by Jack Criss
I cannot recommend highly enough Luigi Zingales’ latest book, “A Capitalism For The People: Recapturing The Lost Genius Of American Prosperity.” But the recommendation comes with caveats.
First and foremost, if you’re a libertarian, or a laissez-faire purist, you probably won’t agree much with the Italian immigrant who is currently Professor of Entrepreneurship and Finance at the University of Chicago’s Booth School of Business. Zingales dares to be in favor of regulation and a tightening down on Wall Street excess.
If you’re a liberal, though, you should be forewarned as well. Zingales believes that capitalism will be this nation’s—and the world’s—saving grace (my words, not his.) Zingales is very upfront and vocal in the book about advocating the power of competition. “Competition does not work, however,” he writes, “when legal protection is weak…For this reason, I recognize the importance of rules. But I advocate few and simple rules…”
Simply put, in my estimation, Professor Zingales may properly be considered a moderate for capitalism (as opposed to the Ayn Randian “radical” for capitalism or the pure anti-capitalism professed by the Occupiers.) Regarding the economic system his book is about, he doesn’t go far enough for the libertarian but he goes too far for the leftist.
Perhaps this is exactly what America needs right now.
Because let’s face facts: neither pure libertarianism or pure socialism will exist in the country if history is an indicator and with any cataclysmic disaster notwithstanding. Zingales book may well someday be viewed as the first—or most popular and best—of the new “fusionism” I have referenced in previous columns: an alliance—uneasy perhaps, but numerically strong—of the political Right and Left. The author himself goes so far to say, early in the book, that he is specifically addressing both the Tea Party and the Occupy movement. His may be the only economic book that aims to reach out to the (apparently) disparate sides.
“A Capitalism For The People” makes for fascinating and interesting reading (if I haven’t already scared off any of you purists out there.) Zingales clearly states that he is pro-market as opposed to pro-business, a fascinating distinction he returns to several times in the book. He writes, “A pro-business agenda aims at maximizing the profits of existing firms; a pro-market agenda, by contrast, aims at encouraging the best business conditions for everyone.”
In a very blunt and highly readable style, Zingales takes on both the crony capitalists/”rent seekers,” our oligopolistic financial system (“In the last decade, our financial sector has become too concentrated and too powerful for its own good.”) as well as the dreaded private/public partnership (which we in the South know about all too well) and the heavy handedness of government over-regulation.
But in taking so many shots within such a wide swath, Zingales does not lose sight of the need to offer solutions to the problems he points out and attacks. Agree with them or not, it is refreshing to see a serious scholar make an audacious, non-partisan attempt at addressing our nation’s many economic maladies.
Amidst heightened passions, zig-zagging markets, high-flying rhetoric and angry denunciations from all sides, Zingales boldly says that it’s time for the people to rally. “…We may be able to channel the new populism into saving rather than destroying free markets.”
This book is a valuable first step.
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