Why Capitalism?

Why Capitalism?

Book - 2012
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A review of the headlines of the past decade seems to show that disasters are often part of capitalist systems: the high-tech bubble, the Enron fraud, the Madoff Ponzi scheme, the great housing bubble, massive lay-offs, and a widening income gap. Disenchantment with the market economy hasreached the point that many even question capitalism itself. Allan H. Meltzer disagrees, passionately and persuasively. Drawing on deep expertise as a financial historian and authority on economic theory, he provides a resounding answer to the question, "why capitalism?" Only capitalism, he writes, maximizes both growth and individual freedom. Unlikesocialism, capitalism is adaptive, not rigid - private ownership of the means of production flourishes wherever it takes root, regardless of culture. Laws intended to tamper with its fundamental dynamics, such as those that redistribute wealth, fail. European countries boasting extensive welfareprograms have not surpassed the more market-oriented United States. Capitalism does require a strong legal framework, Meltzer writes, and it does not solve all problems efficiently. But he finds that its problems stem from universal human weaknesses - such as dishonesty, venality, and expediency -which are not specific to capitalism. Along the way, he systematically analyzes the role of government, positing that regulations are static, but markets are dynamic, usually seeking ways to skirt the rules. Regulation is socially useful if it brings private costs into line with social costs (forexample, the cost of taxes to hire policemen compared to that of the impact of rampant crime); if it doesn't, regulation simply invites circumvention. Vigorously argued, sweeping in scope, Why Capitalism? reminds us of the fundamental vitality of the one economic system that has survived every challenge, and risen to dominate the globe.
Publisher: Oxford ; New York : Oxford University Press, [2012]
Copyright Date: ©2012
ISBN: 9780199859573
Branch Call Number: 330.122 MEL
Characteristics: xi, 154 pages ; 22 cm


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Apr 06, 2015

Describing this as a polemic is dead on [Publishers Weekly]! Reading Meltzer's book, side-by-side with Prof. Perelman's outstanding book, The Invention of Capitalism, and you'll find much of Meltzer lacking. Read this book, concurrently with Prof. Perelman's book, and the book from the Socialist Register, Morbid Symptoms, and pretty much all Meltzer has to say falls by the wayside. [If possible, add the fourth book, Erin Arvedlund's Open Secret, on the LIBOR rigging conspiracy, and draw your own conclusions!] What Meltzer won't talk about: the leveraged buyout of America!

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