The Great Game: The Struggle for Empire in Central Asia by Peter Hopkirk - Chs. 18-22

Chapter 18 - Night of the Long Knives

• "In addition to its heavy commitment in Afghanistan, in China the first of the Opium Wars was well into it second year, while nearer to home there were serious troubles brewing with both France and the United States." - 233
• November 1, 1841: Alexander Burnes is warned by a Kashmiri assistant that "an attempt was to be made on his life that night. It was Burnes whom many Afghans held responsible for bringing the British to Afghanistan" - 239

Chapter 19 - Catastrophe

• "According to his friend Mohan Lal, Burnes had viewed the situation as anything but tranquil, even if he had gravely underestimated his own personal danger that night. On the previous evening he had declared that 'the time is not very far off when we must leave this country.'" - 245
• "Mohan Lal was authorised to offer a reward of 10,000 rupees to anyone who succeeded in assassinating one of the principal rebel leaders." - 246
• "Mohammed Akbar Khan, favourite son of the exiled Dost Mohammed, was on his way from Turkestan to take personal command of what had now become a full-scale insurrection against the British and their puppet ruler." - 247
• "Whereas it has become apparent from recent events that the continuance of the British Army in Afghanistan for the support of Shah Shujah is displeasing to the great majority of the Afghan nation, and whereas the British Government had no other object in sending troops to this country than the integrity, happiness and welfare of the Afghans, it can have no wish to remain when that object is defeated by its presence." - Mohammed Akbar Khan, 252

Chapter 20 -Massacre in the Passes

• January 1, 1842: "an agreement was signed with Akbar under which he guaranteed the safety of the departing British, and promised to provide them with an armed escort to protect them from the hostile tribes through whose territories they must pass." - 259
• "Dr. Brydon was the only one of the 16,000 souls who had left Kabul to complete the terrible course and reach Jalalabad in safety -- and the first, on that fateful thirteenth day of January, 1842, to break the news of the disaster which had overtaken Elphinstone's army to a horrified nation." - 268

Chapter 21 - The Last Hours of Conolly and Stoddart

• "Far from establishing a friendly rule in Afghanistan to buttress India against Russian encroachments, it had led instead to one of the worst disasters ever to overtake a British army...It was a devastating blow to British pride and prestige." - 270
• "With Shah Shujah dead, Kabul was now kingless, and Pollock, the senior of the two commanders [who had retaken the city on September 15], who had been invested with political authority by Lord Ellenborough, immediately placed Shujah's son Futteh on the throne, thereby making him too a British puppet." - 275
• October 11, 1842: the British "hauled down the Union Jack over Bala Hissar, and the next morning the first units marched away from Kabul. The First Afghan War, as historians now call it, was finally over. Within three months Shah Shujah's son had been overthrown, and Dost Mohammed was allowed by the British to return unconditionally to the throne from which he had been removed at such terrible cost...Events had come full circle." - 277

Chapter 22 - Half-time

• "The Russians pushed forward their line of fortresses across the lawless Kazakh Steppe....The British were even more active during this period of detente. In 1843, following their humiliation in Afghanistan, they had seized Sind -- 'like a bully who has been kicked in the street and goes home to beat his wife in revenge,' observed one critic." - 282
• March 2, 1855: "as the Russian surrender [in the Crimean War] became inevitable, Tsar Nicholas, whose attack on Turkey had begun the war, sunk deeper and deeper into despair. He finally died in the Winter Palace, from where he had personally commanded the Russian forces...Officially the cause was said to be influenza, but many believed that he had taken poison rather than witness the defeat of his beloved army." - 286
• October 25, 1856: Herat falls to the Persians - 288
• August 1858: "in an attempt to resolve the deep resentments and antagonisms which had led to the Mutiny, the British government passed the India Act, abolishing the powers of the [East India] Company and transferring all authority to the Crown." - 291

The Great Game: The Struggle for Empire in Central Asia by Peter Hopkirk, Chs. 10-17

Chapter 10 - "The Great Game"

• January 14, 1831: Lieutenant Arthur Conolly, "British officer in disguise...of the 6th Bengal Native Light Cavalry -- and the first of Lord Ellenborough's young bloods to be sent...to reconnoitre the military and political no-man's-land between the Caucasus and the Khyber [Pass]" returns to India; coined the term "Great Game" - 123
• September 1830: Conolly reaches Herat, "which no British officer had seen since Christie's clandestine visit twenty years earlier" - 128
• "It was at this moment that Wellington's government fell, taking Ellenborough with it, and the Whigs came to power." - 134
• January 21, 1831: Lieutenant Alexander Burnes sails from Kutch to see Ranjit Singh - 134

Chapter 11 - Enter "Bokhara" Burnes

• "A dazzling reception awaited Burnes in Lahore, Ranjit being as anxious to maintain cordial relations with the British as they were anxious to keep on the right side of their powerful Sikh neighbour." - 136
• Burnes discovers "that the Indus was navigable for flat-bottomed craft," and "it was decided to proceed with plans to open up the great waterway to shipping, so that British goods could eventually compete with Russian ones in Turkestan and elsewhere in Central Asia." - 139
• February 20, 1833: "just as Burnes arrive in Calcutta to report to the Governor-General on the results of his reconnaissance into Central Asia, a large fleet of Russia warships dropped anchor off Constantinople, causing profound dismay in London and in India. This was the final outcome of a chain of events which had begun in 1831, following a revolt in Egypt...against the Sultan's rule." - 149

Chapter 12 - The Greatest Fortress in the World

• "Under the terms of a treaty signed in the summer of 1833, Turkey had been reduced...to little more than a protectorate of the Tsar's." - 154
• "Not for nothing had one Russian general described the Caucasus as 'the greatest fortress in the world.'" - 155
• "It was around this time that the Russians began to claim that there were British agents operating among the Circassians, supplying them with arms, advising them and encouraging them to resist. Indeed, in addition to its cargo of salt, they alleged that the Vixen had been found to be carrying weapons intended for the rebellious tribesmen." - 158
• "As the arch-Russophobe of the day...he [Urquhart] had done much to turn British public opinion against St Petersburg, and to deepen the growing rift between the two powers. Indeed, the modern Soviet historians lay some of the blame for today's problems in the Caucasus on British interference in the region" - 161-2
• Lord Durham said, "The power of Russia had been greatly exaggerated....There is not one element of strength which is not directly counterbalanced by a corresponding...weakness....In fact her power is solely of the defensive kind. Leaning on and covered by the impregnable fortress with which nature has endowed her -- her climate and her deserts -- she is invincible, as Napoleon discovered to his cost." - 162
• "within a very short time of his arrival in Persia [Sir John McNeill, new Minister to Teheran], the Russians began to make shadowy moves towards Herat and Kabul, the two principle gateways leading to British India. The Great Game was about to enter a new and more dangerous phase." - 164

Chapter 13 - The Mysterious Vitkevich

• "it was no secret in Teheran that it was he [Count Simonich] who had urged the Shah to march on Herat, which Persia had long claimed, and wrest it" - 166
• "All of a sudden Kabul too was at risk. If [Captain Yan] Vitkevich was successful in winning over Dost Mohammed, then the Russians would have succeeded, in one spectacular leap, in clearing the formidable barriers of desert, mountain and hostile tribes which lay between themselves and British India." - 167
• "Ever since the collapse of the great Durrani empire, which had been founded by Ahmad Shah in the middle of the eighteenth century, Afghanistan had been at the centre of an intense and unceasing struggle for power." - 167-8
• "Addressing Dost Mohammad as though he was a naughty schoolboy, and instructing him on whom he might or might not have dealings with, Auckland [Governor-General of India] offered him nothing in return besides Britain's vague goodwill. Despite his anger, however, Dost Mohammed managed to keep his composure, still evidently hopeful that the British could be won round" to returning Peshawar to him - 171

