Break time is over

Sorry guys but I did make an unannounced break. This does not mean that I haven’t been keeping track in what has been going on in the blogosphere, especially when the ones I tend to view as personal favorites. And also this of course does not mean that I took a break on economics or political science.

I finished reading His Excellency: George Washington (2004) by Joseph Ellis, The Age of Turbulence (2007) by Alan Greenspan, and book 1 of the Wealth of Nations (2003 [1776]) by Adam Smith a couple of weeks ago.

Ellis’ book on Washington was a decent read for me. I actually did not know much of Washington, so his book was decent for me because it was a quick and easy read. But I did get the feeling that it was too quick of a read, and thus, left a lot out of what one would expect in a standard biography. I think I will have to read Ron Chernow’s book for a more detailed account of the life of Washington.

Greenspan’s book is an autobiography in where he discusses mostly his work life. I’ll be quite frank, I picked up Greenspan’s book thinking he is a “know-it-all” and ended up thinking the same thing. It is hard to find Greenspan admitting to error. Though, if one can ignore his ego, this book has some interesting things. He discusses his conflict with Bush Sr. regarding inflation (2007: 113), his admiration towards Nixon and Clinton, calling them the smartest presidents so far (2007: 58; 144), and his theory of economics, which is generally covered from chapter 12 to 25, highly appealing to the view of markets as self correcting and regarding Ayn Rand (2007: 40-1), Adam Smith (2007: 260-6), and Joseph Schumpeter (2007: 48) as main influences.

A quick note on Smith book 1. Just because he introduces the concept of the division of labor and from there shows how the market determines prices and wages without mentioning government’s role does not mean that he considers government irrelevant in economic concerns. He is clearly trying to introduce concepts from an elementary level and working his way to a more complicated level as the read goes on. Book 1 basically goes over a detailed account of the division of labor, since the division of labor is highly stressed in economics, there is not much to learn from book 1 if one is already familiar to the concept.

There are three books which I am currently reading: The Theory of the Leisure Class (1899) by Thorstein Veblen, Alexander Hamilton (2004) by Ron Chernow, and The Federalist Papers by Alexander Hamilton, James Madison, and John Jay.

While I am sure that I can benefit from Veblen’s book, I am somewhat skeptical of its thesis, which revolves around the study that individuals tend to purchase items not necessarily for the need of an item but to one’s self look higher up in society. So, for example, instead of buying a set of X, many tend to buy a more expensive set of X even though the ‘utility’ would remain the same. People tend to buy expensive items to ‘show off’ to society of their class. Thus, we have grown to a society that does not necessarily produce items for need and thus increase utility but instead produce items simply to show off and thus ignore the adding on of utility in the face of looking nice.

I do not really see a problem with this, why does Veblen call it conspicuous consumption, I do not know, though please note that I only have read one chapter of the book. But does Veblen vision a society where people wear the same clothes, have houses that look the same and have the same appliances, have the exact same cars, etc? It almost seems like Veblen is criticizing the creative part of capitalism, which I can only see as an advantage to society. Also Veblen criticizes specific activities as a disadvantage since there is some activity that we perform that does not seem to go towards earning a living, he calls this conspicuous leisure. It seems to Veblen to be a problem that a carpenter to learn philosophy, since the subject would probably not contribute to his job as a carpenter. So not only does Veblen theory seems to vision a society with similar goods, but also visions a society that limits one to study liberal arts such as fine arts or philosophy. So this, so far, only seems to me that Veblen sees a problem with the creative aspect of society, what that problem is, I do not know, since I have not read too much of his book.

Chernow’s book on Hamilton is a grand book so far. I am currently on page 320 and I can not seem to put it down. If I was to describe his reason to write such a book it would be to show that Hamilton is a great man AND a great American, contra to what Woodrow Wilson claimed* (Chernow 2004: 3). In fact, it is shown that Hamilton did everything in his power in trying to become both. He was a supporter of the Boston Tea Party protest, a fierce early Revolutionary writer that made some harsh criticisms towards Britain, a Revolutionary soldier, captain, then favorite aide to Washington (which then he was promoted to Lt. Colonel), a supporter of the Constitution (he wrote the majority of the Federalist Papers, which were papers to convince people to support the Constitution). The only problem I seem to have in this book is that Chernow often claims that Hamilton is fighting for a democratic state, or has a democratic appeal. I think Chernow’s book refutes Chernow in this claim. Hamilton was clearly one who was skeptical of having all people vote, since there are many who do not have the political knowledge to make such an opinion. Obviously, Hamilton visioned a Republic in which only a selected crowd was put to vote and influence important changes in government. In Hamilton’s view, the selected crowd would be those who have the knowledge of affairs, not necessarily those who have a certain amount of wealth. Generally, Hamilton is seen as an aristocrat from his critics, but Chernow shows that this seems like a strange label to put on Hamilton, since he was born poor, criticized the British aristocracy, and was against slavery (and activity promoted abolition). I can only imagine that Chernow would conclude the book by saying that Hamilton seems to be the founding father who set in stone the environment in which made capitalism possible.

