Jonathan Levy: Ages of American Capitalism

These epochs of US  history and many more are viewed afresh by Jon as stages of American economic development: the age of commerce, the age of capital, the age of control, and our own age of chaos. We find in Jon’s book wholly new ideas and frameworks. These include the core concept of capital itself, which Jon, following the lead of an earlier generation of capital theorists, defines as a psychological process of forward-looking monetary valuation. Capital, Jon tells us, is not a thing but a process, a process through which a legal asset is invested with pecuniary value in light of its capacity to yield a future pecuniary profit.

But this reimagining of the history of capitalism around the capital process is just the beginning of Jon’s analysis. He also reconsiders the psychic drives and attitudes that drive valuation. Not just the profit motive but an amalgam of shifting motivations shape pecuniary valuation: imperial ambition, the vision of a white man’s property owning republic, the desire to make one’s mark in the heavy industries, the working man’s democracy, consumerist utopias, and so on.

And beneath all of these visions churn the animal spirits – a mixture of confidence and fear about what the future will bring. Jon also introduces us to the mechanisms driving economic development in each epoch of american capitalism: the Smithian multipliers of market expansion and productivity growth in the age of commerce, the investment multipliers have sustained fixed investment of the age of capital, the Keynesian multipliers controlling the macroeconomy of the age of control, and finally the neurotic fixation on asset price appreciation in the age of chaos.

Overarching all these new concepts, Jon finds that the law of liquidity and the mixed impulses toward illiquid investment are what promote or hinder genuine economic development, the winding path toward what John Maynard Keynes called “economic bliss. ” Now, in mentioning these themes I have of course barely scratched the surface of Jon’s monumental book, which runs to 900 pages of lucid yet theoretically ambitious historical narrative. So all of this is really just to say that Jon’s book will give us plenty to discuss over the next hour.

Alright, I want to turn now to the practicalities of today’s event. I need to introduce our speakers and then add a word from our sponsors. And I’ll end with a brief remark about the format for today’s event.

03:49 - Jonathan Levy is professor of US History, Fundamentals, Social Thought, and The College at the University of Chicago, where he is also faculty chair of the Law, Letters, and Society program and a senior fellow of the Society of Fellows in the Liberal Arts. His first book was the multi-award-winning Freaks of Fortune: The Emerging World of Capitalism and Risk in America, published by Harvard University Press in 2012. in addition to his new book, Jon has written widely in recent years on several topics in political economy, including corporations, profit, philanthropy, and the psychological bases of capitalist valuation.

To discuss his new book, he is joined by Professor Emma Rothschild. Professor Rothschild is Jeremy and Jane Knowles Professor of History at Harvard University. She’s director of the Joint Center for History and Economics, a fellow of Magdalene College, Cambridge, and professeur invitée at Science Po in Paris. Her books include Economic Sentiments: Adam Smith, Condorcet, and the Enlightenment, published by Harvard in 2001, and most recently, An Infinite History: The Story of a Family in France over Three Centuries, published by Princeton just this year.

Now, a word from our sponsors. Today’s event is presented by the Chicago Center for Contemporary Theory at the University of Chicago and co-sponsored by the Joint Center for History and Economics at Harvard University,  as well as the Seminary Co-op Bookstore and the Law, Letters, and Society program at the University of Chicago. To all of those sponsors of today’s event, we give our thanks.

05:34 - Finally, a brief remark about format. Professor Rothschild will offer an opening comment on Jon’s book, to which, uh, Jon will respond in turn. And the idea is that the conversation will unfold from there. As moderator, I will be taking questions from our from our large audience, uh, which you can post in the Q&A box, I believe, on the Zoom platform. Uh, and I, uh, plan to inject some of these questions into the conversation as we proceed so, uh, please add questions to the Q&A box really whenever you wish from- from now on and I’ll try to fold those into the conversation as best I can.

Uh, we will wrap up by 1:00pm central time, or in 53 minutes from now. Okay, so with that I will hand over to Professor Rothschild.

06:31 - [Emma Rothschild] Thank you very much, and it’s a real pleasure to be here. I actually have thousands of questions to ask Jon Levy and i’m going to, um, limit myself to only a couple. But I want to start by saying something about the Ages of American Capitalism as a book, and as literary genre or style. Jon Levy has done something extraordinarily new, which is to write a book which is political– in which political history and economic history really are the same thing.

This is a work in which social history, cultural history, the history of high and low economic ideas are recounted in the same story. But the integration of the political and the economic – so often described in theory, so rarely attempted in prose – is even more difficult, and it really does work in the book. It works in the apparently so familiar history of Hamilton, Jefferson, and Madison. It works in the history of the Reagan administration. It works in the history of Houston.

