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The Spirit of Democratic Capitalism
. . . . a major work for our times. ? Irving Kristol, The Public Interest
460 pages, Paperback
First published January 1, 1982
55 people are currently reading
635 people want to read
About the author
Michael Novak
195 books35 followersMichael Novak is an American Catholic philosopher, journalist, novelist, and diplomat. He is George Frederick Jewett Scholar in Religion, Philosophy, and Public Policy at the American Enterprise Institute
Novak served as United States Ambassador to the United Nations Commission on Human Rights in 1981 and 1982 and led the U.S. delegation to the Conference on Security and Cooperation in Europe in 1986.
In 1993 Novak was honored with an honorary doctorate degree at Universidad Francisco Marroquín] due to his commitment to the idea of liberty. In 1994 he was awarded the Templeton Prize for Progress in Religion.
Novak served as United States Ambassador to the United Nations Commission on Human Rights in 1981 and 1982 and led the U.S. delegation to the Conference on Security and Cooperation in Europe in 1986.
In 1993 Novak was honored with an honorary doctorate degree at Universidad Francisco Marroquín] due to his commitment to the idea of liberty. In 1994 he was awarded the Templeton Prize for Progress in Religion.
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Displaying 1 - 21 of 21 reviews
April 10, 2021
Michael Novak passed away in February of this year, but this work, originally published in 1982, guarantees him philosophical, economic and even theological immortality. He dives deep to divine the virtues inherent in democratic capitalism and shows how neither democracy can survive long without capitalism nor capitalism survive without democracy. By comparison with the ideals and results of other systems, he is able to show beyond dispute that democratic capitalism is the best means to improve life for mankind, reduce poverty, and maintain liberty. A theologian, he also castigates religious leaders for not learning more about economics, and, thus, being able to support democratic capitalism as the most beneficial system for their flocks. I could go on. Suffice to say, this is the most compelling, enlightening and realistic definition and defense of democratic capitalism that I have ever read. It is a book that is perfectly suited and desperately needed for our times in which the progressive left is attacking the very foundations of our democratic capitalist system, while its defenders could sorely use this ringing defense of the virtues of our system and critique of socialist alternatives. At the same time, Novak shows tremendous moderation in his thesis and illuminates both sides of the argument thoroughly. This is no extremism, which makes "Spirit" even more effective.
August 21, 2017
Profound and magisterial. I cannot improve on the review by Michael G, so I won’t try.
There are so many good passages in this book, I can’t help sharing a few of my favorites.
On the socialists’ criticism of Adam Smith’s “invisible hand” promoting mass greed:
“The metaphor occurs in an argument in favor of free international markets. The “hand” we are looking for, then, is not coercive. The metaphor, simply put, draws attention to unintended consequences. The motives of individuals, it suggests are not the same as the 'social consequences' of their actions. The logic of economic behavior lies on a plane different from that of the logic of motives. Actually, the socialist conception of “structural sin” makes a similar point. Regardless of the moral rectitude of individual agents, socialists say, 'the system' of which they are a part leads to injustice.”
On the observation that socialism tends to be anti-family:
“Just as tyrannies may on occasion be benevolent, the powerful modern state may also be paternalistic, providing the material welfare of its citizens in exchange for the surrender of self-government. Thus nearly every utopian vision of a paternalistic paradise on earth begins by undermining the sanctity of the family. The more the state invades the family, the less likely the prospect of self-government.”
On why socialism is easy for young people to believe while it demands so little from them:
“…in the early days when I thought socialism represented a moral ideal, socialism required of me no special moral heroism. I did not intend to become an economic activist. I had great ambitions, but not as an entrepreneur, business executive, inventor or other economic agent. While I attributed high moral idealism to socialism, those who would bear the chief costs of my views were, above all, the wealthy and the economically active. Socialism took no skin off my nose. Moreover, if socialism did not actually work as predicted, the poor and the workers would pay a higher price for economic stagnation than I would. It was a moral position which levied no costs.”
