Category Archives: Books

Albert Camus – The Myth of Sisyphus

Albert Camus – The Myth of Sisyphus

There is value in engaging worldviews very different from one’s own. It is an exercise in empathy, and can also sharpen one’s own arguments and views. As for Camus, I am not sure I successfully engaged with his views in this book. Even after reading and thinking it over, I genuinely wonder if he was more interested in fashion than he was in sincerity, wearing his ideas as though they were a costume in order to draw attention. It could also just be that I simply don’t understand him, or that he didn’t want to be understood.

In Greek myth, Sisyphus’ punishment for his hubris against the gods was to push a boulder up a mountain, only for it to fall back down at the end of the day. He was to repeat this punishment every day for eternity. For Camus, the goal of each day of life is a Sisyphean task of not committing suicide. Much of the rest of the book is as overly dramatic as it sounds. Maybe Camus was going through a hard time and needed to talk himself out of suicide, or maybe he just wanted to impress women at the local café by playing the brooding countercultural type. Maybe he was just a drama queen. It’s hard to tell. Camus does offer some commentary on Kierkegaard, Dostoevsky, Kafka, and others, but I still can’t say I got more out of this book than the $1.95 I paid for it besides some insight into his boutique definition of the word “absurd.”

C. Donald Johnson – The Wealth of a Nation: A History of Trade Politics in America

C. Donald Johnson – The Wealth of a Nation: A History of Trade Politics in America

Doug Irwin’s Clashing Over Commerce is the gold standard for U.S. trade histories, so Johnson is easily forgiven for not equaling it. While he doesn’t have Irwin’s command of economic theory or larger themes, Johnson does have a good eye for politics. This makes sense, as his political career has taken him from a House committee staffer to a member of Congress (a moderate Georgia Democrat, he voted in favor of NAFTA), to part of the U.S. Trade Representative’s office.

Johnson’s history starts when the country does, and he hits the usual notes. Johnson covers the Madison-Hamilton debate and Hamilton’s American System proposal, Thomas Jefferson’s failed experiment in protectionism against Britain, the 1828 Tariff of Abominations, how northern industrial interests’ protectionism added to southern agricultural resentment in the Civil War buildup (slavery was far and away more important, but tariffs were also part of the story), right on up to the 1920s Fordney-McCumber tariff and the infamous 1930 Smoot-Hawley tariff that worsened the Great Depression.

As with Irwin’s history, this is where FDR’s Secretary of State Cordell Hull comes across as an unlikely free-market hero. He understood all the usual economic arguments for free trade, but he pushed especially hard for free trade as a policy of peace. That he did so during the 1930s buildup to World War II was especially courageous. The old argument that killing the customer is bad for business goes as far back as Montesquieu, whose Spirit of Laws predates Adam Smith’s Wealth of Nations by a generation. Hull stood out in his ardor, his prominent political position, and his time in history in the importance of his trade advocacy.

After World War II, Hull played a major role in building the international infrastructure that served to drastically lower tariffs around the world over the last 75 years, until the current administration.

Johnson played a small role in this process beginning in the 1970s, and this is where his history’s comparative advantage comes out. He has personal knowledge of the political dynamics of the time, and a specialist’s knowledge of textile policy, which was one of the most contentious areas of post-war trade policy until the Multi-Fibre Arrangment (MFA) was finally ditched in 1995 as part of the WTO’s creation. He has also done a great deal of work on labor provisions in trade agreements. I part company with him on his policy preferences in both of these areas, but his knowledge of both policy details and the political process is valuable.

Robert K. Massie – Catherine the Great: Portrait of a Woman

Robert K. Massie – Catherine the Great: Portrait of a Woman

Every biographer must make a choice between focusing on the person, or the times they lived in. It is a spectrum, not a binary, but most biographies emphasize one or the other. Here, Massie tilts about as heavily towards the person as I’ve ever read in the biography. This makes for a very good read, and Massie gives an insightful character study. But even in a lengthy book, Massie pays only the barest attention to the major world events and larger context of Catherine’s reign (1762-1796).

Her early reign appeared at the peak of the Enlightenment, and Catherine was an active correspondent with thinkers such as Voltaire. She even imported Diderot, famous compiler of the Encyclopedie, for a short time, before he left on bad terms, feeling stifled and homesick.

Catherine’s situation had a little bit in common with the economist Turgot, her rough contemporary in France just before the French Revolution. Her liberalism did not fall on receptive ground, and in a sense there was nothing she could do. She drafted something of a liberal manifesto, the Nakaz, which she intended to lead to a new legal code. But nothing ever came of it—just as Turgot tried to reform France’s finances and economy in a more or less liberal direction, but ran into a political and cultural brick wall. Catherine, of course, was a monarch who jealously guarded her power, and her liberalism was more relative than absolute.

