Return to Veseth home page 

What I'm reading now ...

John Kay, Culture and Prosperity: The Truth About Markets -- Why Some Nations are Rich but Most Remain Poor.  HarperBusiness 2004.

John Kay is an economics columnist for the Financial Times who often says interesting and thought provoking things, so I was looking forward to reading his new book to see what points he might raise.  Alas, the book is more irritating than thought provoking -- but still worth a look.

This book was published in Europe as The Truth about Markets and Kay makes a point to say that it was very considerably revised for the "American market" -- more than just the title was changed (to Culture and Prosperity) and the spelling Americanized  It would be interesting to get a copy of the European version to compare with its American cousin.  I wonder what John Kay thinks that Americans think or need to know that Europeans don't?

My guess, judging the books by their covers (the titles at least) is that the European version was basically the middle chapters of this book, which try to explain in lay terms one of the most difficult, important and interesting topics of economic theory: general equilibrium theory, which is, more or less, the theory of how decentralized market systems work or can work.  Kay's approach to the challenging task of explaining general equilibrium theory is to pepper the text with dozens and dozens of practical examples, personal anecdotes and historical vignettes.  Although a sound strategy in theory (general equilibrium theory is very abstract, so readers need grounding in real world application), Kay's strategy sometimes fails in practice.  The stories sometimes take over and the points that they are supposed to illustrate get lost.  Fo  my money, Joseph Stiglitz's book Whither Socialism? (see review index link at page top) is still the best introduction to this material, although I admit that the theory chapters are tough going for beginners.

What was added for the American edition?  My guess is Kay's critique of the "American Business Model" (ABM for short). This discussion feels like a loose appendage to me -- not part of the central narrative.  Honestly, I think he would have been better off saving this material for a later, more complete, treatment.  Kay's ABM is what other people probably call neoliberalism and I like his attempt to give it a new name -- even this rather bad one -- because neoliberalism's excesses have given economic liberals an undeserved bad name. I like to use the term "market fundamentalism" to describe the beliefs and policies of the neo-libs, but that hasn't caught on.  The term "American Business Model" shouldn't catch on either, however, because, as Kay points out at the end of the book, it doesn't even apply to America.

Franklin Foer, How Soccer Explains the World: An {Unlikelyt} Theory of Globalization.  HarperCollins, 2004.

This is a good book with a great title.  Unfortunately, the title doesn't fit the book and so misrepresents the contents.  Who wouldn't want to read a book that uses soccer to explain globalization?  Well, you won't find it here (although a G-word such as global or globalization does appear at least once in each chapter).

Franklin Foer is a political journalist -- his work appears in New Republic and Slate.  He's a very good writer and a soccer fan and he's written a series of vignettes about soccer and political culture in a number of interesting countries including Scotland, Serbia, Italy, Austria, England and Spain.  The stories are very interesting and you have to admire his courage and tenacity in getting the facts.  His stories illustrate a point that is often repeated among soccer fans -- it isn't that soccer is like life, soccer is life.  But Foer's stories, as interesting as they are, really don't accomplish anything beyond providing examples of this cliché. For my money, Alexander Wolff's book on globalization and basketball (Big Game, Small World -- see book review index at page top) does a better job of making the key links between sports. culture, and globalization.  Foer's book, however, is very good on the political linkages.

I am interesting in an argument that Foer tries to develop in his final chapter on soccer in America.  Foer seems to think that Americans are deeply divided on soccer and that their divisions reflect the way that the country is torn by globalization.  I don't buy it -- mainly because I don't see the strong reaction against soccer than Foer does.  Maybe I need to listen to more talk radio, which apparently is where the "soccer is anti-American" chatter is heard.

For a really good analysis of why American's don't love soccer (while most of the rest of the world does) I recommend Offside: Soccer & American Exceptionalism by Andrei S. Markovits and Stevben L. Hellerman (Princeton University Press, 2001).

 Why Globalization Works  make the positive case for "liberal globalization." Financial Times columnist Martin Wolf is most persuasive when he takes on the critics of globalization, who he terms the "new millennium collectivists." 

The heart of the book is a accounting of charges levied at globalization, which are then discussed and refuted, drawing upon recent economic research, empirical data, and Wolf's own experience in the 1970s and the senior World Bank economist working on India. 

At its best (the chapter on global inequality stands out), this book is simply excellent -- a concise and interesting primer on a contemporary issue.

