*The Great Deformation*

The author is David A. Stockman and the subtitle is How Crony Capitalism Corrupts Markets and Democracy.

I am a big fan of The Triumph of Politics, for its understanding of American government, but in this book I disagree with too many of the key points.  The author likes “sound money” and dislikes “easy money” yet this position is never really argued for.  Fiat money is responsible for a very large number of ills but of course financial crises and bubbles are hardly new.  Consistently, the author knows to vilify Milton Friedman.  He is an explicit liquidationist of the kind you thought Brad DeLong was simply imagining.

On money and macro, I am more persuaded by Friedman, Irving Fisher, early Keynes, David Hume, and Scott Sumner, among others.  If you are not, you will find this a very energetic economic history, including the New Deal, from a passionately argued point of view.  There is an odd mix of historical detail and theoretical lacunae.  I am still wondering what we are supposed to do when the deflationary shock arrives.  The Stockman of The Triumph of Politics, I think, would have seen that our current institutions are not up to supporting such volatility.


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