Book Review: Hughes, C., (2025), Marketcrafters, Simon & Schuster

This book provides the history of so-called marketcrafters who impacted US governments investments and regulations, presumably to the benefit of the economic performance of the US. Marketcraft is a practice of intentionally leading governmental efforts to organize and manage markets, so as to achieve particular social or political outcomes. Marketcrafters make use of governmental tools to pursue economic goals.

The author reports on various US leaders, starts some 100 years ago, and going up to President Trump’s second term. He is hoping that these case stories might lead to a new way of looking at the economic life we share. Free markets do not necessarily represent the best way to bring us prosperity and stability. Instead, policymakers have been spending many efforts to shape markets, to attempt to enhance social and political goals. These policymakers are the marketcrafters.

Are we talking about a totally different system than laissez-faire, such as centralized economic planning often prescribed is communistic regimes? This reviewer’s position is a clear no. The marketcrafting approach seems to deal with often relatively small governmental interventions in governmental systems that are largely open. Perhaps we might position this “new” approach as being somewhat “in-between”.

The book falls into four parts. The first section, Age of the New Deal, starts out with a discussion of Jesse Jones and his efforts to develop the Reconstruction Finance Corporation (RFC), that we perhaps might characterize as a national investment bank. But while RFC did indeed save many existing businesses during the large depression, it failed to spur economic growth.

But Jesse Jones and RFC played an important role when it came to wartime manufacturing, WWII. Aircraft production was very much at the center of this. Car manufacturing facilities were for instance converted into wartime manufacturing. A former Dodge facility, for instance, produced more than 18,000 aircraft engines. RFC funded some 530 aircraft manufacturing plants.

Bill Martin as the longest serving Chair of the Federal Reserve for almost 20 years, under five Presidents. It was during the fall of 1969 that Mr. Martin was replaced by Arthur Burns. This was a decision made by President Nixon. He reshaped it into a new kind of central bank, indeed a core institution of US marketcraft. To achieve more stability in markets was a major aim for Mr. Martin.

A keen tennis player, Mr. Martin took a break every lunchtime to play a tennis match. He always avoided direct contradiction or open criticism of sitting Presidents.

Katherine Ellickson used the power of the labor movement to create a broad social and health insurance system for all US citizens. A national health insurance was created. Over time, however, the social security system became rather byzantine in the way it was run, but this was not the fault of Ellickson.

The second section of the book is Rise of the Global. As we know, the overall structure of international finance was shaped in 1945, at Bretton Woods. To specify currency rates various countries’ valutas was central. Mr. Andrew Brimmer was in charge of maintaining the key rudiments of the Bretton Woods structure. He was one of the Federal Reserve’s Governors and led the Fed’s efforts to set up supplemental reserve requirements including offshore dollar holdings. But Brimmer’s efforts were largely undermined by Arthur Burns, the new Chairman of the Fed.

Burns was central in attempting to fight inflation in the early 1970’s. Price and wage controls were central. In retrospect, we way say, however, that Burns seemed to be largely unable to deliver price stability. He was indeed a failed marketcrafter!

The chaotic energy crisis that resulted in late 1973 when OPEC decided to stop all shipments of oil to the US was indeed a serious one. Bill Simon was in charge of finding ways to cope with this energy crisis in the US. He had detailed control over how energy producers sold their products – refineries, regions, other dealers. By the spring of 1974, the US had made it through the first oil shock better than many had expected. An important decision was for the US government to build up considerable oil reserves, making use of old salt mines for storage, so that potential future oil shocks might be handled in even better ways – marketcrafting indeed!

The third section of the book, The Libertarian Fantasy, starts with a discussion of Nancy Teeters and her role as. Member of the Fed under Paul Volcker’s leadership in the early 1980s. While she was not a strong believer in high interest rates to get high inflation under control, she did go along with Volcker’s “shock” to dramatically increase interests. Inflation did come down. After six tumultuous years at the Fed, often in opposition of Volcker, Ms. Teeters went into private business, taking a job at IMB.

