Book Review: Lincoln Unmasked by Thomas J. DiLorenzo

Imagine that one day everything that you were taught as a child comes out to be a mirage of the truth. What would you do? American children in public schools, including myself, are taught that honest Abe was a great man. He freed the slaves and united a nation, right? But what if it wasn’t so black and white? What if history overlooks a lot of the ills of Abraham Lincoln?

That is what Thomas J. DiLorenzo, professor of economics at Loyola College, tries (and does) answer in his book “Lincoln Unmasked: What You’re Not Supposed To Know About Dishonest Abe.” DiLorenzo does an excellent job of taking Lincoln piece by piece and dismantling the myths of Lincoln with chapters titled “The Great Railroad Lobbyist, The Great Protectionist, & The Great Inflationist.” When most people think of Lincoln they don’t think of his monetary and trade policies. But they should.

For example, most people do not know that pre-Civil War, there was no clear central monetary system in the United States. Andrew Jackson had just finished dismantling it and Lincoln was an strong supporter of a central bank and a national currency. This, of course, would hardly interest a 3rd grader learning about honest Abe, but is it very important in thinking about the way the country as a whole raises funds. With an unlimited central bank with a national currency that was backed in nothing, government spending could go hog-wild and it did.

Another interesting tidbit about the book was the state of slavery at the start of the war and how much wheeling and dealing the so-called “Great Emancipator” did to not free slaves. DiLorenzo points out that early in the Civil War Lincoln made it clear that he did not want to ban slavery he just wanted to centralize the government and keep the states together. This is shown with evidence through his agreement to allow border states to keep slavery as long as they stayed in the Union. Along with the fact that Lincoln actually was more supportive of a deportation of former slaves then to keep them here.

The last major point to take away from this book is the destruction of states rights and federalism. When looking back one might think that it was a slow demise but DiLorenzo suggests that Lincoln murders it outright. This is an important point to debate because federalism and decentralized government is good for the nation and at some point demised. And the reader must ask themselves, is it okay for a state to leave the union peacefully? And what role does that play in keeping the federal government in check? Though this might be one of the hardest concepts for an average American reader to grasp because with the sense of patriotism that has been indoctrinated it would be hard for them to imagine the United States without 50 states.

The only negative that this book has is that it is so short and a quick read. I am sure that this was Dr. DiLorenzo’s intention to have an easy read to spread the ideas to the masses but it left the reader wanting more. It also does such an efficient job at telling the story and illustrating the point that an average American reader may reject it thinking that they found the answer too easily and will not take the time to do the research themselves.

Overall, I highly recommend this book to all who want the other side of the story and love history.



Civil War/Friendship Economics

Slate Magazine published an interesting article on the Civil War and how it helps Economists measure the effect of friendship. Here is what they find:

“They find that men serving in companies with tight social connections—like shared birthplace and occupation—were more likely to stand and fight than those in less tight-knit companies, where desertion rates were up to four times higher. The bonds of friendship also mattered for Union soldiers who ended up in Confederate POW camps: Soldiers imprisoned with others of similar backgrounds were much more likely to survive to see the war’s end.

When economists look at friendship and social networks, what they see is people trading favors—you scratch my back and I’ll scratch yours. A friendship’s value is determined by the benefits of favors you receive weighed against the cost of the favors you’ll need to do in return. A friendship built on cold economic foundations can be sustained only as long as the gains of the long-term trading of favors exceed the benefit of taking one last back scratch before putting an end to the relationship (though news travels fast, so retaliation from others in your social circle may help to keep you from taking advantage of others).”

Thought this was interesting. It sheds light more for Economists to study social relations and networks.

The rest is here.


Published in: on January 30, 2009 at 1:24 pm  Leave a Comment  
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Enemy of the State?

My latest post for NetRightNation:

On January 20, 2009, the new President Barack Obama will stand up and swear the oath of President. As dictated by the Constitution it reads:

“I do solemnly swear (or affirm) that I will faithfully execute the Office of President of the United States, and will to the best of my Ability, preserve, protect and defend the Constitution of the United States.”

Interestingly enough the oath for the military used to be the same minus the part of executing the office of the President. Now here it is in modern day format:

“I, _____, do solemnly swear (or affirm) that I will support and defend the Constitution of the United States against all enemies, foreign and domestic; that I will bear true faith and allegiance to the same; and that I will obey the orders of the President of the United States and the orders of the officers appointed over me, according to regulations and the Uniform Code of Military Justice. So help me God.”

The bold part is added by me. The oath for citizenship is much the same and includes the domestic enemies part. The change was made during the Civil War to assure northern support. An important question is why doesn’t the President have the same oath requirement?

One explanation is that it coincides with the growth of our government. The founding fathers believed in a limited government and often worried about keeping a standing army. They obviously kept the oath short and sweet for a reason. What is interesting is that the change of the oath for military personnel does not require a Constitutional amendment but the changing of the Presidential one does. The size of the government has grown larger than any of the founding fathers would have ever imagined. The debate over a standing army is completely gone and we are currently left with an oath that leaves much interpretation.At first glance, one may not see a problem with the new oath but what is a domestic enemy?

