“The Future of Capitalism: Manifest Destiny on the New Frontier”


I wrote my little essay for the bicentennial of the publication of this great book.


The very first article, I think, that I ever published beyond student periodicals in high school and college, written back in 1976 when Gerald Ford was still president of the United States.  An ominous indicator of my horrifying political views:





  • Lucy Mcgee

    Before the financial crisis in 2008/2009, Alan Greenspan believed that unfettered financial markets always lead to efficient outcomes, and that regulation only hampered capital formation, which was the reason that banking derivatives remained a “dark market” with little or no regulation even after the dire warnings of Brooksley Born, once head of the CFTC, a decade earlier. There is an excellent Frontline documentary about this entitled “The Warning”.

    The “invisible hand” espoused by some economists, gave politicians the ability to stay or remove regulation, desired by people like Born, who saw serious problems after the collapse of LTCM. Yet, her warnings were ignored and she was chastised before a congressional committee by President Clinton’s “working group”.

    Very few economists saw the financial crisis and collapse of Lehman Brothers. The problem with Adam Smith’s model, is that it is far to simplistic, and was created during a very different economic time. It requires perfect information in order to succeed, which economies today are certainly lacking because of size and complexity. And it is exactly this “imperfect information” that the derivatives markets were able to exploit.