Silicon chip making has been a central issue for US policies towards semiconductor manufacturing since the mid 1980s. Robert Noyce played a central role during these first years. He became a vocal supporter of a US policy in this area, first as a co-founder of Intel, and later as the leader of Sematech, a central vehicle for ship manufacturing research and development. The aim was to secure US semiconductor independence. During those years, Japan had become the world’s leading manufacturer. But the US regained the number one spot as of 1994, with 48% global market share versus Japan’s 36%. Sematech gradually lost its role, and was, in the end, absorbed into New York Polytech, a branch of the State University of New York.

Alan Greenspan came to play a key role in reshaping the Fed, in his capacity as its chairman over more than a ten-year period, from mid 1990s to the mid 2000s. His key effort was to gain more control over business cycles, building on financial and technological innovations. The result was a long period of prosperity and stability, with a total lack of serious recessions. It seemed as if Greenspan had crafter the perfect US economy!

A serious financial crisis was brewing. This hit in 2008, under Hank Paulson’s period as Secretary of Finance. Even though Paulson fundamentally believed in a simpleminded version of free market ideology, he was forced to push Lehman Brothers as well as Bear-Stern into bankruptcy. And he was instrumental at the bailing out by the US government of several large banks and insurance companies. While many old institutions and assumptions were washed away, the bulk of the US banking and insurance sectors re-emerged as significantly stronger. This was marketcrafting at its best.

The final section of this book, New Marketcraft, deals with how a small group of young experts, Brian Deese, Gina Khan, Felicia Wong, Julius Krein and Jake Sullivan, as well as others, led major marketcrafting efforts within several sectors of the US economy. Brian Deese took the lead when it came to a dramatic restructuring of the US automaker sector. General Motors was bailed out and Chrysler was sold to Fiat, a temporary nationalization.

Lina Khan led an effort to revise antitrust. This led to a more open-minded view regarding mergers, thereby creating new industrial entities that might be better suited to stand up to international competition.

Several of the new generation of young leaders were concerned with a 21^st century US industrial strategy. Jake Sullivan, for instance, saw it as central to fuse together a domestic and a foreign policy agenda to support US workers. Massive public investments were made, especially in infrastructure, to counter pollution as well as to provide affordable childcare. Brian Deese, Mike Schmidt, Jake Sullivan and others were key proponents of these mass spending efforts. They saw it as essential that the US government would have to make big investments to get private money to flow more easily.

In summary, this book illustrates how business executives, politicians and government employees have shaped markets, so as to achieve their political goals, time and time again. Successful marketcrafting seems to be built on three factors, a clear mission, an accountable institution to carry out specific marketcrafting efforts, and the investments needed to be able to accomplish it all. Perhaps the creation of a national investment bank might be a logical next step! This might make it easier to make reality out of a framework for channeling markets towards political goals.

Is this a reasonable way to go? Would there be a risk of institutions becoming too centralized, often with accompanying bureaucracy and ineffectiveness>? After all, free markets, with little or no marketcrafting, generally seem to be effective when it comes to self-regulation.

There are examples we might learn from when examining how various country regimes seem to have approached marketrafting. The heavily centralized economy of the former Soviet seems to have gone too far. But China, with quite some marketcrafting, seems to perform very well when it comes to economic growth. In the US there seems to be a lot of debate regarding how far one might want to go to rebuild competitiveness on the world basis. Trump’s decision to take a 10% ownership stake in Intel seems to indicate that more marketcrafting may be needed, in this case to strengthen US chip-making capabilities.

There might be a fine line when it comes to how far to push marketcrafting. The recent report my Mario Draghi seems to suggest that EU might have gone too far, paradoxically slowing down growth and competitiveness.

The book focuses a lot on specific individuals, detailing how these few seemed to play central roles when it came to aspects of marketcrafting. But the reality behind these “stories” was that many additional persons also played central roles. The US Presidents at the time (Roosevelt, Truman, Eisenhower, Nixon, Clinton, Obama, Biden, Trump) were, of course, central. But there were also many others, such as Ben Bernanke, Robert Rubin or Larry Summers. So, while this book undoubtedly has become more readable by primarily adding focus this way, the reality of what was actually happening might become somewhat skewed here and there.

I would recommend this book. The issue of marketcrafting is perhaps more central today than ever. World competitiveness seems key. Is marketcrafting a key factor when it comes to this issue? More? Less?