If you’ve found your way to this reading list you may be thinking, “I’m on board; I just need more details!” Or you may be thinking, “I’m not convinced, but I want to know more.” This reading list will set you on your way.
We have assembled here works by economists, historians, bankers, and more, all of whom take a fresh look at economic growth, sustainability, and equity, as well as successful efforts to confront problems on a national, regional, and even global scale. No one of these books captures the new consensus in its entirety; many perspectives—and, even more crucially, many kinds of evidence—are necessary in order to envision and build a future we can all live with.
Bad Samaritans is the best, globally-oriented account of how economic progress really happens. Ha-Joon Chang has written some other great new books (see below), but Bad Samaritans is the book to start with: it tells the full story of how the rich countries got rich. It wasn’t through individual innovations or brilliant investment or “letting the market be free,” but by trying as societies—by building institutions such as national investment banks, non-profit savings bank networks, state-owned or state-backed industries, infrastructure and education designed to promote industrial development, and so on. It’s not just history, either; Chang shows how all the countries today making economic and social progress are still using those kinds of institutions.
Concrete Economics tells much of the same story as Bad Samaritans, but focuses exclusively on the United States, and does so in language even more accessible to mainstream, economically centrist audiences. Cohen and DeLong show how over the course of American history, “the invisible hand [of the market] was repeatedly lifted at the elbow by government, and replaced in a new position from where it could go on to perform its magic.” Again and again, under different coalitions and with different aims, government intervened for the practical purpose of making America stronger, wealthier, larger; until in the 1980s, the interventions took a turn for the ideological, turning “free markets” into a false idol—and planting the seeds of today’s billionaire class.
Made in the USA
Made in the USA is one of Bill Gates’ favorite books–which is a great way to recommend it to friends still entrenched in the Old Consensus. Vaclav Smil shows that a country the size of the United States cannot hope to make a prosperous living without a strong manufacturing sector. The broader point, however, is that a nation must deliberately and constantly invest in its means of making a living. In the global economy, it is clear that nations that “let the free market decide” what they should do for a living decline to the bottom of the economic food chain.
The Entrepreneurial State
Learn about the biggest, baddest entrepreneur in history from Mariana Mazzucato. The Entrepreneurial State documents how virtually every innovative and dynamic part of the U.S. economy has been funded essentially by public venture capital. But it’s a very strange sort of venture capital that takes no stake in exchange for its investments (Why? Because, in the self-serving logic of the American wealthy, private=good, public=bad!). Learn how every cool piece of technology in your smartphone was developed by a company that was venture-backed by the U.S. government, decades before anyone else saw any practical application for the technology.
Try on a new paradigm with Kate Raworth. Doughnut Economics doesn’t just tell you what’s wrong with the current economics paradigm, it offers a whole new one to take its place. It’s exploding right now. I was visiting a think tank in Berlin, and the book was out on every desk.
Makers and Takers
Let Rana Foroohar introduce you to the good guys and the bad guys in Makers and Takers. Mitt Romney famously divided America into two camps, but Foroohar shows us who the real makers are, and the real takers. Makers are people who add value to our economy, as workers, entrepreneurs, caregivers, artists, parents and grandparents and others. The takers on Wall Street use the power of de facto government-insured credit and government bailouts to suck huge amounts of wealth out of the economy.
Learn how some scrappy right-wing activists and business leaders changed America’s mind about economics and created the consensus we’re now breaking away from. Kim Phillips-Fein takes us back a century and picks apart how we got into this mess. Know your adversary!
Check in with capitalism, with Mariana Mazzucato and Michael Jacobs. The financial crisis of 2008 showed two deep failures: not only did economic policy fail to prevent the crash, economics as an academic discipline failed to foresee it. Mazzucato and Jacobs bring together a crack team of economists to rebuild our understanding of modern economics, addressing the most pressing themes of weak and unstable growth, stagnating wages and standards of living, and climate change and other environmental risk. This handbook provides not only theoretical explanations of the evidence, but policy prescriptions based on that evidence.
Economics: The User's Guide
Go back to Ha-Joon Chang, for an objective, heterodox overview of the whole field of economics. “Every responsible citizen,” writes Chang, “needs to learn some economics,” and in this book he aims to give every citizen the tools to understand economic arguments and to distinguish good economics from bad. Don’t get hoodwinked by glib arguments from men in suits paid for by the rich and powerful to preserve their wealth and power.
Against the Consensus
Let Justin Lin clue you in to what the world economy looks like from Beijing. Five hundred years ago, China’s wealth was orders of magnitude greater than Europe’s (Europe, meanwhile, was starting to fill its coffers with South American gold and silver), and China sees the past half -millennium as a soon-to-be-corrected aberration in the order of the world. Justin Lin is one of the figures at the center of China’s current transformation.. After serving as the chief economist of the World Bank through the worst economic crisis since the Great Depression, he gives his take on what’s really going on. The measures taken to contain the crisis, Lin makes clear, are insufficient to forestall years or even decades of globally-depressed growth; bold, counter-cyclical government investment across the globe is badly needed.
The Production of Money
Then read Ann Pettifor’s book to prove to yourself that all this really is possible. In this book, Ann shows how in all of our societies, with all of our people, resources and technology, “we can afford what we can do.” Starting from key concepts in money, finance, and economics, and she shows how the economic institutions of the modern world, from governments and central banks through financial markets and private banks interact with the real wealth creators—across all industries and sectors. Understanding where money comes from and where productivity comes from, you’ll be ready to explain how the two things are really related (and it isn’t “let the people who already have the money decide!”).
