The Battle for the Soul of Capitalism.

• Author: Mackell, Thomas J., Jr.
• Position: Book review

The Battle for the Soul of Capitalism

By John C. Bogle

Published by Yale University Press, New Haven, Conn., 260 pages, $25.00

IN THE POST-DEPRESSION and World War II eras, captains of industry, labor leaders, and the secretaries of the Treasury, Labor, and Commerce Departments and their minions met on an ongoing basis to deliberate over our nation's long-term industrial policies. White papers were circulated and, when appropriate, enabling legislation guided the agenda for this country's corporations and workforce. This tripartisan approach enabled the U.S. to thrive in a prolonged post-World War II boom.

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However, it was not that long before Corporate America began to look different. The marketplace became dominated by three mega-automakers, one telephone company, behemoths of Big Steel, and a handful of giants in every industry, including airlines, shipping, groceries, mining, and trucking, with all their financing coming from large commercial banks and Wall Street bluebloods. As for consumers, on the whole they took what they were given in products, services, and price.

Then came the miserable stagflation of the mid- and late 1970s. Shortly thereafter an upheaval unfolded. Regulators began to trim back red tape and pull down barriers that protected established enterprises from upstarts. Tax law was changed to inspire entrepreneurial risk, and new lenders emerged to seed it.

The landscape of Wall Street as well as Main Street went through tectonic shifts. The era of the 1980s introduced new terminology and behavior in the corporate boardroom and in financial markets. Leveraged buyouts, poison pills, merger arbitrage, and the like were readily discussed outside the canyons of Wall Street. The behavior of corporate moguls, private equity and leveraged buyout firms, and institutional investors redefined a new era, characterized as the "decade of greed."

John Bogle provides us with a view of the past two decades--from 30,000 feet as well as an in-the-trenches perspective--in his book entitled The Battle for the Soul of Capitalism.

Bogle refers to the evolution over the past 20 years as a "pathological mutation of capitalism." He believes that "Business and ethical standards of corporate America, of investment America, and of mutual fund America have been grossly compromised."

The founder and chairman emeritus of the Vanguard Group mutual fund company brilliantly and cogently compares America today to ancient Rome before...