Massie is a superb biographer, an astute psychologist, a well-developed sense of empathy, and a gifted writer. I might have enjoyed more on Catherine’s circumstances in addition to Catherine as a person, but that may well have required Massie to add a second, even lengthier volume. As it is, this single volume is superb.

Wisdom on Inequality

From p. 145 of Arvind Panagariya’s 2019 book Free Trade and Prosperity: How Openness Helps the Developing Countries Grow Richer and Combat Poverty:

“[In] the developing countries, wisdom lies in attacking inequality through poverty alleviation rather than by focusing on inequality, which comes in many forms. Excessive preoccupation with inequality risks the adoption of policies that undermine wealth creation and hence poverty alleviation.”

Moreover, the arguments holds in all countries, not just developing ones. The poor are best served by tending to people, not ratios.

Philip Henry Wicksteed – The Common Sense of Political Economy: Including a Study of the Human Basis of Economic Law 

Philip Henry Wicksteed – The Common Sense of Political Economy: Including a Study of the Human Basis of Economic Law 

I read this 1910 “principle of” textbook because of its influence on James Buchanan, the Nobel laureate who co-founded the public choice approach. He emphasized methodological individualism rather than thinking about people in terms of groups or aggregates. He also emphasized precision in writing and in thought, and repeatedly pointed to Wicksteed as one of his influences in this regard, along with Thomas Hobbes and the Swedish economist Knut Wicksell.

Wicksteed is surprisingly readable. And as with many other older economics classics I’ve read, from Smith, Ricardo, and Say on up to Frank Knight, he defies the stereotype of economists thinking only in terms of abstract models and Homo economicus. Wicksteed wrote in a post-Alfred Marshall world, so by his time the now-standard toolkits of supply and demand curves and equilibrium analysis are in wide use. His grasp of thinking at the margin is deep yet seemingly effortless, and has already sharpened my thinking.

But Wicksteed does not use models for their own sake. He uses standard Marshallian theory to explain why people behave as they do, and why economies have certain tendencies in motion. But he repeatedly emphasizes that these are models, not real life. He emphasizes the importance of human psychology, and how fleeting sentiments and emotions can influence decisionmaking in ways Marshallian analysts struggle to explain. The areas under the supply and demand curves describing subjective values such as consumer and producer surplus do not add up in real life nearly so neatly.

The title is also well chosen. Wicksteed shows common sense throughout, and not just in treating models as models, and not as real life. He shows common sense most brightly in calling shenanigans on the confused and confusing views of land and rent that detracted from the accomplishments even of high-caliber thinkers of Adam Smith and Jean-Baptiste Say, as well as Karl Marx and the nuttier parts of Henry George and his followers. He spends an entire chapter debunking such nonsense, and throughout also explains why the common distinction between land, labor, and capital as separate factors of production is arbitrary and artificial. The likely source of this common pre-20th century confusion is the traditional dominance of agriculture in economic life. As manufacturing and services became more important, the land/rent fallacy declined, and Wicksteed appeared at the right moment in history to put a nail in agrarianism’s deserving coffin.

To the extent that Wicksteed has any readers today, they probably came to him the same way I did, via better-known figures such as Buchanan crediting him as an influence. Due to Wicksteed’s emphasis on psychology and limited rationality, today’s behavioral economists would find a lot to like here, too. Harvard-MIT-Princeton analysts would benefit from Wicksteed’s extended proof that rigorous reasoning is possible without extensive math.

Charles C. Mann – 1493: Uncovering the New World Columbus Created

Charles C. Mann – 1493: Uncovering the New World Columbus Created

An excellent, highly readable sequel to 1491, which was Mann’s history of pre-Columbian North and South America. This book looks at the aftermath. Mann dives deep into disease, biology, trade, culture, and more. I learned that earthworms, or at least the species most Americans are familiar with from their gardens, were brought over to the Americas from Europe. Also, nearly all European and Asian potatoes are essentially clones from one of many candidate New World species. Mann’s surprisingly lengthy and surprisingly light-hearted discussion of the guano archipelago off of South America and the economic and geopolitical consequences of its discovery was also something new.

