Cover image for The cash nexus : money and power in the modern world, 1700-2000
The cash nexus : money and power in the modern world, 1700-2000
Ferguson, Niall.
Personal Author:
Publication Information:
New York : Basic Books, [2001]

Physical Description:
xix, 552 pages : illustrations ; 25 cm
Reading Level:
1530 Lexile.
Format :


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HJ235 .F47 2001 Adult Non-Fiction Non-Fiction Area

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Does money make the world go round, as Cabaret's Master of Ceremonies sang to us? In The Cash Nexus, acclaimed historian Niall Ferguson offers a radical and surprising answer-No.Conventional wisdom has long claimed that economic change is the prime mover of political change, whether in the age of industry or the Internet. In our own time Paul Kennedy has claimed that economics provided the key to international power, while Francis Fukuyama and others have argued that capitalism doomed socialism and ensured the victory of democracy. Small wonder politicians are obsessed with the economy: the Clinton campaign motto-"It's the economy stupid" -sums up a central tenet of modern life.But is it the economy? Ferguson thinks it is high time we re-examined the link-the "nexus," to use Thomas Carlyle's term-between economics and politics, in the aftermath not only of the failure of socialism but also of the apparent triumph of American-style capitalism. His central argument is that the conflicting impulses of sex, violence, and power are together more powerful than money. In particular, political events and institutions have often dominated economic development. A bold synthesis of political history and modern economic theory, Cash Nexus will transform the landscape of modern history and draw challenging and unsettling conclusions about the prospects of both capitalism and democracy.

Author Notes

Niall Ferguson was born April 18, 1964, in Glasgow. He is a Scottish historian. He specializes in financial and economic history as well as the history of empire. He is the Laurence A. Tisch Professor of History at Harvard University and the William Ziegler Professor of Business Administration at Harvard Business School.

His books include Paper and Iron: Hamburg Business and German Politics in the Era of Inflation 1897-1927 (1993), Virtual History: Alternatives and Counterfactuals (1997), The Pity of War: Explaining World War One (1998), The World's Banker: The History of the House of Rothschild (1998), The Cash Nexus: Money and Power in the Modern World, 1700-2000 (2001), Empire: The Rise and Demise of the British World Order and the Lessons for Global Power (2003), Colossus: The Rise and Fall of the American Empire (2004), The War of the World: Twentieth-Century Conflict and the Descent of the West (2006) and The Ascent of Money: A Financial History of the World (2008), Civilization: The West and the Rest (2011) , The Great Degeneration: How Institutions Decay and Economies Die, and The Square and the Tower: Networks and Power, from the Freemasons to Facebook.

(Bowker Author Biography)

Reviews 4

Booklist Review

Ferguson is a history fellow at Oxford's Jesus College and author of The House of Rothschild (1998-99), an exhaustively detailed, well-crafted chronicle of the banking dynasty. Today it is an oft-repeated notion that global corporations have supplanted national governments in setting policy and wielding influence. But Ferguson contends that throughout the last 300 years, economics has not been the primary driving force behind political and social change. He suggests that sex, violence, and power have been significant factors in shaping world events. He pulls together a boggling array of data and historical references to reach provocative conclusions, some of which seem to be contradicted by current events. For example, he predicts that individual national currencies will proliferate--even as more countries announce that they are switching from their own system to either the dollar or the euro. Time will tell! --David Rouse

