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The Fall and Rise of American Finance: From JP Morgan to Blackrock
How Wall Street concocted a more volatile and dangerous capitalism
The Fall and Rise of American Finance traces the collapse and reconstitution of American financial power from the disintegration of robber baron J. P. Morgan’s vast empire to the rise of finance behemoth BlackRock. Contrary to what is taken for common sense by figures from Hillary Clinton to Bernie Sanders, Maher and Aquanno insist that financialization did not imply the hollowing out of the “real” economy or the retreat of the state. Rather, it served to intensify competitive discipline to maximize efficiency, profits, and the exploitation of labor—with the support of an increasingly authoritarian state.
The Fall and Rise of American Finance traces the collapse and reconstitution of American financial power from the disintegration of robber baron J. P. Morgan’s vast empire to the rise of finance behemoth BlackRock. Contrary to what is taken for common sense by figures from Hillary Clinton to Bernie Sanders, Maher and Aquanno insist that financialization did not imply the hollowing out of the “real” economy or the retreat of the state. Rather, it served to intensify competitive discipline to maximize efficiency, profits, and the exploitation of labor—with the support of an increasingly authoritarian state.
361 pages, Kindle Edition
Published February 13, 2024
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Stephen Maher
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Displaying 1 - 9 of 9 reviews
December 11, 2025
This is an interesting if often disappointing book. Maher and Aquanno set out to dispel the notion that finance and financialization are aberrations of capitalism. They take aim at recent critics of the financialized economy, ranging across the political spectrum but most concentrated amongst liberal progressives, who allege that finance is parasitic, favors number games over the "real" economy, and is ultimately at fault for many of the economic ails of the neoliberal era.
The authors' counter argument is disappointing in its simplicity. Following many classical and Marxist economists, they argue that finance is efficient. Indeed, markets as a whole are efficient. Finance does not hinder the real economy because it is integral to the functioning of the real economy. The real economy exists to generate profits for capitalists and that is what finance enables. Additionally, finance has always been arranged relative to industry to allow investors to best generate returns, so there is no sense in which neoliberal finance is particularly parasitic. In fact, the current iteration of our financial system, which bestows significant authority upon a handful of supersized asset managers, serves investors very well by delivering consistent, inexpensive returns and encouraging fierce competition and best practices across the companies they own.
I think there is some merit to this argument. However, I was disappointed by the lack of detail paid to making it. Most of the book is a historical discussion of different eras of capitalism (mostly focused on the US) and how finance interacted with industrial firms. Yet, explicit argumentation about the role of finance today is limited. There is also very little empirical argument. Most of the book is descriptive rather than argumentative and so the authors do not engage with, for example, antitrust or monopoly concerns, corruption introduced by the interconnections between finance and government, or other common progressive criticisms like the destructive nature of many PE/asset management operations, criminal conduct by financial leaders, exploitation of workers/consumers, etc.. Even the discussion of the Big 3 asset managers is relatively high-level. The authors point to evidence that these firms have exercised increasing authority over their portfolio companies, but do not substantially address the many times they haven't exercised that authority.
On the plus side, the book has one of the more extensive and interesting descriptions of America's financial system since 2008 that I've read. They distill many of the key elements of the system and, in particular, the outsized role of the government in making the whole thing work. In their telling, an incredibly centralized, quasi-public financial system is inevitable and maybe even upon us, only with profits given to private actors rather than the government. They gesture to the eventual difficulties this system will face if the government is unable to hold it up through a variety of mechanisms.
Overall, this might be worth reading for you if you're interested in American financial history.
The authors' counter argument is disappointing in its simplicity. Following many classical and Marxist economists, they argue that finance is efficient. Indeed, markets as a whole are efficient. Finance does not hinder the real economy because it is integral to the functioning of the real economy. The real economy exists to generate profits for capitalists and that is what finance enables. Additionally, finance has always been arranged relative to industry to allow investors to best generate returns, so there is no sense in which neoliberal finance is particularly parasitic. In fact, the current iteration of our financial system, which bestows significant authority upon a handful of supersized asset managers, serves investors very well by delivering consistent, inexpensive returns and encouraging fierce competition and best practices across the companies they own.