These- these episodes in the book are truly political history and also economic history. Um, the- the comment of an eminent political scientist quoted on the cover of the book, the back cover of the book, that the book is, quote, “unputdownable,” may have struck readers as implausible. It’s not. It’s true.

08:19 - So, um, the questions. Um, first, the- the book is in many ways a history of legal institutions, municipal as well as national. As Jon Levy writes at the outset, and as Joel Isaac quoted, “capital is the process by which a legal asset is invested with future value. ” Can you tell us a bit more about this approach using, um– engaging so systematically and seriously with the law, which does seem to me to be exceptionally promising for economic history. Where, for example, in the narrative has your study of zoning or tax codes or other legal changes been particularly important to the story?  So the second question is in relation to your thesis three, about the never-ending conflict between hoarding, or liquidity, and investment.

Um, and I wonder if you could say more about whether this really is never ending. You- you finished the book, as you say at the end, in mid June 2020, and you outline the possibility of change in the structure of investment. Do you see the recently discussed investment in material and immaterial infrastructure as a change of this sort. And – and this, I’m afraid, is a very melancholy note on which to end – and what would be the consequences of an enduring shift towards liquidity – in a sense, a long-term shift towards the long-term.

What if the never-ending conflict had actually been won by the short term? So those are my two questions among the thousands, and I really look forward to hearing you. [Jon Levy] Great, so, well let me start just by saying, uh, thank you, thank you to everyone in the audience, and then of course thank you to, uh, the sponsors for the event and everyone who helped to organize it. And then also thank you to Emma and Joel. You know, when I thought about two people to- to drag in to doing this, uh, they’re the first two people I thought of.

I mean, in part because, while the book is is long, certainly too long or at least not too short, uh, a few years ago when I was tasked with- with finishing it, you know, I had the benefit of visiting at the Joint Center for History and Economics at Harvard, thanks to Emma’s invitation, and that was the place where the book finally came into shape, in part because of the the hospitable and welcoming intellectual community there. And then finally, Joel, I have to say thank you to him.

Since he came to the university he’s been just an extraordinary benefit to our intellectual community and for me it’s been, um, you know remarkable to have his, uh, vast knowledge on these subjects to draw upon in finishing the book. Um, so thank you both. Um, let me, you know, try to address, um, the questions that- that Emma brought up. Um, of course they’re- they’re related. First, on the capitalist process and its relationship to- to law and institution and to politics.

And then then second, on, uh, the third core argument of the book, about the conflict between, um, hoarding and liquidity and long-term investment and to what degree that conflict is- is- is never-ending and and what it would mean to, um, transcend it. Um, on the first issue, I mean, as Joel mentioned, um, for me, um, as a historian of capitalism – and capitalism is of course a notoriously vexed, uh, concept, very difficult to define precisely, there’s no uh common definition of the term, and for that reason a lot of economic historians, I think for good reason, um, stay away from it – but for me in my work it’s central and I- I think that any, um, approach to understanding capitalism has to put capital, um, at its– at its center.

And so this led me, in writing the book, in doing the research for the book, into thinking, uh, to engage with a very old tradition in capital theory, uh, that Joel mentioned. Um, for me thinkers like Veblin, but also Keynes, are very important. There’s others. It’s a tradition that that really goes back to the early 20th century and that defines capital not as a thing or a factor of production, um, but as an investable asset. And so the book is very much organized around a sequence, or ages, in which different investable assets, um, became become more or less, um, prominent.

Um, clearly central to that- that process of investing in assets and seeking returns, and how that motion becomes central to defining American economic life and central to defining, I think, what a capitalist economy is and how it works, uh, is the law. So I’ll just mention maybe two or three aspects in which that’s prominent. And then of course Emma or Joel might have questions or comments that we could continue to discuss. First is the corporation and the degree to which the corporate form of enterprise has shaped American economic life over time.

There’s two trajectories in which that’s prominent in the book. The first is the rise of a corporation defined by its relationship to pecuniary profit, and I argue that that happens in the 19th century, whereas before the 19th century corporations were expressions of sovereignty and had public purposes. Across the 19th century corporations newly become defined more so as private actors in the relationship to profit making. But there’s two dimensions of that. There’s the for-profit corporation but also the rise of the non-profit corporation in the 19th century.

And so philanthropic wealth and the non-profit corporate form are essential to the book’s narrative across the 19th and 20th century. And I guess one of the reasons why I wanted to- to pull out the thread having to do with the corporation as it relates to the first point that Emma made, which of course, um, I was very flattered to hear her say that and grateful, about the integration of the political and the economic in the book. And of course, um, I wouldn’t say it’s easy but- but it’s- it’s at least an easy sentence to say, that politics often shapes economics and economics often shapes politics.

