Transaction Man: Traders, Disrupters, and the Dismantling of Middle-Class America

by Nicholas Lemann

Overview

"A splendid and beautifully written illustration of the tremendous importance public policy has for the daily lives of ordinary people." —Ryan Cooper, Washington Monthly

Over the last generation, the United States has undergone seismic changes. Stable institutions have given way to frictionless transactions, which are celebrated no matter what collateral damage they generate. The concentration of great wealth has coincided with the fraying of social ties and the rise of inequality. How did all this come about?

In Transaction Man, Nicholas Lemann explains the United States'—and the world's—great transformation by examining three remarkable individuals who epitomized and helped create their eras. Adolf Berle, Franklin Delano Roosevelt's chief theorist of the economy, imagined a society dominated by large corporations, which a newly powerful federal government had forced to become benign and stable institutions, contributing to the public good by offering stable employment and generous pensions. By the 1970s, the corporations' large stockholders grew restive under this regime, and their chief theoretician, Harvard Business School's Michael Jensen, insisted that firms should maximize shareholder value, whatever the consequences. Today, Silicon Valley titans such as the LinkedIn cofounder and venture capitalist Reid Hoffman hope "networks" can reknit our social fabric.

Lemann interweaves these fresh and vivid profiles with a history of the Morgan Stanley investment bank from the 1930s through the financial crisis of 2008, while also tracking the rise and fall of a working-class Chicago neighborhood and the family-run car dealerships at its heart. Incisive and sweeping, Transaction Man is the definitive account of the reengineering of America and the enormous impact it has had on us all.

Product Details

ISBN-13:	9780374713782
Publisher:	Farrar, Straus and Giroux
Publication date:	09/04/2024
Sold by:	Barnes & Noble
Format:	eBook
Pages:	322
File size:	3 MB

About the Author

Nicholas Lemann is Joseph Pulitzer II and Edith Pulitzer Moore Professor and dean emeritus at Columbia Journalism School and a staff writer for The New Yorker. His previous books include The Big Test: The Secret History of the American Meritocracy and The Promised Land: The Great Migration and How It Changed America.

Table of Contents

Prologue 3

1 Institution Man 23

2 The Time of Institutions 70

3 Transaction Man 100

4 The Time of Transactions: Rising 136

5 The Time of Transactions: Falling 182

6 Network Man 222

Afterword: An Attempt to Use a Tool 252

Notes 269

Acknowledgments 287

Index 291

Editorial Reviews

"Lemann has been one of our wisest, clearest-thinking, and most learned commentators on American society since he began his journalism career at Washington Monthly in the 1970s. His books (The Promised Land, The Big Test, Redemption) all tackle moments of sweeping social transformation, offering compelling studies of the interrelation of ideas and institutions grounded in the experience of ordinary people. Transaction Man, which tracks how the United States went from a largely Polanyian society to one defined by ideas like Friedman’s, is his best—and most sweeping—yet." —Rick Perlstein, The Nation

"Compelling and well reported . . . [Lemann brings] historical perspective to the changing role of economists in American society." —Paul Romer, Foreign Affairs

"Lemann, a New Yorker staff writer and former dean of the Columbia Journalism School, has a skill for making grand stories about American life feel human. He did it in two earlier books, The Promised Land, his 1991 account of the great black migration, and The Big Test, about the SAT and meritocracy, which was published in 1999. Anyone who read those books when they appeared would have been better prepared for some of the political and cultural debates that followed." —David Leonhardt, The New York Times Book Review

"Lemann . . . [reminds] us that Transaction Man and his economist allies were not always ascendant, and that they won’t necessarily remain so . . . [an] elegant history." —Sebastian Mallaby, The Atlantic

"Clearly, something has happened to make us sour on the American corporation . . . Exactly what went wrong is well documented in Nicholas Lemann’s excellent new book, Transaction Man . . . Lemann’s book is more than worth the price of admission for the perceptive history and excellent writing." —Ryan Cooper, Washington Monthly

"[Lemann] is clearly well-versed in the financial, economic, and political histories of his Institution and Transaction Men . . . [his] writing . . . might be essential." —Bradley Babendir, NPR

"Ingenious and colorful . . . There are dazzling passages . . . Gems are dug from the past." —The Economist

"Transaction Man anchors three periods of American capitalism to mini-bios of New Deal brain-truster Adolf Berle, conservative economist Michael Jensen, and LinkedIn tech guru Reid Hoffman . . . [performs] the impressive feat of elucidating complex and significant developments in under 400 lively pages." —Robert Christgau, Bookforum

"The most ambitious, well-researched, and readable account of 20th-century U.S. political economy I’ve come across." —Don Chew, Journal of Applied Corporate Finance

"[An] excellent and unusually framed economic history . . . This concise and cogent history of the theories that have transformed the American economy makes a potentially dry subject fascinating." —Publishers Weekly (starred review)