I could keep going, but you should just read the book instead.
There are so many good passages in this book, I can’t help sharing a few of my favorites.
On the socialists’ criticism of Adam Smith’s “invisible hand” promoting mass greed:
“The metaphor occurs in an argument in favor of free international markets. The “hand” we are looking for, then, is not coercive. The metaphor, simply put, draws attention to unintended consequences. The motives of individuals, it suggests are not the same as the 'social consequences' of their actions. The logic of economic behavior lies on a plane different from that of the logic of motives. Actually, the socialist conception of “structural sin” makes a similar point. Regardless of the moral rectitude of individual agents, socialists say, 'the system' of which they are a part leads to injustice.”
On the observation that socialism tends to be anti-family:
“Just as tyrannies may on occasion be benevolent, the powerful modern state may also be paternalistic, providing the material welfare of its citizens in exchange for the surrender of self-government. Thus nearly every utopian vision of a paternalistic paradise on earth begins by undermining the sanctity of the family. The more the state invades the family, the less likely the prospect of self-government.”
On why socialism is easy for young people to believe while it demands so little from them:
“…in the early days when I thought socialism represented a moral ideal, socialism required of me no special moral heroism. I did not intend to become an economic activist. I had great ambitions, but not as an entrepreneur, business executive, inventor or other economic agent. While I attributed high moral idealism to socialism, those who would bear the chief costs of my views were, above all, the wealthy and the economically active. Socialism took no skin off my nose. Moreover, if socialism did not actually work as predicted, the poor and the workers would pay a higher price for economic stagnation than I would. It was a moral position which levied no costs.”
I could keep going, but you should just read the book instead.
July 6, 2017
For a reader already knowledgeable about the reality of man's fallen nature and how democratic capitalism channels, albeit imperfectly, man's self-interest into mutual benefit and prosperity, most of this book will offer little new. Adam Smith and the authors of the Federalist Papers already "been there and done that" over two centuries ago. Novak may express the fundamental ideas and proffer evidence in their support better than other writers do, but the ideas themselves cannot be new, because they are...fundamental.
However, for readers still ensorcelled by the heady ideals of socialism and willfully blind to its repeated crimes and failures—Cuba, Venezuela, USSR, East Germany, et cetera and bloody cetera—Novak offers a valuable perspective. He began his intellectual life as a man of the left, and only slowly abandoned that weltanschauung as he pondered those crimes and failures. He reluctantly but honestly concluded that the crimes and failures of socialism are not eerily repeating accidents of history, but rather the inevitable consequences of the mis-fit between socialism and human nature.
Above, I wrote that "most of the book" offers little new. However, the final section of the book, entitled "A Theology of Democratic Capitalism," presents a novel and stirring apologia for democratic capitalism in explicitly theological terms. I am tempted to recommend that section of the book even to those who don't want to read the entire book. I hesitate to do so, however. Like the thrilling coda to a masterful symphony, the book's final section would be diminished were it not preceded by the exposition and development of the main themes of the work.
However, for readers still ensorcelled by the heady ideals of socialism and willfully blind to its repeated crimes and failures—Cuba, Venezuela, USSR, East Germany, et cetera and bloody cetera—Novak offers a valuable perspective. He began his intellectual life as a man of the left, and only slowly abandoned that weltanschauung as he pondered those crimes and failures. He reluctantly but honestly concluded that the crimes and failures of socialism are not eerily repeating accidents of history, but rather the inevitable consequences of the mis-fit between socialism and human nature.
Above, I wrote that "most of the book" offers little new. However, the final section of the book, entitled "A Theology of Democratic Capitalism," presents a novel and stirring apologia for democratic capitalism in explicitly theological terms. I am tempted to recommend that section of the book even to those who don't want to read the entire book. I hesitate to do so, however. Like the thrilling coda to a masterful symphony, the book's final section would be diminished were it not preceded by the exposition and development of the main themes of the work.