But how do you– how do you demonstrate that through historical narrative, analytically? And the corporation is- is one site to do it, because the corporation has always been a mixed public and private actor. And you can’t disentangle the politics from the enterprise. And so the corporate form is one way to kind of organize that integration, uh, and to narrate its unfolding over the course of American history. So there’s a lot more to say about that and I’m sure we might come back to that- that topic.

The second point on all this business about, um, liquidity preference and hoarding and investment, um, you know, that is a central, um, a central argument in the book, but it’s also part of the book’s narrative structure. So how- how does, you know, if capital is going to change over time – land, slaves, factories, financial assets – to kind of follow those transformations, you know, the nexus of those transformations, on the one hand is money, and money as a safe store of value, as a liquid asset, provides one means for investment to move into different assets and to create different political economic regimes of investment that I think very much define the different ages of American capitalism over time, at the same time – and there is a contradiction and a paradox here – that money, as a liquid store of value, could also prevent capital from moving into, uh, productive forms of of investment – production in the sense of just production, what you would think of – labor, enterprise, production – but also ways in which capital moves out into the built environment, into the landscape, into social relations, to order, fix, and structure economic life, but also social life and cultural life more generally.

So there is this tension in the book, and I do invoke Keynes’s general thesis that, all things being equal, owners of wealth prefer liquidity. Now, there’s different ways you can get liquidity as an owner of wealth. You can stuff gold under the mattress, leading to no production, no investment whatsoever. Or you could invest in financial securities that are speculative. Uh, Joel referred to animal spirits that can create profits, can create returns, without necessarily fixing capital out in the world long term.

Now the best thing you can get, if you can get it, is to be able to invest in an asset that gives you both, right? Gives you a safe store of value, gives you protection against risk, protection against loss, but also the opportunity to profit. I mean that is a sort of capitalist fantasy and I- I think it’s basically the fantasy that American political economy has been largely organized around since the 1980s. That’s the last age, of chaos. And it’s one of the reasons why we have a very low rate of long-term, uh, productive investment, why we have highly leveraged speculative forms of finance, uh, which which predominate to a very large extent in the American economy, um, still today.

And you know, I think the book ends– the last chapter is about the Great Recession and and the failure of the Obama administration, uh, to change that – to redirect investment and therefore to redirect the American economy on a– on a different path. And I guess the last question that Emma raised, uh, which of course is the most important question but also the most difficult to answer is, you know, what would it mean to- to transcend that– to transcend that- that contradiction, um, and to move to a new order of long-term investment? And I guess I have a number of thoughts about that.

Maybe I’ll just limit myself to- to three and then, um, you know, perhaps we can, you know, we can talk about that or anything else. First, it’s possible, um, it’s certainly possible. If we look back to the third age of the of the book, the age of– age of control, the United States economy emerges out of the Great Depression in large part during the war, um, in which the state, through programs of public investment, but, you know, once again to refer to the corporation, largely through public corporations like the Reconstruction Finance Corporation, but through mixed public and private means, the state forces long-term productive investment in the context of the war.

And then coming out of the war, largely because of pressures put by organized labor, although it’s- it’s complicated, uh, certainly a post-war generation of long-term fixed capital investment. Um, so, so it can be done. So it’s not possible, and there are historical examples that- that demonstrate that. With that said, I. think one of the – and, you know, we could talk about others – but one of the, um, I guess I will say weaknesses of the book, or one of the problems with this framing as I see it – I’m sure there are others that I haven’t thought about – is it does seem to indicate “long-term investment, good.

” And that’s certainly not not the case. You know, the idea, I guess, you know, to sort of restate it maybe better than I could in the book, is that hoarding prevents anything from happening, uh, but just because something happens doesn’t mean that we, you know, we have to– we have to like it. Um, you know, we could think of- of the history of American slavery in that regard. You know, the long-term imperial expansion of the British empire in the North American continent is premised upon, uh, a long-term imperial economic project rooted in, uh, black enslavement.

So the moral valence there is obviously, uh, quite- quite negative from our– from our views. And so the question then becomes, well, what- what- what then– it’s not just that you have to create a long-term investment regime, but it has to be one that we– that we like. And I guess there–  and here I will say, my time at the Center for History and Economics at Harvard I think was– opened my eyes to a lot of these issues. I think one would have to think about the environment, one would have to think about- about climate change.

And I think there is, although it’s somewhat muted in the book, I think there is an implicit argument in the book that the kind of, I think quite massive, long-term investment programs one would need to cope with climate change, let alone mitigate climate change or imagine a different climate future for the species, you’re not going to get it from private forms of investment – due to these problems having to do with liquidity preference that the book spends so much time, uh, describing.

