Capitalism

Books Reviewed:

An Idol Unmasked: A Faith Perspective on Money by Peter Selby

And the Weak Suffer What They Must? by Yanis Varoufakis

Aquinas and the Market: Toward A Humane Economy by Mary Hirschfeld

Capital and the Kingdom by Tim Gorringe 

Crumbling Foundations by Guy Brandon

Economics for the Common Good by Jean Tirole

Good News to the Poor: John Wesley’s Evangelical Economics by Theodore Jennings

How Will Capitalism End? by Wolfgang Streeck

Humanomics: Moral Sentiments and the Wealth of Nations for the Twenty-First Century by Vernon L. Smith and Bart J. Wilson

Platform Capitalism by Nick Srnicek

Redeeming Capitalism by Kenneth J. Barnes

Saving Capitalism: For the Many, not the Few by Robert Reich

The Community of Advantage by Robert Sugden

The End of Growth: Adapting to Our New Economic Reality by Richard Heinberg

The Ethical Capitalist by Julian Richer

The Job by Ellen Shell

The Spirit of Democratic Capitalism by Michael Novak

With Liberty and Justice for Whom? by Craig Gay

 

Christian Viewpoints:

Christians have long debated the merits or otherwise of the free market without ever reaching a consensus. With this in mind, we have reviewed the two books that, better than any others, reflect the two main approaches that Christians have adopted over the past century: The Spirit of Democratic Capitalism by Michael Novak (published 1982) and Capital and the Kingdom by Tim Gorrince (published 1994).

The Spirit of Democratic Capitalism strongly advocates a free market approach. It was published at a time when the terms “capitalism” and “the free market” were used in many Western Christian circles with contempt and many Christians believed that socialism was the only legitimate Christian option. It played a leading role in changing that position and it is still worth reading today as a clear justification of what it calls “Democratic Capitalism”.

Capital and the Kingdom comes from an essentially Marxist viewpoint and it may be felt that this is now so dated that it can be of no more than historic interest. However, the ideas set out in it are often heard from the mouths of bishops and other church leaders and there are signs that they are making a political comeback. It is thus important that their theoretical basis be understood and analysed and this book contains a clear exposition of them.

Those interested in the range of Christian views should also read With Liberty and Justice for Whom? by Craig Blomberg. It analyses the spectrum of conservative protestant views about capitalism. It is also quite old (published 1991) but remains valuable as an overview of the various approaches and the issues raised in it are of continuing importance. Indeed, there would be merit in reading it before reading any Christian analysis of capitalism since it will help lay bare the theological and other factors underlying such analyses.

Good News to the Poor by Theodore Jennings (published 1990) provides an historical perspective. It is an examination of the economic views of John Wesley. It is thus a more specialist book than most of the others that we have reviewed and many people will feel that they can give it a miss. Furthermore, as Richard Turnbull’s review indicates, the book does not always reflect Wesley’s thinking in a balanced way. However, it is wise to allow the views of Christians from past centuries to challenge our views today and consideration of John Wesley’s views on economics may still have a role to play in developing our thinking.

The other books that we have reviewed all set out recent Christian thinking on the economy but they have very different angles on the relevant issues.

Redeeming Capitalism by Kenneth Barnes (published 2018) sets out to point the way to the reform of current western capitalism.  Barnes suggests that this suffers from serious flaws that derive from a “moral vacuum”.  However, he does not reject capitalism as a whole.  Rather he suggests that we need to replace “post-modern capitalism” with “virtuous capitalism”.  Unfortunately, although it is interesting in parts, the book is superficial: it is long on eye-catching statements and short on justification and it presents no ideas as to how in practice the desired change might be effected.  It does not advance the debate about practical reform.

Aquinas and the Market: Toward A Humane Economy (published 2018) is certainly not superficial.  Mary Hischfield has doctorates in both economics (Harvard) and theology (Notre Dame) and she seeks to bring Thomist thought to bear on current economic issues. This may suggest that the book is heavy going but, although complex, it is readable and worth reading. It offers a perspective on the underlying purpose and functioning of a market economy that is very different from those with which most people are familiar.

Crumbling Foundations (published 2016) is only 40 pages long and it focuses on a single, specialist subject: it is, it claims, “A biblical critique of modern money”. Many people will wish to take issue with its application of a number of passages of the bible and others will find some of the issues too specialised for them. However, it is a good introduction to some of the issues raised by the modern global financial system.

An Idol Unmasked: A Faith Perspective on Money (published 2014) is by Peter Selby, the retired former Anglican Bishop of Worcester. It is a polemic against modern money and sets out an attitude to money that is widely held within the Church. It may be worth reading for this reason alone. However, it does not have anything materially new to say on its subject and it does not contain a balanced appraisal of the complex issues that arise out of the modern monetary system. Hence, those wishing to consider these issues are probably best advised to start elsewhere.