February 23, 2009
From the dark days of the Reagan era. Novak is way too smart to be dismissed, but way too smart to be suckered into serving as a shill for the Consumer Economy. He's not afraid to slap-a-pope over economic issues, although his piety would seem to preclude it. Mammon makes a pretty nice substitute though, as his retainer fees would seem to indicate.
On the other hand, the man wrote a stellar book on the murder of Slavic miners in Lattimer PA (The Guns of Lattimer), so he's not blind to how power corrupts. Well, he wasn't then at least.
On the other hand, the man wrote a stellar book on the murder of Slavic miners in Lattimer PA (The Guns of Lattimer), so he's not blind to how power corrupts. Well, he wasn't then at least.
August 26, 2019
En esta obra de 1982, que leí en la app de Kindle, se convirtió en un clásico del género. A partir del descubrimiento de la posibilidad real de prosperar, un fenómeno nuevo notorio en el siglo 18, en partes de Europa y EEUU, el autor explica esa sorpresa describiendo a la sociedad en la que eso fue real. Una descripción organizada del arreglo económico, político y moral-cultural, que generó progreso, riqueza. La explicación de esa sociedad y las ideas que impiden crear riqueza forman el resto de libro. Una gran defensa de la libertad y muy recomendable.
March 13, 2016
An excellent argument on the practical and spiritual superiority of free enterprise - what he calls "democratic capitalism". Socialism, its opposite, is Utopian and impractical - without much success wherever it has been tried. "The problem for a system of economy is how to unleash human creativity and productivity while coping realistically with human sinfulness"
August 26, 2012
Its samizdat translation and publication by dissidents in Communist Poland in 1986 reflected the fact that those who actually experienced real socialism in all its deadening grayness not only knew that collectivism had failed; they also understood there was no "third way.
October 19, 2018
So many things to say about this book. Many may discount it as just another defense of capitalism, which it is; however it’s much more than that by providing the patient reader with a more powerful and useful understanding of democratic capitalism’s unique moral basis. The idea of a moral basis for capitalism seems outlandish even perverse today given the record of the past 20 years, and, it is dated in some respects by virtue of it 1982 publication date. If the reader can get over this limitation, especially the chapters on the socialist/progressive critique of “multinational” companies behavior and impact on so called third world or developing nations, then there is compelling value to be had.
The crux of Novak’s argument is that no serious analysis of democratic capitalism had, until then, been made to truly understand its moral dimension in comparison with socialism and its modern descendent, democratic socialism. Only by comparing the the two systems in light of their actual performance can an true appreciation be reached for the uniqueness of modern capitalism.
As a Catholic intellectual Novak makes no bones about the moral underpinnings of democratic capitalism vs the goals and outcomes of its socialist alternative. He reviews the life and work of Reinhold Niebuhr at length in order to show how this esteemed theologian moves from a youthful support and belief in the socialist worldview to a deeper appreciation for the value and values of capitalism. He sees Niebuhr as a man committed to realism and practical results, not an ideologue and therefore impatient with the idealism and Utopianism underlying socialist and democratic socialist thinking.
Novak concludes with a chapter discussing a theology of democratic capitalism that identifies the crucial moral dimensions of his argument supporting democratic capitalism against the critiques of the left. He delves into an analysis of Christian scripture describe the superiority of capitalism beginning with an understanding of the Trinity, the Incarnation, the notion of competition, the concept of original sin, the separation of the realms(...give to Caesar the things that are Caesar’s, and to God the things that are Gods.). , finally reaching what he calls Caritas, or true compassion and sacrificial love.
He says,...”in order to create wealth, individuals must be free to be other.They are not to be understood as fragments of a collective, members of a kinship group or ethnic enclave but as individual others; originating sources of insight and choice..”
He reflects on the nature and genius of the Founders in understanding what kind of project they were engaged in and the critical need for creating the foundation for creating freedom and growth in the future. Ultimately he says, democratic capitalism will carry a heavy burden to Judgement Day. He believes, and his book argues that capitalism’s basic structure has proved to be productive, its liberties broad and therefore its responsibilities many. He recognizes that democratic capitalism has faults and those are its burden to manage and address, but its ideals are unique and proven over time.