So that’s- that’s one place where I’d point to. And then second, and then I’ll stop, truly. You know, one of the, um, one of the arguments in the book that- that- that– across the 20th century, you know, that I think does maybe, um, help us think about the present moment to some degree, is the argument about income politics, and about how over the 20th century especially since the New Deal, when it comes to particularly policies of redistribution that American political economy focuses on income – income support subsidies, things like Social Security, um, of course, American labor law, to refer to another important dimension of the law, is very much fixated on adversarial bargaining over the wage, as opposed to including a voice of organized labor in investment, uh, production decisions, unlike, uh, labor law regimes, um, in- in other countries.

And. so– and so there’s been a focus on the income side in American politics and not much focus on the capital side. Of course the capital side is where all these dynamics of investment, liquidity preference, hoarding, long-term, short-term play out. And so thinking about the degree to which– of course we’ve seen, um, you know a large stimulus from the Biden administration already, mostly focused on income support-type policies, which in terms of my politics, you know, I would– I would support, because ending unnecessary economic suffering is a good thing, but nonetheless those policies don’t touch that capital investment side.

24:42 - They don’t touch the prerogative to determine long-term patterns of investment. And I think that as a site, I think the book suggests that that site, politically, is the most important site – or at least there’s- there’s no site more important than it. Um, so I think that was– that was enough. I’ll, uh, I’ll stop there and- and, uh, curious to see where the conversation goes from here. So thank you. [Emma] Maybe I’ll just pick up on what you said about, um, about climate change, because one- one of the, um, the things that’s so fascinating in your work on Houston is the way you show that, um, decisions that seem short-term and seem inconsequential – about zoning or the absence of zoning, about land use, about, um, about, uh- uh, where houses are built, and- and what utilities are built out correspondingly – um, I mean, that, of course those are thought of as long-term decisions but they aren’t thought of as long-term systematic investment decisions.

And I think what comes out so clearly from your work on Houston is the extent to which, cumulatively, these small decisions, intertwined with municipal regulation or lack of regulation, have created a pattern of land use and energy use and energy dependence that- that’s extremely difficult to, um- um, to to reverse. And- and I- I- I wonder whether the kind of weightless economy of only the short term, um, is how that looks from an environmental and climate change point of view.

[Jon] Yeah, I mean, so, thanks for the opportunity to to talk about the Houston section, which is, uh– of the book, which is one of the you know closest to my heart being a native Houstonian, and- and becomes, in the last part of the book, um, although it appears in the chapter on the 1970s, but I- I try to use Houston as a– an emblematic site to make sense of a post-industrial, or at least service-oriented city, you know, much the way – and I do this too – but very much a kind of stock use of Chicago as an emblematic industrial city in the age of capital, to give a sense of the kind of texture of life on the ground within these different eras.

And I guess what drew me to to Houston, as Emma was suggesting, was precisely the the climate narrative, that it’s, um, it’s very striking, you know, to- to think that, uh, the city – in the era in which climate change as a problem becomes known, studied, enters politics – that the fastest growing, by many metrics if not all, uh, the– or if not one of the fastest growing cities in the United States has been Houston, a city, you know, completely premised upon a fossil fuel ener- regime– energy regime, in part because of- of the role of Houston in global oil extraction and oil services, but also because of the particular kind of- of city that it is.

The extreme sprawl, you know, the complete and utter dependence upon the automobile, and other reasons as well – air conditioning also comes to mind, because the city is not possible without that – and so you– so you have a city that’s growing and growing at the same time in which the problem that the city itself expresses, um, isn’t being addressed. And so on the one hand, you know, the one way to think about the long term, historically, certainly, is that it’s nothing but an accumulation of of short terms.

And I think history as a– as a genre, history provides an opportunity to- to look back over long periods of time and kind of see what the consequences long term of these short term decisions are. But then– but then, second, um, this is what happens without a kind of long-term vision, uh, in our politics, uh, to- to wrestle with this problem, um, I mean, I’ll say one more thing about Houston, that the law– here the law, I mean, as Emma was suggesting about land use and zoning, that the- the law really is central here too.

Because if you if you look at houston, you know, the recent floods, if you look at the kind of discourse about climate change and the city’s growth, it’s a discourse about property, about property rights for developers about property rights for individual homeowners, uh, with respect to private insurance, with respect to to FEMA, like that’s where the debate and discourse in Houston is- is located. That’s the scale. And that scale, I think, blocks or inhibits, um, you know, addressing the- the fundamental problems that Houston’s, uh, emergence, you know, has generated.

I- I’m sorry I can’t resist saying one more thing about Houston, which is that I like the city, having- having been there. And I think that it’s an interesting place to- to see, you know, not only, you know, on these depressing notes, uh, problems related to climate change but also some of the social possibilities of a post-industrial order, of employment and social life tied to the services and how ambivalent that is and how there are possibilities that I think should make us see the potential of our present economic moment, as opposed to doing – I think the last thing we should do, which is to be nostalgic for post-war society, nostalgic for industrial society, uh, nostalgic for the past.