Chapter 14 - Hero of Herat

• August 18, 1837: "His skin darkened with dye, and posing as a Muslim holy man, Lieutenant Eldred Pottinger...entered Herat on a routine Great Game reconnaissance....Aged 26, and the nephew of that veteran of the game Colonel Henry Pottinger, he had been sent into Afghanistan to gather intelligence." - 175
• "in the Persian camp, Count Simonich cast aside any remaining pretence of being there simply as a diplomatic observer and personally took over direction of the faltering siege" of Herat - 181

Chapter 15 - The Kingmakers

• "Having thus forced the Russians and Persians to back off, the British might have been well advised to leave it at that. But from the moment that Dost Mohammed spurned Lord Auckland's ultimatum, and officially received Vitkevich, he was considered in London and Calcutta to have thrown in his lot with the Russians...it was decided that he must be forcibly removed from his throne and replaced by someone more compliant." - 188
• June 1838: "a secret agreement was signed by Ranjit Singh, [Shah] Shujah and Great Britain, swearing eternal friendship and giving approval to the plan" to replace Dost Mohammad with Shujah - 190
• October 1, 1838: "Auckland issued the so-called Simla Manifesto in which he made public Britain's intention of forcibly removing Dost Mohammed from the throne and replacing him with Shujah. In justification of this, Dost Mohammed was portrayed as an untrustworthy villain...and Shujah as a loyal friend" - 190
• "To occupy Afghanistan would not only be prohibitively expensive...but it would also push the Persians even further into the welcoming arms of the Russians. The Duke of Wellington for one was strongly against it, warning that where the military successes ended the political difficulties would begin." - 192
• June 30, 1839: after taking Ghazni, "Keane resumed his march, and a week later, opposed only by a line of abandoned cannon, the British appeared before the walls of Kabul. Dost Mohammed, they found, had fled, and the capital surrendered without a shot being fired." - 200

Chapter 16 - The Race for Khiva

• "in the coming years 'scientific expeditions' were frequently to serve as covers for Russian Great Game activities, while the British preferred to send their officers...on 'shooting leave', thus enabling them to be disowned if necessary." - 204
• December 24, 1839: Captain James Abbott sets off for Khiva, it being his responsibility "to convince the Khan of the urgent need to jettison the slaves before Perovsky advanced too far to turn back." - 205
• February 1, 1840: "the [Russian] general gave orders for the exhausted and depleted columns to turn about and head back to Orenburg." - 208
• "Few in Britain or India were willing to see that it was largely panic over Britain's own forward move in Afghanistan which had driven St Petersburg into such precipitate action over Khiva." - 210

Chapter 17 - The Freeing of the Slaves

• "Until news of Eldred Pottinger's role in Herat's defense reached Khiva, few if any Khivans had ever heard of them....Many believed them merely to be a sub-tribe, or a vassal state, of the Russians." - 213
• "Accompanied by a number of Russian slaves...[Abbott] was to proceed to...St Petersburg where he would negotiate on Khan's behalf the return of the rest of the slaves. These would be freed if the Tsar agreed to abandon all military operations against Khiva and to return the Khivan hostages held at Orenburg." - 217
• August 3, 1840: Lieutenant Richmond Shakespear, sent to Khiva after lack of word from Abbott, records, "The Khan...has made over to me all the Russian prisoners, and I am to take them to a Russian fort on the eastern shore of the Caspian." - 222
• November 3, 1840: "Shakespear arrived in St Petersburg en route for London...It was no secret in court circles...that privately the Tsar was infuriated by the young British officer's unsolicited but now widely published act. For just as Shakespear's superiors had hoped, it effectively removed any excuse which St Petersburg might have had for advancing again on Khiva" - 227

Truman by David McCullough

• "After three years on the farm, he joined the Masons...Harry was elected to receive degrees at the Belton Lodge on January 30, 1909. By March, having  become 'letter perfect' in the ritual, he passed to Master Mason." - 78
• "It is a race prejudice I guess. But I am strongly of the opinion that negroes ought to be in Africa, yellow men in Asia, and white men in Europe and America." - Harry S Truman, 86
• "To succeed financially a man can't have any heart. To succeed politically he must be an egoist or a fool or a ward boss tool." - HST, 90
• "At Angers[, France], to his total surprise, he learned he had been made a captain months earlier. No one had bothered to tell him. He only found out when he saw it reported in The New York Times." - 116
• "Harry had been ordered to take up a position about a mile closer to the German lines and prepare to fire a gas barrage. So his first action would be to shell the enemy with poison gas." - 121
• "He had been more at home in the older era. He never learned to like the telephone, or daylight saving time, an innovation adopted during the war. He tried to use a typewriter for a while, but gave it up." - 141
• as presiding judge of Jackson County[, Missouri], "He would build the best roads in the state, if not the country, he vowed, and see they were built honestly." - 176
• during his 1934 Senate campaign, "He talked of the capitalist domination of government in bygone Republican times, praised the determination of FDR to end the 'rule of the rich' and give the average American a chance." - 206
• "he voted with the Democratic majority time after time, helping to pass some of the most far-reaching legislation in the history of Congress. He never once spoke for a measure, never took part in debate. He just voted" - 218
• December 20, 1937: "Senator Truman delivered the second of his assaults on corporate greed and corruption...he attacked the power of Wall Street and the larger evil of money worship, sounding at times not unlike his boyhood hero, William Jennings Bryan." - 231-2
• "It is a pity that Wall Street, with its ability to control all the wealth of the nation and to hire the best law brains in the country, has not produced some statesmen, some men who could see the dangers of bigness and of the concentration of the control of wealth. Instead of working to meet the situation, they are still using the best law brains to serve greed and self interest. People can stand only so much and one of these days there will be a settlement." - HST, 233
• "There is no indispensable man in a democracy...When a republic comes to a point where a man is indispensable, then we have a Caesar." - HST, 244
• "Truman was by now a member of both the Military Affairs Committee and the Military Subcommittee of the Appropriations Committee. In September [1941] he had voted for the first peacetime draft." - 254
• "Its formal title was the Senate Special Committee to Investigate the National Defense Program, but from the start it was spoken of almost exclusively as the Truman Committee." - 259
• "If we see that Germany is winning we ought to help Russia, and if Russia is winning we ought to help Germany, and that way let them kill as many as possible, although I don't want to see Hitler victorious under any circumstances." - HST, 262
• "Again at Chicago [during the DNC in 1944], as so consistently through the Truman career, it had been the system of politics, the boss system, that counted in deciding his fate." - 321
• "Stimson [Secretary of War] told Truman what the committee had stressed, and what all his senior military advisers were saying, that it was the 'shock value' of the weapon that would stop the war. Nothing short of that would work." - 395
• "'I am anxious to bring home to you that the world is no longer county-size, no longer state-size, no longer nation-size...It is a world in which we must all get along.' On July 2, he went before the Senate to urge the ratification of the United Nations Charter: 'It comes from the reality of experience in a world where one generation has failed twice to keep the peace.'" - 402
• At Potsdam, "He, Churchill, and their combined Chiefs of Staff decided that Vietnam, or Indochina, would, 'for operational purposes,' be divided, with China in charge north of the 16th parallel and British forces in the southern half, leaving little chance for the unification or independence of Vietnam and ample opportunity for the return of the French." - 452
• "He asked for national compulsory health insurance to be funded by payroll deductions. Under the system, all citizens would receive medical and hospital service irrespective of their ability to pay." - 473-4
• July 25, 1947: "Congress passed Truman's sweeping National Security Act, legislation he had sent to the Hill in February and that would mean mammoth change for the whole structure of power in Washington. Its primary purpose was to unify the armed services under a single Department of Defense and a single Secretary of Defense...It also established the Air Force as a separate military service, set up a new National Security Council, and gave formal authorization to the Central Intelligence Agency." - 566
• "He had faced the pressures of the Palestine issue, the increasing threat of war over Berlin, watched his popularity disintegrate in the polls, seen himself portrayed in the press as inept and pathetic. His party was broke. And now the New Dealers were abandoning him, and noisily. No President in memory, not even Herbert Hoover in his darkest days, had been treated with such open contempt by his own party." - 633
• "If you can't stand the heat, you better get out of the kitchen." - HST, 633
• "Truman liked to move fast. Roosevelt, because of his infirmities, had preferred a smooth, easy pace of no more than 35 miles an hour when travelling in the [Ferdinand] Magellan[, the presidential train car]. Truman liked to go about 80." - 656
• "Republicans in Washington have a habit of becoming curiously deaf to the voice of the people. They have a hard time hearing what the ordinary people of the country are saying. But they have no trouble at all hearing what Wall Street is saying." - HST, 661
• introducing the Point Four Program, "The material resources which we can afford to use for assistance of other peoples are limited. But our imponderable resources in technical knowledge are constantly growing and are inexhaustible....Democracy alone can supply the vitalizing force to stir the peoples of the world into triumphant action, not only against their human oppressors but also against their ancient enemies -- hunger, misery, and despair." - HST, 731
• "as Winston Churchill noted in a speech in London, the full allied force of twelve divisions in Western Europe faced a soviet threat of eighty divisions. The NATO allies were exceedingly concerned lest the United States become too involved in distant Korea." - 790
• "If 'victory' in Korea meant risking a world war -- a war of atomic bombs -- Truman would settle for no victory in Korea. That was the line he had drawn. There was a substitute for victory: it was peace. And he would stand by his policy of limited war for that specific objective." - 856
• 1969: "His books became his life more and more...What would her father's idea of heaven have been, Margaret would be asked years later. 'Oh,' she said, 'to have a good comfortable chair, a good reading lamp, and lots of books around that he wanted to read.'" - 986
• "Born in the Gilded age, the age of steam and gingerbread Gothic, Truman had lived to see a time of lost certainties and rocket trips to the moon. The arc of his life spanned more change in the world that in any prior period in history." - 991