As I read the book, I could not help but wish for an update of its thesis and analysis in the context of all our conflicts today. The fundamental values of community have been weakened perhaps damaged beyond repair and the very definition of community has been altered due technology and the breakdown of traditional family life. On the other hand, what is the alternative? I cannot do justice to all of Novak’s arguments and beliefs but found this book, published nearly 40 years ago to be timely and important for our nation and culture today.
The crux of Novak’s argument is that no serious analysis of democratic capitalism had, until then, been made to truly understand its moral dimension in comparison with socialism and its modern descendent, democratic socialism. Only by comparing the the two systems in light of their actual performance can an true appreciation be reached for the uniqueness of modern capitalism.
As a Catholic intellectual Novak makes no bones about the moral underpinnings of democratic capitalism vs the goals and outcomes of its socialist alternative. He reviews the life and work of Reinhold Niebuhr at length in order to show how this esteemed theologian moves from a youthful support and belief in the socialist worldview to a deeper appreciation for the value and values of capitalism. He sees Niebuhr as a man committed to realism and practical results, not an ideologue and therefore impatient with the idealism and Utopianism underlying socialist and democratic socialist thinking.
Novak concludes with a chapter discussing a theology of democratic capitalism that identifies the crucial moral dimensions of his argument supporting democratic capitalism against the critiques of the left. He delves into an analysis of Christian scripture describe the superiority of capitalism beginning with an understanding of the Trinity, the Incarnation, the notion of competition, the concept of original sin, the separation of the realms(...give to Caesar the things that are Caesar’s, and to God the things that are Gods.). , finally reaching what he calls Caritas, or true compassion and sacrificial love.
He says,...”in order to create wealth, individuals must be free to be other.They are not to be understood as fragments of a collective, members of a kinship group or ethnic enclave but as individual others; originating sources of insight and choice..”
He reflects on the nature and genius of the Founders in understanding what kind of project they were engaged in and the critical need for creating the foundation for creating freedom and growth in the future. Ultimately he says, democratic capitalism will carry a heavy burden to Judgement Day. He believes, and his book argues that capitalism’s basic structure has proved to be productive, its liberties broad and therefore its responsibilities many. He recognizes that democratic capitalism has faults and those are its burden to manage and address, but its ideals are unique and proven over time.
As I read the book, I could not help but wish for an update of its thesis and analysis in the context of all our conflicts today. The fundamental values of community have been weakened perhaps damaged beyond repair and the very definition of community has been altered due technology and the breakdown of traditional family life. On the other hand, what is the alternative? I cannot do justice to all of Novak’s arguments and beliefs but found this book, published nearly 40 years ago to be timely and important for our nation and culture today.
June 14, 2019
It’s a masterpiece. Michael Novak makes the case that democratic capitalism is the fairest of political systems so far experienced by mankind.
Notwithstanding its imperfections, which he reminds us cannot be otherwise for any governmental system practiced by humans, it is the one arrangement that remains ever flexible enough to adapt and improve itself over time. Thus, by its nature of allowing individual freedom, democratic capitalism fosters ongoing innovation, invention, imagination, exploratory enterprise, and always offers hope for future ideas to enhance the lives of persons from any station.
Mr. Novak defines democratic capitalism as requiring three component elements: the political, the economic, and the moral-cultural, each interacting with the other to provide both liberty and communal sharing. He convincingly disputes its critics’ assertion that it promotes only selfishness, and offers real examples of generosity by those who prosper from personal liberty. Compared with the two other dominant economic systems from history—the traditional aristocratic vs. peasant, and the more recent experiments with socialism—it is only the democratic capitalist system that in practice is dynamic and adaptive, while the other two choices are always static and ultimately destructive.
