Author: Ha-Joon Chang
Translator: Hee-jung Kim, Se-min An
Publisher: Bookie
368 pages | 223*152mm
| Important! Please read before you order! |
| >>>This book is written in Korean. |
About This Book
The world is awash with books that claim to explain the global financial
meltdown. Not many are written by economists. Ignorant of history,
including that of economics itself, most economists not only failed to
forecast the crash but, mesmerised by the spurious harmonies of their
mathematical models, were blind to the mounting instability of the
financial system and failed to grasp that an upheaval of the kind that
is currently under way was even possible. After an intellectual failure
on this scale, what could economists have to say today that would be of
any interest to anyone?
23 Things They Don't Tell You About Capitalism by Ha-Joon Chang Buy it
from the Guardian bookshop Search the Guardian bookshop
Anxiously defending their turf, many have objected that they never
claimed to predict the future. But as Ha-Joon Chang writes: "Economists
are not some innocent technicians who did a decent job within the narrow
confines of their expertise until they were collectively wrong-footed by
a once-in-a-century disaster that no one could have predicted." Far from
being an inward-looking, hermetic discipline, economics has been a
hugely powerful – and profitable – enterprise, shaping the policies of
governments and companies throughout much of the world. The results have
been little short of disastrous. As Chang puts it: "Economics, as it has
been practised in the last three decades, has been positively harmful
for most people."
In his 2008 book, Bad Samaritans: The Myth of Free Trade and the Secret
History of Capitalism, Chang – an economist himself, a specialist in the
political economy of development – mocked one of the central orthodoxies
of his profession: the belief that global free trade raises living
standards everywhere. 23 Things They Don't Tell You About Capitalism
assaults economic orthodoxy on a much larger front. Dip into this witty,
iconoclastic and uncommonly commonsensical guide to the follies of
economics, and, among many other things, you will learn that free market
policies rarely make poor countries richer; global companies without
national roots belong in the realm of myth; the US does not have the
highest living standards in the world; the washing machine changed the
world more than the internet; more education does not of itself make
countries richer; financial markets need to become less, not more
efficient; and – perhaps most shocking to Chang's colleagues – good
economic policy does not require good economists. Each of Chang's 23
propositions may seem counterintuitive, even contrarian. But every one
of them has a basis in fact and logic, and taken together they present a
new view of capitalism.
Chang may be our best critic of capitalism, but he is far from being any
kind of anti-capitalist. He recognises the failings of centrally planned
economies, and rightly describes capitalism as "the worst economic
system except for all the others". At the same time he is confident that
capitalism can be reformed to prevent crises like the one we have just
experienced recurring. Making markets more transparent is not enough.
"If we are really serious about preventing another crisis like the 2008
meltdown," Chang writes, "we should simply ban complex financial
instruments, unless they can be unambiguously shown to benefit society
in the long run." He is aware that he risks sounding extreme, but argues
that the ban he proposes is no different from those that have been
enforced on other dangerous products. "This is what we do all the time
with other products – drugs, cars, electrical products and many others."
It is at this point that Chang's analysis, otherwise refreshingly down
to earth, seems to me to become unrealistic. Banning opaque financial
products might be a step towards a safer world. Unfortunately it is also
politically impossible. In the US, Obama's economic policies are being
shaped by the same people – many of them with close links to Wall Street
– who dismantled Roosevelt's curbs on the banking system during the
Clinton era. American politics has been captured by a financial
oligarchy, and there is no prospect of meaningful reform.
Again, Chang urges that we ban financial derivatives, but who are "we"?
Reforms of the kind he envisions require a type of global governance
that will not exist in any foreseeable future. As he himself recognises,
capitalism is not one economic system but many. "There are different
ways to organise capitalism. Free-market capitalism is only one of them
– and not a very good one at that. There is no one ideal model." This is
clearly right, but the types of capitalism that exist today are not just
different. They are also competitors, with conflicting needs and goals.
Chinese capitalism, Russian capitalism, Indian capitalism and American
capitalism are geopolitical rivals as much as they are different ways of
organising the marketplace, and they threaten one another in a number of
contexts – not least when they are struggling to secure control of
scarce natural resources. Many of the world's conflicts are driven by
these geopolitical rivalries. Afghanistan will enjoy nothing like peace
when western forces are finally compelled to leave. Instead it will
become a site of conflict between India, Pakistan, China, Russia and
Iran, each aiming to pre-empt the others in exploiting the opportunities
offered by the country's geography and resources.
Capitalism is not only about creating wealth, it is also about power –
and western power is waning. Economic energy is shifting to the emerging
countries, while in the west economies stagnate and politicians continue
to worship at the altar of the free market (not least in Britain, where
the coalition seems bent on pursuing neo-Thatcherite policies more
extreme than those of the 80s). Rather than reforming itself,
free-market capitalism looks set simply to decline. But if Chang's
reforms are unrealistic, his account of where we find ourselves today is
arrestingly accurate. For anyone who wants to understand capitalism not
as economists or politicians have pictured it but as it actually
operates, this book will be invaluable.
John Gray's latest book, Gray's Anatomy: Selected Writings, is published
in paperback by Penguin
--- Review by John Gray / The Observer, Sunday 29 August 2010
Availability: Usually ships in 5~10 business days.
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