Power, Faith, and Fantasy: America in the Middle East 1776 to the Present by Michael B. Oren

• 1625: "the earliest documented attack [on New World merchants] occurred...when Moroccan corsairs captured a merchant ship sailing from the North American colonies." - 19
• "French leaders were keen to promote their own Mediterranean trade and feared the impact of American competition," so they did not assist the young U.S. against Barbary pirates, in spite of the 1778 Franco-American Treaty of Alliance - 21
• John Adams, minister to Tripoli, on war with North African pirates, "We ought not to fight them [the Barbary States] at all unless we determine to fight them forever" - 27
• "Under the specter of imprisoned sailors in North Africa and imperiled American ships, delegates from twelve of the thirteen states gathered in Philadelphia in May 1787. Their purpose was to consider replacing the Articles of Confederation with a more centralized national character -- to rectify the very weakness that had humbled the United States before Barbary" - 29
• March 27, 1794: "Washington signed into law a bill authorizing an outlay of $688,888.82 for the building of six frigates 'adequate for the protection of the commerce of the United States against Algerian corsairs.'" - 35
• 1902: "The term 'Middle East' was coined by an American admiral....Before that time, Americans (and Europeans) spoke of the area as simply 'the East' or, more commonly, 'the Orient.'" - 41
• 1800: William Bainbridge takes the George Washington to Algiers to deliver tribute and is forced to convey the Algerians' own tribute to the Ottomans;  he "thus became the first American serviceman to behold the epicenter of Ottoman power [Istanbul]" - 53
• "Jefferson maintained the hope of building an international coalition against Barbary, of working 'in rotation' with the European powers to rid the Mediterranean of corsairs." - 54
• May 14, 1801: Tripoli declares war with the U.S. - 55
• September 1801: William "Eaton [ first consul to Tunis]...met Hamid Qaramanli, the exiled brother of Tripoli's sovereign...[and] suggested that the United States help Hamid reclaim his rightful throne and retain him as a trustworthy ally." - 65
• 1823: Pliny Fisk opens the first American-style school in Lebanon - 94
• "In Lebanon, opposition to the Americans' activities mounted from the Maronites, a Catholic sect traditionally associated with France and which ran its own lycee-style schools." - 95
• "While the struggle against North Africa compelled Americans to choose between bribing the pirates and fighting them, the Greek war [for independence] posed an even more fundamental question. Should the United States give precedence to its economic interests in the Middle East or should it forget financial considerations and uphold its democratic ideals?" - 108
• May 7, 1830: "America's first-ever Treaty of Navigation and Commerce with the Ottoman Empire. This granted extraterritorial rights ('capitulations') to the United States and permission to trade in the Black Sea." - 115
• "A common word for cloth in the Persian Gulf area was merkani and in Turkey, americano." - 116
• "American missionaries in the Middle East viewed Manifest Destiny not as a blueprint for conquering territory but rather as a warrant for capturing souls and minds." - 131
• in response to an attack on an American family's farm in 1858, the U.S. send consul Edwin "De Leon [who] was also a Jew, a member of a venerable Sephardic family who owed his post to the State Department's now established notion that Jews formed a natural link between Christian American and the Muslim Middle East." - 167
• "The same urge to safeguard the United States from the ecological devastation of the Middle East led [George Perkins] Marsh to pioneer the American conservationist movement and the creation of a national research institute on nature, the Smithsonian." - 169
• January 1863: while the U.S. was occupied with the Civil War and unable to enforce the Monroe Doctrine, "Emperor Napoleon III...dispatched thirty thousand troops to Vera Cruz with orders to occupy Mexico City. With them marched a battalion of five hundred Egyptians whose services had been volunteered by the Egyptian ruler Sa'id Pasha" - 186-7
• with the assistance of veterans of the American Civil War, "By 1873, Egypt had all the appurtenances of a late nineteenth-century Western-style army, including staff and naval colleges, commands for submarines and mines, and a system for conveying orders." - 199
• "A total of forty-eight Civil War officers, both blue and gray, worked, explored, and, occasionally fought for Egypt. They built an army, erected schools, and blazed new trails into Africa." - 208
• 1868: "Though the documentary record on the episode is vague, the first American attempt to assist Arabs in achieving independence occurred in Syria" - 247
• August 4, 1873: "Ottomans opened the first Middle Eastern embassy in Washington" - 249
• On Britain's invasion of Egypt, 1882, "Though American warships were not involved in the attack, their very presence in Egyptian waters that July, genially exchanging salutes with British destroyers, indicated the degree to which Washington had resigned itself to Egypt's inevitable submission." - 262
• "The missionaries' failure was illuminated by the case of Alexander Russell Webb. A former New Yorker and consul to the Philippines, Webb converted from Presbyterianism to Islam in 1888. He returned to his native city five years later, stout, bearded, and turbaned, and proceeded to establish one of the nation's first mosques and Muslim newspapers." - 287
• "The symbiosis of faith and power in America's Middle East involvement became increasingly pronounced toward the end of the nineteenth century." - 290
• 1883: "Persia's Qajar rulers appealed to Washington for help in resisting British and Russian attempts to dominate the country." - 290
• "Nations, in his [Teddy Roosevelt's] worldview, were like individuals, some weak and others stalwart, and the latter were obliged to defend the former." - 311
• January 1906: responding to German-French disputes over primacy in Morocco, "the United States, which had never participated in the great-power conferences on the Middle East, became a cosponsor of the international deliberations on Morocco that convened in Algericas, Spain." - 316
• After Teddy Roosevelt's speech in Cairo in 1910 support British rule and dissuading Egyptian nationalists, "Hundreds of those nationalists subsequently gathered outside the former president's hotel for the first major anti-American demonstration ever in the Middle East." - 318
• "Just as the Wilson administration extended assistance to the Armenians irrespective of their political aspirations, so did it relieve the Yishuv [Palestinian-Jewish population] without ever taking a position on Zionism. But as American doughboys marched to the front in Europe, and as European statesmen secretly drafted maps of the postwar Middle East, Washington found that it could no longer remain nonpartisan on Palestine." - 359

