Adam Smith. The Roaring ‘80s (1988) “Adam Smith” (George Goodman) was a financial adviser with a knack for story-telling. For some time he told those stories for Esquire and other magazines. This book is one of several that collected his columns. He understands his subject, and he knows enough people in the moneysphere that he can always get the interview that will clarify the current economic crisis or hiccup. And most crises turn out to be hiccups. His style is breezy (for once the cliche fits), a mix of high, medium, and low-level explanation, and illustrative anecdotes. Lots of anecdotes. The effect is that, at least while you’re reading about it, the most abstruse economic theory seems plausible. Or not, depending on Smith’s thesis.
What Smith demonstrates most, though, is that economics isn’t just about the money, and that collectively we have at best a confused mess of notions about finance and the economy generally. At worst, we suffer from a mess of contradictory superstitions, chief of which are the ones surrounding the concept of a free market. Smith’s accounts of financial shenanigans make it quite clear that all markets are distorted by players with market clout. And that these players all eventually succumb to the temptation to use their clout to make the market work for their exclusive benefit. Financial crime may lack gore, but there's no shortage of victims.
A page turner. The time frame is the Reagan years, plus and minus, and all that’s changed since then is that the libertarians have more clout than ever. They will finish the work of economic destruction that began under Reagan. That destruction did not succeed. Smith (and his group of financial gurus) predicted the financial crisis that hit in 2008. Without government bailouts, that crisis would have destroyed the American financial industry. This time, with the government apparatus being systematically gutted, there may be nothing to save the us from the wreck.
Recommended. ****
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