Economics for Everyone: Two Reviews

Marc Lee took me gently to task a couple of weeks ago for being too modest and not promoting my new book (Economics for Everyone, meant to be a “primer” on economics for trade unionists and other rank-and-file folk) on this blog:

http://www.progressive-economics.ca/2008/06/20/economics-for-everyone/

Thanks for your highly kind words Marc, and the prod.

Instead, I will draw to your attention the first two published reviews of the book that have appeared (to my knowledge) in print, and engage with a couple of the points the reviewers brought up.

Mel Watkins, one of my heroes and the first (co) recipient of the PEF’s Galbraith Prize, gives a detailed and highly generous impression in the current edition of the CCPA’s Monitor.  Thank you Mel for your support!  Here’s his review:

http://www.economicsforeveryone.ca/files/uploads/Mel_Watkins_Review.pdf

Mel raises one point which is entirely valid.  The book lacks any significant attention to the particular circumstances of the Canadian economy — in particular its unique level of dependence on staples production and exports, its corresponding dependence on foreign investment, and the peculiarities of developing an economy so close to the U.S. (and so far from God?).  This absence of concrete Canadian detail reflects the trade-off of writing for an international audience (Economics for Everyone is published outside of Canada by Pluto Press in the U.K., and has already been bulk-ordered by several unions in Australia, N.Z., and the U.K. for internal education programs).  International readers will have little patience for Canadian content … and while I’ve included some anecdotes and statistical evidence from several countries in places (including Canada), in no case will this provide sufficient local detail for on-the-ground activists to take into their campaigns and struggles.  The role of this book is to provide some accessible analytical tools and ways of thinking, so that activists can have more confidence in marshalling economic evidence in support of specific campaigns and demands.

The second review appeared in this weekend’s Globe and Mail books section.  Andrew Allentuck, the reviewer, is a regular business columnist for the paper, so he was a much tougher audience than Mel.  But on the whole I’d say his comments helped more than they hurt (among my target audience, anyway).

He reviewed e4e alongside Geroge Soros’s new book on the financial meltdown (The New Paradigm for Financial Markets), which is interesting company for me to keep.  He uses words like “fresh package,” “soft edge,” and “a bit of humour” to describe e4e.  (You know how movie ads can take one kind word from a review and convert it into what looks like a half-page endorsement? We could do the same thing!  60-point headline: Globe and Mail calls Stanford’s new book “fresh” and “humorous”!!!)  In the end he finds Soros’s prescription (a bit of tinkering with bank regulations) more credible than my vision for all-out social justice.  I don’t mind being the bad cop in that particular comparison — it’s all part of shifting the goalposts a bit.

Here’s the full Globe review:

http://www.economicsforeveryone.ca/files/uploads/Globe_and_Mail_Review.pdf

I do want to engage with two substantive economic claims that Allentuck makes in debunking my critique of capitalism.  First, he disputes my depiction of the rise of capitalism as originating in the Industrial Revolution.  He claims, instead, that the foundations were laid much earlier with the use of floating rate loans and bonds in 13th Century Venice.  While it’s certainly true that pre-industrial merchants and financiers were as innovative as today’s hedge fund artists in finding ways to make money from money, that didn’t constitute capitalism as I defined it in the book (a system in which most work is performed by paid employees, and most real production is undertaken with the goal of maximizing private profit).  Those criteria were not met until the 18th century with the erosion of non-profit feudal producion, the rise of mass industry, and the decline of own-production.  Here Allentuck commits the same error I devote much of this book to exposing: namely, confusing finance with production, paper with reality.

Then, Allentuck suggests in rather simplistic terms that we shouldn’t bother complaining about capitalism since it’s become pretty well universal — citing changes in Russia, Brazil, China, and India.  This is a familiar argument (“socialism failed, get used to it”), and one that lefties need to address (I briefly try to do so in the last part of e4e).  But none of these countries listed by Allentuck remotely typifies the model of capitalism that is taught in Economics 101.  They all are guided by powerful state interventions.  Most galling was his depiction of why capitalism succeeded in South Korea: “South Korea is about incredibly hard work in an unfettered economy.”  You don’t need to study the experience of South Korean development (which I actually praise, for the most part, in my book) for more than half an hour to realize that view is dead wrong.  Korea is actually about the necessity of using policy, structures, and interference to foster development, not “freeing markets” and “getting the prices right.”  (My former prof Alice Amsden is the best source here.)  As for being “unfettered.,” learn a bit about Korean regulations, non-tariff barriers, capital market policies, and trade unions (which are among the most militant in the world).

For those who’d like to learn more about Economics for Everyone, visit the website:

www.economicsforeveryone.ca

The book can be ordered over the web through that site (which transfers you to either the CCPA or Pluto, depending on whether you are in Canada or outside); I don’t know when it will appear widely in bookstores in Canada (our partner Fernwood Books is covering that end of the business).  The web site will eventually contain a simple cirriculum (course outline, lesson notes, glossary, etc.) to support unions and other groups wanting to sponsor popular economics training around the book.  Finally, I’ll be doing some public speaking this fall around the book, including Winnipeg on Sept 10, Regina Sept 11, Halifax Oct 2, and perhaps Vancouver later in November.

All feedback is most welcome!