"Shock Values [is] a timely subject in this inflation-focused presidential election year. Carola Binder expounds on monetary ideas both sound and otherwise. She takes up tariffs, antitrust policy, price control, rent control, the minimum wage and the quest for the will-o’-the-wisp called 'price stability.' Her brisk narrative, starting in colonial times, carries the reader all the way down to the tumultuous present."

"[Shock Values] is the new and very useful book by Carola Binder...a very good economic history."

"In [Shock Values], Binder looks back at the long history of politics, inflation and how the government has tried to respond, at times through fiscal policy like price controls, at others with monetary policy."

"Binder argues fluctuations in prices have 'shaped American democracy since its very beginning,' influencing the size, structure and scope of government. . . .Binder skillfully traces America’s circuitous path from a gold and silver standard to a fiat currency, as well as the nation’s recurrent battles over centralized monetary power, from Andrew Jackson’s war on the Second Bank of the United States in 1832 to calls for ending the Fed today. But Shock Values is much more than a monetary history. Many of the most illuminating sections concern non-monetary responses to price fluctuations, such as government attempts to control prices directly by setting maximum or minimum prices."

In recent decades, economists have made great strides in understanding how monetary and fiscal policy influence inflation. Shock Values dives deeper to show how institutional changes throughout US history have been both a cause and a consequence of an unstable price level. Binder perceptively dissects how public policies meant to control inflation have been driven by a complex mix of special interest politics, ideology, and advances in our understanding of the role of monetary policy.

Debates about the money supply and price level predate the Revolutionary War and have often been at the forefront of US politics. Accessible and a joy to read, Shock Values pulls together economic, political, and intellectual history to tell the remarkable story of three centuries of US inflation (or lack thereof).

03/01/2024

Binder (economics, Haverford Coll.) examines the economic destabilization caused by fluctuations in the cost of goods and the effective—and often controversial—remedies the American government has historically used to steady the market, plus their lasting effects. Her book begins with the challenges U.S. colonists faced in controlling prices while financing the Revolutionary War and establishing a new nation. Postbellum politics then shifted to creating best practices for managing national and local economies. This meant establishing the federal system for government and the Federal Reserve (to stabilize the economy). During the Great Depression of the 1920s, the government took an aggressive stance to increase prices, decrease the recession, and avoid deflation. In the 1960s, there was a crisis of soaring prices for steel and other materials. To stem the resulting inflation, President Kennedy and Federal Reserve Chair Paul Volcker (and later Alan Greenspan) raised the prices of goods. Binder also covers the current moment, in which, in reaction to the COVID pandemic, the government regulated the rising costs for drugs and other commodities. VERDICT A solid history of American economic policies. Add to business and economics collections.—Claude Ury