** I stopped taking notes after WWI because the author admits in the introduction that his coverage of post-WWI Middle East is weak in comparison to other books on the subject. **

The Souls of Black Folk by W.E.B. Du Bois

• "To the real question, How does it feel to be a problem? I answer seldom a word." - 4
• "few men ever worshiped Freedom with half such unquestioning faith as did the American Negro for two centuries." - 7
• "To be a poor man is hard, but to be a poor race in a land of dollars is the very bottom of hardships." - 11
• "The problem of the twentieth century is the problem of the color-line, -- the relation of the darker to the lighter races of men in Asia and Africa, in America and the islands of the sea." - 15
• "The two great obstacles which confronted the [Freedman's Bureau] officials were the tyrant and the idler, -- the slaveholder who was determined to perpetuate slavery under another name; and the freedman who regarded freedom as perpetual rest, -- the Devil and the Deep Sea." - 33
• "This is an age of unusual economic development, and Mr. [Booker T.] Washington's programme naturally takes an economic cast, becoming a gospel of Work and Money to such an extent as apparently completely to overshadow the higher aims of life." - 52
• "The mass of those to whom slavery was a dim recollection of childhood found the world a puzzling thing: it asked little of them, and they answered with little, and yet it ridiculed their offering." - 70
• On a changing Atlanta, "she lay gray and still on the crimson soil of Georgia; then the blue smoke began to curl from her chimneys, the tinkle of bell and scream of whistle broke the silence, the rattle and roar of busy life slowly gathered and swelled, until the seething whirl of the city seemed a strange thing in a sleepy land." - 76
• "in all our Nations striving is not the Gospel of Work befouled by the Gospel of Pay?" - 78
• "the habit is forming of interpreting the world in dollars....the sudden transformation of a fair far-off ideal of freedom into the hard reality of bread winning and the consequent deification of Bread." - 81
• "to seek to make the blacksmith a scholar is almost as silly as the more modern scheme of making the scholar a blacksmith; almost, but not quite." - 85
• "shall we teach them trades, or train them in the liberal arts? Neither and both: teach the workers to work and the thinkers to think; make carpenters of carpenters, and philosophers of philosophers, and fops of fools." - 87
• "Progress in human affairs is more often a pull than a push, a surging forward of the exceptional man, and the lifting of his duller brethren slowly and painfully to his vantage-ground." - 96
• In regards to opposition to higher education for blacks (cf. Booker T. Washington), "If white people need colleges to furnish teachers, ministers, lawyers and doctors, do black people need nothing of the sort?" - 104
• "a pall of debt hangs over the beautiful land; the merchants are in debt to the wholesalers, the planters are in debt to the merchants, the tenants owe the planters, and laborers bow and bend beneath the burden of it all." - 127
• "America is not another word for Opportunity to all her sons." - 144
• "The rush to town since 1880 is the counter-movement of men disappointed in the economic opportunities of the Black Belt." - 154
• "For we must never forget that the economic system of the South to-day which has succeeded the old regime is not the same system as that of the old industrial North, of England, or of France, with their trade-unions, the restrictive laws, their written and unwritten commercial customs, and their long experience. It is, rather, a copy of that England of the early nineteenth century, before the factory acts" - 170
• "we must not forget that under a strict slave system there can scarcely be such a thing as crime. But when these variously constituted human particles are suddenly thrown broadcast on the sea of life, some swim, some sink, and some hang suspended, to be forced up or down by the chance currents of a busy hurrying world." - 178
• "The nineteenth was the first century of human sympathy, -- the age when half wonderingly we began to descry in others that transfigured spark of divinity which we call Myself; when clodhoppers and peasants, and tramps and thieves, and millionaires and -- sometimes -- Negroes, become throbbing souls" - 219-20
• So woefully unorganized is sociological knowledge that the meaning of progress, the meaning of "swift" and "slow" in human doing, and the limits of human perfectibility, are veiled, unanswered sphinxes on the shores of science." - 265

Martin Van Buren by Ted Widmer

• "When he was elected in 1836, Van Buren became the first chief executive from New York, and the first ethnic president," being a native Dutch-speaker - 6
• "One of his most courageous decisions was his refusal to join the stampede for admitting Texas, with all of its slave territory, into the union. It cost him the presidency and he knew it, but he stuck to his guns." - 12
• "Between 1837 and 1841, Americans encountered three important reality checks that suddenly made the future less appetizing. The Panic of 1837 taught that capitalism was fallible. The Log Cabin campaign of 1840, with it false promises and hard cider entreaties, taught that democracy was fallible. And rising rage over slavery taught that the Union itself was fallible." - 16
• "At twenty-nine, he was the second youngest [state] senator ever elected in New York. From then until the end of his presidency, he would serve almost continuously in government service." - 37
• "From the moment he started his career, he was he friend of the small farmer. As Franklin Roosevelt would do a century later, he tried to ease the credit burden on rural producers who were cash poor. In particular, he lashed out at the common practice of imprisonment for debt, which in his opinion was the same thing as a jail sentence 'for the misfortune of being poor, of being unable to satisfy the all-digesting stomach of some ravenous creditor.'" - 42
• "Back in 1813, in his first year as a state senator, Van Buren helped to found a newspaper, the Albany Argus" - 47
• 1821: "Van Buren ran for the U.S. Senate and won a difficult victory." - 49
• "Van Buren had laid the foundation for what would become Jacksonian Democracy in only a few short years. With his ideas about party discipline, communications, and enlarged suffrage, he had shown other like-minded individuals how to take democracy beyond the periwigs of the eighteenth century." - 51
• "Far beyond anything that had existed before, Van Buren envisioned a national structure, tethered together by speedy communications and tight message control" - 56
• "Those who have wrought great changes in the world never succeeded by gaining over chiefs; but always by exciting the multitude. The first is the resource of intrigue and produces only secondary results, the second is the resort of genius and transforms the universe." - Van Buren, 72
• "The Democratic Party, still in its infancy, was a stool with three legs. There were Westerners that Jackson had brought in, Southerners under the sway of Calhoun, and Old School Jeffersonians around Van Buren" - 75
• As Jackson's Secretary of State, "this flattering smooth-talker was good at diplomacy, and before long he had resolved two major problems favorably, winning reciprocal trade benefits from the United Kingdom in the West Indies and securing a large payment of 25 million francs from France for indemnities dating back to Napoleon." - 80
• August 16, 1831: "Van Buren sailed for England [as the newly appointed, and soon rejected by the Senate, minister]...happy to enjoy 'the quietude of a midsummer Ocean' after twenty years of unceasing political infighting." - 83
• "Van Buren's idea of a two-party system received support from an unlikely source -- a new party that sprang into existence for the express purpose of defeating Jackson and Van Buren. The Whigs, as they were ultimately known (for opposing Jackson as the revolutionary Whigs had opposed George III), were an unlikely batch of Northern quasi-Federalists and Southern states' rightists, allied more through alienation than shared principles." - 87
• "At the age of fifty-three, Martin Van Buren was in the ascendant. He was the youngest president elected to date." - 90
• "He aimed for stability, keeping many of Jackson's appointees and leaning South with new choices. Balance always." - 93
• March 17, 1837: New York merchant Philip "Hone wrote, 'The great crisis is near at hand, if it has not already arrived.' Over the next month, prices rose and financial houses fell like stacks of cards." - 96
• "Van Buren inherited a superheated economy that was completely unregulated in some ways and draconically controlled in others [cf. Specie Circular]" - 101
• "he called for Congress to meet in September to take special measures to alleviate the crisis. It was the first special session ever called that did not address a military crisis." - 102
• "Van Buren issued an executive order demanding that the slaves [from the Amistad] be taken to a naval vessel, to hasten their return to their Spanish owners" - 121
• March 31, 1840: "Van Buren issued an executive order creating a ten-hour day for federal workers, a dramatic step forward when many employees worked from sunrise to sunset." - 131
• "In the spring of 1839, the phrase 'OK' began to circulate in Boston as shorthand for 'oll korrect,' a slangy way of saying 'all right.' Early in 1840, Van Buren's supporters began to use the trendy expression to identify their candidate, whom they labored to present as 'Old Kinderhook,' perhaps in imitation of Jackson's Old Hickory." - 140
• "The Free Soil campaign was America's first great third party effort." - 155
• "He lingered into the [Civil] war's second year, and then expired at 2 a.m. on July 24, 1862, a day and a half after Lincoln read the first draft of his Emancipation Proclamation to a startled cabinet." - 164

