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Book Club meeting

The book club meets at the Madhatter in south Dupont.  The book is "Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism" by Ha-Joon Chang

http://www.amazon.com/Bad-Samaritans-Secret-History-Capitalism/dp/1596915986/ref=sr_1_1?ie=UTF8&qid=1362538217&sr=8-1&keywords=bad+samaritans )

 

I will make a reservation for the group under the name Andrew.  Just ask for the Andrew/Book Club table when you get there.

 

 

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  • Steve

    Jack - There may not be any examples of pure free trade economies, but there are countries that are more or less free and examples of countries moving along that scale. Those can be used to test my theory. I gave you 3 examples in my last post. Indian growth before and after they moved away from Chang's ideas, Chilean growth as they've became more free and Argentina sinking into depression as they became less free.

    That's hardly saying no ones ever tried my ideas. There are dozens of other examples we can talk about.

    Why haven't more countries tried this route? Easy. Politicians love handing out goodies funded by other people's money and businesses love protectionism as long they are the ones being protected. So no one in power has an incentive to move to free trade, even though it would help everyone.

    Occasionally a free trade type will slip through the cracks, like Jimmy Carter. But for the most part we have to fight like hell for ever gain while they just roll along.

    April 9, 2013

  • Jack M.

    Steve, All of your examples are of companies that failed because they did not receive protectionism (which certainly may have been the wiser decision). Toyota is an example of a company that took 17 years to overcome its limitations. It could have been Solyndra, but it wasn't because the government refused to let it fail.

    The newest news is that all of the BRIC countries are demonstrating declines, and one might ask how much this has to do with their persuit fo free trade! I have no opinion on this matter.

    I still think you are looking for pie in the sky. Why hasn't free trade been tried to the degree that you think necessary. Polanyi has a very persuasive theory. Just like bad protectionism, free trade is not the answer. When it has been tried in the past, governments saw the folly and restructured their economies. Libertarians always have the excuse that nobody ever really gave it a chance. They are like the religious who just believe you haven't prayed long .

    April 7, 2013

  • Steve

    Jack - You're right. No developed country got rich without also having protectionist policies. But that's because we started in a state where all governments engaged in protectionism. It's not like there was a mix of free trade and protectionist states and the protectionists out-grew the free traders.

    India is a great example. When they were following Chang's proposals, they languished for decades. It wasn't until they started moving toward free trade that they finally overcame "the Hindu Rate of Growth". Chile is another good example. Today they are the 6th freest economy in the world and have the highest real growth in Latin America. Argentina OTOH, is following Chang's inflation recommendations and their economy is melting down. Chang predicted just the opposite.

    Regarding Toyota, that's more of Chang's cherry picking. For every Toyota Chang can name, I can name a hundred Fiskers, Solyndras, FirstSolars and A123s.

    April 7, 2013

  • Jack M.

    Their only defense is a purely selfish one that rich nations use to protect their own success, denying developing nations the benefits that all successful nations have used to insure their own success.

    I am sure that the US is sorry that it did not destroy Samsung and Toyota when it had a chance. It is that knowledge which is the motivation of the free trade ideology of the Unholy Trinity.

    April 7, 2013

  • Jack M.

    Chang does not argue that any formula is ideal in all situationa, but only that no formula is universally ideal. His book is merely an agrument that the simplistic free trade concept is obviously a mistake in many situations and needs to be discarded in many cases until certain industries are viable.

    Keep in mind that Chang is only demonstrating that the preconceived ideas of the free trade ideologies are naive and demonstrively ineffective, especially for developing nations. He never argues that there is not a role for free trade, just that the unholy trinity's pre-conceptions are proven by history to be little more than niave ideals which have over and over hurt developing natures rather than helping them.

    April 7, 2013

  • Jack M.

    Steven, Your analysis is absolutely amazing. Chang provides example after example, as has Polanyi in The Great Transformation,providing historic fact after fact and what do you come up with? That these examples only proved successful for other reasons, which you never provide. You assert, never argue.

    Where are the examples of free trade helping any developing country to become a successful economy. I agree that protectism enabled success with a wholelot of down side. I am with Chang in believing that there is no ideology that provides simple formula for success. No ideology, not even Protectionsim, can be depended upon for success. No ideology is the anwer in all situations or times.

    How can you begin to suggest that no industries ever need wise protection from competition that can drive it out of business before it is stable enough to compete with the big guys.

    April 7, 2013

  • Steve

    At Monday's meeting I tried to make the case that the developed world didn't get rich because of the policies Chang promotes, we got rich despite them. Protectionism and central economic planning diverts resource from productive enterprise to cronies. It makes the poor poorer and holds back the country while enriching the well-connected.

    More evidence for this from the LA Times. Fisker Automotive, maker of $100,000 luxury hybrid sports sedans, is going bankrupt and sticking tax payers with a $192M in loan guarantees.

    Fisker was one of the "infant industries" Obama wanted to protect. It worked out as well as most infant industries do.

    And look at the DOE's defense of the loan program, "more than 90% of the $10-billion loan loss reserve that Congress set aside for these programs remains intact.”

    It's only been 4 years and they've already lost 10% of their 'investments'?

    http://www.latimes.com/business/autos/la-fi-hy-fisker-layoffs-20130405,0,6997582,full.story

    April 6, 2013

  • Jack M.

    Excellent

    April 2, 2013

  • Andrew

    Ok. Unless anyone else wants to weigh in, we stick with Monday then. Thanks for the feedback.

    March 22, 2013

  • Kiahana

    I cant make it Tuesday due to work commitments

    March 21, 2013

  • Andrew

    If I moved this meeting to Tuesday, April 2nd, would that impact the ability of anyone who has RSVP'ed to come? I am selfishly thinking of moving it because of something that came up for me, but only if it is not an inconvenience to anyone else.

    March 21, 2013

    • Steve

      The 1st works better for me, but I could do the 2nd.

      March 21, 2013

  • Leif P.

    I need to spend some time digesting on some of the ideas I heard and came up with from previous meetings...

    March 7, 2013

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