Capitalism – Page 18 – artdiamondblog.com

“Would You Exchange Places with a Typical Person Living in Any Year Before Your Birth?”

(p. 80) Consider a thought experiment. If the means existed, would you exchange places with a typical person living in any year before your birth? Exchange places permanently–not, say observe the Battle of Hastings and then rematerialize in the present. You could pick the year and place in the past, but could not specify trading places with someone specific like Catherine the Great or Leonardo da Vinci, and you could not specify that you would he a lord or lady or hold some similar advantage. In this deal you’d he transported back to the year and society of your choosing to live out the rest of your life as an ordinary person.

A good guess is that hardly anyone in the United States or the European Union today would accept a one-way ticket to the everyday life of the past. The physical beauty of the world would be greater then, before the mixed blessing of development. And most moments in the past would be quieter than ours, though not necessarily less stressful–the lives of pioneer farmers for whom a crop loss meant destitution, or of seamstresses working fourteen-hour days in early industrial-era sweatshops and unable to afford more than tea and bread, were hardly (p. 81) serene. Nor was the quiet, small-town atmosphere of the past, which many today idealize, necessarily ideal. Everyone knew your name, but everyone also knew your secrets; men and especially women enjoyed much less personal freedom in small-town life of the past than is typical today.
For essentially all of human history until the last few generations, the typical person’s lot has been unceasing toil, meager living circumstances, uncertainty about food, rudimentary health care, limited education, little travel or entertainment; all followed by early death. (Keep in mind these remain the conditions under which more than a billion people live in the developing world today.) Even if you could somehow carry the benefits of modern medicine with you into the past–health care alone would make almost everyone decline the one-way ticket backward–the toil, low living standards, and isolated lives of past generations would seem awful to us compared to the sorts of things we complain about today.

Source:
Easterbrook, Gregg. The Progress Paradox: How Life Gets Better While People Feel Worse. Paperback ed. New York: Random House, 2004.

Affluence Has Made America More Libertarian

Source of book image: http://images.bookbyte.com/isbn.aspx?isbn=9780060747664

(p. 16) Various scolds and worrywarts have exclaimed, with Wordsworth, that “getting and spending, we lay waste our powers.” To such Jeremiahs, Lindsey provides an essentially cheerful, although not altogether so, counterpoint: affluence has made America a more libertarian, and hence a nicer, place.

First came material improvement. Until very recently, he notes, when people prayed for their daily bread, they often were praying for just that. Not so long ago, many ordinary lives of quiet desperation ended especially dismally: about 10 percent of burials in New York City in 1889 were in potter’s fields. In 1900, 1.75 million children between the ages of 10 and 15 — almost one-fifth of all children in that age cohort — were in the work force. Children provided one-fourth to one-third of the incomes for working-class families, which spent more than 90 percent of their household earnings on food, shelter and clothing. In 1900, Americans spent nearly twice as much on funerals as on medicine, and less than 2 percent of Americans took vacations.
. . .
Affluence, Lindsey writes, has provided “a mad proliferation of choices — and what, in the end, is freedom but the ability to choose?”

For the full review, see:
GEORGE F. WILL. “Land of Plenty.” The New York Times Book Review (Sun., June 10, 2007): 16-17.
(Note: ellipsis added.)

Book reviewed:
Lindsey, Brink. The Age of Abundance: How Prosperity Transformed America’s Politics and Culture. New York: HarperCollins, 2007.

U.S. Holds “Edge in Its Openness to Innovation”

Source of book image: http://www.tower.com/tycoons-how-andrew-carnegie-john-d-rockefeller-jay-charles-r-morris-paperback/wapi/100346776?download=true&type=1

(p. 24) Judging by Charles R. Morris’s new book, “The Tycoons,” it takes about 100 years for maligned monopolists and “robber barons” to morph into admirable innovators.

