Capital Offense: How Washington's Wise Men Turned America's Future Over to Wall Street

by Michael Hirsh

Why every president from Reagan through Obama has put Wall Street before Main Street

Over the last few decades, Washington’s firmly held belief that if you make investors happy, a booming economy will follow has caused an economic crisis in Asia, hardship in Latin America, and now a severe recession in America and Europe. How did the best and brightest of our time allow this to happen? Why have these disasters done nothing to change the free-market mantra of the Washington faithful? The answer has nothing to do with lobbyists and everything to do with ideology. In Capital Offense , veteran Newsweek reporter Michael Hirsh gives us a colorful narrative history of the era he calls the Age of Capital, telling the story through the eyes of its key players, from Ronald Reagan and Milton Friedman through Larry Summers and Timothy Geithner.
•    Based on the solid research and skilled reporting of Newsweek Senior Editor Michael Hirsh
•    Takes you inside high-level, closed-door conversations of top White House advisers and administration officials such as Alan Greenspan, Robert Rubin, Paul O’Neill, and others
•    Illuminates key figures and lively interpersonal clashes, including the conflict between Larry Summers and Nobel Prize-winning economist Joe Stiglitz
•    Offers crucial insights on why President Obama took so long to work on the economy—and why he may not be going far enough
•    Catalogs the missteps of three decades of fiscal, regulatory, and financial recklessness, including the dismantling of the Glass-Steagall Act, the S&L debacle, Enron, and the subprime mortgage meltdown
As we struggle to emerge from the financial crisis, one thing seems Wall Street’s continued dominance of the global economy. Propelled into the lead by a generation of Washington policy-makers, Wall Street will continue to stay ahead of them.

Genres: Nonfiction, Economics, Finance, Politics

352 pages, Hardcover

First published August 13, 2010

About the author

Michael Hirsh is the author of numerous books. During a 40-year career in broadcasting, he produced documentaries and specials for PBS, CBS, ABC and HBO, receiving multiple awards, including the Peabody.

He lives and writes in Punta Gorda, Florida

Reviews

[Greg · Rating 4 out of 5]

Ideology as the unquestioned voice of certainty is the most formidable enemy we face as a civil society. Hirsh makes a compelling argument for that premise by introducing us to the main players in U.S. government finance. We are given an understandable overview about the consequences of their influence, or lack thereof. As one who rues the opportunity lost by this administration's failure to lead, it is even more disheartening to learn that my suspicious feelings in the area of the Treasury and economics were largely true. Much is made of Obama turning his back on his liberal/progressive base, but Hirsch demonstrates that Obama was always taking care of his core consituency—Wall Street.

The other conclusion I drew, in addition to the tragedy of "free maket, deregulatory" argument in vogue since the Reagan administration, is the tragedy that we've never really given liberal or progressive economic ideas a real try. This was especially true of the Clinton and Obama years and certainly accelerated by each Republican adminstration before and between them. The fact that people like Joe Stiglitz, Paul Krugman, and Robert Reich have never been taken seriously by the top policy makers, that they can't get a fair hearing to have their ideas implemented, is perhaps the greatest lost opportunity. Hirsch makes a compelling argument that in order for government finance policy to work, we have to pay attention to all parts of the intellectual spectrum and neither shun nor unconditionally embrace one side or the other.

This is a good fact-filled, connect-the-dots, and relevant overview of why and how, we as a nation, have been badly represented in finance and economics. The situation, unfortunately for us all, continues. A good companion to Matt Taibbi's book, Griftopia. Hirsch gives you the rational facts and Taibbi adds the visceral outrage. And outrage there should be that the Obama administration is complicit in maintaining much of the status quo. Perhaps more than outrage.

[Potomacwill · Rating 3 out of 5]

I read this vitally important book twice in two back-to-back sessions. So impressed was I with the book's clear and well-researched explanation of the reasons every president from Reagan through Obama has put Wall Street's interests a head of Main Street's, I read it again immediately to see whether I could find among its outsized personalities the outlines of a screen play that might appeal to the millions who need to engage the topic, but who doubtless never will read a book about it. Read this engaging, well written book to see how complacency and the received wisdom of past success, more than greed, has put us in a hole from which we have been unable to escape in the years since the Wall Street calamity of 2007.

[Ken Ronkowitz · Rating 4 out of 5]

Capital Offense is a narrative history of the economic and political world from the Reagan revolution through the financial disaster and the attempts to fix the system afterward.

Reading it in the Trump era seems still relevant. As it focuses on the the times of Greenspan, Rubin and Summers in the ‘90s and the Bush years, living with the possibility of another financial disaster in 2018/2019, which is being debated but anticipated, the book is a great historical piece to prepare you.

I would love to see an updated addition or followup by Hirsh.

AUTHOR NOTE: This Michael Hirsh is not to be confused with other authors by that name that are found collectively on Goodreads. This author is an American journalist, and the former national editor for Politico,and the former foreign editor, chief diplomatic correspondent and national economic correspondent for Newsweek. Hirsh was co-winner of the Overseas Press Club award for best magazine reporting from abroad in 2001 for "prescience in identifying the al Qaeda threat half a year before the September 11 attacks" and for Newsweek's coverage of the war on terror, which also won a National Magazine Award.

He is also the author of 'At War with Ourselves: Why America is Squandering Its Chance to Build a Better World.'

[Mark Tatge · Rating 4 out of 5]

"Great look at how Wall Street and Washington insiders lobbied to blunt new rules on derivatives. The lack of such rules ultimately led to the biggest economic downturn since the Great Depression. Now, the newly installed GOP wants to blunt or repeal any attempts to restrict derivative trading and speculation in this toxic instruments. Hold on to your hat"

[Steve · Rating 5 out of 5]

"An outstanding book--well researched and well written. Explores the evolution of unrestrained free-market theories from a criticism of Keynes into a fanatic religion, and how that religion--and particularly the triumph finance as an end in itself over real economic growth--has poisoned national economic policy and American capitalism itself."

[Mof · Rating 3 out of 5]

Another in the list of post crash books. This crash was caused by speculation. But the speculation was fed by the banks. Deregulation made things worse. And the regulators are in the pockets of the offenders.

[Don Hannan · Rating 5 out of 5]

Excellent explaination of dynamics and personalities that initiated different economic theories and thus applications.

[Emanuelle Sedita · Rating 4 out of 5]

Overall good read on how Washington and Wall Street personnel intertwined all too well for deregulation.