Customer Reviews

A World of Wealth: How Capitalism Turns Profits into Progress

5 star:		(22)
4 star:		(40)
3 star:		(19)
2 star:		(6)
1 star:		(1)

 

 

I find it very easy to accept the Washington Times review posted here. It is a very good overview of Mr. Donlan's book. Too good, perhaps, as it almost convinced me not to bother writing one of my own, but this book deserves some comments.

Tom Donlan has done an exceptionally good job of describing the capitalist system and its operation in terms that are, at one and the same time, sufficiently sophisticated to attract specialists, yet intelligible to a much broader public. Mr. Donlan's viewpoint is very obvious; he's "pro-capitalism" and not ashamed to say so, yet he does not beat you over the head with it. When discussing climate change, for example, he presents Vice President Gore's viewpoint and his own, but without the overly-emotionally, anti-intellectual verbiage so common these days from both sides of this issue. Rather, he discusses what Gore's conclusions may mean in terms of the capitalist system's response. As he says, "Global warming is not just an environmental problem; it is also an economic problem." Donlan rightly emphasizes a subject that will become increasingly important as we move from debate to action.

"A World of Wealth" is not a polemic so much as it is a patient and intelligent explanation of a system that most of us think we understand, but few of us can explain in any detail. By focusing on how capitalism and free markets work in a straightforward manner, Donlan brings us back to the basics of the system that has provided is with so much wealth to enjoy and to squander. His emotional commitment to capitalism is clear, but it is his plain-spoken analysis that makes this book worth reading by anyone, socialists included.

I enjoy reading books on finance and economics. Books like Mohamed el-Erian's "When Markets Collide," Nicholas Taleb's "Fooled by Randomness," and Robert Shiller's "Irrational Exuberance" inform me and provide deeper insight into important ideas and trends. But I would liken Thomas Donlan's "A World of Wealth" to Fareed Zakaria's "The Post-American World". They stand in a somewhat different class. They are intelligent, thought-provoking, and deal with very important topics, yet they are also eminently readable and understandable by anyone with a decent education, regardless of their technical training. This should be no surprise. Both Zakaria (formerly editor of Foreign Affairs and currently editor of Newsweek International) and Donlan are professional journalists and both have many years of editorial experience for publications that demand excellence. They know how to communicate their thoughts clearly and succinctly on topics of great importance. That is worth the price of a book like "A World of Wealth" in itself.

Economics is an incredibly complex field. It remains one of the most esoteric ideals for the layman - us average folks really don't study it much beyond balancing the checkbook on average, and what work we put into retirement funds. However, one could argue in the world in which we live it's prudent to do so. A World of Wealth is a great starting point for this daunting venture. It has it's flaws to be sure. Overall, if you are already immersed in studying economics, it will merely accent what you know. If you're a neophyte to the world of how capitalism works, and how it makes the world run, it's a decent place to begin.

My biggest complaint was that the author did not cite sources for his claims. For instance, there is a chapter on how capitalism effects the enviroment. I may disagree with some of his statements (such as global warming being more or less hype), but none of the sources used to make his points are cited at all. This is disappointing for me, because the text makes several interesting points I would not have minded expounding on, but cannot, due to there being no available means to see where he garnered the information.

The book is overall well-written and easily understandable, even without a background in economics. If you'd like a better understanding for the global impacts of capitalism, and also a review of recent history regarding its efficiency, this book shines here. I only wish it had more citing/notation. Admittedly, that is a personal bias and preference of mine...but for a book that professes to be a textbook of all things, it seems odd that there is none. So, fewer stars for that. Otherwise, it's recommended for being a well-rounded (if biased) review of capitalism and what it does for the world.

The author of this book sets out with a noble cause: to explain
economics in simple, easy to understand terms, and to apply it to
issues currently facing our country. Although at times the book is a bit dry, a bit simplistic, and draws some questionable conclusions, he does a decent job at accomplishing this. Overall, however, it is a good basic read that should be required reading for political candidates and voters in general.

