I also think that the authors are right with their examination of regulatory capture. My fear is that the bigger government becomes, the more it has the ability to centralize an economy, to create what I would call “a socialism without doctrines.” This is one of the dangers of economist F.A. Hayek’s The Road to Serfdom.
By the way, the authors scorn many of the economists of the Chicago School, who they see as apologists for monopolies. By contrast, the authors seem to have some nice things to say about the Austrian School. The work of an interesting Austrian School economist Wilhelm Ropke, actually a German classical liberal who fled to Switzerland in World War II, might interest the authors.
Ropke is credited with helping create the German economic miracle of the 1950s and 1960s because one of his most admiring students was the great German finance minister Ludwig Erhard, the man who surprised everyone by ending price controls—Galbraith said it would be a disaster, but he was wrong—and by relentlessly cutting taxes.
I think the authors of this intriguing book would be interested in what Ropke, a great friend of markets, had to say about monopolies. Most monopolies, he said, attained their position through collusion with government policy.
“Nothing stands in the way,” Ropke wrote, “of a Draconian prohibition of a concentration of several units of business in one hand.”
The Myth of Capitalism: Monopolies and the Death of Competition, by Jonathan Tepper, with Denise Hearn (Wiley, Hoboken, New Jersey, 286 pages).
Gregory Bresiger is a longtime freelancer for Financial Advisor magazine.