Publisher's Weekly Review

In a work that neatly marries the subjects of his previous books, Ferguson, who made his name with controversial popular histories of World War I (Pity of War, 1999) and the Rothschild banking empire (House of Rothschild, 1998), continues to challenge conventional wisdom. Here, he argues that the enormous expense of war, which forces governments into fiscal innovation, is the primary agent of financial change and its political repercussions, which sometimes include starting new wars. In Ferguson's view, political crises defined broadly to include those spurred by religion, law and culture cause both wars and financial disasters; the ensuing political outcomes determine the long-term economic fallout. Economic events, on the other hand, affect politics in indirect and unpredictable ways. Emphasizing the nuances and exceptions to his argument, he marshals economic statistics to support it, though he does not discuss alternative explanations for financial change. Despite frequent, jarring digressions into the minutiae of 1980s British politics and in praise of Thatcherism, the book is lucidly argued. But for a history that focuses so much on war, it includes little discussion of the military. Most controversially, Ferguson challenges the orthodox assumption that the world is headed toward a peaceful, prosperous and democratic global future. Economic success does not always lead to stability, he argues, and economic freedom is neither necessary for economic growth nor sufficient for political freedom. Nor, he warns, will economic globalization necessarily lead to greater economic or political cooperation. (Mar.) Forecast: This book will be more talked about than read, though it will attract serious readers. Like Ferguson's The Pity of War, its merits should outlive the controversy over its predictions. (c) Copyright PWxyz, LLC. All rights reserved

Library Journal Review

In this scholarly tome, Ferguson (history, Jesus Coll., Oxford; The Pity of War) presents a heavily noted, high-level economic analysis of the impact of economic trends on political change. As he thoroughly analyzes the nexus between economics and politics, he delves deep into the complex relationship among economic principles and international war, political changes in major countries, social liberalization, and national demographics. He challenges the prevailing principles of well-known author Paul Kennedy (The Rise and Fall of the Great Powers), specifically that economic change is the prime mover of political change, contending rather that the conflicting impulses of sex, violence, and power are together more powerful than money. In the book's many dense chapters, Ferguson argues that political institutions have often dominated economic development, and he deftly integrates historical trends and eras, multiple economic principles and theory, as well as modern economic growth and development. This very complex economic analysis will well serve larger university libraries supporting higher-level study in economics, especially international economic theory. Dale Farris, Groves, TX (c) Copyright 2010. Library Journals LLC, a wholly owned subsidiary of Media Source, Inc. No redistribution permitted.

Choice Review

Ferguson (Oxford Univ.), examining the link between economics and politics--the cash nexus--offers several hypotheses of interest. The first is that war has provided the principal drive for financial innovation, and he offers historical examples as evidence. He also contends that warfare has been the instigator of political institutions, in particular parliaments, and again offers historical examples. To this point, Ferguson seems to be heading toward a warfare determination of history. But he argues the extension of democracy has become a supplemental detriment. "Representation without taxation" has begotten the welfare state, a prime drive in the exercise of power in modern parliamentary states. Ferguson appears to view money only as a facilitator; its successful integration with parliaments helps hold the state together, win elections, and retain power. These propositions are well argued and buttressed by historical evidence. But Ferguson then suggests that political power may rest more on campaign finance than on the state of the economy and that financial globalization may be too unstable absent imperial rule. In measured perspective, these observations seem seriously to overreach Ferguson's basic argument and his supporting evidence. They detract from the work, an interesting one that would be more compelling were the earlier level maintained. Excellent bibliography. Upper-division undergraduate through professional collections. J. Murdock emeritus, University of Missouri--Columbia

Table of Contents

List of Tablesp. xi
List of Figuresp. xiii
List of Illustrationsp. xvi
Acknowledgmentsp. xvii
List of Abbreviationsp. xix
Introductionp. 1
Section 1 Spending and Taxing
1. The Rise and Fall of the Warfare Statep. 23
2. "Hateful Taxes"p. 51
3. The Commons and the Castle: Representation and Administrationp. 77
Section 2 Promises to Pay
4. Mountains of the Moon: Public Debtsp. 105
5. The Money Printers: Default and Debasementp. 137
6. Of Interestp. 163
Section 3 Economic Politics
7. Dead Weights and Tax -eaters: The Social History of Financep. 189
8. The Silverbridge System: Electoral Economicsp. 217
Section 4 Global Power
9. Masters and Plankton: Financial Globalizationp. 261
10. Bubbles and Busts: Stock Markets in the Long Runp. 296
11. Golden Fetter, Paper Chains: International Monetary Regimesp. 321
12. The American Wave: Democracy's Flow and Ebbp. 346
13. Fractured Unitiesp. 373
14. Understretch: The Limits of Economic Powerp. 390
Conclusionp. 419
Appendicesp. 427
Notesp. 435
Bibliographyp. 491
Indexp. 533