(FORTUNE Magazine) – I CAN'T SAY I EVER expected to declare a 700-page history of libertarian economics delightful--especially one that makes a hero of a man who "thought universal literacy a useless goal, as most people can't do anything valuable with it." Or that semi-approvingly quotes someone lamenting the struggle between principles and votes with this: "There is no mass constituency for 7-year-old heroin dealers to buy tanks with their profits from prostitution."

But Brian Doherty knows the value of his material. It's easy enough to lampoon a movement that harbors among its troops some who believe that if a man falls from a skyscraper and attempts to save himself by grabbing a flagpole, he's violating the property rights of the pole's owner. But it's equally easy to appreciate the purity of the libertarian vision. Its noblest advocates genuinely believe that a libertarian-inspired government built around the rights of the individual will serve the interests of all. Doherty, an editor at the movement magazine Reason, knows this world so well he is able both to lampoon it (gently) and appreciate it (temperately).

There are five central figures in Doherty's epically populated and intellectually rigorous narrative (which also contains cameos from such surprising ringers as Warren Buffett's father and Howard Stern): the Austrian economists Ludwig von Mises and Friedrich A. Hayek, who developed libertarianism's central ideas; their profoundly influential American heir, Milton Friedman; the freethinking, free-swinging anarcho-gadfly Murray Rothbard, who somehow reconciled working for Adlai Stevenson with the belief that all taxation was theft; and of course that cranky old loon Ayn Rand.

Who among us wasn't Rand-whammied at 16 or 17, when we were infected by the sort of intellectual Scientology that a reading of The Fountainhead can induce? (My consequent denunciations of charity, generosity, and shared responsibility ran their course in about a month; 35 years later my son broke his own Randian fever in just two weeks.) Doherty explains the seductive appeal of Rand's thinking exceptionally well, but he does not neglect the monstrous personality that by her death in 1982 had chased away almost all her old friends and allies. (An exception: this economist guy named Greenspan.)

Rand may have been inspiration, but to the degree that libertarian thinking has advanced (and Doherty, while a believer, isn't sure that it has), it has been due to those few--very few--who connect thought to action. Congressman Ron Paul may be a singular figure: His Texas district contains more than 100 miles of coastline, but Paul steadfastly opposes federally subsidized flood insurance. More commonly, public libertarianism is diluted by temporizing. Textile monarch Roger Milliken has spent millions promoting libertarianism, but he's campaigned constantly for import tariffs (on textiles, natch). Newspaper publisher R.C. Hoiles "preferred whorehouses" to public schools because they "were voluntary, while public schools were not." Still, he sent his own kids to free public schools.

Always, it seems, practical reality intervenes. Yet when it doesn't, you see why libertarianism, taken to its logical limits, is an idea whose time will never come. Consider the case of Andrew J. Galambos, a California astrophysicist who alighted on the notion of "primary property"--the concept that his most valuable private assets were his own ideas. He attracted a few nutballs to his side, but the doctrine held that however much they might value his concepts, his adherents weren't allowed to discuss them with someone who hadn't paid Galambos for them. It's a hell of a way to build a movement.