How Capitalism Saved America

The Untold History of Our Country, From the Pilgrims to the Present
by Thomas DiLorenzo

The easiest way to describe this book would be to call it an economic history of the United States of America. & while that is true, that description sets up a negative mindset in a lot of people. Some people will say: "If it is a history, & even more so, 1 about economics, it has to be boring." Or " It must be a difficult read because it will go into a lot of arcane economic theory."

Let me put these misconceptions to rest at the very beginning of this post. It is not dull, boring or a difficult read. Instead it is a highly readable look at exactly what the title says it looks at.

The Introduction lays the groundwork for the task the author has set out for himself. He states that there are misconceptions & myths about what capitalism really is & how it works. He gives a short overview of these "mistaken beliefs about capitalism" & the confusion they create. He states his purpose is for us to "(L)earn about the realities of capitalism in the United Staes, how, from the very beginning, capitalism has been vital to America's growth, and how excessive government interference in the economy has only exacerbated economic problems and stiffled growth."

Before he actually gets into the history of capitalism in America he uses the 1st chapter to explain what capitalism really is & what it isn't. There are several important things he looks at, the fact that property rights is of central importance in capitalism, that the consumer is sovereign, & that capitalism is a win-win situation for everyone involved.

The 2nd chapter deals with the anti-capitalist mindset & its love affair with socialism. He also gives an overview of the harm that mindset has had on allowing capitalism to function as it should. He goes into this in greater detail later in the book. Another thing he focuses in on in this chapter is what "mercantilism" is. This section was a real eye opener to me as it showed how some of my assumptions of what capitalism is were wrong. That what I equated with capitalism was actually mercantilism.

With this groundwork laid, we now get into the heart of the book. He begins with the arrival of the Jamestown settlers. & he ends up with the state of things in the USA today (2004) The book is more of an overview than a detailed history. Which works perfectly. It gets across the basic facts without bogging things down. Each chapter could inspire a book on its own to develop what he points out. He keeps things simple without becoming simplistic. & he makes you think by looking at the facts, not only opinions.

My favorite chapter was that on the Revolutionary War era. Most of us see the era in simplistic terms of British denial of American rights. While true, what he looks at is the rights denied & why they were denied. & esp the part that British Mercantilism played in it. Look at the Declaration & you see clearly that economic issues were, directly or indirectly, a major cause of the Revolution. The same can be said about the Constitution. Its many safeguards of liberty & property show that this is so. (& supports why, IMHO, it is of ultimate importance that we have judges that uphold orignal intent & the natural law that that intent was based upon.)

Anyone who is looking for an honest, accurate defense of capitalism will find it in this book. Those that uphold mercantilism or socialism will not like the light he sheds on their goals & plans. They depend on much of the conventional wisdom he (rightly) shoots down to enable them to attack capitalism. He gives an explanation of capitalism that is clearly aimed at the average American who has little or no background in economics. In doing so he enables the average reader to better understand what he or she was taught in American History. It also challenges the reader to think about what is going on in our country today & what he or she should do to ensure that our country turns things arround & again allows capitalism to flourish as it should.

The book turned out to be what I expected it to be. I highly recomend it as a must read for those who truly want to better understand capitalism & our country. My only regret is not discovering this book when it 1st came out in 2004.

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Thomas J. DiLorenzo (born 1954) is an American professor of economics in the Sellinger School of Business & Management at Loyola College in Baltimore, Maryland. He is an adherent of the Austrian School of Economics. He is a senior faculty member of the Ludwig von Mises Institute. He is a Research Fellow at The Independent Institute. He holds a Ph.D. in Economics. He has written or co-written about 12 books. He lectures widely. He has been invited to deliver a series of lectures at the University of Prague in April 2008 to coincide with the annual Prague Conference on Political Economy. He will also give the Cuhel Memorial Lecture at the conference.