 

Contemporary Issues:

We have reviewed a number of recently published books relating to current issues in western economies. With the exception of the first mentioned below, these are broadly hostile to capitalism as a system (at least in the form currently experienced in the West).

Economics for the Common Good by Jean Tirole (English edition published 2017) is an outstanding book written by one of the finest minds of our time. It is long (563 pp) but it is aimed at the general public and Jean Tirole, is masterful in using simple language to convey highly complex issues. It focuses on both the purpose of economics and the challenges that the world now faces. Although no book is value free and few readers will agree with all that Tirole says, he does not adhere to any clear cut ideological line, leaving the readers free to make up their own minds.

The Ethical Capitalist by Julian Richer (published 2018) is by no means uncritical of modern capitalism but Richer believes that it is the only viable economic system and, when pursued responsibly, a force for good.  He thus focusses on what “good capitalism” looks like, drawing on his experience as a successful entrepreneur.  Some of his comments lack depth but he makes many challenging points and the result is a book that, overall, is compelling, well evidenced and convincingly nuanced.

Although recently published, How Will Capitalism End? by Wolfgang Streeck (published 2016) largely comprises a collection of previously published papers, which gives it an unstructured feel. It is deeply pessimistic in tone and the author’s structuralist view of society pervades the analysis. This viewpoint needs to be understood and considered but this book does not provide positive suggestions and its approach is philosophically flawed.

The End of Growth: Adapting to Our New Economic Reality by Richard Heinberg (published 2011) is also gloomy in tone.  It suggests that economic growth as we have become accustomed to it over the past century or so is over and done with.  It is well written and thoroughly researched but those looking for a balanced account of the long-term economic outlook should look elsewhere.

Platform Capitalism by Nick Srnicek is a wholly new book (published 2017). It has many defects and, were it longer, these might outweigh its merits. However, it is short and is worth reading as a brief analysis of the digital age phenomenon of “platform companies”. It should assist understand of the way in which the business world is moving and reduce the risk of outdated solutions being proposed to modern business problems.

Saving Capitalism: For the Many, not the Few by Robert Reich is another recent contribution to the debate (published 2016). It also comes from the left of the political spectrum (although it is not Marxist) and it sees redistribution of wealth and other activist governmental intervention as the solution to the issues that it perceives exist in capitalism. It is more polemical and directly political that most of the other books that we have reviewed but it is a worthwhile read. Although we have categorised it as a book about capitalism, much of its concern is about poverty and might be read alongside Wealth, Poverty and Politics by Thomas Sowell (see our reviews relating to “Wealth and Poverty” in the tab below) which advocates a radically different, free market, approach to the alleviation of poverty.

And the Weak Suffer What They Must? Europe, Austerity and the Threat to Global Stability (published 2016) was written by the Professor of Economics of the University of Athens (Yanis Varoufakis) who, as Finance Minister of Greece, was at the heart of the bail out negotiations between the EU and Greece in the first half of 2015. It analyses key aspects of modern European economic and political history and draws some depressing conclusions as well as implicitly imposing some important questions relating to the direction of politics and economic policy in Europe.”

The Job by Ellen Shell (published 2018) considers the issue of the future of work in the digital age.  It is an easy read and includes memorable stories and phrases.  Unfortunately, however, it is deeply flawed.  Whilst many will enjoy reading it and will be stimulated by parts of it, those who are seeking careful analysis and clearly worked through proposals need to look elsewhere (perhaps to some of the other books that we have reviewed).

 

The Implications of Behavioural Economics:

We have reviewed two very different books that consider the implications of the findings of modern behavioural economics:

Humanomics by Vernon Smith  and Bart Wilson (published 2019) resurrects Adam Smith’s first book, The Theory of Moral Sentiments, to explain the results of modern two-person trust gain experiments. The authors suggest that Adam Smith’s theory has a predictive force that is lacking in the concept of utility maximisation, which has been a governing model in economics for many years. The book is thought provoking and, although not an easy read for the non-specialist, should be read by those who want to think further about human economic behaviour.

The Community of Advantage by Robert Sugden (published 2018) also addresses the results of modern behavioural economics.  It aims to meet head on the challenge that these present to the liberal tradition.  Robert Sugden shares Hume’s scepticism about human rationality and rejects previous attempts to meet this challenge on the basis of assumed “latent preferences”.  He suggests that the use of what he calls the “Individual Opportunity Criterion” is the key to doing so. The book is heavy going and many will question Sugden’s moral relativism but it is worth persevering with it.