Book Reviews, Business & Money, Charles, Economics, Political Economy
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Straight Talk on Trade: Ideas for a Sane World Economy (Dani Rodrik)

I find that my hit percentage on economics books is about fifty percent.  One out of every two books I read is excellent, and the other is awful. Very little seems to be in between.  Unfortunately for me, this book is in the latter group.  It is supposed to be, I think, an effort to show that a mainstream economist can be less than totally enthused about unlimited free trade and “hyper-globalization,” without being on the side of Trump or “illiberal democracies,” and without giving up his neoliberal ID card.  But Straight Talk on Trade is just a mess.

Why that is so is given away in the Preface.  The reader’s heart drops when Dani Rodrik informs us this is not a fresh book, but merely a compilation of “my monthly syndicated columns, as well as a few other short and lengthier pieces, [of which] I have done only a light edit of the original text.”  In other words, this is simply a mélange of rewarmed offerings done earlier on a deadline, not tied together in any meaningful way, other than that the theme is “economics.”  It is not the “visionary framework” promised by the dust cover; rather, it is what is known as a “money grab.”  I should have stopped reading there.  But I did not.  I suffered that you may avoid suffering.

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Holistically, Rodrik’s project seems to be to rescue globalization from its excesses.  That is, he is a neoliberal in good standing, no doubt chummy with George Soros and Pankaj Mishra, but he is afraid that the evil populists are given ammunition by economists and politicians who over-promise what globalization has to offer, and then under-deliver the social goods to their constituents.  Not for Rodrik, therefore, fantasies about emerging global governance or the demise of the nation-state.  Instead, he preaches that the nation-state has to be run by clear-eyed politicians who will save us from the populist beasts.  In this project, though, he has to walk a tightrope, since he can’t afford to be seen as an ally of the beasts—but he agrees with some of their points, such as that the Trans-Pacific Partnership was probably a bad idea, and that perhaps we should note that some people are made worse off by globalization.

To the end of rescuing globalization, from its excesses and its enemies, Rodrik offers twelve chapters, each just copied from his earlier work.  Concepts and phrases frequently overlap and are repeated, so it is hard to tease out a set of principles, much less a “visionary framework.”  But if you poke at the pile enough, several basic points, all simplistic and unoriginal, pop out their heads.  First, economics is hard and non-specific, and economists too often express pithy certainties to the media which they do not really believe in their unqualified form.  Second, gains from free trade are unevenly distributed, within any given country, and between countries as well.  Third, developing countries that are not yet developed may have trouble developing to First World standards, due to structural limitations in the global economy.  Fourth, although each country should choose its own path, developing countries will pay no cost at all if they immediately implement a full-scale social justice regime as they develop, and in fact all developing countries are morally obligated to do so.  Fifth, democracy, but only approved forms of it, is just awesome, and an economic tonic like none other.

Surrounding these points, like a mist of stinging insects, are tiresome obeisances to the imperative need for more “liberalism” for everyone in the world (meaning, of course, policies dictated by the Left that aggressively implement emancipation and individual autonomy are the only ones allowed), demands for more action against global warming, claims how unspecified “green technologies” and “green industry” are needed to save both the world and its economies, demands for how we must have increased global redistribution to achieve “social legitimacy,” and innumerable vague calls for “social justice.”  Punctuating this cloud of annoyance are jarring uses of obscure economics-speak without any clarification, such as “a corner solution” and “economists’ beloved Arrow-Debreu model of general equilibrium.”  And framing it all are constant preening references to “my [other] book, so-and-so,” used as a shortcut to avoid actually demonstrating a point.

Moreover, all the writing in this book has an odd characteristic; it may come from Rodrik being excellently educated in English, but only as a second language (he’s from Turkey).  That characteristic is that every paragraph seems very clear—but at the end of it, or of a series of paragraphs, the reader is basically unsure what was actually said.  I can’t figure out why.  Maybe there is little substance.  Maybe there aren’t enough thesis statements buttressed by reasoning.  But you can read page after page and you get a feeling like cotton candy—you think there should be something there, and it felt like there was something there, but it melted away leaving no trace (and without leaving a sweet taste).  It is most disturbing.