Domestic obviously means inside the border and an enemy means one that is antagonistic to another (Websters). This is a very broad definition and would be left up to Congress or the President to define. During the Civil War was the South an domestic enemy? Were the Japanese-Americans during World War II? Are Muslims today?

With the Pentagon’s announcement of 20,000 that will soon be stationed inside the United States, this is an important distinction to make. Most people imagine that our local and state police, sometimes with the help of the FBI, would be in charge of defending against domestic acts of crime. Instead, this is another chapter of government growth in the United States since these Oaths were originally created.

Do we really need federal soldiers on our own soil? We have national guards, local police, state police, and the FBI. This is a threat for both state sovereignty and individual rights. A standing army historically has infringed upon citizens rights. The British did it to the Colonies and that is why we have the 3rd amendment prohibiting the quartering of troops. That is just one example. There are many more.

We are beginning to mix big government with militarism and is the dangerous recipe the Soviet Union and the Third Reich used. Domestic enemies could be terrorists but also could be anyone the President or Congress deems as an enemy of the state. Anyone who owns a gun could be an enemy and anyone who disagrees with the government could be an enemy.


Published in: on December 9, 2008 at 6:25 pm  Leave a Comment  
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Book Review: A Nation of Counterfeiters

The book “A Nation of Counterfeiters: Capitalists, Con Men, and the Making of the United States” by Stephen Mihm is an attempt at studying the history of the American way of printing money. This does not just include illegal printing in someones basement but it also includes banks when there was not a national currency.

The problem with this book is the author’s lack of understanding Economics, especially in relation to Capitalism. Let take a look at a paragraph about his opinion of Capitalism:

“This was free-market capitalism at its most radical, and the inevitable consequence– rampant counterfeiting– belied claims that private economic interests inevitably contributed to the public good. Neither the banks nor the bank-note engraving firms had a stake in the larger consequences of their actions; neither had an interest or even an ability to make the sort of decisions necessary to frustrate counterfeiters. Rather, most bank not engravers and the bankers they served put profits– and their own economic survival–before the public interest. That meant producing notes as cheaply and efficiently as possible. But what was good for business was good for counterfeiting, too.”

Murray Rothbard once made the claim that those who do not understand Economics, should refrain from talking about it. This becomes impossible because Economics has invaded most other disciplines so we are going to get ignorant comments like this.

First, the banks did have an interest to keep their currency from being counterfeited. The market actually allocated some resources in stopping counterfeiting, which was the use of detectors, which he mentions in his book. These detectors helped the consumer and businesses tell the difference in the currencies. Mihm might argue that this was the consumers protecting themselves. This is for many reasons. The more counterfeit a bank’s currency becomes the less people are going to use that currency. This is a natural devaluation.  Not to mention that as soon as someone learned that a bank has issued more currency (or someone has printed extra) then people will run to the bank and demand the specie (i.e. Gold).

This is another major error in his book. He constantly talks about how these “wild-cat banks” would print currency without having the species. If a bank did this it would go out of business, people would run on the bank. This is somewhat like what we do now. Wachovia was in the news as a troubled bank and people ran on it, pulling their money out, which put the bank out of business. In fact, banks do this today. This is called fractional reserve banking. The banks are only required to keep 10%. So if you deposit $100 dollars they keep $10 and loan out $90.

Now that I have bashed the book, let me mention that it was not completely bad. It does a very good job of describing the counterfeiting operation found near the Canada-U.S. called Cogniac street. The other part that I found very interesting was his account of the Confederate money being so inflated during the Civil War that the South started to use the North’s money. This means that the South was making itself apart of the North economically. What I am curious of is how they got the currency? They must have traded with the North.

Overall, I would say that the lack of Economic understanding lowered this books score. I give it a 3/10.


Book Review: Soul by Soul: Life Inside the Antebellum Slave Market

The book “Soul by Soul: Life Inside the Antebellum Slave Market” by Walter Johnson takes you through a tour of how slavery worked in the United States before the Civil War. Everyday we are faced with different types of goods and products when deciding on making a purchase. Most of these purchases do not talk and walk or except for pets they do not breath either. It can be almost impossible for us to imagine purchasing a person and going through this type of process.

This book takes us into the life of slave traders and slave buyers. This is a market in which we hopefully will never see in America. It tells the stories about how slave traders would buy slaves in which it thought its buyers would like. The would be like any other speculator buying low and selling high. It takes us in the world of the slave buyer. They want to make sure that the slave is healthy, strong, and skilled. They want to make sure they are not paying more than they should.

It even takes you into the world of the slave. The idea that you are worth a certain amount. This is the part of the book I found to be the most profound. Slaves could determine their own value. When slavebuyers would come around to look at slaves, they didn’t just look at scars and physical traits, they ask questions. They would try to evaluate what their skills were by what the slave thought his skills were. They found out about family. It was well known that the more you ripped a slave from it’s family the more of a chance you had that they would leave and run away.

Overall, I would say this book is interesting because it sheds light on a market that no longer exists in most peoples modern lives. The only downside is that his points to me could have been summarized better and put into much better order. I never really understood where the book was going. To me the book should have focused more on each person in a different chapter, like I highlighted before. If you are interested in slavery and the market process this would be a good book for you. If you are like me and need a well organized layout. This layout may distract you from the story telling.


Published in: on October 30, 2008 at 11:54 pm  Comments (2)  
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