And I think because Houston doesn’t have that past, when you have to look at it, analyze it, think about it, you can’t– you can’t think in those- those kinds of nostalgic frames about the American economy. You have to, you know, once again, look forward and think about what kind of future could be imagined given our present. [Emma] And the statistics for female employment in Houston that you’ve given in the book are very striking. [Jon] Right, right. [Joel] So on this question of, um, you know, nostalgia, climate change, and long-term investment, we have a kind of question that speaks to those issues from Charles Peterson, who writes: “If a political economy oriented around long-term investment is the best solution for climate change, would one way of putting your argument be that in a counter-factual world where climate change first became acknowledged as a problem, say, in the 1950s, then New Deal order institutions could have effectively dealt with the issue?” So, in other words, the problem with addressing climate change is not the ‘capitalocene’ but the ‘shareholder-revolution-cene,’ if that– if that makes sense, right? Um, and that does seem to speak to, um, the fact that your book isn’t a kind of anti-capitalist tract, right.

It’s about maybe, you know, directing capital into the right channels to get socially beneficial outcomes or at least collectively attractive outcomes, um, what would you say to this this question about if climate change would come up in the 1950s? [Jon] Well I have a – Hello Charles, thank you for the question – I have– I have a lot to say about that. Let me start by talking about another chapter in the book that I–that- that then will get us to the New Deal, um, eventually, I hope.

But I guess the chapter that- that for me, um, well that I liked the most, personally, uh, but also was most important for for figuring out, you know, what the book was about, is a chapter, I. think it’s chapter five– it is chapter five, it’s called “Confidence Games,” and it comes in the first part of the book. And it’s really a cultural and intellectual history of debates about commerce, um, in the Antebellum period. It talks about P. T. Barnum and the rise of the Barnum Circus as a kind of commercial-cultural spectacle.

It deals with Thoreau and transcendentalist critiques of commerce. And then it has a final section on Melville’s novel, The Confidence-Man. Okay this is a very indirect answer to the question but I promise I’ll– I’ll get there. And I think one of the things the chapter tries to do, um, is, um, present, favorably, uh, Melville’s moral argument about capitalism and commerce, which is that capitalism and commerce need to be appropriated towards better ends, uh, not completely rejected for moral reasons.

And in the chapter, Thoreau kind of stands it as the Romantic critic of the market, or critic of the greedy, corrosive, um, nature of the market always trying to push upon– push upon and spoil the things that we value the most, um, whereas Melville I position as someone who says, well, no let’s- let’s think of this future-oriented, uncertain motion that’s central to capitalism, and think about the ways we can appropriate it, shape it, and direct it. And of course that’s not, uh, Melville’s argument.

You can find that in Marx certainly, um, but- but I think that is the moral perspective on the book, and then the kind of Keynes liquidity mumbo jumbo is the kind of analytic device that, uh, that works in unison with it. Um, so- so Joel’s right. It’s not a kind of anti-capitalist, um, moral critique, like, or at least that’s not in the book, and I think actually one thing that’s not in the book that could have been are those voices in the American past that did lodge that kind of critique, because the book can’t, you know, cover everything.

And so that kind of gets to– gets me to, um, the New Deal and, okay, so if we knew about climate change couldn’t the New Deal have just done it itself? And my, you know, interpretation of the New Deal in the book suggests that the answer is no. There’s a chapter in the book– now here I actually don’t know the– i don’t know the number myself, but there’s a chapter in the book, I believe titled “The Postwar Hinge,” uh, that deals with– uh, that extends an argument made by many scholars, I think most forcefully recent- recently by Ira Katznelson about how the New Deal, what the New Deal state was, what the New Deal political economic settlement was, is not really secured until after World War II, um, after you come out of the war: the general strike, the rise of the Cold War, battles between shareholders and industrial managers at corporations like General Motors, before the kind of managerial triumph.

And, and I, you know, make the argument that, coming out of the war, you know, the New Deal leaves, uh, far too much investment power in the hands of private- private capital. You know, there’s contingent reasons, coming out of the war, largely having to do with organized labor, in the manufacturing core, for why there’s a kind of two-decade period in which there are benefits of long-term capital investment, in terms of productivity, in terms of wages, etc.

, etc. , despite exclusions from those benefits. But I see the New Deal in this respect as somewhat of a faded tragedy, and that the 1970s, 1980s the breakup of the New Deal order, I think, you know, can be traced back to essential features of the New Deal itself. And so, therefore, when I kind of evoke a long– the kind of long-term investment regime you would need to grapple with climate change as well as other political and moral problems, you know, I- I don’t think, uh, the New Deal is the answer.

Um, I mean, there’s a history there that informs, certainly, that question, but- but I. don’t think going back to the to the New Deal state is the way to go.