The Road to Serfdom by F.A. Hayek

• "Whatever merits this book possesses consist not in the reiteration of this thesis but in the patient and detailed examination of the reasons why economic planning will produce such unlooked-for results and of the process by which they come about." - 43-4, 1956 Forward
• "The essence of the liberal position, however, is the denial of all privilege, if privilege is understood in its proper and original meaning of the state granting and protecting rights to some which are not available on equal terms to others." - 46, 1956 Forward
• "Few are ready to recognize that the rise of fascism and naziism was not a reaction against the socialist trends of the preceding period but a necessary outcome of those tendencies." - 59
• "'Freedom' and 'liberty' are now words so worn with use and abuse that one must hesitate to employ them to express the ideals for which they stood....'Tolerance' is, perhaps, the only word which still preserves the full meaning of the principle" - 68
• "Probably nothing has done so much harm to the liberal cause as the wooden insistence of some liberals on certain rough rules of the thumb, above all the principle of laissez faire." - 71
• "We have in effect undertaken to dispense with the forces which produced unforeseen results and to replace the impersonal and anonymous mechanism of the market by collection and 'conscious' direction of all social forces to deliberately chosen goals." - 73
• "Nobody saw more clearly than Tocqueville that democracy as an essentially individualist institution stood in an irreconcilable conflict with socialism: 'Democracy extends the sphere of individual freedom,' he said in 1848, "socialism restricts it. Democracy attaches all possible value to each man; socialism makes each man a mere agent, a mere number. Democracy and socialism have nothing in common but one word: equality. But notice the difference: while democracy seeks equality in liberty, socialism seeks equality in restraint and servitude.'" - 77
• "socialism means the abolition of private enterprise, of private ownership of the means of production, and the creation of a system of 'planned economy' in which the entrepreneur working for profit is replaced by a central planning body." - 83
• "The liberal argument is in favor of making the best possible use of the forces of competition as a means of coordinating human efforts, not an argument for leaving things just as they are." - 85
• "What in effect unites the socialists of the Left and the Right is this common hostility to competition and their common desire to replace it by a directed economy." - 88-9
• "planning and competition can be combined only by planning for competition but not by planning against competition." - 90
• "To direct all our activities according to a single plan presupposes that every one of our needs is given its rank in an order of values which much be complete enough to make it possible to decide among all the different courses which the planner has to choose. It presupposes, in short, the existence of a complete ethical code in which all the different human values are allotted their due place." - 101
• "The point which is so important is the basic fact that it is impossible for any man to survey more than a limited field, to be aware of the urgency of more than a limited number of needs. Whether his interests center round his own physical needs, or whether he takes a warm interest in the welfare of every human being he knows, the ends about which he can be concerned will always be only an infinitesimal fraction of the needs of all men. This is the fundamental fact on which the whole philosophy of individualism is based." - 102
• "Even if...a democracy should succeed in planning every sector of economic activity, it would still have to face the problem of integrating those separate plans into a unitary whole. Many separate plans do not make a planned whole -- in fact, as the planners ought to be the first to admit, they may be worse than no plan." - 107
• "It is the price of democracy that the possibilities of conscious control are restricted to the fields where true agreement exists and that in some fields things must be left to chance." - 109
• "It may well be true that our generation talks and thinks too much of democracy and too little of the values which it serves....Democracy is essentially a means, a utilitarian device for safeguarding internal peace and individual freedom. As such it is by no means infallible or certain." - 110
• "It cannot be denied that the Rule of Law produces economic inequality -- all that can be claimed for it is that this inequality is not designed to affect particular people in a particular way." - 117
• "Central planning means that the economic problem is to be solved by the community instead of the individual; but this involves that it must also be the community, or rather its representatives, who must decide the relative importance of the different needs." - 127
• "in competition chance and good luck are often as important as skill and foresight in determining the fate of different people." - 134
• "all government affects the relative position of different people and that there is under any system scarcely an aspect of our lives which may not be affected by government action is certainly true." - 139
• "there can be no doubt that some minimum of food, shelter, and clothing, sufficient to preserve health and the capacity to work, can be assured to everybody." - 148
• "It seems to be almost the law of human nature that it is easier for people to agree on a negative program -- on the hatred of an enemy, on the envy of those better off -- than on any positive task. The contrast between the 'we' and the 'they,' the common fight against those outside the group, seems to be an essential ingredient in any creed which will solidly knit together a group for common action." - 161

The General Theory of Employment, Interest, and Money by J.M. Keynes

Introduction - Chapter 1

• The general theory: "I shall argue that the postulates of the classical theory are applicable to a special case only and not to the general case, the situation which it assumes being a limiting point of the possible positions of equilibrium." - 3

The Postulates of the Classical Economics - Chapter 2

• Fundamental postulates of the classical theory of employment
• "The wage is equal to the marginal product of labour" - 5
• "The utility of the wage when a given volume of labour is employed is equal to the marginal disutility of that amount of employment." - 5
• "possible means of increasing employment" - 7
• "An improvement in organization or in foresight which diminishes 'frictional' unemployment"
• "decrease in the marginal disutility of labour, as expressed by the real wage for which additional labour is available, so as to diminish 'voluntary' unemployment"
• "increase in the marginal physical productivity of labour in the wage-goods industries"
• "increase in the price of non-wage goods compared with the price of wage goods, associated with a shift in the expenditure of non-wage earners from wage-goods to non-wage goods"
• "When money-wages are rising...it will be found that real wages are falling; and when money-wages are falling, real wages are rising." - 10
• "the struggle about money-wages primarily affects the distribution of the aggregate real wage between different labour-groups, and not its average amount per unit of employment" - 14
• "In a given state of organisation, equipment and technique, the real wage earned by a unit of labour has a unique (inverse) correlation with the volume of employment." - 17
• "Contemporary thought is still deeply steeped in the notion that if people do not spend their money in one way they will spend it in another." - 20