The thing about Economics is that it takes all the emotion out of problems and describes them in simple terms like supply and demand. With oil, for instance, the pure economic solution is simply to charge the market price that perfectly matches the supply curve with the demand curve. Since people don't like paying $4 a gallon for gas, all sorts of imperfections have complicated the market, but the true capitalist response is simply to charge $200 a barrel for oil if the market requires it. Alternative energies will be developed and be cost effective once the market price is high enough.

The author also applies this sort of thought to global warming (with some very controversial conclusions), huge corporate profits, market regulation, health care, poverty, and more. The subject matter is all very timely and I wish everyone who will take part in politics would read this book. Understanding what true capitalism in a free market economy should be would help citizens understand how to implement such things, or whether they actually want what they say they do.

Length:: 3:36 Mins

This book explains a bit about how the free market works and then takes on immigration, health care, the environment, and other issues facing us. The book gives the history of each issue from a market perspective and argues that the best way to make progress is simply to get out of the market's way.

This country would be better off if the public understood better how the market works and why you want to be careful about messing with it. This book delivers on that and is an easy, interesting read. However, it is deliberately light on theory, so if you know any economics you will probably feel that the free market is being oversold in the sense that there is little acknowledgment of the conditions required for the free market to function effectively (e.g. barriers to competition must be low, the transacting parties must understand what they are getting, the costs and benefits must be borne by the transacting parties, etc.). Instead, it ends up sounding like the free market is a magic wand that solves all problems, and all regulation is bad.

Also, the author makes some mistakes (or misrepresentations) which are egregious enough to make one wonder how much the accuracy of the rest can be trusted. For example,
- On page 3 he tries to justify big profits by saying that producers must have the funds to buy the next round of supplies. That is quite misleading: even if a company makes a profit of precisely zero, that means its revenues were sufficient to cover its expenses, which includes all of the supplies it needed for production, so it has that same amount of money for the next round. In fact, the mere existence of big profits is evidence that there are barriers to competition -- that is, the free market isn't operating freely.
- On page 90 he presents the fantastic explanation that the reason we have fewer children on average than we did not so long ago is that during this time we evolved, in the genetic sense, to respond to good times by having fewer children. If you don't have a strong background in evolution and associated disciplines, trust me -- that's ridiculous.
- On page 124 he discusses why Microsoft can be successful charging for products when there are free (and faster and more secure and less buggy) alternatives available. He argues that the idea that Microsoft has a monopoly is an illusion based on carefully defining the relevant market. Yeah, sure. And he dismisses the judge's findings as circular logic because "Microsoft supposedly profited from its Windows monopoly while sacrificing profits to protect the monopoly." Of course that is *not* circular logic, because the profits being protected were *future* profits. The whole discussion of monopoly seemed quite tainted.

I got a similar taste of snake oil from some of the other sections as well, e.g. the environment -- no mention of the fact that if my consumption damages the environment then others are paying part of the costs, and under those conditions the free market causes the wrong thing to happen.

Anyway, without dragging this out any further, this is an interesting read and you are certain to learn something. I personally like free-market solutions and think the government's role should whenever possible be to make sure that the conditions are right for the free market to operate effectively. But this book goes overboard and presents a strongly biased, even misleading view.

I had thought that a World of Wealth was going to be a thoughtful discussion of economic based solutions to many of the nation's and world's problems. I looked forward to understanding how Thomas Dolan of Barron's was going to argue the side of free markets and economic forces. Unfortunately, this book is more political rhetoric than a thoughtful discussion of the issues and how economics would respond. The books chapters promise to deal with issues as diverse as the energy crisis, environmental pollution, free trade, investment, etc. Regardless of the issue the answer is always the same: free markets work, market intervention is at the root cause of the problem, leave us alone.

So if you like those arguments, read this book, you will learn many things that you already know or have heard before. If you do not, or you want a balanced argument, then avoid this book.