Morris skillfully assembles a great deal of academic and anecdotal research to demonstrate that Andrew Carnegie, John D. Rockefeller, Jay Gould and J. P. Morgan did not amass their fortunes by trampling on the downtrodden or ripping off consumers – . . .
. . .
Though Morris only hints at it, the truth is that the real heroes of the American industrial revolution were not his four featured tycoons, but the American people themselves. I don’t mean this to sound like a corny burst of patriotism. In the 19th century, the United States was still young. Most families had either been booted out of Europe or fled it, and they didn’t care about tradition or the Old Guard. With little to lose, they were willing to bet on a roll of the dice, even if it was they who occasionally got rolled. Europe was encrusted with guilds, unions and unbendable rules. Britons took half a day to make a rifle stock, because 40 different tradesmen poked their noses into the huddle. American companies polished off new rifle stocks in 22 minutes.
The United States still holds an edge in its openness to innovation. In 1982, French farmers literally chased the French agriculture minister, Edith Cresson, off their fields with pitchforks because she suggested reform. By contrast, back in the late 1850’s, Abraham Lincoln was a hot after-dinner speaker. Was he discussing slavery? No. The title of his talk was “Discoveries and Inventions.” The real root of economic growth is not natural resources or weather or individual genius. It’s attitude, not latitude. The Austrian economist Joseph Schumpeter called innovations gales of “creative destruction.” Americans, not Europeans, had the gall to stare into those gales – with optimism.

For the full review, see:
TODD G. BUCHHOLZ . “‘The Tycoons’: Benefactors of Great Wealth.” The New York Times Book Review (Sun., October 2, 2005): 24.
(Note: ellipses added.)
(Note: the online version of the review has the title “‘The Tycoons’: Benefactors of Great Wealth.”)

Book under review:
Morris, Charles R. The Tycoons: How Andrew Carnegie, John D. Rockefeller, Jay Gould, and J. P. Morgan Invented the American Supereconomy. New York: Times Books, 2005.

Middle-Class Today Live Better than 99.4% of Humans Who Ever Lived

(p. 80) In his extraordinary book Mapping Human History, the science writer Steve Olson estimates that 80 billion “modern” humans–from the first beings recognizable as our forebears to the advent of Homo sapiens sapiens, our official name–have walked the earth down through the millennia. Supposing this number is correct, the men and women at middle-class standards or above in the United States and the European Union now live better than 99.4 percent of the human beings who have ever existed.

Source:
Easterbrook, Gregg. The Progress Paradox: How Life Gets Better While People Feel Worse. Paperback ed. New York: Random House, 2004.

The Olson book mentioned is:
Olson, Steve. Mapping Human History: Discovering the Past through Our Genes. New York: Houghton Mifflin Company, 2002.
(Note: italics in original.)

Cars Bring Convenience, Freedom, and Personal Security

(p. 16) Two generations ago in the United States,most families lacked a car; by our parents’ generation, most families had one car while the two-car lifestyle was a much-sought ideal; today a third of America’s families own three cars or more. The United States now contains just shy of one automobile per licensed driver, and is on track to having more cars than licensed drivers. Cars are a mixed blessing, as a future chapter will detail: But there is no doubt they represent convenience, freedom, and, for women, personal security, when compared to standing on street corners waiting for buses or lingering on dark subway platforms. Cars would not he so infuriatingly popular if the did not make our lives easier. Today all but the bottom-most fraction of the impoverished in the United States do most of their routine traveling by car: 100 auto trips in the United States for every one trip on a bus or the subway, according to the American Public Transit Association. The portion of routine trips made in private cars is rising toward overwhelming in the European Union, too. Two generations ago, people dreamed of possessing their own cars. Now almost everyone in the Western world who desires a car has one–and vehicles that are more comfortable, better-equipped, lower-polluting, and much safer than those available only a short time ago.

Source:
Easterbrook, Gregg. The Progress Paradox: How Life Gets Better While People Feel Worse. Paperback ed. New York: Random House, 2004.

