by Robert D. Hormats
|
| List Price: | $27.50 |
| Amazon Price: | $20.08 & eligible for FREE Super Saver Shipping on orders over $25. |
| You Save: | $7.42 (27%) |
| Average Rating: |  |
| Lowest New Price: | $5.00 |
| Availablitiy: | Usually ships in 24 hours |
|
 |
|
Product Description
In a bracing work of history, a leading international finance expert reveals how our national security depends on our financial security
More than two centuries ago, America’s first secretary of the treasury, Alexander Hamilton, identified the Revolutionary War debt as a threat to the nation’s creditworthiness and its very existence. In response, he established financial principles for securing the country—principles that endure to this day. In this provocative history, Robert D. Hormats, one of America’s leading experts on international finance, shows how leaders from Madison and Lincoln to FDR and Reagan have followed Hamilton’s ideals, from the greenback and a progressive income tax to the Victory Bond and Victory Garden campaigns and cost-sharing with allies.
Drawing on these historical lessons, Hormats argues that the rampant borrowing to pay for the war in Iraq and the short-sighted tax cuts in the face of a long-term war on terrorism run counter to American tradition and place our country’s security in peril. To meet the threats facing us, Hormats contends, we must significantly realign our economic policies—on taxes, Social Security, Medicare, and oil dependency—to safeguard our liberty and our future.
Customers who bought this item also bought
Average Customer Review:
13 of 14 people found the following review helpful:
 Seven Chapters of Historical Insight..., 2008-02-17
...followed by one chapter of evasiveness and some relatively unsurprising conclusions. The Price of Liberty is being marketed as an analysis of our current quagmire in conducting our national defense against terrorism. Good marketing, no doubt, but for this reader the chief value of the book is historiographical. Beginning with Alexander Hamilton and his brilliant schemes to pay for the Revolution after the fact, Hormats has written what amounts to a history of the American economy in terms of tax policies and the debates about taxes. Because that history is a kind of 'punctuated equilibrium', Hormats vaults from war to war, not unlike an old-fashioned high school textbook: the Revolution, the War of 1812, the Civil War, WW1, WW2, the Cold War, Vietnam, with passing references to the other events of warfare in the two centuries of American coping. But the principal actors in Hormats's military history are not generals; rather they are secretaries of the treasury, leading congressmen, and presidents often overshadowed by their own administrations. This amounts to a fresh and thought-provoking history of the United States as a whole over the 'long duration'.
Hormats begins by expounding his vision of Hamilton's Vision. It's quickly obvious that Hormats himself is Hamiltonian to the core. Hamilton was the prime advocate of strongly managerial federal powers - Big Government - employing taxation and fiscal mechanisms like his national bank to stimulate the growth of the economy, especially the manufacturing sector. Part of Hamilton's vision, Hormats, says, was to build the financial stability to support a secure national defense. The contrary vision of Thomas Jefferson - an agrarian, states' rights centered isolationism - didn't play out very successfully during Jefferson's own administration or during that of his Virginian successors, but it has never faded away. During every subsequent crisis of the federal budget in wartime, more or less the same fault lines of difference have ruptured Congress; military preparedness versus social spending, borrowing versus pay-as-you-go, sales/excise taxes versus income/property taxes, and with increasing acrimony, progressive taxation of the wealthy versus regressive taxation of the masses. Even such seemingly current notions as 'supply side economics' have had previous incarnations in Congressional debate, as Hormats amply demonstrates.
Hormats also documents the uneven success of presidents at controlling the fiscal policies of their administrations, including those whose own parties controlled Congress. The most interesting chapter in the book - chapter 5, A Righteous Might - focuses on FDR's frustrations with the coalition of Republicans and conservative Democrats who actually wrote most of the tax laws of the New Deal era. Conservatives and libertarians of the present era would do well to re-examine Roosevelt's record in light of Hormats's revelations, rather than demonizing FDR for decisions which weren't entirely his to make.
