analysis is especially fruitful and is the book's highest achievement. Who can take seriously those who award the Nobel Prize if this book is not seriously considered and awarded what it rightfully earns? P.S. No politician should be considered for office who has not read this book. In today's world, that should be a law!
Rating: 
Summary: The utility of this book is marginal
Review: This book is a massive treatise on economics that attempts to do what von Mises, Ayn Rand, and other well-known apologists for capitalism left incomplete: namely a comprehensive foundation and justification for laissez-faire capitalism. The book is a grand attempt, but falls short in many places, the most important being the author's aversion for what he calls 'mathematical economics'. Arguing that this field is dominated by the use of calculus and differential equations, the author rejects this approach is invalid because it fails to take into account the inherent discrete nature of goods and services. The author fails though to realize that a large body of economic theory and econometrics uses discrete mathematics and computer algorithms to model economic behavior. Not only that, economic models based on calculus are not necessarily unable to capture the discrete nature of economic phenomena. Such approaches are always considered by mathematicians an idealization, and one that needs to be compared with empirical data for validation. Indeed, an enormous effort has been undertaken in the last decade in financial engineering to apply advanced mathematical techniques to option trading, portfolio optimization, and risk analysis. These efforts are based in part on partial differential equations, and have had great successes in modeling trading in the marketplace. The author also argues, incorrectly, that too much emphasis is placed on states of final equilibrium in mathematical economics. He does not however give evidence for this claim. The behavior at long time of course is of interest for those modeling economic phenomena using dynamical systems, but the transient short-time behavior is also of great practical interest, and one that much of the literature is devoted to. The author also takes a swipe at the mathematical economics community, referring to them as 'snobs" for their insistence on using what he calls 'esoteric' methods for studying economics. What he fails to note though is that mathematical systemization in economics was strongly resisted at first by the academic community; mathematical economics had a long and horrendous fight for recognition. And mathematics has indeed served the study of economics well, and even more importance now is placed on the validation of the algorithms for economic models, thanks to the growth of computing power. The second major objection to the book is the lack of empirical and statistical analysis for the claims made. It is one thing to argue against the claims of socialists and others hostile to capitalism; it is quite another thing to put forth a theory of capitalism that meshes with known facts about what is observed in the real world. The author needs to spend more time on the validation of his theories using real data. Such an activity is difficult, but it is crucial to building a successful defense of laissez-faire capitalism, which from an ethical point of view, the author argues well for. The book however is not all bad. The author is briliiant in his argumentation of the moral justification for capitalism, as he generalizes and clarifies the arguments of von Mises, Rand, and others who are sympathetic with capitalism. He encourages the reader to sharpen their critical thinking skills and to dispense with pre-conceived notions about capitalism as a morally-justifiable system. In particular, his analysis of the environmental movement is very well-written. Even more troubling, is that this book will probably not be read by the most important audience of all: the worlds business people. The sheer size of the book will dissuade such individuals from reading it. This is unfortunate, since actually, modern business people view capitalism as somewhat 'evil'; they just don't mind being 'evil'. The accept the capitalist system as being 'realistic' and that those who don't are 'naive' and not atune to the real nature of humans. They really don't believe, or care to articulate on, the need for a moral justification of capitalism. If this book were revised to include more statistical and empirical analysis, it would be a tour-de-force in economic theory. As it reads now though, it is more of a book on the ethics of capitalism and not a scientific description. As a scientific theory of economics, it fails to deliver......