Weird errors abound, as well.  It is not true that American unemployment checks come from the federal government.  “Civil rights” is not the same thing as “the rule of law”—in fact, Rodrik’s lengthy discussion trying to show how some “electoral democracies” are not really democracies, because they are “illiberal,” may take the cake for the most confused discussion of core political concepts I have ever seen offered by a major author.  “Culture shock” does not mean “situations where our expectations about people’s behavior turn out to be so wrong that we find ourselves jolted by the experience.” Every so often, to be fair, there is something interesting, such as a solid attempt to resurrect mercantilism, properly defined and updated, as a counterpoint to classical liberalism (although this is somewhat undercut by a total failure to understand that government regulation of, and government support for, business are not the same thing).  But mostly, as I say, it is just a mess.

Ultimately, what this leaves us with is mushy analysis and prescriptions that are vague bromides or simply incoherent.  The topics here are much better covered in Clyde Prestowitz’s The Betrayal of American Prosperity (in fact, it was Prestowitz’s review of this book that caused me to buy and read it), or Richard Baldwin’s The Great Convergence.  Or even in Robert Gordon’s The Rise and Fall of American Growth, if the topic is relative amounts and impacts of innovation over time.  And as far as political structure, Francis Fukuyama offers a coherent neoliberal perspective and analysis, something utterly lacking here.  If you read those books, then read this book, you will go backward, so just read those books.

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  1. Your consistency and depth in your articles are amazing. How many books do you read a year? How much time do you spend reading? How long do your blog posts take?

    I really enjoy your blog and reviews, but, and if your not opposed to it, I’d like to know just a bit more about you. Not personal information, just an overview of what started this very unique, though highly beneficial relationship bookwiths that you seem to have. Honestly it’s something I’d like to emulate, but I’ve been unable to so far.

    Regardless, thanks for the post.

    • Charles says

      Thank you! Recently, about 125, I’d guess. Most of those get reviews, for the past two years. My guess is that reviews may slow down at some point–for example, you can only read so many books about the problems of modern Europe, without it being repetitious (and depressing). I will probably turn to in-depth topic analysis at some point. On the other hand, I read fast–probably a page a minute for dense books (far faster for fiction, though I read little fiction), and write fast (each review takes 2-4 hours, complete, I’d guess).

      I’ve always read a fair bit, but one of the problems I noticed is that because I don’t have a good memory, I tend to forget everything I read quickly. That is both bad in itself, and prevents a coherent framework of thought from developing. Hence the reviews–it fixes the books in my memory, and also thereby (and by going back and refreshing my memory by reading the reviews) allows reading to build on itself. This has been very useful to me. So, as I say elsewhere, I’d write the review even if nobody read them. But people seem to like them, so everybody wins!

      I am helped by that I have lots of spare time–I run a business that, now, requires little attention from me, and gives me a lot of money. A unique and favorable position, to be sure.

  2. Charles

    I’d love your take on A Capitalism for the People (Recapturing the Lost Genius of American Prosperity). It’s got endorsements from both Paul Ryan and Brad DeLong (a liberal economist), and talks about the flaws with our current “capitalist” (but not really) economy.

    And a very short book that I recently read (on the advice of others) and simply can’t say enough good things about: Lessons of History by Will and Ariel Durant.

    Lastly, some of my recent thinking about society has been informed by What Money Can’t Buy: The Moral Limits of Markets by Michael J. Sandel.

    Keep up the good work!


    • Charles says

      Oh, I love Zingales and his book (though I read it before I started doing reviews). In fact, yesterday I discovered that Zingales, since January, has been doing a podcast on “Capitalisn’t,” along with a Georgetown finance professor. Now, I’ve never tried podcasts, but I did try this, and they are outstanding. Highly recommended.

      Durant I have not read, though I did read a book (“Blue Collar Conservatives”) that covered him and his wife. (No review because I wrote one and it was bad, and I couldn’t get it to be good; that happens sometimes.)

      I will check out Sandel’s book!

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