I think there is some merit to this argument. However, I was disappointed by the lack of detail paid to making it. Most of the book is a historical discussion of different eras of capitalism (mostly focused on the US) and how finance interacted with industrial firms. Yet, explicit argumentation about the role of finance today is limited. There is also very little empirical argument. Most of the book is descriptive rather than argumentative and so the authors do not engage with, for example, antitrust or monopoly concerns, corruption introduced by the interconnections between finance and government, or other common progressive criticisms like the destructive nature of many PE/asset management operations, criminal conduct by financial leaders, exploitation of workers/consumers, etc.. Even the discussion of the Big 3 asset managers is relatively high-level. The authors point to evidence that these firms have exercised increasing authority over their portfolio companies, but do not substantially address the many times they haven't exercised that authority.
On the plus side, the book has one of the more extensive and interesting descriptions of America's financial system since 2008 that I've read. They distill many of the key elements of the system and, in particular, the outsized role of the government in making the whole thing work. In their telling, an incredibly centralized, quasi-public financial system is inevitable and maybe even upon us, only with profits given to private actors rather than the government. They gesture to the eventual difficulties this system will face if the government is unable to hold it up through a variety of mechanisms.
Overall, this might be worth reading for you if you're interested in American financial history.
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November 11, 2024I found this very useful as an alternative narrative of the role of finance in contemporary (and 20th century) capitalism.
Against the social democrats/vulgar marxists: finance is not predatory on the ‘real’ economy. Their interests in general terms have converged as industry and finance have increasingly integrated in response to crises - the formerly industrial firm has become a money-manager as it has diversified away from any particular concrete process of production.
Finance is also not anti-competitive. Restructuring and international market integration based on dollar/Fed supremacy have shifted competition to a higher, more globalised plane. Competition is more cut throat than ever as financial institutions can be extremely mobile in investment, and exercise high degrees of leverage on company boards for restructuring.
Against the brennerites: the crisis of the 70s was not terminal, and we are not experiencing secular stagnation. Neoliberal restructuring was a successful strategy to kill wage-push inflation through monetary policy/austerity. Profits were restored, although the stage was set for 2008.
I think the argument against the brennerites is quite strong, but does not address their arguments on falling rates of profit convincingly (and acknowledges the basis of their diagnosis as basically correct, with disagreement on the consequences). They basically say that there is no universal ideal rate of profit, as long as investment remains profitable in general. Sure, but does this not demonstrate an increasing underlying weakness in capitalist dynamism? I think we can acknowledge the decline from a ferrari to a civic - yes, they are both on the road but one is getting you there a lot faster. Firms are fighting harder for less (in relative not absolute terms).
Their argument that the state has retained a relative autonomy in the interests of system-wide success is very strong, especially in relation to the growing importance of asset management firms. The central bank/treasury/asset management nexus represent the commanding heights for today’s transition to socialism - seize the means of investment!
Against the social democrats/vulgar marxists: finance is not predatory on the ‘real’ economy. Their interests in general terms have converged as industry and finance have increasingly integrated in response to crises - the formerly industrial firm has become a money-manager as it has diversified away from any particular concrete process of production.
Finance is also not anti-competitive. Restructuring and international market integration based on dollar/Fed supremacy have shifted competition to a higher, more globalised plane. Competition is more cut throat than ever as financial institutions can be extremely mobile in investment, and exercise high degrees of leverage on company boards for restructuring.
Against the brennerites: the crisis of the 70s was not terminal, and we are not experiencing secular stagnation. Neoliberal restructuring was a successful strategy to kill wage-push inflation through monetary policy/austerity. Profits were restored, although the stage was set for 2008.