37:15 - [Joel] Perhaps I could just ask a very brief question on this issue of long-term investment as I think about the the four ages that you described in the– in the book. Would it be fair to say that the two moments in which, you know, illiquid long-term investments have been made in American political economy have followed war– war and social upheaval, particularly total warfare, um, so we have the period after the Civil War, um, and then we also have the kind of period, you know, after World War II and thereafter.

And, you know, one question would be: Does it take a war economy or kind of a torrential rending of the social fabric to create the commitment to these kind of long-term investments, um, or is that relationship between war and those longer-term commitments to investment, um, contingent? [Jon] So, it’s a great question, Joel. I mean, I- I think– I think you’re right, um, you know, Keynes did say, uh, in the late 1930s that the only social experiment that would ever prove, um, my argument about an investment multiplier or, uh, the un- the- the complete un- the- the lack of any need for that– for there ever to be a depression, it would come about in war, um, and- and World War II does that.

I guess the- the- the link there– I mean I can think of maybe two reasons why that’s the case. First, uh, there is a kind of target for long-term investment, which is war making, uh, producing weapons of war. And that makes it easier if you have a kind of goal in mind. Um, the second thing has to do with money and credit and- and finance. And- and to go back to where we started with kind of definitions of- of capital, um, you know, one of the things the book does try to do is integrate money and- and credit, um, aspects often excluded from the “real,” um, in economic understandings of capital for purposes of analysis and modeling and things like that.

And of course the thing about the wars is, because there’s a need to fight the war, uh, you get a relaxing of money, and a relaxing of of credit. In the civil war you get greenbacks, during World War II, uh, you have the Fed and the Treasury supporting all out- out production. Um, and that opens up possibility, uh, for credit and- and finance. And since you know what you want to- to finance, which is war production, um, you know, those are moments where you’ve kind of seen those expansions and- and after the war is coming out a legacy of- of those moments of- of rupture, you know, along the lines that you– that you suggested.

Of course, both moments, um, you know, in both moments, after the war, uh, you see a tightening of the credit systems. Um, you know, you see a return to the gold standard after the civil warm, or after World War II, eventually the Fed-Treasury accord where, uh, the Fed is liberated to once again conduct monetary policy, which means setting interest rates to tamp down on- on inflation. Um, so- so you’re right, you’re definitely right to kind of point to those two moments and see concurrent, you know, processes, and it does suggest that you need, um, ruptures, if not wars themselves.

I don’t think that’s the case, it has to be a war or kind of social and political ruptures of that order, uh, to get the kind of transformations that we’re– that we’re talking about. And that’s, um, you know, I think we’re all waiting to see, uh, you know, to what degree COVID will or will not be that kind of rupture. And we thought 2008, the financial crisis, might have been that kind of rupture, and it was not. Um, of course we’re talking about COVID, uh, but I think there’s also the election of Tump, um, and that moment, and that political rupture, that perhaps might prompt this kind of reckoning or response.

But, you know, these are all– these are all open questions to decide in the future, of course. [Joel] Thank you, um, so we have a number of questions, but I do want to give Professor Rothschild a chance to- to- to weigh back in to the– to the discussion, if you would like to- to- to say something. [Emma] Well, no, I see that there’s a question from Bill Janeway which is very much, um, on this this point, so maybe you could ask that, Joel, and then hear Jon’s response.

[Joel] Oh, sure. Yeah, I mean, in fact, there are– there are a number of questions about climate change, Jon, as you can probably- probably see, um, uh- uh, Bill Janeway’s question is, um, “Having just been listening to Gina McCarthy, national climate advisor, on a Columbia University webinar, it seems that this administration does mean to shape the pattern of investment on a long-term basis,” you know, presumably in relation to climate change as a kind of war or quasi-war, um, “do you think that this can succeed?” [Jon] Um, sure, I guess– I- I guess is the short answer to the question, um, that– there’s no reason why, um, you couldn’t– you couldn’t do this.

I mean– I mean I guess we’re waiting to see what will- will happen. Um, it- it does seem like one of the things that- that would be necessary to see this kind of transformation achieved by the the Biden administration given- given, um, given the people that are in his administration, is there does seem to be, like, unlike 5-10 years ago, uh, support from corporate interest to do something to shape this problem. And it does seem like, to some degree, some of the investments that would be necessary, um, you know, to do it, uh, could get, you know, momentum from you know the private sector.

So- so that’s– so that’s good. But- but I think the other side of it, on- on the public side, I mean, I think you do see– I mean I think, you know, maybe this is one of the things that got cut in the book, but- but- but- it’s striking when you go back and look at 2008, um, and- and- and that the book– the chapter on- on the great recession, uh, is critical of the Obama administration. It’s critical of Obama. But- but in fairness to them, I think I do say that there’s not that much on the shelf, you know, from the Left in thinking about transforming the- the economy, unlike, you know, FDR, who unlike Obama, I think, to his- his, uh, to his benefit, you know, was no intellectual, but nonetheless when FDR came to office in 1932, you know, there are generations of- of ideas, books, tracks on the reform of the economy – from populists, from progressives – and a lot of those ideas already tried out at the state level.

