The Mind and the Market : Capitalism in Modern European Thought

Rating:
Summary: Who knew capitalism could be so fascinating??
Review: Anyone who wants to be introduced to the richness of thought about capitalism in an enjoyable & accessible fashion should read this book!

I recommend it to all introductory economics professors seeking to spark their students' interest in the dismal science.

Rating:
Summary: The course you always wanted to take
Review: Capitalism is the world's most powerful idea about political, economic and moral relationships between people, enterprises and the state. It has brought immense opulence to hundreds of millions of people and hope for economic liberation to hundreds of millions more. But capitalism is not just a way of doing business. No culture nor any state can harness capitalism with a management school curriculum. Capitalism is a complex tapestry of economic arrangements, governmental obligations, cultural traditions, personal behavioral norms, concepts for production enterprises, methods of management, public acceptance of investment, encourage of competition, religious and ethnic tolerance and ideas of personal property. It is a historical fact that secular states with individual economic liberty and free markets harvest the most from capitalism. Capitalism is not just economics.

Capitalism, as a global culture that defines our modern civilization, is therefore too important to be left to the economists. Jerry Z. Muller, a historian, has given us a book which in its sweep and breadth is up to the task of giving us a deeply thoughtful and insightful analysis of the evolution of capitalism's political, economic, social, ethical and psychological threads from early European thinking through the big intellectual ideas of the late Twentieth Century. He tells the story of the idea of the market, as it is formed and transformed by the great socio-politico-economic intellectuals - Voltaire, Adam Smith, Burke, Hegel, Marx, Simmell, Schumpeter, Keynes, Marcuse, Hayek, and others. As a historian, Muller interprets each man in the context of his time and culture. Muller's analysis is even handed, one of the great virtues of the book. There are thousands of political economy books, each with its own agenda if not unground axe. For me, The Mind and the Market is a level-headed guide through that thicket of thought. Muller coolly lays out the case for each ideology and clinically assesses its successes and failures, giving the devil his due, even if that devil is Marx, who while foisting the evil idea of collectivism upon the world did have empathy and voice for the terrible treatment of workers under early capitalism. Muller's trip through the minds of the great thinkers gives us the insights we need to understand how today?s manic anti-competition forces diminish our personal wealth and how governments with moral agendas weaken capitalism.

Even while Muller brings us tidal historical and economic insights, he also salts this book with one liners and anecdotes that illustrate the anatomy of capitalism. Here are a couple I liked.

- "Cultures that favor equality in poverty over greater but unequally distributed affluence tend to be less market oriented." Muller

- From Schumpeter: "The capitalist achievement does not typically consist in providing more silk stockings for the queen but in bringing them within reach of factory girls in return for steadily decreasing amounts of effort."

- Burke voicing the dilemma of capitalism: "It is hard to persuade us that everything that is got by another is not taken from ourselves."

- Fascists and socialists exploit resentment of those who succeed under market systems. Muller relates how Hungarian communists took control in 1919. The Hungarian Soviet nationalized private enterprises, made wages uniform and guaranteed employment. Labor discipline and productivity declined steeply. The communist experiment failed after 133 days. I gather from subsequent world events that no one was paying attention.

The Mind and the Market should be read by every world citizen to understand how we got the flow of wealth we enjoy and the roles of the state, individual liberty and market competition necessary to sustain our affluence. Capitalism is fragile. It does not come automatically with democracy. US capitalism is buffeted daily by well funded or popular pleas for the state to intervene in the market. They come under banners of anti-globalism, criticisms of the World Trade Organization, preserving the American family farm, special tax breaks to lower costs of domestic producers, Buy American Act, requirements for domestic content, special tariffs, quotas or restrictions on foreign-made products, protection against exporting jobs, closed shops, sustaining the American manufacturing base, regressive income taxes, and dispensations to monopolize trade, among other anti-liberal policies. Jerry Muller's marvelously well-written and colorful story of the road to capitalism helps us understand the essential roles played by open, competitive markets, personal liberties and a secular state in preserving and expanding our wealth.

