What Makes the World Go Round?

The Cash Nexus: Money and Power in the Modern World, 1700-2000
by Niall Ferguson
Basic Books, 552 pp., $30.00


In 1987 the historian Paul Kennedy published a controversial book called The Rise and Fall of the Great Powers: Economic Change and Military Conflict from 1500 to 2000. Its message was that the United States was suffering from imperial “overstretch.” Its economy was no longer large or dynamic enough to support its strategic commitments. It had to accept a lesser role in a “multipolar” world. This message was embedded in a grand historical-geopolitical narrative. Kennedy discerned a long-run correlation between economic and military power. This gave rise to a historic pattern of “rise and fall,” in which successive dominant powers were drained of economic vitality by the cost of fending off their challengers.

Continue reading “What Makes the World Go Round?”


The World on a String

Open Society: Reforming Global Capitalism
by George Soros
Public Affairs, 365 pp., $26.00

George Soros is the best-known financial speculator of our time, godfather of hedge funds, those fast-moving and largely unregulated raiders in the corporate jungle that make their killings from fluctuations in the prices of stocks, commodities, currencies. When he writes books readers might reasonably expect tips on how to make money. They will be disappointed. Soros’s ambitions are altogether more exalted. Having become a billionaire, he has set himself up as the philosopher and statesman of global capitalism, tirelessly telling the world that it now needs to remove the ladder by which he himself climbed to fame and fortune. On January 2 he was reported predicting a “hard and bouncy” landing for the US economy.

Continue reading “The World on a String”

What’s Left of Marx?

Review of Karl Marx: A Life by Francis Wheen
Norton, 431 pp., $27.95


When Karl Marx was twenty-four, a contemporary wrote of him: “Imagine Rousseau, Voltaire, Holbach, Lessing, Heine and Hegel fused into one person…and you have Dr. Marx.” Marx was not one of those brilliant young men who fail to live up to their promise. He produced the most powerful, coherent, and influential secular system of ideas ever devised to explain man’s past, analyze his present, and predict his future.

Continue reading “What’s Left of Marx?”

All in the Family

Five Sisters: The Langhornes of Virginia
by James Fox
Simon and Schuster, 496 pp., $30.00


In the early 1980s, the English writer James Fox was shown a large trunk at his grandfather’s house in Northamptonshire covered in Cunard and White Star steamship stickers. On inspection it turned out to contain thousands of letters between the Langhorne sisters, as well as other correspondence, carefully collected and preserved by his grandfather, Robert Brand, who had married one of them. It was a collection, Fox writes, made possible by two or three posts a day and the convention of returning letters to their senders “in time of grief.” That first encounter with the trunk has led to his absorbing chronicle of a Virginian family which sprang to prominence on both sides of the Atlantic at the turn of the last century, but paid a heavy price for fame and fortune in the wrecked lives of their children.

Continue reading “All in the Family”

Family Values

The House of Rothschild: The World’s Banker, 1849-1999
by Niall Ferguson
Viking, 658 pp., $34.95

The House of Rothschild: Money’s Prophets, 1798-1848
by Niall Ferguson
Penguin, 518 pp., $18.95 (paper)


In his delightful memoirs, the art historian Kenneth Clark recalls that Lord Cunliffe, governor of the Bank of England, came to lunch with his father on August 2, 1914. “There’s talk of a war,” said Lord Cunliffe, “but it will never happen; the Germans haven’t got the credits.” Almost a century earlier Gutle Rothschild, widow of Mayer Amschel Rothschild, is supposed to have said of a dispute between England and Prussia, “It won’t come to war; my sons won’t provide money for it.” Niall Ferguson’s extraordinary book is both a history of the world’s most powerful banking dynasty and an attempt to understand the role of high finance in an international system about which such statements could be made and be believed.

Continue reading “Family Values”


Morgan: American Financier
by Jean Strouse
Random House, 796 pp., $34.95

When John Pierpont Morgan died in 1913, he was the most powerful banker in the world. As the main conduit for British foreign investment into North America he helped transform the United States from a society of yeoman farmers into an industrial colossus. More controversially, Morgan helped change competitive business into what Lenin called “monopoly capitalism.” His bank financed the consolidation of large sectors of the American transportation, steel, and electricity industries. Most of this made economic sense, eliminating destructive competition, stabilizing the market, and lowering costs to the consumer through economies of scale and marketing. But the resulting concentration of power and wealth produced a popular backlash, leading Congress to pass the Sherman Antitrust Act in 1890.

Continue reading “Giant”