I think the argument against the brennerites is quite strong, but does not address their arguments on falling rates of profit convincingly (and acknowledges the basis of their diagnosis as basically correct, with disagreement on the consequences). They basically say that there is no universal ideal rate of profit, as long as investment remains profitable in general. Sure, but does this not demonstrate an increasing underlying weakness in capitalist dynamism? I think we can acknowledge the decline from a ferrari to a civic - yes, they are both on the road but one is getting you there a lot faster. Firms are fighting harder for less (in relative not absolute terms).
Their argument that the state has retained a relative autonomy in the interests of system-wide success is very strong, especially in relation to the growing importance of asset management firms. The central bank/treasury/asset management nexus represent the commanding heights for today’s transition to socialism - seize the means of investment!
December 15, 2025
I found this book to be an interesting inquiry into the development of the American, and thus in many ways world, financial system. Using a Marxian analysis the writers do a good job of providing a historical grounding of American finance while also dispelling common tropes of said history (i.e. the position that finance is an aberration/parasite or that the post war consensus was a uniquely moral point in capitalism).
Something I found commendable which I found many reviews ignoring is that despite the top down history provided in much of the book, the writers are cognizant of the bottom up history happening along side their story. This allows the writers to always ground their history of finance in the history of class struggle, and specifically in the history of the union movement.
The biggest issue I had with the book was in its last few pages. In the end the authors struggle to see beyond the horizon of the current financial system and they simply call for a socialist strategy which sizes control of the fed, creates a public financial system (which is shielded from market forces) which works along side a cooperative economy. Maybe that is a reasonable position, but I found it rushed and unconvincing as presented here. I felt a more more detailed and radical solution would have improved the conclusion.
Something I found commendable which I found many reviews ignoring is that despite the top down history provided in much of the book, the writers are cognizant of the bottom up history happening along side their story. This allows the writers to always ground their history of finance in the history of class struggle, and specifically in the history of the union movement.
The biggest issue I had with the book was in its last few pages. In the end the authors struggle to see beyond the horizon of the current financial system and they simply call for a socialist strategy which sizes control of the fed, creates a public financial system (which is shielded from market forces) which works along side a cooperative economy. Maybe that is a reasonable position, but I found it rushed and unconvincing as presented here. I felt a more more detailed and radical solution would have improved the conclusion.
June 14, 2025
Personally found this extremely dry and technical, and difficult to not constantly zone out while reading it, and wanted more empirical analysis weaved through this. But there is some interesting and important analysis and argumentation in this, particularly around its general points about how finance capital and industrial capital aren't really opposed to each other, as certain kinds of lefty common sense holds. Overall a challenging read that could probably have been written better, but worth slogging through if you're interested in Marxian analysis of the history of the US financial industry and its changing position in broader political economy.
December 31, 2025
I’m guilty of being the exact guy Maher and Aquanno criticize in the book of hand waiving derivative markets as “fictitious capital”. As a result, I’ve always had a hard time squaring the circle of why there hasn’t been the catastrophic post-2008 crash every Marxist like myself has been endlessly predicting. It hasn’t happened because of the construction and administration of the anti-democratic American “risk state”. Finance capital simply cannot be thought of as separate and distinct from industrial capital in contemporary capitalism—both are now expressions of the same sort of hyper corporate capital.
A lot to think about.
A lot to think about.
April 30, 2025
solid history on American finance but missed some basic points on monopolies and capitalism.
keep reading about the feds role in social policies wonder how that will turn out. good points on structural change vs cheering for bank breakups
good stuff on state involvement and increasing involvement in maintaining competitive imperatives
keep reading about the feds role in social policies wonder how that will turn out. good points on structural change vs cheering for bank breakups
good stuff on state involvement and increasing involvement in maintaining competitive imperatives
January 16, 2026
Probably out of my depth, but i do feel i learned a good deal and have a greater appreciation of the financial system. The authors' arguments seem to be new and even slightly heretical in the field, so maybe this wasn't a great place to start. However, i'm glad to have read it and build upon it.
July 21, 2024
4.5 rounded down
April 10, 2024
No mention of the S&L crisis or references to JK Galbraith or Hyman Minsky seem like major oversights in a study of American finance.
Displaying 1 - 9 of 9 reviews