In the rogues’ gallery of disastrous economic policies, the protectionism of the United States in the Great Depression, codified in the notorious Smoot-Hawley tariffs, has pride of place. A new book by Douglas Irwin, [amazon_link id=”069115032X” target=”_blank” ]Peddling Protectionism: Smoot-Hawley and the Great Depression[/amazon_link], examines the effect the legislation had: did it, as believed, play a central role in bringing about a collapse in global trade and seriously exacerbating the depression? Irwin concludes that the Act was based on no economic logic, and was a blatant example of pork-barrel politics. Even so, it played a subsidiary role to demand shocks (especially monetary ones) in prolonging and deepening the weakness of the economy. The book is very informative on the Congressional politics of the time, and the current role of Congress in setting trade policy. There is nobody to match Irwin on this subject, and it’s a short and accessible book. It is a great introduction for students as well as general readers.

However, the status of the Smoot-Hawley tariff as a bogey man has proven useful ever since, Irwin suggests. The great inertia of the American political system means that the post-war openness to trade is actually hard to overturn in practice. The experience of the post-crisis policy reaction is certainly encouraging in this respect, although I’m not sure I’m as relaxed about the dangers as the book suggests I ought to be. Still, fears of a return to Great Depression style protectionism have not entirely come to life, although there is evidence of a pick-up recently in protectionism. The excellent CEPR Global Trade Alert reports on this document policy reactions in some detail. The book concludes that the far greater openness of the US (and other economies) now than in the 1930s make protectionism a less likely policy reaction; but equally, if governments ever do reach for those trade policies, the disruption will be far greater.

[amazon_image id=”069115032X” link=”true” target=”_blank” size=”medium” ]Peddling Protectionism: Smoot-Hawley and the Great Depression[/amazon_image]

[amazon_image id=”1907142193″ link=”true” target=”_blank” size=”medium” ]Tensions Contained… for Now: The 8th GTA Report (Global Trade Alert)[/amazon_image]

I’m part way through William Rosen’s [amazon_link id=”1845951352″ target=”_blank” ]The Most Powerful idea in the World: A Story of Steam, Industry and Invention[/amazon_link]. It’s an enjoyable read, although I’m not learning anything new, as someone who has already read plenty about the Industrial Revolution. The book covers the same terrain as classics of economic history such as Joel Mokyr’s [amazon_link id=”0691120137″ target=”_blank” ]The Gifts of Athena[/amazon_link] and more recent [amazon_link id=”0140278176″ target=”_blank” ]The Enlightened Economy[/amazon_link], and Greg Clark’s [amazon_link id=”0691141282″ target=”_blank” ]A Farewell to Alms[/amazon_link].

However, one novelty is the claim made in a footnote that “a number of international economists” use the production of sulphuric acid as a proxy for the level of development. I’m familiar with the use of electricity consumption as a measure of economic activity – Friedrich Schneider and Dominik Este use it as one approach in their estimates of the scale of the underground economy. A bit of searching this morning has found the claim about sulphuric acid made in one commodities market blog post endlessly copied around the internet, and the following New Scientist article from 1988 attributing the claim to a classic chemicals textbook (Industrial Chemicals by Faith, Keyes and Clark) but noting that the relationship between economic output and sulphuric acid production had broken around 1983 in Britain. Intriguingly, this is the time when UK GDP decoupled from the material weight of the economy in general, as noted in my 1996 book, [amazon_link id=”0262032597″ target=”_blank” ]The Weightless World[/amazon_link].

[amazon_image id=”1845951352″ link=”true” target=”_blank” size=”medium” ]The Most Powerful Idea in the World: A Story of Steam, Industry and Invention[/amazon_image]

Quotation of the day comes from Robert Solow, in his introduction to the forthcoming new edition of [amazon_link id=”0230575978″ target=”_blank” ]Manias, Panics and Crashes: A History of Financial Crises[/amazon_link] by Charles Kindleberger and Robert Aliber. He writes: “Large quantities of liquid capital sloshing around the world should raise the possibility that they will overflow the container.” A thumbnail diagnosis of the recent Great Financial Crisis.

[amazon_image id=”0230575978″ link=”true” target=”_blank” size=”medium” ]Manias, Panics and Crashes: A History of Financial Crises[/amazon_image]

A while ago I posted about a 1956 book by sociologist C Wright Mills, [amazon_link id=”0195133544″ target=”_blank” ]The Power Elite[/amazon_link]. It was the persistence of unearned banking bonuses that made it seem so relevant at the time, but recent events in the UK are a reminder that the media are – and always have been – in the nexus of power in every country.

An article by John Nichols in the current issue of The Nation considers the market power of News International in the United States, bringing to mind Timothy Wu’s excellent recent book on concentration in media markets, [amazon_link id=”B004DUMW4A” target=”_blank” ]The Master Switch[/amazon_link]. It would be interesting, too, to go back to some of the classics looking at the elite – in the UK, it would be Anthony Sampson’s [amazon_link id=”0719565669″ target=”_blank” ]Who Run’s This Place: An Anatomy of Britain in the 21st Century[/amazon_link], and Robert Peston’s [amazon_link id=”B002V0921A” target=”_blank” ]Who Runs Britain?[/amazon_link], which focuses on the financial sector.

All in all, with both the big banks and a major international media company in turmoil, not to mention the travails of Silvio Berlusconi in Italy, bringing together political and media power in his own person and now at the latest epicentre of the financial crisis, it’s a fascinating time for social scientists to ponder questions of power. (I write this as both a social scientist and a minor member myself of Britain’s power elite.)

[amazon_image id=”0195133544″ link=”true” target=”_blank” size=”medium” ]The Power Elite[/amazon_image]

I’ve started reading William Rosen’s history of how innovation came to be, [amazon_link id=”1845951352″ target=”_blank” ]The Most Powerful Idea in the World: The Story of Steam, Industry and invention.[/amazon_link] It’s a readable canter through the history of the science of steam, culminating in the steam engines of Savery, Newcomen, and James Watt – and through that specific story, a history as well of the invention of invention. Having grown up in Lancashire, with parents and aunties and uncles working in what was left (by the 1970s) of the traditional cotton industry, I’m a complete addict when it comes to anything about the Industrial Revolution.

This being an English summer’s day, it’s bucketing with rain in London. I was particularly struck by a quotation early in the book from Evangelista Torricelli, a Florentine scientist of the 17th century, and discoverer of atmospheric pressure. No, I’d never heard of him before either.

Anyway, he said: “We live submerged at the bottom of an ocean of air.” What a fantastic image – especially now we know what the Earth looks like from space.

[amazon_image id=”1845951352″ link=”true” target=”_blank” size=”medium” ]The Most Powerful Idea in the World: A Story of Steam, Industry and Invention[/amazon_image]