The weakest chapter in The Price of Liberty deals with the administration of Ronald Reagan. Hormats carefully exposes the naive irresponsibilty of Reagan and his economic advisors - their refusal to adjust their Reaganomic theories to the realities around them - yet he is oddly evasive about the results. Like most Reaganites, he exaggerates both the novelty and the impact of Reagan's Cold War tactics, even though he has already acknowledged the continuity of such tactics from Truman to Carter. He pays quick lip-service to Gorbachev's declaration that the USSR collapsed chiefly from internal failures, yet he credits the pressures of budgetary competition with toppling Communism. That's an odd paradox. If the Soviet Communist economic system was so dysfunctional in comparison to Capitalism, why did it take 60 years to falter? On the other hand, if it was dysfunctional, why should Reagan get credit for tipping it over? [My own opinion, lest I be accused of leftist sympathies, matches Gorbachev's - that the USSR was dysfunctional economically and socially, and suffered a well-deserved collapse of its own making.]
Hormats is distinctly positive, though less 'historical' in his approach, about the Gulf War policies of George H.W. Bush. Then, after no more than one clause of one sentence about the Clinton administration, Hormats delivers an indictment of the fiscal incapacities and blunders of the George W Bush debacle that could be read aloud as a campaign speech by any candidate of any other party.
I won't summarize Hormats's concluding recommendation for a sounder fiscal policy to prepare the US for the future. The value of this book, in my mind, is not Hormats's plan to pay for the War on Terrorism but rather his insightful historical recounting of the payments of the past. Definitely a five-star history, but I've deducted one star for slipping from history to journalistic opinion-making in its final chapters.
1 of 1 people found the following review helpful:
Good Book, 2007-10-10
I just saw this author give a lecture with Richard Brookhiser at the New-York Historical Society, and although it was brief, the author gave an extremely cogent overview of how the U.S. paid, and is paying, for its wars. The book is engrossing and very highly recommended.
Wars are extremely expensive and destructive; it's a pity the monies spent on defense cannot be allocated elsewhere (but, I am a firm believer that defense spending is more a stimulus to the economy than simple transfer payments.) However, in the near future, pressure from other budgetary obligations will necessitate a drastic reduction in defense spending, or an extreme cut back in social spending.
I feel sorry for the baby boomers and their quickly disappearing dream of retirement.
2 of 2 people found the following review helpful:
 A highly recommended addition to American History shelves, and a sharp warning against the obstacles facing America's future., 2007-10-06
Former member of the board of directors of the Council on Foreign Relations and international finance expert Robert D. Hormats applies his expertise and extensive historical research to The Price of Liberty: Paying for America's Wars, a thoughtful history of how America has paid for its conflagrations from the Revolutionary War debt (deemed a threat to the nation's creditworthiness and very existence by America's first secretary of the Treasury, Alexander Hamilton) to the invention of the greenback during the Civil War, the adoption of a progressive and populist income tax during World War II, the arms race budgeting that allowed the United States to outlast the Soviet Union during the cold war, and the diplomatic cost-sharing of the first Gulf War. A critical look at America's precarious modern-day financial position - including the heavy toll of over-dependence on oil, and a debt that relentlessly climbs especially due to unchecked social security spending and rising interest payments - closes The Price of Liberty, along with a lament that Hamilton's wisdom has been all but forgotten today. A highly recommended addition to American History shelves, and a sharp warning against the obstacles facing America's future.
1 of 5 people found the following review helpful:
4% of GDP, 2007-08-06
Foreign Investment: foreign loans provided the nation with critically needed money. Hamilton argued, the lack of national tax condemned the nation to a permanent weakness and the government to debilitating dependence on the state for revenues. State Power ruled supreme when central government was bound. The new constitution gave Congress exclusive authority to authorize federal borrowing and to lay and collect duties, excises, and imports. Congress determined that the treasury could spend. The nations commander and chief was over the military but depended on Congress to authorize funding of war debt.