The Principle of Effective Demand - Chapter 3

• Two kinds of entrepreneurial expense
• factor cost: "the amounts which he pays out to the factors of productions for their current services" - 23
• user cost: "the amounts which he pays out to other entrepreneurs for what he has to purchase from them together with the sacrifice which he incurs by employing the equipment instead of leaving it idle" - 23
• income (of entrepreneur) = value of output - (factor cost + user cost)
• total income = income + factor cost
• effective demand: "point of the aggregate demand function [D], where it is intersected by the aggregate supply function" - 25
• Propositions summarizing the General Theory
• "income (both money-income and real income) depends on the volume of employment N." - 28
• propensity to consume (D1): "the relationship between the community's income and what it can be expected to spend on consumption" - 28
• D = D1 + D2; D2 = new investment - 29
• "the volume of employment in equilibrium depends on (i) the aggregate supply function...(ii) the propensity to consume...and (iii) the volume of investment" - 29
• "N cannot exceed the value which reduces the real wage to equality with the marginal disutility of labour" - 29
• "When employment increases, D1 will increase, but not by so much as D" - 29
• "It may well be that the classical theory represents the way in which we should like our Economy to behave. But to assume that it actually does so is to assume our difficulties away." - 34

The Choice of Units - Chapter 4

• "In dealing with the theory of employment I propose, therefore, to make use of only two fundamental units of quantity, namely, quantities of money-value and quantities of employment." - 40

Expectation as Determining Output and Employment - Chapter 5

• short-term expectation: "the price which a manufacturer can expect to get for his 'finished' output" - 46
• long-term expectation: "what the entrepreneur can hope to earn in the shape of future returns if he purchases (or, perhaps, manufactures) 'finished' output as an addition to his capital equipment." - 47
• long-period employment: "the steady level of employment...corresponding to that state of expectation." - 48
• "the economic machine is occupied at any given time with a number of overlapping activities, the existence of which is due to various states of expectation." - 50

The Propensity to Consume, The Objective Factors - Chapter 8

• "The ultimate object of our analysis is to discover what determines the volume of employment." - 90
• "in general, we shall in what follows take the subjective as given; and we shall assume that the propensity to consume depends only on changes in the objective factors" - 91
• "Account has also to be taken of all kinds of risks, such as the prospect of not living to enjoy the future goods or of confiscatory taxation. As an approximation...we can identify this with the rate of interest." - 93
• "If fiscal policy is used as a deliberate instrument for the more equal distribution of incomes, its effect in increasing the propensity to consume is, of course, all the greater." - 95
• "the propensity to consume may be considered a fairly stable function, provided that we have eliminated changes in the wage-unit in terms of money." - 95
• "apart from short period changes in the level of income, it is also obvious that a higher absolute level of income will tend, as a rule to widen the gap between income and consumption." - 97
• "employment can only increase pari passu with an increase in investment....For since consumers will spend less than the increase in aggregate supply price when employment is increased, the increased employment will prove unprofitable unless there is increase in investment to fill the gap." - 98
• "We cannot, as a community, provide for future consumption by financial expedients but only by current physical output." - 104
• "Consumption is satisfied partly by objects produced currently and partly by objects produced previously, i.e. by disinvestment." - 105
• "The obstacle to a clear understanding is...much the same as in many academic discussions of capital, namely, an inadequate appreciation of the fact that capital is not a self-sufficient entity existing apart from consumption." - 106

The Propensity to Consume, The Subjective Factors - Chapter 9

• "Apart from the savings accumulated by individuals, there is also the large amount of income, varying perhaps from one-third to two-thirds of the total accumulation in a modern industrial community such as Great Britain or the United States, which is withheld by Central and Local Governments, by Institutions and by Business Corporations" - 108
• "The rise in the rate of interest might induce use to save more, if our incomes were unchanged. But if the higher rate of interest retards investment, our incomes will not, and cannot, be unchanged." - 111

The Marginal Propensity to Consume and the Multiplier - Chapter 10

• "The marginal propensity to consume is not constant for all levels of employment, and it is probable that there will be, as a rule, a tendency for it to diminish as employment increases" - 120
• "It is curious how common sense, wriggling for an escape from absurd conclusions, has been apt to reach a preference for wholly 'wasteful' forms of loan expenditure rather than for partly wasteful forms, which, because they are not wholly wasteful, tend to be judged on strict 'business' principles. For example, unemployment relief financed by loans is more readily accepted than the financing of improvements at a charge below he current rate of interest; whilst the form of digging holes in the ground known as gold-mining, which not only adds nothing whatever to the real wealth of the world but involves the disutility of labour, is the most acceptable of all solutions." - 129

The Marginal Efficiency of Capital - Chapter 11

• supply price: "the price which would just induce a manufacturer newly to produce an additional unit of such [capital-]assets, i.e. what is sometimes called its replacement cost." - 135
• marginal efficiency of capital: " the relation between the prospective yield of one more unit of that type of capital and the cost of producing that unit" - 135
• "The expectation of a fall in the value of money stimulates investment, and hence employment generally, because it raises the schedule of the marginal efficiency of capital, i.e. the investment demand-schedule" - 141-2
• "The fact that the assumption of the static state often underlie present-day economic theory, imports into it a large element of unreality." - 146

The State of Long-Term Expectation - Chapter 12

• "In practice we have tacitly agreed, as a rule, to fall back on what is, in truth, a convention. The essence of this convention...lies in assuming that the existing state of affairs will continue indefinitely, except in so far as we have specific reasons to expect a change." - 152
• "Of the maxims of orthodox finance none, surely, is more anti-social than the fetish of liquidity, the doctrine that it is a positive virtue on the part of investment institutions to concentrate their resources upon the holding of 'liquid' securities. It forgets that there is no such thing as a liquidity of investment for the community as a whole." - 155
• "We have reached the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees." - 156

The General Theory of the Rate of Interest - Chapter 13

• "the quantity of money is the other factor, which, in conjunction with liquidity-preference, determines the actual rate of interest in given circumstances." - 168
• "The market price will be fixed at the point at which the sales of the 'bears' and the purchases of the 'bulls' are balanced." - 170
• "The concept of Hoarding may be regarded as a first approximation to the concept of Liquidity-preference." - 174

The Classical Theory of the Rate of Interest - Chapter 14

• "Unlike the neo-classical school, who believe that save and investment can be actually unequal, the classical school proper has accepted the view that they are equal." - 177
• "The mistake originates from regarding interest as the reward for waiting as such, instead of as the reward for not-hoarding" - 182

The Psychological and Business Incentives to Liquidity - Chapter 15

• "the income-velocity of money merely measures what proportion of their incomes the public chooses to hold in cash, so that an increased income-velocity of money may be a symptom of a decreased liquidity-preference." - 194
• income motive: "One reason for holding cash is to bridge the interval between the receipt of income and its disbursement." - 195
• business motive: "Similarly, cash is held to bridge the interval between the time of incurring business costs and that of the receipt of the sale-proceeds" - 195
• precautionary motive: "To provide for contingencies requiring sudden expenditure and for unforeseen opportunities of advantageous purchases" - 196
• "the banking system and the monetary authority are dealers in money and debts and not in assets or consumables." - 205

