Grand Pursuit: The Story of Economic Genius

  • Sylvia Nasar
  • Simon & Schuster
  • 576 pp.
  • November 1, 2011

From the author of A Beautiful Mind, a history on modern economic thought and the people who helped develop it.

Reviewed by Barbara Mitchell

The power of a new thought seems greatest when it is no longer a new thought, and instead has become a premise for our lives rather than an astonishing breakthrough. In Grand Pursuit, Sylvia Nasar traces the evolution of the idea that humankind could alter the millennium-long pattern in which a few privileged people lead lives of abundance while the vast majority lead lives of hopelessness and poverty, from the perspective of the economists who pursued this vision. At a point at which we are heatedly debating economic policy in the streets of many cities across many nations, Nasar’s analysis offers an opportunity to pause and rethink the invention of this economic theory itself and the influence of this theory on human progress.

The three lead sections of the book are Hope, Fear and Confidence, while the chapters focus on individual thought leaders in economics and academia. “Hope” begins in the sooty squalor of 18th-century London where dreary Malthusian theory reigned. The tour of the minds and hearts of leading economic thinkers continues through two world wars, the Great Depression, the living laboratories of communist economics and the rise of newly-developing nations, as these thinkers struggle to articulate an economic theory that can be actualized for human progress.

In Hope, writer and humanitarian Charles Dickens surveys the painful contrasts between poverty and wealth, and urges his fictional Scrooge to act with compassion towards the impoverished Cratchits. Nasar surveys the leading economic thinkers and their work, including Karl Marx, Friedrich Engels, Alfred Marshall and Beatrice Webb Potter. She paints complex and colorful portraits with anecdotes and revelations about these economists’ spouses and lovers, early childhood influences and intellectual infighting, along with their distinguished careers and publications.

Fear begins with the start of the First World War, moves through the Great Depression and into World War II. Notwithstanding the devastation and political machinations, a small cadre of economists and visionaries continues its pursuit of workable, progressive economic policy. The somewhat scandalous Alfred Schumpeter and John Maynard Keynes dominate this discussion. These men shuttle among European capitals and America throughout these perilous decades, trying to implement their economic theories within a traumatized world. In this section, the policy debates and personal quarrels seem to override the premise of the book, and the focus appears to be much less on human progress and much more on the very human ambitions of these men. Nasar doesn’t skimp on the scandalous behavior that characterized these men and women, noting Schumpeter’s highly public flings with prostitutes and Marx’s illegitimate child. These brilliant people are revealed as all too human while they pursue their grand visions of progress. This time period also witnesses the beginning of the ferocious debate between American capitalism and Russian communism, viewed through the analysis of Sidney Webb and Joan Robinson, who Nasar portrays as the intellectual trophy wife of the Soviet economy during the Stalinist period. Revealing another sort of scandal, Nasar points out that during World War II, Milton Friedman, later the “patron saint of low taxes and small government in the Reagan years,” was highly influential in raising taxes to stabilize the U.S. economy and support the war effort.

Confidence opens in the 1944 peace negotiations, with President Roosevelt determined to realize the political economic theory that “the foundation for lasting peace was … raising living standards.” Keynes was prominent at Bretton Woods, which struck me as the political establishment’s Woodstock, a gathering of over 700 policy wonks and policymakers who brainstormed for three weeks in the beautiful New Hampshire countryside about how to restructure the global economy. Meanwhile, Friedrich von Hayek began contributing his guidance to the revival of Germany and its economic miracle. Robinson continued to send gilded reports from Moscow and Beijing, omitting details on the policies that produced famines that murdered tens of millions. The final chapter is devoted to a disciple of Robinson’s, Bengali economist Amartya Sen. In the discussion on Sen, Nasar returns to the heart of this grand pursuit. Sen questions the role of society in making choices that reflect the preferences of individuals, the reconciliation of individual rights and economic welfare and the measure of a just society.

A pivotal lesson from this review of the origins of these economic theories is that they are the inventions of human thought, rather than discoveries of existing forces. During the current crisis of capitalism, this book reminds us that we have the freedom to re-invent the economic forces that shape our lives, and we can determine the level of social consciousness that will drive this reinvention.

Barbara Mitchell works in Internet technology and infrastructure, and holds an MBA in Finance and an MS in Computer Systems. She is currently writing a history of the American Revolutionary War that includes the contribution of Hispanic Americans. Contact her at: barbaramitchell.01@gmail.com and visit her web site at: www.OurAmericanHistory.com

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