I also learned that an attempt to popularize escargot in Taiwan led to the imported snails escaping and becoming an invasive species. Meanwhile, the dish failed to catch on. The spontaneous orders that emerged in managing this common resource would be of interest to students of Garrett Hardin’s famous 1968 article “Tragedy of the Commons,” as well as Elinor Ostrom’s empirical studies on polycentric governance. Mann himself is also economically literate, accurately using insights from Douglass North, Joseph Schumpeter, and other economists.

Adrian Goldsworthy – The Fall of Carthage: The Punic Wars 265-146 BC

Adrian Goldsworthy – The Fall of Carthage: The Punic Wars 265-146 BC

This is a history of the Punic Wars, mostly from the Roman side. It is not a survey history of Carthage. For that, turn to Richard Miles’ excellent Carthage Must Be Destroyed. Carthage versus Rome was the big rivalry of its day, the Ancient Mediterranean equivalent of Yankees-Red Sox or Packers-Bears, except with rather higher stakes. The temperature ran especially hot on the Roman side of the dispute. Cato the Elder, for example, ended his every Senate speech, regardless of topic, with the phrase “Carthago delenda est” (“Carthage must be destroyed”).

That said, the rivalry has an artificial cast to it. Roman culture placed a heavy emphasis on self-aggrandizement. Virgil’s Aeneid, for example, ties Rome’s origins all the way back to the Trojan War epics of Homer. And every hero needs a villain to fight; Rome’s villain was Carthage. Goldsworthy is a good narrative historian, and though he remains Rome-centric, he gives the reader an idea of Carthage’s origins and why the former Phoenician colony (whence “Punic”) stuck in Rome’s craw so much. He also explains prominent Carthaginians such as Hamilcar and Hannibal’s significance, strategies, and motivations. Finally, Godsworthy also separates the three Punic Wars into distinct entities. They blend together for many people, including me, and this book helped to give a more detailed understanding. This was a multi-generation conflict, and each generation had a different fight.

Alan Greenspan and Adrian Wooldridge – Capitalism in America: A History

Alan Greenspan and Adrian Wooldridge – Capitalism in America: A History

Deirdre McCloskey’s review is here. An economic history of the U.S. that is optimistic without being to starry-eyed. Greenspan and Wooldridge say wise things about two of my main policy interests. Early on, they have an excellent 30,000-foot level discussion of regulation. They don’t directly cite my colleague Wayne Crews or his Ten Thousand Commandments, but some of his numbers and many of his arguments appear prominently.

Later in the book, they give a defense of modern prosperity, complementing thinkers such as Julian Simon, Matt Ridley, Hans Rosling, and Deirdre McCloskey. They also draw on Cox and Alm’s ever-useful measure of how many hours an average person must work in order to afford a loaf of bread, a tv, a car, and other things. For the better part of two centuries, Americans have been getting more and better goods in return for steadily decreasing amounts of effort.

In between these two highlights is a fairly comprehensive business history of America, from roughly the founding up until now. Their discussion of the rise of the Carnegie, Rockefellers Vanderbilts, and Morgans of the world would have improved from a deeper discussion of competition theory that includes the Brandeisian view, the Borkian view, as well as the public choice critique of both (see Wayne Crews’ and my recent paper for that). Given Greenspan’s name recognition and Woodridge’s skilled writing and distillations, this is a book that will likely sell far better than the average of its genre, and hopefully will be more read as well. Not perfect, but good—much like the economy it studies.

Nicholas R. Lardy – The State Strikes Back: The End of Economic Reform in China?

Nicholas R. Lardy – The State Strikes Back: The End of Economic Reform in China?

Lardy’s “core conclusion is that absent significant further economic reform returning China to a path of allowing market forces to allocate resources, China’s growth is likely to slow, casting a shadow over its future prospects.” In this case, Lardy largely echoes other recent works such as Elizabeth C. Economy’s The Third Revolution: Xi Jinping and the New Chinese State and Ronald Coase and Ning Wang’s How China Became Capitalist.

China has taken a decidedly dirigiste turn under Xi Jinping. If Xi continues down an increasingly statist path, China’s growth will slow. If market reforms continue, China will prosper. Given the outsize amount of power centralized in his person, this choice is up to him more than anyone else. This will remain the case regardless of whether the current U.S.-China trade war ends tomorrow or continues for years. U.S. presidents come and go, but Xi will likely be around for a long time. And if not him, then someone in his inner circle with similar policy views.

Lardy is an excellent economic analyst, parsing through China’s not-entirely-truthful official statistics as well as international data to give as accurate a picture of China’s trajectory as he can, given the sources. One of his major conclusions is that China’s state-run businesses are severely underperforming compared to the country’s private businesses. State-run enterprises consistently make more and larger losses, are more heavily in debt, and the ones that are profitable tend to be less profitable than their private counterparts. They are also concentrated in legacy industries; China’s growth is less in energy and manufacturing and more in services and technology—precisely where China’s private sector is strongest.

