The Nation - 30.03.2020

March 30, 2020 The Nation. 31

What might these days take place in

seconds took weeks. The lower-level firms

would then approach their clients, say a

trust officer in Kansas City, who might

buy a chunk “to hold on to it for a wealthy

widow.” The widow might shake her fist,

reading in the morning paper about how

the execs at GM were surrendering their

corporate liberty to that damned socialist

Walter Reuther, but what could she do?

“Owners” had no power— and the system

wasn’t about to change to accommodate

competitors who might devise faster and

more flexible ways to move cash around

and keep its recipients accountable. In

1947 the US government tried to sue Mor-

gan Stanley as a trust, the judge in the case,

after seven years of deliberations, declined

to label it thus, ruling that the system

worked perfectly well for all concerned and

noting the “absolute integrity” of Harold

Stanley, one of the firm’s founders.

C

orporate finance is rather different

now. Turn on your TV, and one

fictional corporation’s struggle not

to be devoured by investors fuels

enough cliffhanging melodrama to

plot a soap opera. In one episode of HBO’s

Succession, an executive addresses the em-

ployees of a hot website that his conglom-

erate purchased to signal to stockholders

its hipness; he fires the entire staff to prove

its ruthlessness. Not exactly the sort of

capitalism in which decisions are taken in

light of their probable effect on the whole

community. In another episode, a young

executive proudly announces a manage-

ment efficiency he’s been able to realize.

(He has stock options to worry about, after

all.) “How many skulls?” his supervisor

asks lustily.

How did the one regime transform

into the other? As a quibbling historian, I

sometimes find Lemann’s approach to the

answer unsatisfying. In the manner of too

many intellectuals, he privileges the role

of intellectuals. He also gets the periodiza-

tion wrong, granting great motive force to

an academic paper published in 1976, even

though the new phase of financialization

was well underway in the previous decade.

(Just read Stoller’s account of the finan-

cial chicanery that brought down Penn

Central railroad in 1970.) And Lemann

also prefers to focus on the personalities

implementing these changes instead of

the structural forces behind them. These

include the decline of American corporate

profitability, the way formerly colonized

nations began withholding access to their

resources until their demands for political

consideration were met, and the rising

industrial strength of Europe and Japan

as they rebuilt from the ruins of World

War II.

But the story Lemann does tell in this

part of the book is so revelatory that I’m

glad to put such pedantic concerns aside.

He introduces us to the anti-Berle: Mi-

chael Jensen, the kind of University of

Chicago–trained economist who insists

that markets are the only fair way to ap-

portion value in a society because they

are the only institutions that are rational.

Lemann illustrates the peculiar lunacy of

this doctrine by relating how the psychol-

ogist Amos Tversky once asked Jensen to

“assess the decision-making capabilities of

his wife.” Jensen responded by contemp-

tuously citing a series of economically ir-

rational absurdities she indulged in. Then

Tversky asked Jensen about his students,

and Mike rattled off silly mistakes

they made.... As more wine was

consumed, [Jensen’s] stories got bet-

ter, [and] Amos went in for the kill.

“Mike,” he said, “you seem to think

that virtually everyone you know is

incapable of correctly making even

the simplest of economic decisions,

but then you assume that all the

agents in your models are geniuses.

What gives?” Jensen was unfazed.

“Amos, you just don’t understand.”

from the cacti, fashions me a crown

that asks Who were you when you weren’t blooming only

for boys? & I recall the night-

blooming cereus, whose bats fly hundreds of miles

one night of the year to sustain themselves

on the sweet nectar, & how many

mornings I missed, how many

dark things I emptied myself for. My daughter

is a graveyard by which I mean ripe

for rebirthing. She pulls me from the beds

I’ve buried & tells me

if she is wise it’s because I’ve taught her

by which she means

I’ve held myself deep within

myself all along.

I’ve plucked bones & swapped

for jackrabbit for woodrat for javelina. O tusks

o glorious horns

I’ve borne

from daughter, from the un-

mothered loam.

JENN GIVHAN