I understand Dolan's views and the arguments he advances, but the big fault is that he relies on a very pristine definition of markets, prices, and their behavior. To Dolan the market is nameless, faceless, and always right because where ever it goes is where it is supposed to go. The markets would only work if we could keep policy and politics out of the way. Here is where Dolan forgets something very important -- the discipline of economics was originally called political economy and you need to consider both to come out with a well rounded view of what is going on, the causes, the answers etc. The reason why its political economy is that pricing mechanisms are not perfect, even in our internet driven age, and do not account for all of the costs, nor all of the utility they way they would in classic economic theory.

The other shortcoming of Dolan's arguments is that he fails to make the connection between the individual (micro) decisions and the market (macro) results. The book is full on macro-economic based with the individual their motivation, or the short term vs. long-term considerations taken into account. These very real factors distort the macro market as people opt for higher taxes to support clean air and water for example.

In leaving out these two pieces, Dolan's work rings hollow as they are more of a policy shout out for free markets than a reasoned response to the challenges facing America and the world.

I will not go through the book chapter by chapter because the answers are the same -- less policy, less politics, there is no short-term disruption, -- markets adjust themselves. While intellectually stimulating, Dolan's thoughts come into sharp contrast with the realities we see everyday of pollution, high-energy prices, people being laid off and not finding work, etc.

I do not recommend this book, for these reasons and the fact that a world of wealth is not made by a mindless or faceless market, no it is made one person at a time, one decision at a time that aggregate into a market that is more about behavior, politics and economics, than the cold hard facts of pricing. Dolan says it all in his dedication "To Carol, who has heard it all before." No offense to Carol, but we have all heard this all before.

If you are looking for a good book on this subject, I heartily recommend "The Origins of Wealth" by Eric D. Beinhocker as it incorporates many of the advances of the last thirty years of economic thinking into a compelling book.

Given the current state of affairs in the world's economy I can't think of a better time to read this. Others have already debated the validity of the ideas in the book so I won't go over that.

I have not given economics books much reading since college but even without that the book is an easy read going over the main forces shaping economics. The topics that the author focuses on are also very relevant to today. The examples used are simple but not oversimplified and should give the reader a good understanding of the basic consequences of the pursuit of wealth.

This is an interesting read but did remind me of my days at university with classes such as economics and statistics. This was less dry and boring and makes many valid points. Maybe it should be mandatory reading for our folks in Washington?

I have no background in economics, but the siren call of free markets has always appealed to me. I eagerly read this book, hoping to learn more about free market economics. The time was right, given what is happening in financial markets right now (late September 2008).

Unfortunately, this book was ultimately unsatisfying. In chapter after chapter, the author starts to create a case for free markets in a specific area (energy policy, ecology, price controls, health insurance, etc.) But his arguments are brief and his reasoning unsupported. I was initially excited by what I read, but eventually I recognized that the arguments were incomplete and ultimately unconvincing.

What I would have liked to have seen was a deeper exploration of how free market policies have succeeded in one or more of the areas covered. And there must be some cases where regulations are supportable, although this author doesn't seem to think so. If Alan Greenspan can express shock at the failure of free markets in the mortgage business (October 2008), then we should probably acknowledge that some regulation is necessary.

At a bit over 200 pages, we can't expect a complete exploration of every aspect of free market capitalism. But I would have preferred a more even handed and detailed exploration of a few issues, rather than the light treatment given here to so many issues.

The sins of capitalism are vast. The opportunities of capitalism span this gulf with a thousand bridges of opportunity. Mr. Donlan has the craft, the experience and the knowledge to 'condemn with faint praise' those who rule by fiat or dictat.
Sit here. Enjoy. The word craft is elegant. The complex story is one told simply, with grace.
Yes, we are over taxed. The wealthy are taxed because we create wealth, because we have capital. It is the 80/20 rule applied again. 20% contribute. 80% consume. Whether it is vegetables or taxes, cars or cabbages, the rule always works. Edison did not create the light bulb. He simply mass manufactured it, after much trial and error: with the capital of J P Morgan. The results are well illuminated in this brilliant tome.
Beyond here, lie dragons. The unknown is just that. Most are fearful and unwilling. A few try; fewer succeed. Those who do create opportunity. Some call it wealth. Others tax it.
Read this book. Hate , depise, like or love it - but read it.