Sundry Observations on the Nature of Capital - Chapter 16

• "since the expectation of consumption is the only raison d'etre of employment, there should be nothing paradoxical in the conclusion that a diminished propensity to consume has cet. par. a depressing effect on employment." - 211
• "Every act of saving involves a 'forced' inevitable transfer of wealth to him who saves, though he in his turn may suffer from the savings of others." - 212
• "It is much preferable to speak of capital as having a yield over the course of its life in excess of its original cost, than as being productive." - 213

The Essential Properties of Interest and Money - Chapter 17

• "Unemployment develops, that is to say, because people want the moon; -- men cannot be employed when the object of desire (i.e. money) is something which cannot be produced and the demand for which cannot readily be choked off. There is no remedy but to persuade the public that green cheese is practically the same thing and to have a green cheese factory (i.e. a central bank) under public control." - 235
• "The neutral rate of interest can be more strictly defined as the rate of interest which prevails in equilibrium when output and employment are such that the elasticity of employment as a whole is zero." - 245

The General Theory of Employment Re-Stated - Chapter 18

• "changes in the rate of consumption are, in general, in the same direction (though smaller in amount) as changes in the rate of income." - 248
• "the evidence indicates that full, or even approximately full, employment is of rare and short-lived occurrence....an intermediate situation which is neither desperate nor satisfactory is our normal lot." - 249-50

Changes in Money-Wages - Chapter 19

• "whilst no one would wish to deny the proposition that a reduction in money-wages accompanied by the same aggregate effective demand as before will be associated with an increase in employment, the precise question at issue is whether the reduction in money-wages will or will not be accompanied by the same aggregate effective demand as before." - 259
• "a movement by employers to revise money-wage bargains downward will be much more strongly resisted than a gradual and automatic lowering of real wages as a result of rising prices." - 264

The Employment Function - Chapter 20

• "the inevitable price-instability due to change cannot affect the actions of entrepreneurs, but merely directs a de facto windfall of wealth into the laps of the lucky ones" - 288

The Theory of Prices - Chapter 21

• "So long as there is unemployment, employment will change in the same proportion as the quantity of money; and when there is full employment, prices will change in the same proportion as the quantity of money" - 296
• "Too large a proportion of recent 'mathematical' economics are mere concoctions, as imprecise as the initial assumptions they rest on,which allow the author to lose sight of the complexities and interdependencies of the real world in a maze of pretentious and unhelpful symbols." - 298
• "When a further increase in the quantity of effective demand produces no further increase in output and entirely spends itself on an increase in the cost-unit fully proportionate to the increase in effective demand, we have reached a condition which might be appropriately designated as one of true inflation." - 303

Notes on the Trade Cycle - Chapter 22

• "The right remedy for the trade cycle is not to be found in abolishing booms and thus keeping us permanently in a semi-slump; but in abolishing slumps and thus keeping us permanently in a quasi-boom." - 322

Notes on Mercantilism, The Usury Laws, Stamped Money and Theories of Under-Consumption - Chapter 23

• "The fact that the advantage which our own country gains from a favorable balance is liable to involve an equal disadvantage to some other country (a point to which the mercantilists were fully alive) means not only that great moderation is necessary, so that a country secures for itself no larger a share of the stock of the precious metals than is fair and reasonable, but also that an immoderate policy may lead to a senseless international competition for a favorable balance which injures all alike." - 338-9

Lords of Finance: The Bankers Who Broke The World by Liaquat Ahamed

• "Each in his own way illuminates the national psyche of his time. Montagu Norman, with his quixotic reliance on his fault intuition, embodied a Britain stuck in the past and not yet reconciled to its newly diminished standing in the world. Emile Moreau, in his insularity and rancor, reflected all too accurately a France that had turned inward to lick the terrible wounds of war. Benjamin Strong, the man of action, represented a new generation in America, actively engaged in bringing its financial muscle to bear in world affairs. Only Hjalmar Schacht, in his angry arrogance seemed out of tune with the weak and defeated Germany for which he spoke, although perhaps he was simply expressing a hidden truth about the nation's deeper mood." - 8
• "Boiled down to its essentials, a central bank is a bank that has been granted a monopoly over the issuance of currency." - 11
• 1914: 59 countries "had bound their currencies to gold" - 13
• "Shaken by the crisis [of 1907], the U.S. Congress decided to act. In 1908, it created the National Monetary Commission...to undertake a comprehensive study of the banking system...Memories of how close the system had come to imploding progressively dimmed and the momentum for reform stalled." - 54
• December 23, 1913: Woodrow Wilson signs the Federal Reserve Act; "the Glass Plan called for a number of autonomous regional institutions: Federal Reserve Banks...While these individual entities were to be controlled and run by local bankers, a capstone -- the Federal Reserve Board, a public agency whose members were to be appointed by the president -- was placed in an oversight role over the whole structure." - 56-7
• "Lenin was certainly right. There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency." - 99, J.M. Keynes
• "Only on reparations did Germany seem able to fight back. It discovered what every large debtor at some point discovers: that when one owes a large amount of money, threatening to default can give one the upper hand." - 109
• "Germany experienced the single greatest destruction of monetary value in human history. By August 1923, a dollar was worth 620,000 marks and by early November 1923, 630 billion." - 121
• "the really pernicious effect of war debts was that they made it hard, if not impossible, for Britain to forgo collecting its own debts from France and Germany, made France all the more obstinate in its efforts to collect reparations from Germany, and led Europe into a self-defeating vicious cycle of financial claims and counterclaims." - 144
• "Whether to deflate or devalue became the central economic decision for every country after the [First World] war. The burden of deflation fell on workers, businesses, and borrowers, that of devaluation on savers...The United States and Britain took the route of deflation, Germany and France that of devaluation." - 157
• "The bigger concern among bankers after the war was not so much that the world was short of gold, but that too much of the gold was concentrated in the United States." - 163
• "The world of the international gold standard had become like a poker table at which one player has accumulated all the chips, and the game simply cannot get back into play." - 164, emphasis mine
• "the Federal Reserve was so flush with gold that it had gone from being the central bank of the United States to being the central bank of the entire industrial world." - 172
• "the new German prosperity depended on what Keynes described as 'a great circular flow of paper' across the Atlantic: 'The United States lends money to Germany, Germany transfers its equivalents to the Allies, the Allies pay it back to the United States government. Nothing real passes -- no one is a penny the worse. The engravers' dies, the printers' forms are busier. But no one eats less, no one works more.'" - 215-6
• "During [Montagu] Norman's visit to New York in January 1925, [Benjamin] Strong had warned him, 'In a new country such as ours with an enthusiastic, energetic and optimistic population,...there would be times when speculative tendencies would make it necessary for the Federal Reserve Banks to exercise restraint by increased discount rates, and possibly higher money rates in the market. Should such times arise, domestic considerations would likely outweigh foreign sympathies.'" - 240
• "In the fall of 1925, Hoover, not shy about interfering in his cabinet colleagues' business -- Parker Gilbert called him the 'Secretary of Commerce and the Under-Secretary of all other departments' -- decided to launch a campaign against the pervasive atmosphere of speculation that he claimed was infecting the country, from Florida real estate to the stock market." - 275
• "In Strong's view, something about the American character -- the exuberance, the driving optimism, the naive embrace of fads -- lent itself to periods of speculative excess." - 277
• "At particular times a great deal of stupid people have a great deal of stupid money....At intervals....the money of these people -- the blind capital, as we call it, of the country -- is particularly large and craving; it seeks for someone to devour it, and there is a 'plethora'; it finds someone, and there is 'speculation'; it is devoured, and there is 'panic.'" - 307, Walter Bagehot
• in early 1929 "The Fed was now paralyzed by this standoff between its two principal arms. The Board kept insisting that the right way to deflate the bubble was through 'direct action': credit controls, particularly of brokers' loans. New York was equally insistent that such a policy could not work, that it was impossible to control the application of credit once it lefts the doors of the Federal Reserve." - 322-3
• "To jump-start the economy, a central bank had to have enough gold, the underlying raw material for credit creation under the gold standard. The international monetary system was now operating, however, in a very perverse way. Because of investor fear, capital in search of security was flowing into those countries with already large gold reserves -- such as the United States and France -- and out of countries with only modest reserves -- such as Britain and Germany." - 375
• "'Gold is out of sight -- gone back into the soil. But when the gods are no longer seen in yellow panoply walking the earth, we begin to rationalize them; and it is not long before there is nothing left.' The bullion reserves that backed the credit systems of the world, buried as they were in underground vaults...were invisible to the public eye. They had acquired an almost metaphysical existence. Keynes thought that perhaps gold, its usefulness now outlived, might become less important. He compared the situation to the transition in government from absolute to constitutional monarchy." - 383-4
• "Money has no motherland; financiers are without patriotism and without decency; their sole object is gain." - 393, Napoleon Bonaparte
• "As the economy lost ground, unemployment climbed, and the budget deficit widened [in Germany], [Heinrich] Bruning [, the new Chancellor,] focused on balancing the budget. Unemployment benefits were restricted; salaries of all high federal and state officials, including the president's, were slashed by 20 percent. Wages of lower-level officials were cut 6 percent; income taxes were raised, taxes on beer and tobacco increased, and new levies imposed on warehouses and mineral water. All of these measures made the Depression worse." - 400
• After resigning in 1930, Schacht "spoke about reparations, seeking to make his audience understand German bitterness over the issue: 'You must not think that if you treat people for ten years as the German people have been treated they will continue to smile....Reparations are the real cause of the world-wide economic depression.'" - 402
• "Never has the incapacity of the economic leaders of the capitalist world so glaringly demonstrated as today....A capitalism which cannot feed the workers of the world has no right to exist. The guilt of the capitalist system lies in its alliance with the violent policies of imperialism and militarism" - 417-8, Schacht, The End of Reparations
• "Britain's problem was not its budget deficit, but rather that it had clung to the role of banker to the world without any longer having the money or the resources to do so and at a time when most of the world was a damn poor risk." - 429
• Roosevelt's "simplistic view was that since the Depression had been associated with falling prices, recovery could only come about when prices began going the other way. His advisers patiently tried to explain to him that he had the causality backward....They were themselves only half right. For in an economy where everything is connected, there is often no clear distinction between cause and effect." - 459
• "In 1935, Congress passed a banking act designed to reform the Federal Reserve. Authority for all major decisions was now centralized in a restructured Board of Governors. The regional reserve banks were stripped of much of their powers and responsibility for open market operations was now vested in a new committee of twelve, comprising the seven governors and a rotating group of five regional bank heads, renamed presidents." - 475