The Progress Paradox Documents How Life Is Better Here and Now

Source of book image: http://grigr.com/

Greg Easterbrook’s book has been out for several years, but I am a slow reader and have a long “to read” list. I enjoyed the first half or so of the book very much, and also enjoyed some parts of the second half. Roughly speaking, the first half is devoted to illustrating how much better life is now than before, and here (the West) than there (the less-developed countries). Roughly speaking, the second half of the book asks why we aren’t happier, and complains about areas of life where Easterbrook sees room for improvement.
Some of the part I like has now been updated, or written with better argument or more panache, by Matt Ridley in The Rational Optimist. But even so, Easterbrook often gives examples, or arguments, that complement Ridley’s case.
And even though Ridley is on average more eloquent than Easterbrook, the latter is eloquent plenty often enough to be worth reading. (And maybe my judgment about eloquence is colored by my agreeing with Ridley 90% of the time, and only agreeing with Easterbrook 75% of the time.)
On the less-satisfying second half of the book: worthwhile questions are often asked, but the answers are few and not very satisfying.
In the next few weeks, I’ll occasionally be quoting a few of the more illuminating or edifying passages in the Easterbrook book.

Easterbrook’s book:
Easterbrook, Gregg. The Progress Paradox: How Life Gets Better While People Feel Worse. Paperback ed. New York: Random House, 2004.

The Ridley book that I mention:
Ridley, Matt. The Rational Optimist: How Prosperity Evolves. New York: Harper, 2010.

Estonia Re-Elects “Government that Continued to Embrace Laissez-Faire Capitalism”

(p. A5) MOSCOW — Early results in Estonia’s parliamentary election on Sunday showed the ruling coalition headed for a victory, in a remarkable show of support for a government that has imposed harsh austerity measures to lift the country out of recession.
. . .
The vote reflects approval for a government that continued to embrace laissez-faire capitalism during the painful months after the global downturn. After Estonia’s economy shrank nearly 15 percent, the state reduced its budget by the equivalent of 9 percent of gross domestic product. Demand fell steeply, and unemployment crept up, early in 2010, to 19.8 percent.
But in contrast to their neighbors in Latvia, where economic troubles led to riots and the government’s collapse, Estonians stoically absorbed the suffering. These sacrifices allowed Estonia to join the euro zone in January, a move its leaders hailed as a sign that the country was on its way to achieving Western European standards of living. Meanwhile, the economy has been projected to grow by 4 percent this year, and unemployment has dropped to around 10 percent, according to the Estonian Unemployment Insurance Fund.

For the full story, see:
ELLEN BARRY. “After Cuts, Voters Back Ruling Bloc in Estonia.” The New York Times (Mon., March 7, 2011): A5.
(Note: ellipsis added.)
(Note: the online version of the article is dated March 6, 2011.)

Koch Does Not Run with the Antelope

If you were standing amongst a herd of antelope when a dangerous predator arrived, you would not see the antelope defending themselves against the predator. What you would see would be their white rear ends disappearing in the distance.
Last July in Wichita I heard some executives from Koch Industries talking about Market-Based Management. A couple of them mentioned Koch’s stands in defense of the free market. As a result of these efforts, Koch Industries has become the target of many agencies of the government and of groups opposed to the free market. Once or twice I heard an executive say something like: ‘it would have been a lot easier if we had just painted our butts white and run with the antelope.’
Schumpeter thought that those in business would not defend the fortress of capitalism (CSD, p. 142). And the evidence suggests that Schumpeter was mainly right. But we can hope that there are enough exceptions, in unpretentious places like Wichita, to keep the fortress standing.

(p.A15) Years of tremendous overspending by federal, state and local governments have brought us face-to-face with an economic crisis. Federal spending will total at least $3.8 trillion this year–double what it was 10 years ago. And unlike in 2001, when there was a small federal surplus, this year’s projected budget deficit is more than $1.6 trillion.

Several trillions more in debt have been accumulated by state and local governments. States are looking at a combined total of more than $130 billion in budget shortfalls this year. Next year, they will be in even worse shape as most so-called stimulus payments end.
For many years, I, my family and our company have contributed to a variety of intellectual and political causes working to solve these problems. Because of our activism, we’ve been vilified by various groups. Despite this criticism, we’re determined to keep contributing and standing up for those politicians, like Wisconsin Gov. Scott Walker, who are taking these challenges seriously.

For the full commentary, see:
CHARLES G. KOCH. “Why Koch Industries Is Speaking Out; Crony capitalism and bloated government prevent entrepreneurs from producing the products and services that make people’s lives better.” The Wall Street Journal (Tues., MARCH 1, 2011): A15.

