(Literary Masterpieces, Critical Compilation)

Francis Fukuyama has never shrunk from controversy. In his 1992 book The End of History and the Last Man, he announced that humankind had come to the end of history. In doing so, Fukuyama was not arguing that the world had reached the end of wars, assassinations, and elections. Rather, he was trumpeting the advent of a consensus, hard won after seventy-five years of brutal ideological conflict, that democracy and capitalism provide the only viable path to development. Fukuyama was ridiculed by critics who misunderstood his book. Yet The End of History and the Last Man remains one of the most compelling documents to have emerged from the end of the Cold War. With his latest book, Trust: The Social Virtues and the Creation of Prosperity, Fukuyama confirms his place as one of America’s boldest and most original social commentators.

Having laid the past to rest with his first book, in his second Fukuyama looks to the future. He addresses the issue of international economic competition, which has replaced the military balance of power as the leading concern of American foreign policy. Fukuyama observes that while people may look forward to a liberal and democratic dispensation, there are different kinds of liberalism and different kinds of democracies. Some nations will prosper more than others in the new world order. Fukuyama believes that the wealth of the successful will reflect more their cultural than their material resources.

In arguing for the importance of culture in a nation’s productive life, Fukuyama is challenging an economic orthodoxy—one recently made all the stronger by the collapse of the Soviet Union. With Marxism consigned to the historical rubbish heap, neoclassical economists have come to cling all the more tightly to the twin pillars of the free market and economic individualism. Fukuyama suspects that this faith could ultimately prove as self-defeating as the Marxists’ attachment to the Communist ideal.

Man does not live by bread alone. This homely truth from the Jewish and Christian Scriptures lies at the heart of Fukuyama’s message in Trust. He is careful to point out that Adam Smith, the intellectual father of modern capitalism, had the same insight. Although Smith is most famous for his great tome Inquiry into the Nature and Causes of the Wealth of Nations (1776), he was also the author of The Theory of Moral Sentiments (1759), which argued that the economic motivations of people are highly complex and always involving concerns that transcend the desire for profit. In short, Smith realized that people create values as well as goods.

Fukuyama has long been preoccupied with the importance of “values” when calculating social policy. He wrestled with the threat of human desires to the capitalist order in The End of History and the Last Man. In that book, he predicted that the greatest challenge to the safe and comfortable world emerging in the developed nations would be the human drive for mastery and the taste for glory that accompanies it—what the German philosopher G. W. F. Hegel termed the desire for recognition. According to this view of human nature, people want respect just as much as material well-being. As many poets and moralists have observed, power is every bit as seductive as gold. Pride as well as greed runs before a fall. Hence humankind’s long history of wars and oppression, with lust for supremacy clothed in the specious rhetoric of martial virtue and political necessity.

Like it or not, argued Fukuyama, the old warrior passions lie just beneath the surface in modern men and women. Liberalism, he said, faces the delicate task of redirecting these energies into constructive channels. One of his suggestions for doing this was to sublimate the struggle of the battlefield into the competitiveness of the boardroom—to let business become the moral equivalent of war. Such considerations make a mockery of the “rational man” model of conventional economic analysis.

Fukuyama believes that economics must grapple not only with unreconstructed man, full of tumultuous needs and emotions, but also with constructed man, the socialized product of a culture, programmed with the inherited habits and prejudices of generations of forebears. People betray both individual wants and collective ambitions. They operate within a web of meaning and intent shared with others. No individual can be fully understood outside the context of the culture within which he or she was reared. In Trust, Fukuyama takes these social facts of life and applies them to international economic rivalries.

He assumes that it is possible to discern national styles of economic enterprise, rooted in the idiosyncrasies of culture. Differences in choices made by societies reflect variations in these societies’ understanding of the good. Some societies will value communal cohesion over individual self-expression. Others will celebrate the private at the expense of the public. All such cultural predilections will find concrete expression in a nation’s economic organization and institutions.

Fukuyama’s rejection of orthodox economics, and his reification of the economic importance...

(The entire section is 2144 words.)