One of my favorite globalization books is The End of Globalization by Harold James, so I couldn't wait to see what he would have to say in his book about 20th Century European History. Although this is really a textbook, meant to be read and digested a little at a time, I found it to be a good read and very interesting. Although he would probably disagree with this, it seems to me that, in looking at this long span of history, he tends to give equal weight to people, ideas, and global forces.  The Twentieth Century was full of all three.

James provides an appendix with thumbnail biographies of major figures -- a good reference for students who read history and constantly encounter unfamiliar names.  He also weaves into his text boxes on "isms" that are very useful, although they could sometimes be clearer.  And, for the main part, he tells his story of Europe as a battle between the international influences and nationalistic concerns and policies.  He argues that, by the end of the century, it is not longer possible to talk about Europe outside of its international and global context -- and I think he is right.  Does this mean that we are fated now to see the pendulum swing back towards nationalism, isolation, and conflict?  I certainly hope not.

I wish the book were longer and more detailed.  I know that James is just touching the surface of so many of the topics he writes about. Five hundred pages isn't enough!

For a completely different viewpoint on 20th Century history, I recommend another of my favorite books, The Age of Extremes: A History of the World 1914-1991 by Eric Hobsbawm. (Random House, 1996).  Hobsbawm is a Marxist economic historian and noted jazz music critic.  His other books (The Age of Empire and The Age of Capital for example) pretty much define the way the we under European history before 1914.  He hesitated to write this book because it is his history and he was very much a part of.  This is very much a personal account full of exciting passages and not lacking in bold conclusions.  I especially like the chapters on music and popular culture, which capture so well the spirit of the times and provide such important insights and commentary on the surrounding events.  Skip the final chapter, however, if you want to remain an optimist.

William Bernstein, The Birth of Plenty: How the Prosperity of the Modern World was Created.  McGraw-Hill, 2004.

"Why do some places prosper and thrive while others just suck?"  That's really the question that links these two books. P.J. O'Rourke, the author of the quote, is a political essayist who can't resist thinking about economics in spite of the numbing pain his college econ prof apparently inflicted upon him.  William Bernstein is a neurologist who writes about economics and finance because he just finds it so darn interesting.  Bernstein and O'Rourke are both interested in where prosperity comes from (and what's stopping so much of the world's population from having it), but they approach the question from completely different angles.  This makes reading these two books together both informative and fun.

O'Rourke treats economic growth as if it were a political issue.  His method is to travel around the world, to prosperous places and destitute ones, talks to people, and makes his own observations. A certain amount of the book is irrelevant (but funny) or just B.S. (not-so-funny), but there is a lot that is interesting and insightful, too.

I  like Bernstein because he approaches economics as if it were brain surgery -- he reads the scientific and historical literature thoroughly and brings this knowledge to his writing.  Instead of traveling around the world, Bernstein takes us back into history, to see the origins of our economic institutions and to learn through historical examples what works and what doesn't.

Both books have flaws.  O'Rourke's has that B.S. problem and it is a little dated now (they say that Albania isn't nearly as lawless, corrupt and generally "sucky" now as it was when P.J. was there).  Someone who knows economic history well can quibble with Bernstein's choices -- why use this example instead of that example? 

But I think books have strengths that easily outweigh their weaknesses.  And both books present clear conclusions.  They aren't exactly the same (no surprise), and they aren't a simple roadmap to prosperity, but they tell us a lot about the sources of economic success, especially when considered together.  Looking for a summer book that is both worthwhile and fun?  Take these two, please.

Niall Ferguson is a fearless author.  He is completely unafraid to stake out bold positions and to defend them by drawing upon his background as a historian (a financial historian to be exact).  These qualities make Ferguson's books thought-provoking and interesting to read whether you agree with him or not.  Each chapter of this book makes a bold statement; here are four to whet your appetite for the rest.

The two key dates in recent history are 11/9 and 9/11.  11/9/1989 was the day that the Berlin Wall fell, an event that released America from the Cold War.  The Cold War both engaged the U.S. in international affairs and constrained its actions there.  After 11/9, American reigned supreme, but didn't seem to care -- domestic affairs seemed more important. Remember how uninterested GW Bush was about foreign affairs in the 2000 election campaign?  Tax cuts were what mattered then, not international relations. The tragedy of  9/11/2001 gave the U.S. a mission in a world without a power that could rival it.   Taken together, 11/9 and 9/11 set the scene for the birth of an American Empire.