Koch’s book is:
Koch, Charles G. The Science of Success: How Market-Based Management Built the World’s Largest Private Company. Hoboken, NJ: Wiley & Sons, Inc., 2007.

Economic Importance of Inarticulate Knowledge Undermines Case for Central Planning

(p. 78) . . . the intelligence of humans, though immensely strengthened by articulation, nonetheless contains a large component of tacit understanding by individuals who know more than they can say. If this is also true with respect to the sorts of knowledge relevant to our economic activities, then no comprehensive planning agency could obtain the sort of knowledge necessary for economic planning, for it would lie buried deep in the minds of millions of persons.

Source:
Lavoie, Don. National Economic Planning: What Is Left? Washington, DC: Cato Institute, 1985.
(Note: ellipsis added.)

The Fragility of China’s Red Capitalism

Source of book image: http://media.wiley.com/product_data/coverImage300/63/04708258/0470825863.jpg

Red Capitalism is scheduled for release on February 15, 2011. I have not read it, but from early reports it would appear to be a credible account that updates and supports concerns about China’s economy expressed by David Smick (The World Is Curved) and others.

The reference is:
Walter, Carl E., and Fraser J. T. Howie. Red Capitalism: The Fragile Financial Foundation of China’s Extraordinary Rise. Hoboken, NJ: Wiley, 2011.

The Smick book mentioned, is:
Smick, David M. The World Is Curved: Hidden Dangers to the Global Economy. New York: Portfolio Hardcover, 2008.

Rockefeller Is Vilified Despite His Entrepreneurial Genius and His Philanthropic Generosity

Source of book image: http://ecx.images-amazon.com/images/I/512M5Z648JL.jpg

(p. C7) . . . as Suzanne Loebl rightly emphasizes in “America’s Medicis,” the Rockefellers’ patronage has been notable not only for its generosity but also for its deliberativeness. By founding such diverse institutions as MoMA, Colonial Williamsburg, the Cloisters, Riverside Church and the Asia Society–as well as by commissioning the distinguished artworks that enliven the office complex at Rockefeller Center–various members of the family have been guided by a perception that a moral responsibility comes with the possession of great wealth.

John D. Rockefeller, Sr. (1839-1937), the founder and chairman of Standard Oil, was routinely vilified in the press as a ruthless monopolist who crushed competition the way a giant might crush a bug. . . . . . . yet he was not the cold-hearted miser that some supposed. A devout Baptist, he donated substantial sums every year to one or more of the congregations he attended, as well as to associated causes, such as the American Baptist Education Society, which founded the University of Chicago with his support in 1890.
. . .
Unfortunately, not everyone behaved well in the face of Rockefeller munificence. The Mexican painter Diego Rivera, commissioned to create a sprawling mural for the lobby of Rockefeller Center, chose to deviate from his preparatory drawings and place an enormous portrait of Lenin at the center of the finished composition. Refusing to amend this egregious provocation, Rivera was paid in full for his work, which was then duly destroyed. A predictable uproar ensued, garnering the artist abundant publicity, which may have been his objective all along.
. . .
Ms. Loebl’s account is well grounded both in the existing literature and in original archival research. She has striven to be comprehensive and done a good job of incorporating lesser-known Rockefeller projects, for example the charming Wendell Gilley Museum of carved birds, in Maine, funded by Nelson’s son Steven. But several worthy undertakings, such as Junior’s restoration of the châteaux of Versailles and Fontainebleau, receive scant attention–as do Laurance Rockefeller’s extensive gifts for the purpose of creating and expanding our national parks.

For the full review, see:
JONATHAN LOPEZ. “BOOKSHELF; The Splendid Spoils of Standard Oil; The Rockefeller family’s vast cultural legacy resulted from a sense of civic duty and a love of beautiful things.” The Wall Street Journal (Sat., NOVEMBER 20, 2010): C7.
(Note: ellipses added.)

The book being reviewed, is:
Loebl, Suzanne. America’s Medicis: The Rockefellers and Their Astonishing Cultural Legacy. New York: HarperCollins, 2010.