Debt, the first 5,000 Years (David Graeber) - Learned that most of history has been communist (eg. hunter gatherer societies), shops of the past were run on credit (eg. tally sticks), money/capitalism tended to emerge with the rise of the state, taxing to feed soldiers for war, and that the drive to pay off one's debt fueled a lot of the cruelty of mankind (eg. Hernan Cortez, Casimir).
21 Things they don't tell you about Capitalism, Bad Samaritans (Ha Joon Chang) - Learned that free trade is generally bad for developing countries, countries need to build out high productivity industries to grow their economy in the long term and avoid a balance of payments deficit (unless blessed with oil or something), manufacturing is vital to a country's economy and its service sector, "free markets" are a constantly evolving political definition with numerous inherent double standards, the only reason most of us in first world countries are paid well has nothing to do with our own superior ability (eg. bus driver in India vs. Norway), but due to immigration control and the institutions we inherit.
Also looking for more book recommendations, so feel free to send some my way!
> Learned that free trade is generally bad for developing countries
The consensus among experts on the matter is that protectionism has a negative effect on economic growth and welfare, while free trade has a positive effect.
There are challenges to be sure, but free trade is most definitely a net positive for developing countries. Countries whose governments prevent their citizens from engaging in international trade tend to be much worse off.
Well read "Bad Samaritans" to see why the consensus amongst economists is wrong.
There isn't a single first world country that developed under free trade. The US and the UK were highly protectionist with steep tariffs, and it was only after they gained world dominance that they started opening their borders and demanding free trade from everyone else.
The economic "miracles" of Japan, Korea, and Taiwan were all highly protectionist, and their now world-renowned industries were heavily subsidized by the government over decades. Toyota took 30 years to make a profit and 60 years to become a dominant player in the auto industry. Had these countries adopted free trade policies, these industries never would have developed due to being unable to compete with foreign competitors, and Korea and Japan would still be third world countries exporting textiles and refined sugar.
The developing countries that did adopt free trade policies (at the behest of the IMF/World Bank/WTO) all grew slower than they did before those policies were in place. Latin America's growth rate since the 80s has been a third of what it was prior, in Africa's case I believe it went from like 1-2% to .2% (don't remember the exact numbers).
The analogy in Chapter 3 titled "My six-year-old son should get a job" is brilliant. If a child is told to get a job and fend for himself, then he'll likely end up working low-productivity dead-end minimum wage jobs for the rest of his life. However if he's able to focus on his studies, get parental support, go to university, maybe do research for a professor on the side - then this insulation from the free market via parental subsidies will pay off in the long run as the child will end up doing much greater higher productivity work. Similarly, developing countries need to invest in high productivity industries to develop.
Highly recommend the book, it's a quick read. I took the same Econ 101 classes where I was taught that free trade is unequivocally good. This book changed my mind, while also helping me realize that much of economics is completely divorced from reality. Even if you ideologically can't let go of the theory that free trade is good, history and the data clearly say otherwise.
The point you make about protectionism is a very good one. But it doesn't tell the whole story.
Isn't it interesting that in books about the economic development of the "first world" you never read about imperial politics? It boils down to how looting of other peoples resources and selling/keeping these people as slaves is the key reason for the riches in the "first world" (particularly its western part). And how protectionism came after (or in parallel, in later phases) to protect the looted. And how the West still does the looting of other peoples resources today and (thanks to that) keeps and grows its riches. And how the only thing that has changed is that it doesn't do the slave trade anymore, but how it still uses and profits greatly from the slave labour.
What about science and technology? It seems to me like the Western world has always been more developed in those senses, even back in the time of the Romans.
It's also not like Westerners are the only people who ever had slaves; "intrarace" slave trade was and still is alive and well in Africa. It's just the logical step forward from slaughtering enemy tribes, it's humanitarian relative to the alternative.
I'm saying this because of the recent trend of white guilt, which I think is unproductive like any group-based guilt; in a way it's a tool of warfare, a psychological/social weapon and an excuse to persecute individuals for things they did not do themselves.
I'd also like to read more on this, I think I definitely could be better informed.
