The Wheels of Commerce

"As you said, Braudel’s book is the second in this series. Civilization and Capitalism is a monumental undertaking. In these three volumes, Braudel did what no one else had attempted before and he did it more successfully than anyone I know of, that is to try to understand the beginning of capitalism – particularly the kind of capitalism that has now become dominant in the world, the capitalism that started in Europe between the 15th and 18th centuries. What I like about the second volume, The Wheels of Commerce, is that he understood that the banking and the trading systems that evolved in Europe between the 15th and 18th centuries were run, dominated, and designed by a different group entirely from the actual people who developed the goods and services that would be traded within this emerging system – the merchants, the craftsmen, the farmers. They were all part of capitalism, but the actual organisation of capitalism was through this ever more complex banking and trading system and the evolution of credit. Braudel recognises that credit is the key. He understands that between the 15th and 18th centuries, the invention of banking and of a system of credit and fundamentally a system of trust among a people who understood that they had every selfish reason to trust one another, was the essence and the genius of the development of capitalism. Another thing I love about the book is the detail – the abundance of data, the charts, the information about social and political life interwoven in the development of capitalism and also the extraordinary illustrations. You get it all. You see the relationships. Braudel illustrates that point beautifully. Again and again, capitalism reached points where, if the state did not intervene in such ways as to induce more competitiveness, it would collapse under its own weight. In other words, what Braudel saw was this continuing evolutionary balance between the state and capitalism, in which the state needed to support capitalism but at the same time needed to guard against its excesses. Braudel in this sense is part of the same tradition as Herbert Croly and Galbraith."