"A fresh account of the magnitude of inequality in America and how it came to be . . . Lemann relies on his well-developed skills as a longtime journalist to weave the specific and the abstract into a narrative that is intellectually challenging." —Kirkus Reviews

"Through the stories of individuals, often from varied neighborhoods, businesses, and corporations, Lemann makes these experiences come alive . . . [an] insightful business history." —Library Journal

"A thorough, impressive and hard look at the American economy and the people who most influenced its arrival in the present moment." —Literary Hub

“With his characteristic fluidity of thought and of expression, Nicholas Lemann has written a powerful book about how America really works—and doesn’t. Part history, part reportage, part argument, “Transaction Man” is original, compelling, and illuminating.” —Jon Meacham, author of The Soul of America

“This fascinating book is destined to become our era’s most important and insightful explanation of the deep forces disrupting our economy. Nicholas Lemann uses compelling stories of real people combined with brilliant analysis to show how the rules that shape our lives have changed. The author's narrative is riveting and convincing — as is his call for a renewed American pluralism. His new way of thinking about our past and present leads to a new way of thinking about the future we want. If you want to read one book to understand America today, this is it.” —Walter Isaacson, author of Leonardo da Vinci and The Innovators

"A brilliant, essential, and rollicking read. Nicholas Lemann deftly guides the reader on a fascinating excursion through some of the last century’s densest Big Idea terrain. Blending incisive commentary with deliciously salacious detail, Transaction Man thrums with whiz-kid New Dealers and post-war management gurus, New Age Svengalis and Great Recession financial prestidigitators, free-market mavens and Silicon Valley techno-titans–and the soaring and all-too-frequently silly nostrums with which they have tried to jacket the blooming, buzzing confusion of the modern world." —David M. Kennedy, Pulitzer Prize-winning author of Freedom from Fear

"Every so often there comes along a book that forces you to reconsider what you thought you knew. Nick Lemann’s Transaction Man is one of these books. Focusing our attention on short-term visionaries and disrupters, activist professors, rogue economists, and Silicon Valley lifers, Lemann revisits and revitalizes the economic history of America since the New Deal." —David Nasaw, author of The Patriarch

“Brilliant and incisive, Transaction Man illuminates America’s economic history through colorful stories of the thinkers whose ideas, often stubbornly held, benefited a succession of wealthy elites while failing ordinary people who were diligently trying to earn a living. For anyone who thinks Wall Street has too much power, this book explains how that power grew. Nicholas Lemann brings needed clarity and human interest to an essential topic of our time: who should make the rules for the financial system?” —Rosabeth Moss Kanter, Ernest L. Arbuckle Professor at Harvard Business School, Founding Chair and Director of the Harvard Advanced leadership Initiative, and best-selling author

"Through a deft interweaving of key ideas from thought leaders, the playing out of large-scale social and economic forces, and accounts of the lives of ordinary citizens, Lemann brilliantly illuminates the course of the United States during the last 100 years." —Howard Gardner, Professor, Harvard Graduate School of Education and author of Frames of Mind: The Theory of Multiple Intelligences and other books

From the Publisher

2019-06-25
A fresh account of the magnitude of inequality in America and how it came to be.

New Yorker staff writer Lemann (Emeritus, Dean/Columbia Journalism School; Redemption: The Last Battle of the Civil War, 2006, etc.) turns to complex theory to explain why income inequality has deepened in conjunction with the fracturing of social bonds between and among the ultrawealthy, middle-class residents, and those struggling with poverty. The author posits that three phases, dating back about 100 years, explain much of the upheaval: the era of powerful institutions, including government, political parties, massive corporations, massive labor unions, and affinity groups based on ethnicity; the era of transactions that often bypassed those institutions, mostly through Silicon Valley and Wall Street; and now, the era of internet-enabled entities such as Google, Apple, and Facebook. Lemann chooses one individual to explicate each phase: New Deal economist Adolf Berle as "Institution Man," Harvard Business School professor Michael Jensen as "Transaction Man," and LinkedIn co-creator Reid Hoffman as "Network Man." Though the author's high-level theorizing is confusing at times, he wisely offers general readers a solid foundation by discussing the impact of each era on citizens in specific neighborhoods, especially a neighborhood on the South Side of Chicago called Chicago Lawn. In that setting, he provides sharp portraits of a white male automobile dealer, an African American woman who migrated from the Deep South to fend off virulent racism in the neighborhood, and other residents struggling to make sense of the increasing economic inequality plaguing much of the country. The desires of Berle, Jensen, and Hoffman to create an orderly, prosperous society allowed a small slice of the citizenry to thrive beyond their wildest dreams but left the vast majority to struggle consistently with poverty.

Lemann relies on his well-developed skills as a longtime journalist to weave the specific and the abstract into a narrative that is intellectually challenging.

Kirkus Reviews