The End of Alchemy
If you’re still not convinced, then read The End of Alchemy by the former governor of the Bank of England! Mervyn King dives deep into four driving forces in today’s economy: disequilibrium, radical uncertainty, the prisoner’s dilemma, and trust—and shows what we need to do, as governments and as a society, to build an economic future that we can all live with.
The Shifts and the Shocks
Then listen to mainstream Financial Times economics guru Martin Wolf. He’s going to admit to you that he and all his colleagues had it all wrong when they crowed about “austerity,” and come clean: it’s time governments start mobilizing many trillions of dollars in non-debt monetary expansion (creating money) for fiscal policy (investing in industry and infrastructure) again!
The Only Game in Town
And if one mainstream econ guy wasn’t enough, then read former PIMCO CEO Mohamed El-Erian who says it too. “This book,” he writes, "is not just about consequential destinations that affect the well-being of both current and future generations. It is also about the ongoing transition that is likely to feature even more improbables and unthinkables becoming reality.” As political and economic developments continue to shock experts, El-Erian’s analysis provides not only the tools to understand what’s going on, but his policy prescriptions—starting from the breakout proposition that democratically-elected governments must intervene in the economy beyond central bank activity—can help avert the worst of these shocks and build a broader and more stable base of economic growth.
And now that you know we need to launch a massive national rebuilding project in every nation, it’s time to learn about some of the ways that nations have done this in the past. Have your breath taken away by Freedom’s Forge, and its account of the massive public-private alliance that won World War II. This book is written by a hard right-wing historian, which makes it all the better to read. He provides a great model here for how to explain a national economic building project in terms that conservatives will like.
Then read a much better-researched and objective account of the mobilization for World War II in Mark Wilson’s Destructive Creation. Accounts of American arms production—“the arsenal of democracy,” in Roosevelt’s memorable phrase—have centered the business leaders of the time, portraying them as patriotic heroes (in the right-wing narrative) or as rapacious villains and war profiteers (in a left-wing understanding). Wilson cuts these business leaders down to size; while their motives were mixed, he shows, they just weren’t as important as either account makes them. Rather, America’s mobilization was managed by dedicated government public servants as much as by businessmen.
When Small States Make Big Leaps
Next learn about how some other countries have mobilized just because they decided to, not because they were under the pressure of war. Like Finland and Denmark, who used many institutions, such as public venture funds, that can inform our vision for what is possible in the twenty-first century.
The Park Chung Hee Era
Learn how fruit- importer Samsung became a global powerhouse—and many other incredible tales—from the complex and conflicted Park Chung Hee era. South Korea entered the 1960s with virtually no economy, a mostly illiterate population, and very few resources—and built a modern, wealthy economy almost in a single generation. Many believe that they were favored by huge investments from the United States, but the U.S. was actually very stingy with South Korea. The country used public funding, and tight coordination—even micromanagement—of firms.
MITI and the Japanese Miracle
The South Korean story had its origins in the story of the post-war Japanese model. We’re all familiar with the big Japanese industrial conglomerates—Yamaha, which produces everything from motorcycles to concert pianos, for example—and on first glance they may seem to be examples of unrestrained capitalism, reminiscent of the Gilded Age monopolies in the US like Standard Oil and US Steel. But as Chalmers Johnson shows, these corporations represent a totally different—and vastly more successful—model: significant, sustained, and high-quality intervention from the Japanese government. The “Japanese miracle” of decades of economic growth and synonymy with high-quality, low-cost manufacturing was not accidental but created and sustained by Japan’s Ministry of International Trade and Industry.
Why Europe Grew Rich and Asia Did Not
Get the really big picture with Why Europe Grew Rich and Asia Did Not. The short answer: It’s because barbarians on horses (or ships) are fully capable of taking over giant, advanced empires. It happened all the time through history… The Mongols, and then Manchus, taking over China; the Moguls taking over India. And so on. Britain taking over India and China was part of that same tradition. It’s a sucker punch, but it works. The internal ruling class tends not even to mind, because they’re so sick of their own rulers—that helps the invaders. The barbarians move into the palace and soon become locals. But the Industrial Revolution changed this longstanding pattern and made this kind of conquest incredibly destructive for the conquered. Because of the Industrial Revolution and the nationalist project that had begun in Britain, the conquerors now merely wanted to extract resources to feed coal-powered factories back home that sucked more wealth back to the whole British People. And why did the Industrial Revolution get started in the first place? To compete with the overwhelming dominance of Chinese and Indian industry (much like Japan’s and now China’s leap ahead of the US in industrial innovation).
Get a deeper overview of the emerging consensus from a whole range of economists – including:
- The Failure of Austerity: Rethinking Fiscal Policy (Stephanie Kelton)
- Understanding Money and Macroeconomic Policy (L. Randall Wray and Yeva Nersisyan)
- The Costs of Short-termism (Andrew Haldane)
- Innovative Enterprise and the Theory of the Firm (William Lazonick)
- Innovation, the State and Patient Capital (Mariana Mazzucato)
- Investment-led Growth: A Solution to the European Crisis (Stephany Griffith-Jones and Giovanni Cozzi)
- Inequality and Economic Growth (Joseph Stiglitz)
- The Paradoxes of Privatisation and Public Service Outsourcing (Colin Crouch)
- Decarbonisation: Innovation and the Economics of Climate Change (Dimitri Zenghelis)
- Capitalism, Technology and a Green Global Golden Age: The Role of History in Helping to Shape the Future (Carlota Perez)
We can't afford to keep the status quo.
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