A lengthy and interesting section of the book is devoted to the example of Latin countries, including all of South and Central America, where socialist systems encouraged by theologians who misunderstand economic interactions have not only failed but encouraged people’s resentment against and actual blame of the United States for somehow “causing” poverty in other countries by enjoying prosperity at home.
That the book's historical examples naturally date only up to 1982 (when it was first published) does not change the premise of Michael Novak’s argument. He has not since been shown to be wrong, nor is he likely to be in the future. As he explains, he came by his conclusions only over a long career of study and observation of empirical evidence of reality vs. theory of “ideal.”
Unfortunately, this timeless argument is even more timely today than when it was published thirty-seven years ago.
Notwithstanding its imperfections, which he reminds us cannot be otherwise for any governmental system practiced by humans, it is the one arrangement that remains ever flexible enough to adapt and improve itself over time. Thus, by its nature of allowing individual freedom, democratic capitalism fosters ongoing innovation, invention, imagination, exploratory enterprise, and always offers hope for future ideas to enhance the lives of persons from any station.
Mr. Novak defines democratic capitalism as requiring three component elements: the political, the economic, and the moral-cultural, each interacting with the other to provide both liberty and communal sharing. He convincingly disputes its critics’ assertion that it promotes only selfishness, and offers real examples of generosity by those who prosper from personal liberty. Compared with the two other dominant economic systems from history—the traditional aristocratic vs. peasant, and the more recent experiments with socialism—it is only the democratic capitalist system that in practice is dynamic and adaptive, while the other two choices are always static and ultimately destructive.
A lengthy and interesting section of the book is devoted to the example of Latin countries, including all of South and Central America, where socialist systems encouraged by theologians who misunderstand economic interactions have not only failed but encouraged people’s resentment against and actual blame of the United States for somehow “causing” poverty in other countries by enjoying prosperity at home.
That the book's historical examples naturally date only up to 1982 (when it was first published) does not change the premise of Michael Novak’s argument. He has not since been shown to be wrong, nor is he likely to be in the future. As he explains, he came by his conclusions only over a long career of study and observation of empirical evidence of reality vs. theory of “ideal.”
Unfortunately, this timeless argument is even more timely today than when it was published thirty-seven years ago.
April 1, 2019
An excellent book, it remains current thanks to the enduring popularity of Democratic Socialism, if for no other reason. Novak intended to write a theology to go along with the practice of Democratic Capitalism. In that ambitious endeavor, Novak falls short. However, along the way, he identifies just how woefully under informed many, if not most, theologians are about serious political and economic issues and how their pontificating upon such subjects in the grip of this ignorance ranges from wrong-headed to dangerous. He also correctly identifies the gap between Socialist aspirations and practice, not to mention the near absence of an articulated ideal for Democratic Capitalism. He provides a strong moral argument for Democratic Capitalism and waxes philosophic on the topic, but the theological portion, strictly speaking, is saved for the very end and is so short is smacks more of an after-thought. Nonetheless, Novak's contribution remains valuable if only for identifying the need for more serious thought and reflection on the subject.
While Novak's own background is Catholic Christian, for the most part his religious approach to issues of political economy come from a broader Judeo-Christian point of view, so readers with a variety of backgrounds will find his work pertinent. Lovers of liberty ought to read his work as a primer for the moral case for liberty; those in favor of alternative systems ought to read it if only to prepare counter arguments. While not quite up to the level of a "must read," it really is close to that; it certainly is not excessively long, it is written as a popular work and is not the least bit technical. A very good read indeed.
While Novak's own background is Catholic Christian, for the most part his religious approach to issues of political economy come from a broader Judeo-Christian point of view, so readers with a variety of backgrounds will find his work pertinent. Lovers of liberty ought to read his work as a primer for the moral case for liberty; those in favor of alternative systems ought to read it if only to prepare counter arguments. While not quite up to the level of a "must read," it really is close to that; it certainly is not excessively long, it is written as a popular work and is not the least bit technical. A very good read indeed.