And so, you know, one of the things historians debate about the New Deal is it’s hard to characterize because there’s just– the policy experimentation is just so, um, is so overwhelming. It’s- it’s quite difficult– it can be quite difficult to characterize it, uh, ideologically. And you know, the Obama administration was not in that position. You know, not even close. I think with Biden– the Biden administration, regardless of- of Biden himself as a politician and where he would align on this kind of ideological spectrum, the Biden administration, the situation is very different.

Since 2008 there’s been a decade of- of history, writing, of history, uh, economic history, of historians– histories of capitalism, uh, there’s been, you know, lots of new debates and thoughts about, uh, public investment banks, public investment trusts, regional trusts, all kinds of of different mechanisms for publicly mobilizing finance and investment towards public goals and towards public ends. And of course, you know, we’ll have to wait for the fine print on a lot of the– on a lot of the legislation that the Biden administration is- is planning, promising, not to mention passing that legislation, executing it.

But since we’ve hit some, um, um, some more depressing notes in our conversation, I mean, I think there are, you know, reasons to think of this moment as being full of possibility for doing– for doing new things, um, that, as recently as as 10-12 years ago, in the midst of a financial crisis, the worst financial crisis since the Great Depression, I think were politically and also intellectually, um, you know, unimaginable. So, um, you know, that would be, you know, my response to that question.

[Emma] I mean, maybe the only thing I’d add on that is that the so-called immaterial infrastructure proposals, um, the soft versus hard, that the investment in things that aren’t bridges and roads, does seem kind of new and very promising. Broadband, I mean, rural broadband is a very big deal; so is the infrastructure of- of- of daycare and and widespread public health. And you only think of, I mean, India, today, to see how the absence of a really widely diffused system of public health can have the most sort of extraordinary long-term consequences.

47:36 - [Joel] So, Jon, I wonder, um, if I could sort of take us back to where Professor Rothschild began and, um, ask you about how you decided the way in which to kind of frame this book.

47:50 - There are a number of questions to kind of ask about- about framing, about approaches, you know, you’re maybe writing against or trying to distinguish yourself from, and also the kind of– the- the- the national framing. And so I suppose it’s, you know, it’s- it’s, uh, uncontroversial to say that there are many ways to write a history of capitalism, uh. One could focus on class relationships in the labor process, commodity chains, business organization, accounting practices, religious ethics, consumerism, a whole bunch of issues.

You focus on investment and valuation, right? And that’s– it just would. be interesting to hear you talk about what made you focus on that, which of course allowed you to exploit this tradition of economic thinking running from Veblen to Keynes. Relatedly there’s the question of- of national framing. Paul Ward asks, um, “what if this book was a book about capitalism in America rather than American capitalism?” Is there a distinction there worth considering? Is- is that national– is there an American variant of capitalism which is unique to the United States.

Um, I just wonder if you could reflect, kind of, a little on- on how you decided to frame this, you know, epic history of- of capitalism? [Jon] Yeah, so I- I think that the kind of, um, the- the– as far as just periodization goes, um, the sort of two big problems that I saw myself as facing, which the kind of framework, um,Ii think to some degree helps, you know, helps address in a way that’s satisfactory, historically: the first is- is where to begin, um, and- and I think that, given this is a- a synthesis that’s relying upon a secondary literature, you know, the- the work on the early modern period, colonial period, is– has just been so strong, the work on the British empire, the work on commercial, uh, society, the work on the Atlantic– Atlantic world, certainly the significance of- of- of slavery in these in these processes as well, and also work on, um, indigenous history.

And- and- so- how to– how to kind of capture that… So the first stage, I think is, um, maybe the most odd, uh, compared to what you would see elsewhere, in that it’s very long, that it goes from the kind of reassertion of English imperial control over North America coming out of the civil war in the 1660s and then goes through the American Civil War in the 1860s,  and argues that the geopolitics of space as it relates to commerce is really the, kind of, central dynamic of the era.

And so the American Revolution, um, isn’t as prominent. Um, and, uh, that does relate somewhat to the the global, kind of, question so the- the framework for the first period is really empire, um, the British empire and then the rise of Jefferson’s empire of liberty, um, in the creation of the American republic. And then, so, the second big problem is what do you do with the more more recent stuff? And, uh, that’s really challenging. How do you not have a narrative that seems to be, uh, culminating in post-World War II industrial modernity, um, and then you get a kind of post-industrial something-or-other, or a financialization off of that baseline, right? How do you come up with a- a structure that can both explain, you know, what the post-1980 American economy has been about, you know, what it looks like, uh, but in which it’s, you know, makes as much sense as the industrial economy of before? That you wouldn’t want to privilege one or– one or the other.