Duties: Import duties were consider a tax on the rich where direct taxes were assessed on the value of the individual's assets. The average American lived on a farm or in a small village and bough few imports.
Direct Taxes: Direct taxes were seen as more coercive than import duties. Property owners were compelled to pay the direct tax. Direct taxes were used in times of emergency and limited by Congress to impose. The direct tax was appropriated among the several states and the national population corresponds to the tax portion. The direct tax could not disproportionately gang up on the slave states to pay more taxes. Initially customs and duties provided the bulk of government revenues. Property tax appeared during war times and existed in the 19th and 20th century, as a result of continual war. The revenue bill passed as a tax on importation necessary for support of government, the discharge of debts, and the means to encourage production and commerce. Duties on coffee were 5 to 15% and luxury items 15% tax. The tonnage act placed modest duties on registered tonnage of American owned ships.
Coalitions: The war in Iraq was seen largely as a unilateral American effort. No Islamic nations were involved. Building strong coalitions helped establish international legitimacy and encourage participating nations to pay a large portion of their costs. War required massive borrowing. In the early part of the war, the American people were assured costs would be low. Politicians cast aside worries about post war reconstruction believing that Iraqi oil production would reach 2.3 million barrels per day and defer much of the reconstruction expense. It didn't happen.
GDP: Politician managed to sidestep tax increases, hard recession, and increased nonmilitary spending (social security, Medicaid, and Medicare). The war was only costing 4% of GDP, whereas, the Korean war cost 10% of the GDP and Vietnam cost 15% GDP. The war was marketed as a "long war on terror" with financial similarities to the cold war. Prior to 9/11 pentagon spending was slowly decreasing. GDP pressure to spend on non-military expenditures is predicted to increase. Social security, Medicare, and Medicaid are face with entitlement blitz from some 79 million, post WWII baby boomers. The demand for entitlement is sure to crowd out discretionary spending.
Democrats: Democrats during the war wanted a tax increase. Republicans feared cuts of entitlements. Fed man Greenspan said he "would pursue tight monetary policies until a meaningful deficit reduction package was enacted." Four issues were at hand: 1. entitlements and mandatory program reform 2. Tax revenue increases 3. Orderly reductions in defense expenditures 4. And budget process reforms. Republicans cared about issues one and four.
Consumer Spending: Unlike past wars there were no bipartisan calls for patriotic sacrifice. Instead, Americans were encouraged to spend money to boost the economy. 2003, $87 billion in emergency supplement appropriation was requested and 2004,2005, and 2006 the supplements were controversial. In 2006, Department of Defense budget totaled $290 billion and foreign aid reached $28 billion. 2007, $270 billion more was required. From 2004 through 2006, Fed revenues rose from 16% of GDP to 18.4% of GDP at the same time deterioration of GDP of 6 percent in 4 years was the largest drop in 50 years. Four other times matched the drop: Civil War, WWI, Great Depression, and WWII. In 2008 and 2009, funds will be made through the national budget process.
"Pressures to withdraw troops intensified in 2006, primarily because to mounting causalities and growing fustration that enormous mistakes had been made and victory highly improbable." "Faith in the ability of tax cuts to drive the economy and dramatically or eliminate deficits heavily influenced thinking in fiscal policy." "Supply side effects from tax cuts arising from increased work and savings are unlikely to have revenue feedbacks of over 10%" "If Congress were to make recent tax cuts permanent, and fail to enact significant entitlement reform, the county would face a steep rise in the debt burden in the next decade.
1 of 8 people found the following review helpful:
 Mundane, 2007-07-14
The bulk of "The Price of Liberty" summarizes how America paid the costs of its former wars, ensuring its future stability. This provides the backdrop for today - increased spending on non-war items, combined with increased defense spending in a long-term struggle and a major tax cut. Obviously, this is a major break with the past and "does not compute."
Price is accurate as of the date/time indicated. Prices and product availability are subject to change. Any price displayed on the Amazon website at the time of purchase will govern the sale of this product.
|
Store Categories
|