Econoclasts: The Rebels Who Sparked the Supply-Side Revolution and Restored American Prosperity (Culture of Enterprise)

This is the perfect antidote to economics as taught by John Stewart, the New York Times, and the evening news. The conventional view of the 1980s, the Reagan years, is one of economic and social disaster -- big deficits, forcing the mentally ill to live on the streets, coddling the rich at the expense of the poor. The truth, as you'll learn from this entertainingly written and meticulously documented history, is quite different, and fascinating.For at least the last hundred years, the U.S. has experienced cycles of prosperity alternating with economic debacle -- usually about 25 years of the former and, fortunately, only ten years of the latter. Our (economically) worst presidents -- Woodrow Wilson, FDR, Lyndon Johnson, Richard Nixon, Jimmy Carter, and now Barack Obama -- adhered to economic policies loosely described as Keynesian, which means deficit spending, ineffective stimulus packages, high taxes, crippling regulation, and currency manipulation that weakens the dollar. Our best presidents (again, economically) -- Calvin Coolige, John Kennedy, Ronald Reagan -- chose the path of tax cuts, deregulation, and a strong dollar, either explicitly or effectively tied to gold.In the 1970s the dollar lost 90% of its value and economists coined a new term, "stafglation," to describe the coincidence of high inflation and high unemployment, which until that time were thought to be mutually exclusive. Fortunately for those of us building careers and raising families in the 1980s, Ronald Reagan listened to a group of iconoclasts that included (now) Nobel laureates Robert Mundell and F.A. Hayek, plus economist Art Laffer (the Laffer curve) and Robert Bartley, Wall Street Journal editorial page chief. (Seldom acknowledged is the fact that by Reagan's third year, annual GDP growth and unemployment were both in the 6% range. Compare that with Obama's third year.)Especially interesting to me is the story of JFK's double-barreled tax cuts that stimulated both the supply side (business) and the demand side (consumers), giving us the longest period of spectacular U.S. economic performance up to that time -- 4%-plus GDP growth from 1962 to 1969.

I recommend this book to anti-supply siders in particular so that they can assess this economic philosophy on its own merits, instead of echoing whatever Paul Krugman and Bernie Sanders have to say on the matter.

Well, if you're like me you have never even heard of Robert Mundell. "Robert who??" And, by the time you finish reading this excellent book, you'll wonder why you have never even heard the name of this brilliant, Nobel-prize-winning economist, and his major contribution to economic theory and practice, generally called "supply-side economics."But first, we need to go back in time, to 1913. It was in 1913 that the last goals of the "Progressives" made it into the Constitution and the law: specifically, the Federal Reserve Bank of the United States, and the income tax. Your first lesson in understanding "supply-side economics" is that it makes no sense without the Fed and the income tax.In fact, it becomes clear that the "Progressives," although they had nothing but the best of intentions, created two gigantic "toys" they had no idea how to handle. Should the Fed raise interest rates to 25%, or lower them to zero? How about printing money? Could we just print as much as we liked?And the income tax. Obviously, setting it at 100% would be a bad idea, but how about 90%? Or 15%?Did anybody have a clue? Not very much. In fact, the Harding administration got lucky in making Andrew Mellon Secretary of the Treasury; he pressed the right levers and created the Roaring Twenties. But then came the stock market crash, and everybody started pressing the levers at random, leading to eleven years of misery.Robert Mundell says that announcing a simple increase in the price of gold would have put a stop to all this, and there would have been no Depression, no Hitler, and no World War II. The picture is more complicated than that: there was the idiotic Smoot-Hawley tariff law, which basically cut off all foreign trade and led us into a Fortress America mindset: not TOO bad for a huge country with vast resources, but very bad indeed for countries like Germany and Japan, which did not have vast resources and began to set their military machines going.So there's a whole fascinating history of the world in this book, plus a clear explanation of the main tenets of supply-side economics. Basically, Mundell says that we should use the Fed to support and maintain the current level of prices, period. No inflation and no deflation. Then we should encourage economic growth by cutting marginal tax rates. (Note well, George Bush and Barack Obama: mailing out checks to everyone is NOT THE SAME. Cutting MARGINAL tax rates encourages growth.There's a lot more in this book. Perhaps the most surprising is that it is actually the first researched and documented history of one of the most important discoveries of the 20th century. Whatever else you read on the subject is simply OPINION, including the "famous" story of the Laffer curve being sketched on a napkin, the terms "voodoo economics" and "Reaganomics," and all the rest. Supply-side economics has a secure place as a respected extension of classical economics.The only place where it doesn't seem to be given a hearing is in Washington, D.C., right now, where the current economic mess is either ignored, or treated with some sort of stupid band-aid. This is particularly frustrating because there are millions of Americans who could do better, but no one has ever accused the current POTUS of being open to new ideas. In fact, with all the new taxes he's foisting on the country, he's doing the Jimmy Carter malaise waltz all over again, wasting valuable time and trillions of dollars.As G. K. Chesterton once observed about England, "It may be a strange spectacle indeed to see the blind leading the blind, but right now in Washington we can observe something much stranger: the blind leading those who can see."Highest possible recommendation!

They had the book I needed to teach my college class in economics, at a great price, with prompt delivery.