America is being accused of being an Empire these days -- of trying to create a liberal empire around the world, especially via its war on terrorism. That's a good thing, according to Ferguson (point two).  World history is dominated by empires.  The 20th century experiment in autonomous states and self determination has been a pretty ghastly failure, characterized more by civil war and ethnic strife than peace and prosperity.  We'd be better off with an empire.

Especially a liberal empire (point three).  The British Empire was a liberal empire, but a flawed one.  The problem with the British Empire was that it did not go far enough -- it did not try hard enough to transform the colonial periphery into an image of the imperial center.  It was not vigorous enough in introducing liberal institutions and attitudes.  The result was that many of the colonies remained trapped in traditional regimes that were unequal and inefficient.  Note to President Bush:  don't make the British mistake.  Go all the way.

But Bush won't listen (point four) because America won't listen.  The world needs America to create a liberal empire, but America cannot do the job properly because of three deficits:  its economic deficit to the rest of the world, a deficit in people who are willing to live abroad and see through the mission of transforming the world (they'd rather be home, shopping on foreign-supplied credit).  And, finally, America has an attention deficit disorder.  It's attention span isn't long enough to allow it to complete successfully the project that it has begun.  The sort of empire that the U.S. is likely to build is unlikely to solve the problems that it set out to address.

MV: No. It is really the story of a Mexican family, but the climax comes at the Seattle protest. One Mexican brother, who was adopted by a British couple as an infant, is a public relations specialist who promotes the interests of global corporations (like those in the book who are trying to monopolize the world's water supplies). His brother is an anti-globalization activist, who blew up a water pipeline to draw attention to corporate abuses. The third main character is the activist's 14 year old son, who has never met his father or his uncle, and who is sort of caught between the forces they stand for on the Seattle streets.

Q: Any particular plot twists you can mention?

MV: It is my Norwegian nature to look for symbolic representations in movies, plays, and novels. I think it is pretty interesting that the author made the characters who represent the two sides members of the same family, so I began by seeing the two brothers as symbols of the current globalization debate, with the son as a symbol of the current generation, trapped in the present, haunted by an unknowable past, looking for clues about the future. But I am not really sure that this is correct. Now I am thinking that the three of them collectively represent what globalization does to us. The fate of the British brother (which I won't disclose because it would spoil the story for you) is particularly interesting in this regard. I haven't worked out what the fountain means.

Q: Highlights?

MV: I find the action that takes place during the WTO protests to be exciting. I do not know if it accurately represents what went down on the streets, but it is interesting to read. I hope Matt Warning reads this -- I think one of the characters might be based on him. This is an interesting book that has a lot to say and gives you something to think about when you are finished. Recommended for serious pleasure reading.

Q: Disappointments?

MV: This is a pretty one-sided telling of the story at every level. Don't read this if you want a serious discussion of the two sides. It is the author's right to tell the story his own way, however, and I respect that. But unlike some people I really like to read books that challenge my thinking. -- I think I like them better than the ones I know I will agree with. .

Speaking of novels, here is one that I like much better than Newman's and that deals with some of the same subjects.  Waxwings (you won't understand the title until the final page) is a book about immigrants and globalization, too.  And it is set in Seattle. But it deals with globalization and at the grassroots level, leaving ideology aside for the most part.  This makes its critique more powerful, however, in my view.

Waxwings traces the intersecting lives of a British expatriate writer living in Seattle (hmmm ... just like Jonathan Raban) and an undocumented Chinese worker, lucky to be alive after being smuggled into the U.S. in a sealed ocean container, scratching out a living along with other illegals.  Raban tells the story of these two and their very different existences, living in different American strata, if you know what I mean. 

I am particularly interested in Raban's account of the life of the Chinese man, living on the margins, just under the surface, doing dangerous and illegal work, and yet moving forward uncertainly towards a somewhat paradoxical version of the American Dream.  This is an interesting contrast to the British writer, who lives at the opposite end of the spectrum and yet seems stalled, trapped in the system, a victim of it. 

The two stories intersect in an unexpected way, which may also be distinctly American as the strata seem to get mixed up.  The book is ultimately a critique of the money-driven consumer culture that surrounds us, but not an altogether unfriendly critique, I think, rooted as it is in the immigrant experience and in the dreams that migrants have.

Jonathan Raban is a British author who now lives in Seattle and is one of the best writers I know.  I especially recommend Bad Land, about migrants coming to eastern Montana, and Old Glory, about Ragan's attempt to travel the length of the Mississippi River in a small boat.

Click here to see more of "What I'm Reading Now"