False Economy

by Alan Beattie


Not knowing anything about the book or author besides that I saw it on a friend’s shelf and it looked interesting, I spent the first 50 pages or so trying to figure out what Beattie’s agenda was — his arguments were so bland and middle-of-the-road that he was difficult to get a bead on.

Then some hints started to drop: he compliments the IMF; he criticizes protectionism; he defends oil companies and later the WTO. So it actually becomes embarrassingly obvious that he’s one of these soft-spoken “moderates” that are really conservative neo-liberals.

He’s not a belligerent conservative though, which is probably more annoying and disconcerting. He couches his arguments, much like The Economist magazine, in these matter-of-fact truisms that he wants you to read as if they are common sense and the height of logic. Actually, however, they’re mere opinions based on who-knows-what. We might know the basis if he decided to offer even a modicum of support for his arguments, but he doesn’t. He just wafts them out there and breezes onward. Here’s an example in his defense of free trade:

There is still relatively little trade between far-flung regions compared with that between close neighbors. There is also surprisingly little trade between rich and poor countries. Most trade today is in fact in fairly similar products and services between fairly similar countries, not between very different economies exploiting big innate advantages over their trading partners. 193

This would have been a great time to provide some statistics and explain some of his language. For instance, who is this “surprising” for? Just the author? Opponents of free trade? And what does he mean by “most trade?” 51%? 75% This is a terrible way to try and make a point. Woe unto the people who are convinced by such tripe! Here’s another:

But India’s overall literacy rate remains low. The official rate is around 65 percent, though many of those can probably do little more than write their names. Much of the money supposed to go to education is siphoned off by a huge bureaucracy and a corrupt political class. 283

This is just embarrassing in a supposed work of non-fiction.

So despite being ably written, it’s both horrendously and deceptively argued, which ejects most of Beattie’s credibility from the proceedings. On top of that, Beattie continually disproves his own thesis throughout the book.

Both the book jacket and Beattie (in his preface and many other times) claim that he is trying to show that economic destinies are a result of choice, not predetermination. Yet there are over a dozen comments in the first chapter alone arguing that Argentina is screwed because of factors outside of its control (most notably its Spanish heritage). I struggle to reconcile the two claims. It’s either Argentina’s fault, which I feel like is what Beattie really wants us to believe, or it’s due to circumstances, which is what I actually believe.

These sorts of self-rebutting arguments occur throughout the book. He acknowledges that the economic travails of Islamic countries have “a lot more to do with accidents of geography and history than with the theology or ‘management structure'” (i.e., the choices) of Islam. He recognizes that Africa’s terrible market infrastructure “owes something to geography and history.” He even cites Guns, Germs, and Steel — the modern bible of cultural predestination — to explain African history.

The more I read, the more confused I became. Here you have a book called “False Economy: A Surprising Economic History,” and Beattie has his tone that he’s going to lift a veil from your eyes. It’s supposed to be subversive, or at least counterintuitive, and his thesis kind of is, I guess, except that he concludes with, “Often, taking the right path is more than one country can do on its own,” and, “. . . it still takes large amounts of courage, luck and strength to find a better path.”

So his thesis is basically, “A country’s fate is not predetermined but due to the choices it makes, except for when it can’t make any other choices.” This means nothing, like saying it’s sunny except when it’s raining. Or maybe that aliens control our thoughts except when they don’t. There is NOTHING HERE!

Overall, I get the impression that Beattie is trying to pull a Malcolm Gladwell with this book and failing miserably. To be sure, some of his anecdotes are interesting, but only some of them, and none of them seem quite as clever as he thinks they are.

But there’s something else that I alluded to above. Beyond this lack of any real substance or meaningful arguments, there’s a very dangerous mindset. Beattie’s presentation is misleading and thus dangerous, that aw-shucks, vanilla way in which he states his (many times groundless) opinions as fact. But his mindset as a whole is dangerous in that he only sees things through a lens of economics. Things are only good and bad insofar as they positively or negatively affect national and global economies.

For example, Beattie (poorly) argues that: people should be charged more for water; food security is bad; poor countries need rich multinationals to exploit their natural resources; corruption can be better than honesty; and pandas are worthless. I’m serious about that last one — he really thinks that an entire species is “worthless.” I’ll be honest, I couldn’t care much less about pandas, but the paradigm that encourages you to consider them or any other living thing as “worthless” is sad, twisted and scary. There are more important things than money, people!

Many people will accuse me of being a dirty tree-hugging hippie for these arguments. I gladly admit I lean left, but not nearly so far as I used to. What I dislike most about the book is its deception. And for those who disagree with this review, please do two things: read Malcolm Gladwell or Freakonomics and tell me it’s not more entertaining; and then read Open Veins of Latin America, the famous liberal economic treatise, and tell me it’s not better-argued (see my review).



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