Kel Kelly had several ambitions in writing this book. He wanted a final and decisive answer to the constant attacks on economic freedom that have emerged since the housing bust. As in the s, the enemies of capitalism are having a field-day with - but with bad analytics, bad economics, and a dreadful prescription that only makes matters worse. Also, Kel wanted to bring the energy, rigor, enlightenment, and fun of the website of the Mises Institute to the printed page. In both respects, he has succeeded many times over.
It is a book that every freedom lover can rally around and give to the deeply confused. And it is true that this book is very powerful: It moves the Austrian theory of the business cycle up front to present a popular understanding of booms and busts. Without understanding this point, there is scarce hope for figuring out the rest of the puzzle that is the economic stagnation of today. View the discussion thread. Skip to main content. Thus, Kelly's message is to explain and justify an unrestricted "free market. And he observes that, when those restrictions hamper the proper functioning of the economy, capitalism is blamed unfairly, and the "reforms" called for are usually more harmful regulation.
The Case for Legalizing Capitalism
All in all, "Kelly's book provides a very readable description of all the ways that government goes too far in regulating businesses and manipulating the economy. The author calls for a return to "real capitalism," a truly free marketplace, and states that all other schools of economic thought "endorse various forms of government control of the economy and of individuals.
Thus, a weakness of the book is that he does not identify where government does need to regulate, police, and control both the economy and the people. Much of the political debate in recent years entails the confusing references to "de-regulation. Such a proper split describing needed government action as compared to burdensome government action was spelled out 25 years ago in Joseph Johnston's "The Limits of Government. The bulk of the book is aimed at: Keynsian theory is refuted, especially in it's pursuit of faulty statistics about money supply, GDP growth, and its emphasis on consumer spending.
Kelly shows the warts in the stimulus program--the idea that pump priming, giving the public more dollars, will somehow jump start constructive economic activity.
The author then describes just how such attempts to manage the economy fail, dangerously inflate the money supply, brings on inflation, and causes boom and bust scenarios. All of this is explained without the economic jargon used by professional economists and is reasonably accessible for most lay readers. An excellent part of the book is the author's explanation of why almost all economists support some form of the failed Keynesian theories. First, he reveals the oft-ignored fact that Alan Greenspan was a free market champion in his youth before he was "given the chance to run a prestigious and economically powerful governmental agency.
The author indirectly endorses a theory of mine--that over-educated abstract thinkers--the kinds that get all "A's" in school, have a natural liking of theory over practice, and are attracted to ideas that require them to be at the top thinking about solutions for those at the bottom. For example Kelly attributes the adherence to Keynesian theory, supporting government management of our economy, in almost all our schools, colleges, and governmental institutions, to three factors: They like socialist ideologies because they seem so moral, altruistic, and enlightened.
They don't understand the market place because they have never participated in business, having spent their entire lives in academic study, and 3.
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The only place they can get a job is advising on how to control or improve the economy! Under the free market system there is no place for managers or experts to manipulate the system. Because most economists work for the government, or organizations that seek to shape governmental policies, they have to be "government economists" rather than "free market economists" if they want employment. And since governments control our schools and colleges, and provide the grants for studies, and funds research, it does not pay to be a free market specialist! We have been giving them "aid," free food and medicine, for over 50 years, but no one has given them a free market place or the right to own private property as capitalism requires.
The book is also very good at explaining why the financial community favors both massive governmental regulation and the federal Reserve's fractional banking--those are the policies that give the bankers oodles of cheap money to lend out, speculate with, and live off, all the while with federal support should they get into serious financial trouble.
Kelly covers the recent mortgage meltdown, as well as many historical financial panics since the Civil War, and shows how they arose primarily from the ill-advised inflationary fanning of credit by bankers. In concluding, Kelly laments that the Government economists will occasionally "consider" free market capitalism but then argue that there is no proof that it will actually work in practice.
And he asks for a regional free market experiment to demonstrate that it works, even though he states that "no true free market has ever existed in the history of the world. Even I, a fan of von Mises, do not believe in a market entirely free of some regulation. It would have helped the book if the author had looked at history and seen that most prosperous societies during the last 4, years have enjoyed "substantially" free markets.
The Case for Legalizing Capitalism
It's not all or nothing. But Kelly is correct that in America today we have gone way too far in burdening small business, and relied way too much on Keynesian pump priming, stimulus plans, and bail outs of those we let get too big to fail. His book is an excellent case for reducing the influence of economists that have been basically bought and paid for by the special interests they support. Kindle Edition Verified Purchase. This is not a bad book by any means, it is just trying to do much too much at once. It tries to rationalize Austrian free-market economics with Anarcho-Capitalism and succeeds at neither.
It lacks the clarity of "Economics in One Lesson" and, while more modern, it lacks the dedicated focus of "For a New Liberty". There are momements of pure brilliance and they are why I kept reading; they were just buried in a meandering and circular oratory. I think an interesting opportunity was missed; but it would have to have better focus and tighter writing before it could replace the 'classic' texts it tries to join together. Over all, it was twice as long and half as well written and either work.
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One person found this helpful. This book is great for people interested in economics. It will show you how free markets function and then show you how the govn't regulates them to death. Kinda like how fat tends to clog the arteries. I wholeheartedly recommend it. It started me down a rabbit hole I shall never return from.
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I used to be a republican, of sorts, leaning towards libertarian. I didn't vote last election.
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The market can fix itself. But it can't do it unless it's allowed to do so. All the distortion must end. And it will - there's no stopping it. The financial collapse is coming. This book will show you how the free market functions. It really is quite easy to read.
I implore it's importance, if you are a truth seeker or have any interest in Economics. One person found this helpful 2 people found this helpful. This is one of my four favorite introductory books defending free markets. Concise and the points are well made. I highly recommend this book.