And so there the kind of definition of capital and capitalism and investment, I think, uh, is precise enough to kind of narrate the whole history, but also you know, suggests that these different eras are- are just that – contingent eras – and that no one or the other is the baseline of– upon which to judge the others. You know, I think that in writing the book, global and transnational history have remained some of the more exciting sites in the historical profession, and so to do a kind of national history, uh, definitely felt like something that- that- that cut against the grain somewhat.

I mean, I don’t have a, you know, critique of global or transnational history to justify the choice that I made to offer. I mean I do think that I did want, um, politics to be really central and- and did aspire to the kind of, um, you know, an attempt at the kind of integration of the political and the economic that- that Emma was- was talking about earlier. Now of course, you know, the national scale,  by all means, the national scale doesn’t, you know, doesn’t have to be the scale that occurs, and there’s other scales in the book where I try to play that out.

Empire is one, uh, both in terms of thinking of early American empire in the context of, uh, western, uh, settler expansion, and also more recently American global economic hegemony since World War II, um, you know, is another kind of thread of the book. And there’s also the local, cities like Houston, corporation, other other kinds of scales, uh, but nonetheless, you know, the national scale is really important for the book’s, um, political-economic narrative, and that’s- that’s really the best, you know, answer I can– I can give.

You know, American capitalism, capitalism in America, that’s- that’s- that’s a very provocative question. And, uh, and, I don’t know, I- I think, I think capitalism in America would be– would be just as good, um… [Joel] Professor Rothschild. [Emma] Um, no, this is a sort of meta question, since we’re coming to the end of the– of our time. Um, Jon had said beforehand that they’ll– nobody will say anything in the chat, and actually there’s absolutely fantastic discussion in the chat, and I think there’s, um, um, you know, there is your next book, um, outlined and discussed in the chat.

Um, and the other thing I want to say, I mean, um, Giacomo Parinello raised the- the very important point about expectations, and one thing I do want to say, um, very clearly to people who are going to be reading the book, I hope they’re going to be buying the book, is that, um, it’s- it– the book has seemed extremely serious, and to do with large, awesome questions about the future of humanity. Actually, it’s really fun to read, and it’s full of– it’s full of stories, it’s full of people, but it’s full of, um, you know, movies and music and poems and- and a lot of architecture, and and it– in- in lots of ways it is a story of how people’s expectations, uh, uh, don’t change over time, but change sort of dizzyingly in particular periods of time.

55:18 - So- so I- I want– before this all ends up, I want people to know that it’s not only a solemn history of the great issues of our times. [Joel] That seems to me a wonderful point at which to, which to conclude, although I do want to give Jon a chance to say, you know, to have the last word, if there’s anything you’d like to– you’d like to add to that. [Jon] No, I guess I- I, um, this might pull readers– potential readers in the opposite direction but I mean I guess I do want to say that one of the goals that I, you know, that I had in the– in the book, and one of the reasons why the center that- that Emma directs was such a hospitable place to try to put the book together, is there is a– I think idiosyncratic, you know, not definitive by any means, attempt at integrating history and economics, at least economics of a certain vintage, of a certain kind, and- and, you know, I think one of, in my, the kind of work that I do, one of the more unfortunate things that I tend to often see, are kind of knee-jerk reactions made by historians against work done by economists, and also maybe a lack of interest by economists, um, in- in- in taking history, you know, really seriously in their work.

And I think that expectations, um, has a checkered history in economic thought, from Keynes through Lucas, and so on. And it’s a category of analysis that I think has not been very prominent outside of economics, maybe some political science whatsoever, recently sociologists have become interested in the topic, um, but- but I think is an example of a of a category of analysis that’s- that’s– that has traction, um, in- in economics, but also has traction, um, in history, and- and creates a kind of– a site in which these different subjects, these different scholars can, you know, can engage one another.

And I guess that would be the note that I would, you know, like to end on is that, you know, my hope for the book would be they would, they would lead other people – and I see a lot of my, you know, students and other other young scholars in the chat – that it would kind of get them to, you know, to find ways to- to think together with history and economics in new, in new and generative ways. [Joel] Amen to that, Jon. And I- I guess I should, uh, I should bring this to a close by congratulating you on a remarkable achievement of scholarship and of writing, um, and I should also thank Professor Rothschild for her comments and discussion, and all of you for– there are many, as Professor Rothschild said, wonderful questions that we weren’t able to get to, so thank you to the audience for engaging, um, and, uh, I look forward to seeing the reception of your book playing out over the coming weeks and months, uh, Jon, so thank you everyone for- for coming.

[Jon] Great, thank you both and thank you all. .