This sounds like good news, but the trouble is that under Xi, the poor-performing state-run share of the economy has been growing. Since government tends to make a hash of whatever it does, if Xi keeps this up, China’s growth will slow. This is an avoidable mistake, but it is an open question if Xi will be willing to admit it.

China has several massive white elephant projects that are wasting precious capital, such as its Belt and Road initiative. While this program and others like it scare China hawks in the U.S., they are weakening China. Government infrastructure projects worldwide are late, overpriced, and often of low quality. The Belt and Road initiative is no different, according to available evidence so far. Moreover, the billions of dollars Beijing is putting into it now cannot put into more productive ventures.

Lardy, like everyone else, is unable to guess which path China will take—state-run and poor, or free and prosperous. Unlike many analysts, Lardy is humble enough to admit that he cannot predict the future. He is hoping Xi will eventually decide to turn China’s policy momentum back towards liberalization. The Chinese people share this hope, and China observers of all stripes should hope the same, whether their politics are hawkish or dovish.

Herman Wouk – The Caine Mutiny

Herman Wouk – The Caine Mutiny

This Pulitzer-winning 1951 novel is starkly relevant today. When a commander is clearly unfit for the job, at what point is it ok to depose them, and on what grounds? John Locke wrestled with this question. So did the American revolutionaries he influenced—as did their opponents. This book, set in World War II, explores the same question onboard the Caine, a fictional World War II U.S. navy minesweeping ship. The main character, who is something of a privileged twit though with redeeming qualities, enlists in the Navy and finds himself aboard an old bucket of a ship near the end of its lifecycle. The Caine‘s captain is as mediocre as his ship, and is eventually transferred elsewhere.

His replacement, with the Melville-esque name Captain Queeg, quickly establishes his popularity with the crew with his attention to details the previous captain had neglected, and boosts morale. But after the initial wave of good feeling, the mood quickly shifts. He is indecisive and wavering during several critical points of action, and nearly loses the ship and its crew more than once. He isolates himself in his cabin, avoiding both crew and duty. When they enter his cabin to bring him news, he is nearly always asleep, undressed, or unshaven. Captain Queeg resorts to harsh, arbitrary discipline, such as cutting the crew off from all non-subsistence water rations for 48 hours while the non-air-conditioned ship is sailing near the equator. The crew had earlier exceeded their water usage quotas by ten percent. This and other nonsensical measures, along with another panic attack during action induce the grumbling, frightened crew to relieve him of command.

The book is interesting because the case is not so cut-and-dry. During the court-martial trial that follows the mutiny, Queeg never exceeded his bounds of authority under regulations, and gives decent justifications. Despite showing some signs of mental illness, doctors refuse to formally diagnose him with anything that would render him unfit for command. Queeg is also able to give plausible justifications for his command decisions. Meanwhile, the crew clearly had an animus against him. There is clear evidence they conspired against Queeg in a premeditated mutiny, which the crew members admit to. After the trial, both of the mutinying crew members find themselves captaining the Caine at various points before its decommissioning. They find their performance in that difficult job to be not much better than Queeg’s.

The Caine Mutiny presents more questions than answers, on purpose. That is what makes it both an excellent novel and a good lesson for today’s predicament with President Trump. There are clear signs that his temperament is not suitable for the presidency, yet it’s not so cut-and-dry in a legal case. He has little respect for the rule of law, has an arbitrary, uncertain approach to policy, is an alienating diplomatic presence, and deliberately polarizes the electorate. His age and mental state are also tempting to question. But at the same time, does he meet the threshold for 25th Amendment action, or for impeachment? It’s not black-and-white, and both sides have good arguments. Moreover, Trump’s potential replacements from either party don’t necessarily guarantee improvement.

The weighty matter of mutiny is both leavened and paralleled in the main character’s romantic subplot. He comes from an upper-middle class WASP-ish upbringing. In his first post-Princeton job, as a nightclub pianist, he meets a young singer of poorer Italian-Catholic background. They genuinely love each other, but the main character’s reticence to marry outside of his class and religion, along with some mommy issues, complicate things. They are a cute couple together and the reader naturally wants to root for them, but both external circumstances and mutual idiocy keep them apart—though far more his than hers. At the end of the book, as with the question of mutiny, their relationship is unresolved, but it seems hopeful that things will work out.