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Random House, Inc.
February 2010
On Sale: January 26, 2010
382 pages
ISBN: 0307464229
EAN: 9780307464224
Hardcover
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Non-Fiction
We Have a World-Class Mess . . . Now What? Amid the
carnage of bankruptcies, soaring unemployment, and millions
of families losing their homes during the financial crisis
of 2007–2009 lay the bloody corpse of a set of ideas that
had underpinned the economics of the previous thirty years.
A system that had been delivering unprecedented prosperity
on a global scale suddenly teetered on the verge of
collapse. Capitalism was seemingly exposed as a house of
cards. The blame game became a new national pastime as
doomsayers predicted the end of America’s leadership of the
world economy. We’re at a crossroads, and decisions
about how to reshape a discredited capitalism will
profoundly affect whether the coming years will be ones of
depression, stagnation, or renewed prosperity.
Instant analysis since the collapse of the financial system
in the fall of 2008 has produced no end of ideas about what
to do—ranging from those of free market ideologues (let the
market do its work and damn the consequences) to extreme
government interventionists determined to keep the animal
spirits of capitalism penned up. But if there is
anything worse than toxic financial assets it is toxic
ideas. We need to reject the old orthodoxies and
conventional wisdoms. Matthew Bishop and Michael Green take
a step back and analyze what can be learned from financial
crises of the past—from the Tulip Craze of the seventeenth
century through the Great Depression of the 1930s, Japan’s
Great Deflation, and the Long-Term Capital debacle of the
1990s to the unprecedented interventions of the government
during the past year—to set the agenda for a reformed
twenty-first-century capitalism. The result is an
enlightening perspective on what set us on the road to ruin,
as well as road signs to guide us back to prosperity. --Why
bubbles are the consequence of financial innovations that
generate economic breakthroughs, but why it would be wrong
to abandon these inventions of the financial engineers. The
Road from Ruin explains how stifling innovation and
risk-taking comes at a huge cost to future prosperity.--Why
the economy needed a fiscal stimulus to recover from the
crisis. Bishop and Green show how economic dogmatists of the
Right, who opposed the stimulus, got it wrong, but warn that
those on the Left who want the stimulus to run and run could
usher in a new era of high inflation.--Why company bosses
became too focused on short-term results and did not see the
crisis coming. The Road from Ruin shows how we can get
business leaders to put the interests of society ahead of
their own pay-packets.--The danger of focusing on the
financial symptoms of the crisis without tackling the
underlying economic causes, such as the world operating on
the dollar standard. Bishop and Green show why the role of
the dollar as the world’s reserve currency is not just a
problem for the rest of the world but for the United States
as well. --Why many of capitalism’s champions—especially the
advocates of the efficient market hypothesis—lost touch with
reality. The Road from Ruin provides insights into new ideas
in economics that recognize how the complexity and
irrationality of the human beings who make up the economy
can be harnessed to build a better capitalism.
Remarkably, the issues we face today have presented
themselves in one form or another over the past three
centuries. Matthew Bishop and Michael Green skillfully draw
both the lessons learned and prescriptions for reform to
prevent another catastrophic meltdown and put America back
on top.
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