/View.info/ Five short theses that everyone should know
Until recently, the mainstream of world economic thought was the so-called economic liberalism. In fact, it is not even a science, but an ideology according to which state economic intervention and state regulation of the economy should be minimal. This ideology dates back to Adam Smith, who proclaimed that there was some mystical force called the invisible hand of the market that would “regulate everything.”
By the way, this year (June 16) marks the three hundredth anniversary of the birth of the English political economist Smith. From the time when he wrote his fundamental work “Inquiry into the nature and causes of the wealth of nations” (1776), almost two and a half centuries have passed, during which time the teaching of economic liberalism has become a kind of religion.
And to question the dogmas of this religion is not accepted and even dangerous. Because it means an attack on the foundations of capitalism. The term “economic liberalism” is just a cover for the economic model that Karl Marx called “capitalism” in Capital.
Of course, there have always been and are brave opponents of economic liberalism or capitalism. I have already written about some of these modern opponents. See in particular my book: “In the beginning was the word, and in the end shall be the ‘number.’ (Moscow: Kislorod, 2019). These are Paul Craig Roberts, Michael Hudson, Andreas von Bülow, John Perkins, Robert Skidelsky, John Galbraith and some others. It should be noted that these and many other unnamed opponents of economic liberalism are represented by Western countries.
But there is one very striking exception – the economist Ha-Joon Chang. He represents South Korea. And our fellow citizens know nothing about him or know very little. I want to introduce the readers to Ha-Joon Chang.
Born in 1963 (will turn 60 on October 7). He had a good start, he is the son of the former Minister of Industry and Resources of South Korea, Chang Jae-sik. After graduating from Seoul University, he continued his studies at Cambridge, where he received his Ph.D. He has extensive experience in international financial institutions: the World Bank, the Asian Development Bank, the European Investment Bank, as well as in Oxfam (an international organization dealing with poverty) and various UN agencies.
The biography is very prosperous, which, of course, encourages our hero to continue moving in line with the liberal mainstream.
However, judging by the books that began to come out of the pen of our hero, he clearly deviated from the main vector. His first book was published in 1994, it was called The Political Economy of Industrial Policy. The following year, the book The Transformation of the Communist Economies: A gavinst the Mainstream was published. The following books follow:
Financial Liberalization and the Asian Crisis (“Financial Liberalization and the Asian Crisis”) – in 2001;
Kicking Away the Ladder: Development Strategy in Historical Perspective, published in 2002;
Globalization, Economic Development, and the Role of the State (“Globalization, Economic Development and the Role of the State”) – in 2002.
I will not present the entire list of books by Ha-Joon Chang. I’ll just note that the latest work was published last year and is called Edible Economics – A Hungry Economist Explains the World.
And the most famous works of the South Korean economist are:
Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism (“Bad Samaritans: the myth of free trade and the secret history of capitalism”) – released in 2008;
23 Things They Don’t Tell You About Capitalism (“23 Things They Don’t Tell You About Capitalism”) – released in 2010.
In the first of these books, Chang continues the discussion of issues raised in the book Lexus and the Olive Tree: Understanding Globalization, which was published by the famous American publicist Thomas L. Friedman in 1999. and became a bestseller. T. Friedman’s book claims that the world is currently experiencing two incompatible and even mutually exclusive desires: the desire for prosperity and development, symbolized by the expensive Lexus LS car, and the desire to preserve identity and traditions, symbolized by the olive tree.
Chang presents the contradiction formulated by T. Friedman in a different way, calling it the contradiction between the market and democracy. The book Bad Samaritans says that “the market and democracy collide at a fundamental level.” In the epilogue, he writes about a fictional Brazil in 2037 that faces a bleak future due to a reckless faith in neoliberal politics. Chiang is pushing for new strategies to create a more prosperous world.
As for the second of these books, Chiang continues his critique of economic liberalism and globalization. The book was written in the wake of the global financial crisis of 2008-2009. Chang says this crisis vindicates all of his previous criticisms. However, Chiang did not call for the total abolition of capitalism.