I commend The Mind and the Market to you without reservation.

Rating:
Summary: I read every word
Review: It isn't often that I find myself reading an entire book, or taking notes on every page, but that's how intriguing I found Jerry Muller's easy-to-read and profound new book. I am an admirer of his previous work, Adam Smith in His Time and Ours, which I cited several times in my own history, "The Making of Modern Economics." But this book outperforms all previous efforts. It is essentially an historical commentary on the long-standing debate over the cultural effects of capitalism, a debate between the advocates (Voltaire, Adam Smith, Burke, Hegel, Weber, Schumpeter, and Hayek) and the critics (Rousseau, Marx, Arnold, Sombart, Lukacs, Keynes, and Marcuse). I learned a great deal, especially Voltaire's fraudulent business practices, Burke's long fight against the East India Company, Hegel's surprising defense of individualism and the market, the brilliant insights of Georg Simmel, Schumpeter's subtle subterfuge of intellectuals, and Muller's extensive coverage of anti-semitism and capitalism. (One surprising omission is Veblen, whose cultural criticisms of capitalism are well-known, but frankly, it is refreshing to read a book without a reference to the conspicuous Veblen). I won't give away author's perspective on this never-ending debate, but one can only be awe-struck by Muller's achievement.

Rating:
Summary: A sweeping overview of modern economic thought
Review: Jerry Muller's objective is to trace the origin and evolution of a central tenet of economics: the market. But rather than start with Adam Smith (he comes second), Muller reaches back to Voltaire and the Enlightenment: he sees Voltaire's criticism of religion as a crucial step toward acceptance of capitalism. I would recommend this book to anyone interested in the evolution of ideas and the role of individual thinkers, ranging from the famous (Karl Marx) to the less famous (Justus Möser??).

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Summary: The connection between anti-commerce and anti-Semitism
Review: There were three interesting friends of commerce whose support of commerce derived from experiences of their time. I had not seen the connection in their writing. Muller found it.

Adam Smith the first great lover of commerce was drawn to his insights in sharp contrast to the rampant and vicious wars of religion around him. As a Scot idealist, Smith was stunned at the internecine battle for righteousness among the Baptists, Anabaptists, Puritans, Quakers, Anglicans and Roman Catholics. Commerce seemed mild in comparison, offering a prospect of inter religious neutrality and even cooperation.

Georg Simmel's insight , 150 years later, came from the extraordinary cultural and intellectual vitality of his 1900 Vienna and the Austro-Hungarian empire before WWI. Commerce was the driving force for ethnic diversity in the capital, for entrepreneurial vigor that crossed class lines and Simmel saw the creation of liberal freedoms in a dying Catholic anachronism.

Joseph Schumpeter experienced the exuberance of the entrepreneurial spirit in post WWI Germany and recognized that commerce could uniquely utilize the talents and genius of the creative elites who drove society forward.

While these three intellectual friends and appreciators of commerce gained their insight from a variety of experiences, the intellectual enemies of commerce all had one thing in common. Their hatred of commerce paralleled their nearly universal hatred of Jews.

Voltaire hated Jews and liked the free market only for the luxury goods it could produce. Marx was vituperative in his hatred of both commerce and Jews. His prominent disciples from Trotsky to Stalin explicitly hated commerce and Jews. The anti-commerce thinkers, Tonnies, Sombert and Heidigger, were similar in the vehemence of their anti-Semitism.

As Fredrich von Hayek put it in reference to the Roman Catholic Church in the 12th century, "It is the old story of the alien race's being admitted only to the less respected trades and then being hated still more for practicing them." . The Catholic Church hated the commercial challenges to landlords and to local markets from trade, money lending and the free floating prices of goods outside of guild control. So the Church let only outsiders into the world of commerce: Jews. Then the Church taught hatred of Jews because they were involved in commerce.

The significance of this issue is statistically evident from the index of Muller's book. The entries for Jews, Judaism and for anti-Semitism are much longer than for any other subject. On closer inspection, the entries are abbreviations. Under Jews, Vienna it says 341-356. On each page the issue of Jews is mentioned in nearly every paragraph. Separate entries for each mention of Jews and anti-Semitism would have consumed nearly a third of the index.

