Some novels bring out the truth better than most nonfiction books do. Ayn Rand's Atlas Shrugged (1957), for instance, showed how a nation could collapse if the correct economic policies were not followed. I read it 25 years ago as an engineering undergraduate and I was so profoundly impacted by it that I became a capitalist for life. This was the book that readily came to my mind when I read Lionel Shriver's The Mandibles: A Family 2029-2047 (2016) recently.
Shriver's book is a dystopian tale set in a near future which shows how a nation crumbles due to its own economic follies. The year is 2029. The world has nine billion people. America has a Mexican-born president. The entire country is suffering from water shortages. A few years ago (around 2024) the internet infrastructure had been paralyzed by "hostile foreign powers" (China?). This had led to a collapse of e-commerce including the almighty Amazon.com.
In 2029, several nations including Asian ones unite to float an alternate currency - the bancor - which supplants the American dollar as the reserve currency. The dollar crashes in value. The American government responds by prohibiting American citizens from trading in bancors. In addition, it confiscates gold held by Americans and defaults on its debt payment by declaring all treasury bills null and void. The American government also puts in place capital controls preventing Americans from taking more than $100 out of the country. The country slowly descends into a depression.
If this scenario seems outrageously unbelievable, I suggest you check out economist Peter Schiff's The Real Crash (2012), financial analyst James Rickards' Currency Wars (2011) and The Death of Money (2014) or legendary investor Jim Rogers' latest YouTube videos. Such a scenario - or one closely similar to it - is not only plausible but also inevitable as per these experts' opinions.
The book narrates the story of the Mandible family which had a considerable fortune prior to 2029. But with the T-bills declared unpayable, the Mandible fortune becomes worthless and the family declines into a steady unraveling.
While most of the members of the family are at a loss to understand what has befallen them, one of the younger members, a teenager named Willing, learns the correct economic principles and uncannily diagnoses what has gone wrong with the country.
The economics espoused by Lionel Shriver is not mainstream economics but is closely aligned to the Austrian school. It is clear from her narrative that having a massive debt overhang is wrong; Keynesian economics is wrong; massive money printing is wrong since it can lead to hyperinflation and subsequently very high interest rates; simply urging citizens to spend more is not a way to restore confidence in the economy.
While Rand's Atlas Shrugged culminated in a utopian ending where all the heroes are transported into a magical new world, there is no such comfort in Shriver's book. As the title suggests the depression lasts close to 20 years and the nation limpingly emerges out of it. There is only a promise of joy in the ending which is realistic and, in a sense, provides a measure of satisfaction.
Shriver who has previously written sociological novels - including the acclaimed We Need to Talk About Kevin (2003) - shows an incisive understanding of mainstream economics and its limitations. Her characters are well formed and her wit is dark and hilarious. This is a timely contribution on what ails America and the West.
Shriver's book is a dystopian tale set in a near future which shows how a nation crumbles due to its own economic follies. The year is 2029. The world has nine billion people. America has a Mexican-born president. The entire country is suffering from water shortages. A few years ago (around 2024) the internet infrastructure had been paralyzed by "hostile foreign powers" (China?). This had led to a collapse of e-commerce including the almighty Amazon.com.
In 2029, several nations including Asian ones unite to float an alternate currency - the bancor - which supplants the American dollar as the reserve currency. The dollar crashes in value. The American government responds by prohibiting American citizens from trading in bancors. In addition, it confiscates gold held by Americans and defaults on its debt payment by declaring all treasury bills null and void. The American government also puts in place capital controls preventing Americans from taking more than $100 out of the country. The country slowly descends into a depression.
If this scenario seems outrageously unbelievable, I suggest you check out economist Peter Schiff's The Real Crash (2012), financial analyst James Rickards' Currency Wars (2011) and The Death of Money (2014) or legendary investor Jim Rogers' latest YouTube videos. Such a scenario - or one closely similar to it - is not only plausible but also inevitable as per these experts' opinions.
The book narrates the story of the Mandible family which had a considerable fortune prior to 2029. But with the T-bills declared unpayable, the Mandible fortune becomes worthless and the family declines into a steady unraveling.
While most of the members of the family are at a loss to understand what has befallen them, one of the younger members, a teenager named Willing, learns the correct economic principles and uncannily diagnoses what has gone wrong with the country.
The economics espoused by Lionel Shriver is not mainstream economics but is closely aligned to the Austrian school. It is clear from her narrative that having a massive debt overhang is wrong; Keynesian economics is wrong; massive money printing is wrong since it can lead to hyperinflation and subsequently very high interest rates; simply urging citizens to spend more is not a way to restore confidence in the economy.
While Rand's Atlas Shrugged culminated in a utopian ending where all the heroes are transported into a magical new world, there is no such comfort in Shriver's book. As the title suggests the depression lasts close to 20 years and the nation limpingly emerges out of it. There is only a promise of joy in the ending which is realistic and, in a sense, provides a measure of satisfaction.
Shriver who has previously written sociological novels - including the acclaimed We Need to Talk About Kevin (2003) - shows an incisive understanding of mainstream economics and its limitations. Her characters are well formed and her wit is dark and hilarious. This is a timely contribution on what ails America and the West.
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