Rating:
Summary: The utility of this book is marginal
Review: This book is a massive treatise on economics that attempts to do what von Mises, Ayn Rand, and other well-known apologists for capitalism left incomplete: namely a comprehensive foundation and justification for laissez-faire capitalism. The book is a grand attempt, but falls short in many places, the most important being the author's aversion for what he calls 'mathematical economics'. Arguing that this field is dominated by the use of calculus and differential equations, the author rejects this approach is invalid because it fails to take into account the inherent discrete nature of goods and services. The author fails though to realize that a large body of economic theory and econometrics uses discrete mathematics and computer algorithms to model economic behavior. Not only that, economic models based on calculus are not necessarily unable to capture the discrete nature of economic phenomena. Such approaches are always considered by mathematicians an idealization, and one that needs to be compared with empirical data for validation. Indeed, an enormous effort has been undertaken in the last decade in financial engineering to apply advanced mathematical techniques to option trading, portfolio optimization, and risk analysis. These efforts are based in part on partial differential equations, and have had great successes in modeling trading in the marketplace. The author also argues, incorrectly, that too much emphasis is placed on states of final equilibrium in mathematical economics. He does not however give evidence for this claim. The behavior at long time of course is of interest for those modeling economic phenomena using dynamical systems, but the transient short-time behavior is also of great practical interest, and one that much of the literature is devoted to. The author also takes a swipe at the mathematical economics community, referring to them as 'snobs" for their insistence on using what he calls 'esoteric' methods for studying economics. What he fails to note though is that mathematical systemization in economics was strongly resisted at first by the academic community; mathematical economics had a long and horrendous fight for recognition. And mathematics has indeed served the study of economics well, and even more importance now is placed on the validation of the algorithms for economic models, thanks to the growth of computing power. The second major objection to the book is the lack of empirical and statistical analysis for the claims made. It is one thing to argue against the claims of socialists and others hostile to capitalism; it is quite another thing to put forth a theory of capitalism that meshes with known facts about what is observed in the real world. The author needs to spend more time on the validation of his theories using real data. Such an activity is difficult, but it is crucial to building a successful defense of laissez-faire capitalism, which from an ethical point of view, the author argues well for. The book however is not all bad. The author is briliiant in his argumentation of the moral justification for capitalism, as he generalizes and clarifies the arguments of von Mises, Rand, and others who are sympathetic with capitalism. He encourages the reader to sharpen their critical thinking skills and to dispense with pre-conceived notions about capitalism as a morally-justifiable system. In particular, his analysis of the environmental movement is very well-written. Even more troubling, is that this book will probably not be read by the most important audience of all: the worlds business people. The sheer size of the book will dissuade such individuals from reading it. This is unfortunate, since actually, modern business people view capitalism as somewhat 'evil'; they just don't mind being 'evil'. The accept the capitalist system as being 'realistic' and that those who don't are 'naive' and not atune to the real nature of humans. They really don't believe, or care to articulate on, the need for a moral justification of capitalism. If this book were revised to include more statistical and empirical analysis, it would be a tour-de-force in economic theory. As it reads now though, it is more of a book on the ethics of capitalism and not a scientific description. As a scientific theory of economics, it fails to deliver......
Rating:
Summary: A voluminous defense of theoretical capitalism
Review: This book is clearly the most encyclopedic defense of capitalism ever written. It attempts to answer most, if not all, of the stereotypical objections raised by socialist and interventionist ideologues against the capitalist system. Reisman, for the most part, prefers to find support for capitalism, not in facts or exhaustive empirical analysis, but in rationalistic argumentation. In doing so, he is merely following the example set for him by his great teacher, Ludwig von Mises, and by the other great intellectual influence in his life, the Aristotelian philosopher Ayn Rand. Both Mises and Rand, each in their own way, were champions of rationalistic speculation. Fortunately for Reisman, rationalistic modes of thought are not entirely out of place in economics and are even, in some respects, necessary. Since economic behavior tends to be much less irrational than other types of behavior, it is possible to to deduce from the principles of human rationality economic theories which serve as useful approximations to real world conditions. It is important to remember, however, that these deductions are in fact only approximations and not precise descriptions of the way things actually are in economic reality. There is one other thing the reader should be warned against in relation to this book. Reisman entitles his work "Capitalism." It is a massive tome--possibly over a million words altogether. You might expect the book to constitute a more or less complete description of capitalist reality--or at least that it would tell you everything you needed to know in order to understand the nature of capitalism. But if this is your expectation, Mr. Reisman is going to disappoint you. Mr. Reisman's view of capitalism, like that of most economists, is a very narrow one. He only has eyes for the side of capitalism that lends itself most easily to being expressed in some bloodless abstract theory. That other side of capitalism, the side that can only be accessed through a study of historical and sociological facts, does not exist for Mr. Reisman. For this reason, Reisman's understanding of capitalism must be regarded as one-sided and incomplete. For example, take the problem of capital distribution. According to Mr. Reisman's theoretical view of capitalism, under a capitalist system, capital is distributed to those most fit and able to use it through various market mechanisms, such as the rate of interest, the banking system, the stock exchange, etc. etc. This, however, is only part of the truth. In the real world, raising capital by this method presents an enormous problem, because those who are most predisposed to save the money necessary for capital accumulation tend to be extremely timid about investing it, while those best fitted to use this capital tend to be reckless men of vision, eager to try new and daring economic experiments with other people's money. How then are these men of vision to get their hands on the necessary capital? Historically, they have resorted to methods which tender-hearted moralists regard as "underhanded"--i.e., protectionism, credit inflation, bribery, exploitation, monopoly, forced savings (through inflation), and outright fraud. Despite his impressive scholarship, Riesman has no idea that this seamier side of capitalism exists. As an ideological defender of capitalism, perhaps he doesn't want to see it. But it's there nonetheless. All the brilliant theories in the world won't make it go away. Nevertheless, despite Reisman's short-sightedness on this issue, his book is a great work in economic theory.