This thousand year old symbiosis of commerce hatred and Jew hatred is so deep most of us are blind to it. There is little new in the specific 21st Century hatred of business. Anti-globalization and anti-Starbucks were expressed by Justus Moser in 1770. "... the (local) artisan, Moser believed, was now being undermined by the international market and its local agent, the shopkeeper. The shopkeeper imported goods from... London, Paris and big cities... and so the (local) artisan was increasingly displaced by the shopkeeper." Moser is quoted: "Our ancestors did not tolerate ... shopkeepers; they were spare in dispensing market freedoms; they banned the Jew from our diocese ... in order that ... inhabitants not be daily stimulated, tempted, led astray and deceived ...."

Other anti-commerce assumptions, such as: equity markets are a haven for speculators and banks and lenders are parasites, is 500 years old. The idea that free marketplace competition destroys nationalism, destroys the elite status quo and destroys ethnic purity have long been widely expressed. And denounced.
Today's lefty liberal is in many ways a 12th century Roman Catholic monk in modern clothes. Many are unwitting anti-Semites at that.

Muller's book is an eye opening Goliath. His title The Mind and the Market represents a double entendre. My mind was altered by my encounter with the Market presented in Muller's brilliant insights.

Rating:
Summary: Quite simply amazing
Review: This is not a book I would have read six months ago since I am typically not very interested in economics or political theory. But a required class in modern political economy helped change my outlook and introduced me to what thinkers such as Adam Smith actually said, which is quite different from what libertarians claim today. Muller's book fed my new found interest and then some.

Muller examines how some of western civilization's greatest minds have thought about capitalism and the market. He includes thinkers that are both traditionally viewed as economists (Smith, Hayek, Schumpeter) and others not usually identified with economics (Burke, Voltaire, and Arnold). Each chapter provides an excellant summary of these thinkers and can be read alone or out of order if one wishes. One has to admire Muller for his objectivity, he studies the individuals according to their own terms and doesn't seek to judge them. Every theorist has identifiable faults and Muller points these out without bias. My personal favorite chapters were those on Smith, Hayek and Matthew Arnold.

My only (minor) criticism is that I thought Muller could have dealt with Keynes in more detail. I feel he short-changed the man who in many ways defined much of the mid-20th century. I also thought a chapter on Amartya Sen might have been interesting, but it makes since to pick those theorists who are dead since their work can't develop any futher.

Rating:
Summary: Quite simply amazing
Review: This is not a book I would have read six months ago since I am typically not very interested in economics or political theory. But a required class in modern political economy helped change my outlook and introduced me to what thinkers such as Adam Smith actually said, which is quite different from what libertarians claim today. Muller's book fed my new found interest and then some.

Muller examines how some of western civilization's greatest minds have thought about capitalism and the market. He includes thinkers that are both traditionally viewed as economists (Smith, Hayek, Schumpeter) and others not usually identified with economics (Burke, Voltaire, and Arnold). Each chapter provides an excellant summary of these thinkers and can be read alone or out of order if one wishes. One has to admire Muller for his objectivity, he studies the individuals according to their own terms and doesn't seek to judge them. Every theorist has identifiable faults and Muller points these out without bias. My personal favorite chapters were those on Smith, Hayek and Matthew Arnold.

My only (minor) criticism is that I thought Muller could have dealt with Keynes in more detail. I feel he short-changed the man who in many ways defined much of the mid-20th century. I also thought a chapter on Amartya Sen might have been interesting, but it makes since to pick those theorists who are dead since their work can't develop any futher.

Rating:
Summary: Superb
Review: This is simply a superb history of European thinking about markets. Muller does a magnificent job of weaving together different thinkers, presenting their ideas clearly and powerfully. This is accessible but sophisticated stuff, a series of brilliant short intellectual portraits that provides a deep sense of the controversies that capitalism has provoked over the centuries. Just great.