(1) I'll clarify myself: When I write about imperial politics, I mean the western oligarchy, not the people in the west. Yes, the people in the west have been made complicit in the crime of the oligarchy, but they are also (in a sense) a victim. For example: The oligarchy in England was not able to conquer India alone. Nor would they have risked their lives in the process. For that they have used the people. First they gave more money and power (military grades) to soldiers who would go to another side of the world and risk their lives to fight some foreigners who didn't pose any threat to their families or their country. After these soldiers have done their part, using the same scheme ("more money and power"), administrative officers were sent to administer the looted and to secure the power position of the oligarchy. Again, both groups (soldiers and administrators) were victims as well, risking their lives for a tiny bit of money and power compared to the profits and power gain of the oligarchy. And that pattern continues to be used today. Look for example at the testimonies of US soldiers who were in Iraq (on YouTube [1] [2] [3]). These guys are now physically and psychically sick from the war they were sent to wage for the US oligarchy and the system has no purpose for them (prior to them entering the service and now), but they are still humans with compassion.
(2) The argument about science and technology is a complex one. Yes, there were Romans but we don't know sources for their scientific and technological advancements. We do know that, after the Romans, the west fell behind burning books and "heretics", and that the Islamic world was leading in science and technology during that time. We also know that when the west (the western oligarchy) came back with trade, it was followed by the imperial politics. And that continues to exist today as well. Look at the USA: It has made a system where it offers free information on US universities in their embassies. Then the young bright people, many from countries the US oligarchy has destroyed economically, so see no future in them and they come and study in the US. Later, in universities, research facilities and companies (as employees and [co]founders) they become (known) sources for scientific and technological advancements in the US. By doing that, he US is robbing already robbed countries: (a) of their future elite that would build a home country again; (b) their home countries have paid for their pre-tertiary education. And other western countries (oligarchies) do the same.
(3) Considering what I wrote under (1), it were not all "Westerners" but the western oligarchy who was the driver of the slave trade. Also, even thou there was (and still is) slave trade in Africa, the sheer scale, brutality and profit extraction out of slaves by the western oligarchy is not comparable with "intrarace" slave trade.
(4) Yes, white guilt is wrong. You are right that it is a tool of warfare, a warfare between poor people in the west and poor people in other countries, staged by the western oligarchy. No rich people fight in a war, not in the past, not now. And you are right that it is "a psychological/social weapon and an excuse to persecute individuals for things they did not do themselves". There is only the guilt of the oligarchy. If (and only if) the people in the western world say no to being peons in this game their oligarchy plays with their and the lives of other people, then they would do more for the peace in the world than all UN programs for the "third world".
I think Japan is actually a counterpoint to your argument. Post WW2 was not when it became a first-world economy. I'm pretty sure that when it first industrialized in the late 19th century, it did so under free-trade. (Its government wanted protectionist economic policies but the British forced free-trade on them!)
You are oversimplifying a tremendously complex issue. You can have a net positive wealth creation that's reserved for only certain economic sectors while leaving out everyone else. Absolute gains in economic growth are not really indicative of life satisfaction towards everyone in society
This only holds for developed economies and trade between peers. Developing economies is much better off protecting themselves against external competition. Of course developed markets would decry this "protectionism", they after all, only care about their own gain.
I'm curious if the commenter meant "free trade" in the sense it's used by most politicians, which is to say deals between nations involving trade, which is to say effectively the opposite of "freedom of trade."
I read the book a while ago, and the general point was that it is a misconception that capitalistic free trade was a driver of high growth in today's powerful western economies. These countries actually engaged in significant levels of industrial protectionism during key parts of their economic history.
I don't think the book was making a point about what is best for developing nations today, just attacking the the idea that laissez-faire capitalism built the US economy.
It's quite a good, short book, if you want to get a perspective on capitalism that's neither from a Communist or a university's Business & Commerce faculty.
Coincidentally, "the only reason most of us in first world countries are paid well has nothing to do with our own superior ability (eg. bus driver in India vs. Norway), but due to immigration control and the institutions we inherit" clearly explains why a bus driver in a first world country would/should vote for anyone who promises more immigration control and sticking to the institutions we inherited.
> money/capitalism tended to emerge with the rise of the state, taxing to feed soldiers for war
There is actually a musical about the way that the US federal government and financial system were founded in order to be able to provide capital for warfighting.
21 Things they don't tell you about Capitalism, Bad Samaritans (Ha Joon Chang) - Learned that free trade is generally bad for developing countries, countries need to build out high productivity industries to grow their economy in the long term and avoid a balance of payments deficit (unless blessed with oil or something), manufacturing is vital to a country's economy and its service sector, "free markets" are a constantly evolving political definition with numerous inherent double standards, the only reason most of us in first world countries are paid well has nothing to do with our own superior ability (eg. bus driver in India vs. Norway), but due to immigration control and the institutions we inherit.
Also looking for more book recommendations, so feel free to send some my way!