Thetwentieth century experienced many changes in the world’s economies over thecourse of its decades. In Commanding Heights, authors Daniel Yergin and JosephStanislaw, illustrate the changes after the collapse of the Soviet Union andwhat followed suite–countries turned away from state-controlled economies to freemarket economies. Communism and socialism were prevalent in countries across Europealong with the Soviet Union and China, while the rest of the world was invarious stages governance. By the mid-century, it was beginning to seem ascentralized controlled governments such as communism and fascism, we bound tobe the way of the future.In the early 1900s, the Russian Revolution resulted in a different type ofmodel to market capitalism. As the Great Depression ensued in the 1930’s peoplelost faith in the markets. By the late 1940’s the market was unpredictable acrossthe globe.
Extreme inflation in certain countries caused many issues. InGermany, the middle class was affected the most–people’s money almost becamevalueless overnight and Hitler capitalized on this. Extreme inflation caused asense of anxiousness and fear, so people became vulnerable to Hitler’srhetoric. This was one of his most important reasons as to why he was able toget the masses to follow him over time. There were many key figures that emerged over the decades that played importantroles. Two very important economists with contrasting views, John MaynardKeynes from Britain and Friedrich von Hayek from Austria, introduced their owntheories during the Great Depression era. Keynes championed capitalism statingthat is was a good economic system because created a positive business cycle–businessesemployee people, people generate income, then they spend money based on incomeand put it back into the economy.
Friedrich von Hayek defended the concept ofliberalism and believed that government spending was not the way for economic growth,but rather private investment was the way to maintain sustainable economicgrowth. As the 1970s approached, government dominated economies were stagnating. Anotherkey figured that emerged was the first elected woman Prime Minister of GreatBritain, Margaret Thatcher. She played a vital role recuperating the market economyby reducing government’s role which in turn allowed the market to positivelyresurface. Thatcher was also a key figure, along with Ronald Regan, in ending theCold War.Commanding Heights ends by stating that there is no guarantee of permanentmarket stability. There are too many constant challenges such as the ever-growinggap between the rich and the poor, environmental concerns, the rise of olderpopulations, and the never-ending cultural differences that exist across theglobe.