I’ve been reading Michael Lind’s new book, Land of Promise: An Economic History of the United States, which has been getting a lot of press, including a front page review in Sunday’s New York Times Book Review section. (Yes, I’m envious.) I can see there is a lot of overlap with my own upcoming book, The Surprising Design of Market Economies. My book is also basically a work of economic history. I can see so far that Lind and I basically agree that a collaboration of government with business is not to be feared, that in fact, it’s essential.
I’ve only read the first few chapters, but perhaps there is value in a kind of running book review. Although I agree overall with Lind in many respects, I can feel my native Virginian skin bristling at Lind’s easy division of Alexander Hamilton – Right, Thomas Jefferson – Wrong. Hamilton said big is better, and in most cases, like the need for a national bank, and the need for government to focus on developing manufacturing and export industries, he was right. But so far Lind has ignored that Hamilton led a party called the Federalists which in many respects was against giving rights and power, and frankly wealth, to the common man. I’m not sure we would have had a democracy if the federalists had won a complete victory against Jefferson’s Republicans.
More specifically, as laid out in Andro Linklater’s excellent book Measuring America, Jefferson used his attention and powers to thwart land speculators like Robert Morris, who is a basically a fat villian in Measuring America, but sort of a good guy in Lind’s book. Jefferson used his powers of mind and of political authority to make sure that western land went to regular people in reasonable amounts, not just insiders who colluded with Congress and bribed surveyors to get first dibs on huge tracts in million-acre chunks. Although I’ll try not to go into Thomas Jefferson too much here, what I’ve been constantly surprised at is how much Jefferson designed the deep architecture of this country. It was Jefferson who designed the money of this country, the decimal dollar system. Lind states this, but it’s subordinate to an overall message about Hamilton. As Linklater explains in detail, Jefferson designed the system of measurement used in surveying and portioning out the western lands. He laid some of the foundations for universal education. He was the nation’s first head of patents, and designed some of the system that Congress later adapted when it revised the early primitive system. And more.
I’ll be interested to see how Lind handles the development of railroads in this country. I basically say in Surprising Design that in the 19th century the United States developed its railroads in just about the worst way possible. In Great Britain and France, the state laid out railroads in a systematic way and managed them, even while employing private companies to operate them. The United States, in contrast, via both the federal government and the states, gave private companies enormous power and resources – land, money, powers of eminent domain, and more – and then stood back and let them rape the average citizen, whose taxes and governmental powers the railroads were using. The railroads needed more government control, not less. But I’ll see later how Lind handles that.
So far, my big criticism of Lind is the word equity. I don’t think it’s appeared yet. It’s not enough for a nation to grow. It needs to grow fairly. Not perfectly evenly or anything, but in some sort of bell curved fashion. The latter half of the 19th century were truly horrible times for a large percentage of Americans, even while the economy overall and a few Americans in particular got really, really rich. But on Lind’s overall message: government and business need to work together to make the average person more prosperous. I completely agree. Lind is certainly correct in how nations develop, in what might be called an export-driven economy, crafted by the state. Ha-Joon Chang’s book, Bad Samaritans, which among other things recounts the rise of his native Korea using policies that went against the advice of the international advisors, is the best I’ve seen on the subject.
As a reader, I have an interesting relationship with Lind. I first noticed his articles in Harpers in the late 1980s, if memory serves. In this liberal, leftist magazine, he was writing against Affirmative action. He said liberals should pay more attention to economic issues, like health care, and less to matters such as whether a college had enough black students. I had never heard of such a thing. The more I thought about it, the more I thought Lind was right. I’ve followed him ever since. I’ve really admired and valued his iconoclasm and willingness to have his own opinions on everything. In some weird way, we seem to be following similar intellectual trails. My first book, How Cities Work (Texas 2000), emphasized the role of transportation in shaping cities and economies. That grew into an overall fascination with infrastructure. In recent years, I heard that Lind was writing a book on transportation, or infrastructure. Perhaps it grew into this one.
Whichever, it’s clear that both of us have been focusing on the relationship of business to government. Clearly Lind’s book is very worth reading. I’d be very curious as to what Lind thinks of my own work, if it is ever ends up in front of him.