Rating:
Summary: Worth Its Weight in Gold--A Real Bargain at Any Price!
Review: This book is enormous--both in terms of its size an of the achievement it represents. Don't be misled by the 1000 pages: this is NOT a quick read like "Atlas Shrugged," and the amount of text actually makes it more like 2000 pages. Still, before you complain about how long it takes to read it, just remember how long it must have taken Dr. Reisman to WRITE it! That one man could assimilate so much knowledge and convey it in so methodical, coherent, and (yes!) concise a form is truly a testament to the potential of the human mind. The ideas presented in this book, if heeded, can save the United States--indeed, all of material civlization--from the abyss into which it is now marching. This book is both a warning and a reassurance. It is a warning of the consequences of statism and government intervention in the economy; it is a reassurance that these consequences can be mitigated or altogether avoided if the statist interference is stopped and capitalism restored--either way, it is a promise of things to come. If mankind insists on dragging itself into another Dark Age, it will not be by the default of those who knew better and could have alerted others, but of those who refused to be alerted. To my knowledge, this book is the most comprehensive, accurate and practical economic defense of capitalism ever written (in textbook form, no less!). George Reisman is perhaps the most profound--and correct--economic thinker of his day, and his achievement makes him worthy of being mentioned in the same sentence as Aristotle, Adam Smith, Ayn Rand, and Ludwig von Mises. The best hope for the future is that Dr. Reisman's profession will someday be worthy of him.
Rating:
Summary: Brilliant, insightful, comprehensive, but unfair to Rothbard
Review: This brilliant exposition of capitalist economic theory belongs on the bookshelf of anyone interested in either liberty or economics. Professor Reisman's treatise offers a thorough understanding of capitalism, a synthesis of Austrian and classical economics bristling with new insights into the bargain, and refutations of the major opposing camps. (The chapter on the "environmentalism" may be the only writing on this subject, other than Ayn Rand's own, clearly to identify the anti-human motivations of the "green" movement.) My only misgiving is that Reisman's introduction, footnotes and bibliography continue the Objectivist tradition of unfairly criticizing Murray Rothbard. Neither Rand nor her followers have ever come thoroughly to grips with the claims of anarchocapitalism that defense and court services can be provided by the market without a central government; nor have they adequately faced the difficulties (if not actual contradictions) inherent in the creation of a State from scratch without violating anyone's rights in the process; nor do they ever seem to have grasped why Rothbard describes many of the actions of the U.S. government in the twentieth century as "imperialistic." There is thus a little hubris in dismissing Rothbard's work as egregiously self-contradictory. (And who ever said -- as Reisman implies in his bibliography -- that Rothbard's _Man, Economy and State_ should be read as a "substitute" for Ludwig von Mises's _Human Action_?) Reisman does not accept Mises's neo-Kantian and ethically subjectivist foundations (as Rothbard also did not), yet he recommends that students of economics read _all_ of Mises's works. Would that he showed the same generosity toward another of Mises' most brilliant students. But these are small issues that do not affect the main thrust of Reisman's presentation. Anyone who wants to defend capitalism should study this outstanding treastise in detail.
Rating:
Summary: A Tablet From The Mountaintop
Review: This epic of economic truth is required reading for anyone seeks to know, to understand, what capitalism is, and what it means to civilization as we know it. The pursuit of rational self-interest is it's singularity.
The book is as thorough as it is inspiring. It breaks down every possible argument against capitalism, every tenet of support for the welfare state, and exposes them for what they are: empty and false, with no relationship to the real world. It's power and logic will frighten the unininformed and the brainwashed alike with it's stark clarity (How many of our fellow citizens, for instance, know that "the government" neither creates nor produces anything? It only consumes and redistributes the leftovers).
This work cannot be recommended too highly (I had the privelege of studying under Dr. Reisman. He was a protege of Mises, and the many of the theories in "Capitalism" are presaged in "Human Action." He, in turn, has profoundly influenced many of his students). Each chapter is a captivating journey into human behavior, human interaction and "human economic life." To read the book is to understand economics. It really is that simple.
Please do not skip over the Epilogue. It is truly the icing on Dr. Reisman's intellectual cake.
Rating:
Summary: The most comprehensive since von Mises' Human Action
Review: This is a big thorough book worth reading line by line. Drawing from both von Mises and Ayn Rand, it provides a moral foundation for capitalism. It also draws from classic economists such as Adam Smith and David Ricardo. It demolishes moral arguments of Marx and Keynes and attacks irrational environmentalism. It shows how building capital resources benefits both rich and poor. It shows how capitalism can cure racism. It shows how freedom leads to prosperity by allowing individuals to use reason to solve problems and produce more wealth. It ends with a plan to evolve a mixed economy into one much freer, to the benefit of all
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