23 Things They Don't Tell You About Capitalism

This is an interesting and provocative book which questions the received wisdom of the neoliberal free market policies proposed by Friedman and the Chicago School economists of the 1970s and first implemented on a large scale by Regan and Thatcher – in other words, it questions the ideas underpinning mainstream economic thinking in the UK and the US governments and their associated economic institutions since the early 1980s. As such, it is not seeking to offer an alternative to capitalism – as Chang says on the third page of his introduction, the “book is not an anti-capitalist manifesto. Being critical of free market ideology is not the same as being anti-capitalist. Despite its problems and limitations, I believe that capitalism is still the best economic system that humanity has invented." Instead, the book describes the limitations of free market approaches, detailing how such policies largely fail to deliver what their proponents suggest they should and emphasising the continuing importance of government planning and regulation. Chang does this in an entertainingly anecdotal fashion in which he takes each of his “things”, describes how those who believe in free markets think they work, explains how he thinks they work and then uses some carefully chosen examples as a way to illustrate his views.A couple of examples illustrate the tone of his arguments.In Thing Five (Assume the worst about people and you get the worst) Chang takes on the assumption implicit in Adam Smith’s free hand of the market that economic progress is driven exclusively by self-interest – the very bedrock of free market principles. Instead, he suggests, a fair proportion of people’s behaviour is almost altruistic; most people, for example, work hard even if there is no-one to check up on them and most people don’t cheat their customers even when they could get away with it. Many good economic systems, he suggests, do better by making use of people’s disinterested and unrewarded input rather than when they assume that people will always be motivated by self-interest alone.In Thing Twelve (Governments can pick winners) Chang takes on the free-market mantra that capitalism works best when people are able to take on enterprises without government interference – a belief which is, as Chan demonstrates, at odds with the economic history of every wealthy country. Reading this chapter, I couldn’t help but think of Canary Wharf (the most potent symbol of successful capitalist enterprise in the UK in the last fifty years?) and reflect that it wouldn’t have got off the ground without the UK Government creating the London Docklands Development Corporation, granting the Isle of Dogs Urban Enterprise Zone status and funding infrastructure investment in the DLR and the Jubilee Line.So, overall, then, well worth a read – an ideal book, perhaps, for an A Level economics student?And, by way of a related postscript, I have a teaching colleague who demonstrates principles of market failure and inequality to his A Level economics students by starting them on a game of Monopoly and then, once the game is underway, he deregulates the game by introducing massive cash hand-outs and free houses, hotels and properties to some of the players. The results are often hilarious and, typically, lead to civil disobedience, crime and violence as those who lose out protest, steal from the bank and even upset the board. The exercise illustrates beautifully how free-booting, unregulated capitalism can create rather than solve problems. Chang would, I’m sure, approve.

The book states it has 23 points to make, in truth all the points are highly interrelated and overlap. It’s in essence an academic article that has been unnecessarily elongated into a book.There are not ’23 things’ in the book. If this were true they would all be independent points in their own right that you as a reader could touch upon individually at your own pace. All ’23 things’ are interrelated and overlap. So much so, that the author casually drops brackets through the book amidst an argument they are trying to make by simply stating ‘refer to things (2, 6, 13 and 21). It is excruciatingly annoying and weak argument building.Imagine wanting to read a book in chronological order and at your own pace, just like a normal person. Repeatedly the author refers to points gone or yet to come simply by their number.Now… am I meant to hop forward several ‘ things’ and read that specific ‘thing’ in its entirety to understand the full extent of a single point you are trying to make at this present point in time? Or, alternatively am I meant to hop back to specific ‘things’ and re-read them in their entirety again as you do not wish make your argument clear by simply re-iterating a small point in a discussion past gone?Nobody of sound mind would follow the brackets instructions as you would bounce back and forth across the entire book re-reading entire chapters countless times.More so, despite the book being about capitalism it never at any point actually defines outright what capitalism is, again this is weak. You cannot state that the book is geared toward a novice with no previous knowledge in economics and not state the basics. It jumps straight in assuming you know who Karl Marx and others are along with their concepts and theories. The book has an introductory chapter and wastes it not covering this.The book is highly eloquent. English is my first and only language, credit where credit is due – it certainly enhanced my own vocabulary. This is why I find it hard to understand why the book has a single severe repeated grammatical error throughout it. The author fails to use ‘they’ or ‘their’ and instead uses ‘she’ or ‘her’. I am all for gender equality. However, it is a major blunder that causes your mind to switch from absorbing what you’re reading to sheer shock on how bad the grammatical error is. It stands out, “the government increased taxes…. she will now have to pay”. How the book went to print with that error throughout it bewilders me.Despite the author being a Cambridge graduate and member of staff at this world renowned institution for over 20 years I let this error slide as English is not their first language. Instead I blame his publisher, publicist and the many he thanked for proof re-reading and providing input on how to make the book and its arguments reader friendly. On these accounts they failed spectacularly, the book is not user friendly, not for a novice and not in layman terms for the non-experienced economist.I can only think when you are an academic gearing content toward a non-academic it is incredibly difficult to find the right balance. Even when you think you’ve found the right balance you could still be way off. A key example is the author’s use of death by statistics through the book. They swallow you whole and leave you confused and numb opposed to executing an epiphany/ah-ha moment that positively supports the point made.All in all, the book’s concept was a good idea, poorly executed and poorly advised by those called upon to make it readable/marketable to the masses.

Excellent.To summarise:Ha-Joon Chang, exposes the insincerities and double standards of the Washington Concenusus (the economic dogma, in which it is asserted that free markets, liberalised trade and deregulation are simpatico with economic development). What's often left out of the classical economic philosophy is the evidence to the contrary. For example the USA is often held up as a paragon of free market efficiency and growth. However it's early economic development (see Land Of Promise: economic history of the US) was founded on three interlocking interventionist policies:1. High tariffs-to protect their infant industries until they were efficient and productive enough to compete globally2. Noncompliance with foreign patents-enabling their researchers, inventors and manufacturers to develope industries and companies without the additional costs associated with paying patentees for their discoveries.3. Large scale publicly funded infrastructure-widening their domestic markets and enabling the development of an interconnected economy.These policies were in turn developed by observing the UKs policy of protecting infant industries with tariffs and only removing them once they were assured of the superiority of their products.Thus by analogy the western developed economies (built in no small measure from the dirigiste policies of the past) insisting that the less developed world open up to (superior products) is like a tennis pro insisting on a game with a novice whilst insisting it's 'fair'.Great book, good read and free of irksome, self gratifying economic jargon.

I’ve always been a believer in market economics, though I’ve mellowed in my beliefs as I’ve got a bit older. I loved this book - it’s an easy read, yet it challenges “conventional” wisdom, suggesting that “kinder” / more understanding economic behaviours might not only be kinder, but also smarter - if we can get over the short term focus so many of us have been brought up with from an early age.

We've started reading this for our Talk Socialism reading group (set up by members of Labour/Momentum but open to anyone) in York. It really is excellent. Well argued, accessible and entertaining. I can also recommend the audio book.