How Capitalism Destroyed Itself: Technology Displaced by Financial Innovation, By William Kingston (2017) Cheltenham, UK: Edward Elgar Publishing, 192 pages. ISBN: 978-78536-773-1

William Kingston’s illuminatingly provo-cative How Capitalism Destroyed Itself is a bibliographically rich and historically munificent treatment of the arguably inherent self-destructive tendency of capitalism. According to its main thesis, the extraordinary wealth generated by the creative energy released by capitalism fuels a cycle of exploitative regulatory capture that elevates financial excess at the expense of technological innovation. The resulting “wealth” lacks a solid basis, manifesting an economic bubble inexorably destined to burst. Forces that generate vast material well-being unleash a political dynamic to sustain preferential treatment that, eventually, undermines the fragile underpinning value of nominal monetary gain. The solution to this paradox lies partly in reformulating the property rights that foster financialization and concentration at the expense of technological dynamism. Kingston meticulously develops the logic behind the interconnected economic, political and social forces that converge to thrust financial recklessness to the forefront of economic activity. The internal logic lies in the distortion of property rights that initially fostered a massive expansion in economic well-being through concomitant cycles of industrial development. Corporate interests grow powerful enough to capture the political system through lobbying and the resultant institutionalization of economic advantage. A solution to the economic residue of this distortion, which includes a blend of stagnation, rising inequality, and protectionism masked as competitive security, lies in reorienting the nature and distribution of property rights. Therein rests a major strength and weakness of the book, with the latter attributable to the internal destructiveness of capitalist forces. The book includes five chapters and a provocative epilogue. Chapter 1 is an informative documentation of “What Capitalism Was.” It develops a “’market power’ paradigm” upon which the self-destructive nature of capitalism is based. There are three sources of market power, each of which is institutionalized by the formalization of property rights, which initially serve to stimulate positive growth. The first source of power is market capability, which accrues to “productive assets.” The property right which underlies this source is limited liability, which encourages people to take risks by restricting the scope of their personal liability for misfortune. A second source is persuasive power, which is reinforced by trademark regulations, which essentially insulate entities from competition. This insulation, in turn, deters advancement and innovation. The third and final source of market power is specific in nature, which is embedded in property rights associated with patents. Improperly designed and executed, patents discourage innovation and shift the focus of economic energy away from technology and other factors that have genuine value. Chapter 2 examines “Where Capitalism Came From,” showing how a religiously motivated work ethic can combine with intelligent property rights to achieve positive economic results. The Cistercians illustrate this practice, creating a “managerial revolution.” However, capitalism, which lived “off the moral and intellectual capital of the Enlightenment,” ultimately “gave free reign to changes in the rules that had earlier disciplined it.” This brings Kingston to Chapter 3, which examines the capture of market power by the exploitation of property rights that created a privileged class immunized from the forces of competitive advancement. This resembles the Schumpeterian self-destructiveness of capitalism. A natural tendency to restrict competition through the self-interested development of property rights, such as information protection, “produces forces that are against taking up any major potential challenge in… [the dominant corporate] technology…” Accordingly, “[t]hese large firms will possess a great deal of market power of capability because they have invested heavily in pro- ductive assets. Any newly formed firm intent on challenging them cannot have either of these at the outset, and consequently can only rely upon whatever specific market power it can obtain from patents. Since the …