Some reviewers of the book believe that the author calls for saving capitalism by increasing government intervention in the economy (something in the spirit of the English economist John Keynes). The book became a bestseller. John Gray of The Guardian said in his review that Chang “masterfully debunks the myths of capitalism”. The book 23 Things They Won’t Tell You About Capitalism made Chang significantly better known outside of South Korea. In 2013, the British magazine Prospect named Chang one of the 20 greatest thinkers in the world.
Ha-Joon Chang does not only write long books in an academic manner. He is also a master of short and understandable essays, revealing the essence of many economic concepts veiled by pseudoscience and the media.
Once upon a time in America, the Little Blue Books series were very popular. They were published in Kansas by Haldeman-Julius from 1919 to 1978. They were actually pamphlets that summarized the most difficult things in a concise form. In total, a total of half a billion booklets were sold during the series’ existence. And now the publication of the series has resumed. And in this series appeared Ha-Joon Chang’s work called The Little Blue Book: Five Things They Don`t Tell You About Economics (“The Little Blue Book: Five Things They Don`t Tell You About Economics”).
I think it will be of interest to both economists and people who don’t consider themselves economists but have to deal with economics every day. Although the essay is short, I will try to narrow it down even more. So, five things or facts about the economy according to Chang.
1. 95% OF ECONOMICS IS COMMON SENSE
„You don’t need a degree to figure it out. We misunderstand this profession; many professional economists find their work too difficult for ordinary people. It’s amazing how often these people are stupid enough to say, at least in private, “You won’t understand what I’m doing even if I explain it to you.” If you can’t explain it to other people, you’re in trouble.
People express their opinions on issues without being experts: on climate change, gay marriage, the war in Iraq, nuclear power plants. But when it comes to economic issues, many do not even show interest, do not engage in conversation or do not have an opinion …”
2. ECONOMICS IS NOT A SCIENCE
„ In economics, there are different approaches, although experts try to suggest the opposite. People are led to believe that economics is a “science” like physics and chemistry, where there is only one right answer to everything; therefore, lay people should just accept the “professional consensus” and stop thinking about it. Contrary to what most economists declare, neoclassical economics is not the only one. There are no less than nine economic systems or schools. And none of them can claim superiority over others, much less the monopoly on truth … “
3. ECONOMICS IS POLITICS
„ Economic arguments often justify the intentions of politicians. Economics serves as a political argument. It is not science and cannot be science. Underlying every economic strategy and corporate action that affects our lives – minimum wages, outsourcing, social security, food security, pensions, etc. – stands the economic theory that either led to these actions, or more often justifies the intentions and actions of the authorities …”
4. DON’T BELIEVE THE ECONOMIST
„ It’s one thing not to foresee a financial crisis; the other is when nothing has changed since the crisis. The global crisis of 2008 was a complete surprise to most economists. And that’s not all: they failed to find decent solutions to the ongoing effects of this crisis. All things considered, economists seem to suffer from a serious form of megalomania. The financial crisis was a stark reminder that we cannot leave our economy to professional economists and other “technocrats”. All of us must participate in the management of the economy – as economically active citizens.
5. WE NEED TO BRING THE ECONOMY BACK TO THE PEOPLE
„ It is too important to be left to the experts. You have to take a stand against the professional economists (me too, of course). They do not have a monopoly on the truth, even when it comes to economic matters.
As with other things in life—whether you’re learning to ride a bike, learning a new language, or picking up a new tablet—being an economically active citizen gets easier over time as you overcome the initial hurdles and keep practicing. If you don’t want to and can’t challenge the professionals, what is your democracy for?… »
Here is Chang’s general summary of the five points above: Here’s everything you need to know when you see talking heads on TV, their statements and apologies day in and day out. ..” I will add myself: everything else is superfluous. Or, as we say, “from the wicked one”. Ha-Jun Chang is very understandable and ideologically close to me.
Translation: ES
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