Jonathan Levy - Ages of American Capitalism: A History of the United States

A ny historian can tell you that origins are a very tricky subject. One beginning only reveals another. Still, I know the proximate origin for the writing of this book.

More than ten years ago I was walking in Princeton, New Jersey. It was Monday, September 15, 2008. The next day I was to make the short trip to New York City to meet a friend who worked on Wall Street for lunch.

But I received a message from my friend that obviously he would not be able to meet on Tuesday, given what was happening. What was happening? I had not been following the news. I had arrived at Princeton University one month before, a greenhorn assistant professor struggling to finish my doctoral dissertation. How lucky I was to be recently hired. The academic job market was about to collapse, too. So focused on completing my dissertation in order to keep my job, I was unaware that my chosen academic subjectcapitalismwas then imploding in the most spectacular fashion. For on Monday, September 15, 2008, the New York investment bank Lehman Brothers declared bankruptcy. Fearful and panicked, bankers almost completely ceased trading with one another. Seizing up, the global financial system very nearly crashed. U.S. Treasury secretary Hank Paulson dry-heaved into an office trash can. The Great Recession had begun.

I finished my dissertation. In the spring of 2009, there were bank stress tests, and the panic finally subsided. I taught a class on the history of American capitalism to a small group of enthusiastic undergraduates who were disappointed when the class ended not long after World War II, about as far as the existing historical literature was then able to take us. The students wanted to know the whole story, how it all fit together. I did, too.

Since then I published my first book, a history of risk and finance in the nineteenth century. I kept teaching the class, eventually at the University of Chicago, where I earned my PhD, and where I am now currently employed. Every time I taught it, the endpoint of the class moved closer to the present, as 2008 moved further into the distance. I tried to tackle the whole story, how it all fit together. I wrote this book. Then, just as I finished it in 2020, the economy took another deep dive.

Writing this book has been an education. Since 2008, in the academic circles in which I travel, there has been talk of a new history of capitalism. Whether I like the label or not, I am considered one of its practitioners. While much of this new scholarship is excellent, in my opinion what has been missing in it has been an engagement with economics. To write this book, I have learned and drawn from a tradition of thought in economics, sustained in the twentieth century by such thinkers as John Maynard Keynes, Thorstein Veblen, Joseph Schumpeter, John Hicks, Nicholas Kaldor, and Albert Hirschman. I have also drawn from the pre-twentieth-century, so-called classical political economists that many of them engaged with, above all Adam Smith but also Karl Marx. Learning from these writers, I worked to develop the economic framework that I have employed in this book.

Every single one of these individuals is dead, almost all for quite some time. Why go back to these men, all prominent in their day, but so long departedtheir ideas so long dated? After all, over the years since, economics has made remarkable intellectual progress. But this progress has been in a particular direction, cutting a path of inquiry narrower than the one that economists once carved out for themselves. Today mainstream economics follows a path of great mathematical rigor that, precisely due to this virtue, does not make much room for other accounts of economic lifeincluding historical accounts. I have attempted to make a place for economics in the study of history. That includes contemporary economics and its offshoot discipline of economic history, an essential body of scholarship without which this book could not have been written. But I would argue for the rightful place of historical analysis in economics, and for a broader vision of what the economy is. Dormant traditions in economic thought once argued for this position. Seeking to revive them, I have tried to recut a wider path in order to make room for the inclusion of many subjectsspanning, say, politics and society, or environment and psychethat once were but today are not typically seen as relevant to understanding the economy in which we live. My conviction is that these subjects and many others are relevant. The need to include them is my excuse for having written such a long book.

Therefore, in addition to an economic history, this book can be read as a new single-volume history of the United States. It is a chronicle of American economic life from the English colonial settlement of North America in the seventeenth century through the Great Recession. It is divided into four Ages of American Capitalism: Book One, The Age of Commerce (16601860); Book Two, The Age of Capital (18601932); Book Three, The Age of Control (19321980); and Book Four, The Age of Chaos (1980).

As the United States is often rightly taken to be the quintessential capitalist society, an economic perspective does afford a unique purchase upon its history. A history of the U.S. economy must encompass a great deal: demographic trends, trade patterns, growth rates, energy regimes, incentives, and productivity measurements. But it must also encompass Thomas Jeffersons disdain for the English. Henry David Thoreaus moral critique of commerce, and Herman Melvilles response. The corruptions of the Lincoln administration. Labor violence. FDRs jokes. The persistence of white supremacy. The twentieth-century architecture of shopping malls. Second-wave feminists critique of marriage. The erotic quality of much stock market speculation. Reagans optimism about markets. Obamas ambivalence about bankers. And much more, in the pages ahead.