March 13, 2018
First of all I think this book is closer to 5-stars than 3-stars. I went with 4 because it covers a lot and isn't all that compelling of a read... but what it lacks in compelling reading I think it makes up for with some very strong defenses of Democratic Capitalism. It was also a historically important book written in the early 1980s when people were not defending Democratic Capitalism as a moral good and something positive to the extent they are now. Novak makes the case that not only does this work better than socialism, it's actually morally better... you can actually be supportive of it on its own merits, not just that it is apparently better than the alternative. The author, a Catholic philosopher, does not shy away from getting into some theology and making points from there as well.
Key take-away: the Democratic Capitalist system is set up with three competing centers of power. Political, economical, and moral-cultural. None of the three can rule over the others and all have the ability to push back against the others. The arrangement of government might not be the same in all countries but liberty in these areas is crucial to allow the system to prosper.
I really enjoyed this book and think if you have deep interest in the topic there is a ton you would find valuable in here. But it's not a book I'd think everyone would love by any means.
Key take-away: the Democratic Capitalist system is set up with three competing centers of power. Political, economical, and moral-cultural. None of the three can rule over the others and all have the ability to push back against the others. The arrangement of government might not be the same in all countries but liberty in these areas is crucial to allow the system to prosper.
I really enjoyed this book and think if you have deep interest in the topic there is a ton you would find valuable in here. But it's not a book I'd think everyone would love by any means.
January 6, 2018
Not for the faint of heart, but also not impenetrable, with some excellent insights and critiques both of the topic and its critics. Worth a read for those serious about understanding Western, and in particular American, political, economic, and moral life.
This not to say that it is somehow authoritative, but it ties together many disparate pieces of thought and experience in fascinating ways.
This not to say that it is somehow authoritative, but it ties together many disparate pieces of thought and experience in fascinating ways.
February 3, 2025
A very difficult read on one of the most boring topics in philosophy.
Novak is a great writer and very sharp thinker, but Reaganomics simply do not pass the test of time. This book is worth a read to see how far off target conservative expectations have been for the last 50 or so years.
I never quite finished this one and I don’t plan to do so. All because, time and time again, Novak was wrong.
Novak is a great writer and very sharp thinker, but Reaganomics simply do not pass the test of time. This book is worth a read to see how far off target conservative expectations have been for the last 50 or so years.
I never quite finished this one and I don’t plan to do so. All because, time and time again, Novak was wrong.
March 12, 2019
Incredible
A true classic. Novak lays our it point perfectly. Truly enjoyed reading it and will be expanding my collection of his other works. Perfectly discusses the subject without falling into the many pitfalls present when discussing such subjects.
A true classic. Novak lays our it point perfectly. Truly enjoyed reading it and will be expanding my collection of his other works. Perfectly discusses the subject without falling into the many pitfalls present when discussing such subjects.
September 28, 2020
Competent defense of democratic capitalism against socialism from a Christian perspective. Seemed a bit dated in places. I liked this book.
August 2, 2011
While this book is a bit dated in some of its data and statistics, it is a helpful overview of the ideal of democratic capitalism over and against socialism. It is primarily a book about the theory of democratic capitalism and not primarily the practice of said theory. Nevertheless, for those looking to ground themselves in economic theory and connect said theory to a broader theology within a Christian value system, this is a helpful book.
December 5, 2012
This is an excellent book, full of relevant insights into the dynamism of a plural, democratic, and free social order. At points the argument could have been clearer, which is the only reason I gave it four instead of five stars. In terms of the content, this book is stellar.
September 24, 2023
It is shame that this is regarded as the pinnacle theological work in defense of capitalism. While useful insights are made—such as the interdependent relationship between capitalism, democracy, and pluralism—its theological project is ultimately lacking, making it perfect for criticism.
April 3, 2009
Of all the books I read in my Honors Econ 101 class as a freshman at BYU, this was my favorite.
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June 18, 2012I know this is a great book by reputation, but I simply had a hard time wading through it. VERY dense. Phew!
Displaying 1 - 21 of 21 reviews