The Protestant Ethic and the "Spirit" of Capitalism by Max Weber

The Problem

- Denomination and Social Stratification

1. "business leaders and owners of capital, as well as the skilled higher strata of the labor force, and especially the higher technical or commercially trained staff of modern enterprises tend to be predominantly Protestant." - 1
2. "But what is often forgotten is that the Reformation meant...the replacement of an extremely relaxed, practically imperceptible, and scarcely more than formal authority by an infinitely burdensome and earnest regimentation of the conduct of life" - 2
3. "The Catholic...is more calm; his acquisitive drive is lower, he places more value on a life which is as secure as possible, even if this should be on a smaller income, than on a perilous, exciting life, which could bring honors and riches. As the popular saying jokingly has it, 'either eat well or sleep soundly.' In the above case, the Protestant likes to eat well, while the Catholic wants to sleep soundly." - 5, Offenbacher

- The "Spirit" of Capitalism

1. "Kurnberger, in his book, The Man Tired of America, sums up its philosophy of life thus: ' They turn cattle into tallow, and people into money.' The essence of this 'philosophy of avarice' is the idea of the duty of the individual to work toward the increase of his wealth, which is assumed to be an end in itself." - 11
2. "the 'summum bonum' of this 'ethic' is the making of money and yet more money, coupled with a strict avoidance of all uninhibited enjoyment...it is...so much purely thought of as an end in itself that it appears as something wholly transcendent and irrational, beyond the 'happiness' or the 'benefit' of the individual." - 12
3. "Moneymaking --  provided it is done legally -- is, within the modern economic order, the result and the expression of diligence in one's calling and this diligence is...the real alpha and omega of [Benjamin] Franklin's morality" - 12-3
4. Traditionalism: "a person does not 'by nature' want to make more and more money, but simply to live -- to live in the manner in which he 'is accustomed to live, and to earn as much as is necessary for this.'" - 16
5. "We shall...provisionally use the expression 'spirit of capitalism' for that attitude which, in the pursuit of a calling strives systematically for profit for its own sake in the manner exemplified by Benjamin Franklin." - 19
6. Rationalism: "a historical concept which embraces a world of opposites...that concrete form of 'rational' thinking and living from which arose the idea of the 'calling' and that devotion to the work of the calling -- so irrational from the point of view of eudaemonistic self-interest -- which was and still is one of the most characteristic components of our capitalist culture." - 27-8

- Luther's Conception of the Calling

1. "labor in a secular calling appears as the outward expression of Christian charity. This view is based in particular on the argument that division of labor forces each individual to work for others, an extremely otherworldly argument which is almost grotesquely at variance with Adam Smith's well-known dictum." - 29
2. "If economic traditionalism was at first a result of Pauline indifference, it later came to flow from an ever-more intense belief in providence that identifies unconditional obedience to God with unconditional submission to the situation in which one has been placed." - 32

The Idea of the Calling in Ascetic Protestantism

- The Religious Foundations of Innerworldly Asceticism

1. "To assume that human merit or fault had any influence on one's fate would be to regard God's absolutely free decision which had stood for all eternity, as capable of being changed by human influence -- an impossible idea...Since his decrees were immutably fixed, those on whom he bestowed his grace could never lose it, just as those to whom he denied it could never attain it." - 73
2. "The wonderfully purposeful structuring and organization of this cosmos, which, according to the biblical revelation and equally according to natural insight, is evidently designed to be of 'use' to the human race, shows that labor in the service of this social usefulness furthers the divine glory and is willed by God." - 76
3. regarding Calvin's doctrine of predestination, "One question inevitably very soon arose for every single believer, and forced all other interests into the background: 'Am I one of the elect? And how can I be certain of my election?'" - 76
4. "tireless labor in a calling was urged as the best possible means of attaining this self-assurance" of election in the eschatology of predestination - 77-8
5. "Totally unsuited though good works are to serve as a means of attaining salvation...they are indispensable as signs of election...This means, however, the Calvinist 'creates' his salvation himself (as it is sometimes expressed) -- more correctly: creates the certainty of salvation." - 79
6. Pietism: "For our subject...merely the penetration of methodically cultivated and controlled, that is , ascetic, living into areas of non-Calvinist religious observance." - 90
7. "just as in external 'material' life, the inclination to seek enjoyment in the present conflicts with the rational structuring of the 'economy', which is, after all, based on the need to make provision for the future, so it is, in a sense, in the sphere of religious life." - 94
8. Methodism: "A combination of emotional and yet ascetic religious practice and increasing indifference or even rejection of the dogmatic foundation of Calvinist asceticism is a distinguishing mark of the Anglo-American equivalent to continental Pietism" - 95

- Asceticism and the Capitalist Spirit