John Cassidy, a seasoned staff writer at The New Yorker and author of "Capitalism and Its Critics: A History," discusses the seismic shift in economic policy under Donald Trump. He analyzes Trump’s chaotic tariff strategies and their impact on markets. Cassidy explains how capitalism has evolved, noting the rise of monopolies and young people's view of capitalism through an environmental lens. He also revisits Marx's critiques, highlighting ongoing class struggles and the complexities of economic philosophies in America compared to Europe.
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Trump's Radical Break From Free Trade
Traditionally, both Republicans and Democrats supported free trade as key to growth and efficiency.
Trump's tariff policies marked a radical break, causing market instability and recession fears.
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Capitalism's Historical Roots
Capitalism began around 1770 with industrial capitalism built on mercantile capitalism.
Mercantile capitalism involved heavy government protectionism, unlike free trade advocated later by Adam Smith.
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Adam Smith's Critique of Monopoly
Adam Smith critiqued mercantile capitalism and defended free trade as better for efficiency and reducing corruption.
He saw government-backed monopolies like East India Company as crony capitalism harming markets.
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Published in 1776, 'The Wealth of Nations' is Adam Smith's magnum opus that laid the groundwork for modern economics. The book critiques mercantilist economic theories and introduces the concept of the 'invisible hand,' which describes how individual self-interest leads to societal benefit. It emphasizes the division of labor, the accumulation of capital, and the importance of free markets. Smith argues that a nation's wealth is not measured by its gold and silver reserves but by the stream of goods and services it produces. The book also outlines the core functions of government, such as maintaining defense, enforcing civil law, and promoting education, while advocating for limited government intervention in market activities.
The Communist Manifesto
Friedrich Engels
Karl Marx
Capitalism and Its Critics : A History
John Cassidy
John Cassidy's sweeping narrative examines capitalism's evolution through the lens of its detractors, spanning from 19th-century Luddites to contemporary degrowth advocates. The book highlights both famous critics like Marx and Keynes, and lesser-known figures such as Trinidadian economist Eric Williams and Indian Gandhian economist J.C. Kumarappa, while addressing modern concerns about AI, inequality, and climate change.
The General Theory of Employment, Interest and Money
John Maynard Keynes
Published in February 1936, 'The General Theory of Employment, Interest and Money' by John Maynard Keynes revolutionized economic thought by challenging the classical economic theories of his time. Keynes argued that total spending in an economy can fail to generate full employment if total savings exceed total investment. He introduced key concepts such as the 'Principle of Effective Demand,' liquidity preference, and the marginal efficiency of capital. The book emphasizes the importance of aggregate demand, the role of government in stabilizing the economy, and the interaction between monetary and real economic factors. Keynes's theories have had a profound impact on economic policy and continue to influence macroeconomic thought and policy to this day.
For a long time, Republicans and many Democrats espoused some version of free-trade economics that would have been familiar to Adam Smith. But Donald Trump breaks radically with that tradition, embracing a form of protectionism that resulted in his extremely broad and chaotic tariff proposals, which tanked markets and deepened the fear of a global recession. John Cassidy writes The New Yorker’sThe Financial Page column, and he’s been covering economics for the magazine since 1995. His new book, “Capitalism and Its Critics: A History,” takes a long view of these debates, and breaks down some of the arguments that have shaped the U.S.’s current economic reality. “Capitalism itself has put its worst face forward in the last twenty or thirty years through the growth of huge monopolies which seem completely beyond any public control or accountability,” Cassidy tells David Remnick. “And young people—they look at capitalism and the economy through the prism of environmentalism now in a way that they didn’t in our generation.”
The New Yorker Radio Hour 