* Wilson claimed that Hamilton was “a very great man, but not a great American.”

I’ll update my References later, since I do not have all of my books on me


Chernow, Ron. 2004. Alexander Hamilton. New York:The Penguin Press.

Ellis, Joseph J. 2004. His Excellency: George Washington. New York: Knopf.

Greenspan, Alan. 2007. The Age of Turbulence. New York: Penguin Group.

Hamilton, Alexander, John Jay, and James Madison. [1787] The Federalist Papers. New York: The Modern Library

Smith, Adam. 2003 [1776]. The Wealth of Nations. New York: Bantam Dell.

Veblen, Thorstein. 1934 [1899]. The Theory of the Leisure Class. New York: The Modern Library.


6 responses to “Break time is over

  1. Veblen’s book is a monstrosity; I say that not because I disliked its message but because I still remember with dread his chapter-long elaborations on the most trivial of issues. If he really wanted to, he could have packed all of his thoughts on the matter into the usual journal article of perhaps 30-40 pages.

    I dunno why you think that his book is against a creative aspect of capitalism. From how I understand it, it is a scalding treatise on the formation and continuation of the social norms and institutions. In the end, we are just animals who want to dominate other animals, and a lot of our actions are aimed at that goal or at showing that we could do that. A powerful warlord is not obliged to, but he will feed his underlings in a show of his personal wealth. A wealthy aristocrat will buy a mansion with a garden – not because he truly needs it, but because then he will one-up those without such a house. Those of the limited wealth or power will copy their betters, creating patterns of consumption based on envy and greed. And so on.

    It is an interesting book, but I think that its barely concealed contempt is aimed not at the capitalism per se, but at the dying strata of nobility.

    • I see, interesting concept. But like I said, I only read a chapter of it so I was only speculating on what his conclusion would be. But given his definitions of conspicuous consumption and leisure, I cannot see how he views this as progressing society for he assumes in the definitions that these activities produce no economic good as a whole.

      • And to further a point, he sees industry as creating something new and or productive that will benefit society (thus the end productive of industry is to produce a need for society and not to provide a product which gives people the incentive of conspicuous leisure or consumption) while a business is concerned with profit than the social need and thus does not care if their products cause or further conspicuous leisure or consumption. Which the former is seen as productive and latter as waste. So it seems to me that his vision of society is one that solely embraces his definition of workmanship and to see the latter group as absolute waste. I just cannot accept this.

        And while it might be true that his criticisms are not directed towards capitalism per se, he sure criticizes many things that are needed in order for capitalism to work (trade policies, patent policies, importance of individual ownership, importance of profit, etc).

        • The problem is not in business or firms or things they produce. The problem is in people and their desires for the conspicuous goods.

          Do you base your views on Veblen on his latter works on firms, production, etc? He was a supporter of technocracy (talk about obscure movements…) so some of his views might be considered quite odd. Still, ‘The Theory of the Leisure Class’ is one of his first works and from what I remember has scarcely any anticapitalistic undertones. It is more of the anthropological study into the less attractive sides of the modern society.

          • I’ll read further but it is quite clear that he makes the distinction of what a business does and an industry. One is more prone to producing the conspicuous leisure services and consumption goods and the other, through the emphasis of workmanship, is prone to produce the things that he considers to be the beneficial goods in society . One deals with producing a waste, while the other deals with producing a social utility.

            Your interpretation seems like the author is saying we benefit from conspicuous leisure and or consumption by saying that the non leisure class ultimately tries to be like the leisure class in purchasing these items and thus, develops the strive to be like the leisure class, but the way I am reading his theory, conspicuous consumption and leisure is an ultimate waste to society that provides no utility towards the society as a whole

            • Afaik, Veblen made no explicit value judgements on the matter. It was clear that he disliked the old customs and irrational actions of people, though. Reading some sources on Veblen’s biography left me with impression that he was a bitter but brilliant niggard.

              Also, a chapter on Veblen from Heilbroner’s ‘Worldly Philosophers’ is a must in my opinion.

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