Books and Arts; Book Review;Money and the markets
Two new books probe the limits of capitalism
How Much Is Enough? Money and the Good Life. By Robert Skidelsky and Edward Skidelsky.
Most policymakers, and the economists who advise them, believe that the rich Western economies have suffered a mechanical malfunction. With the right monetary, fiscal and regulatory tools, the growth machine will eventually whirr into life. Others think the West's true malaise is not mechanical but moral: a love of money, markets and material things.
“How Much Is Enough?” and “What Money Can't Buy” are well-argued versions of this second view. In the former, Robert and Edward Skidelsky, a father-and-son pair of British academics, take as their text an essay written in 1930 by John Maynard Keynes. Keynes (of whom the elder Skidelsky has written a three-volume biography) mused that within a century “the economic problem” would be solved: in rich countries people would be at least four times wealthier, on average, and have to work perhaps 15 hours a week. He looks right about living standards, but horribly wrong about working hours.
In the rich world the modern economic problem, the Skidelskys say, is how to live well amid plenty, not how to survive amid scarcity. Yet the West still chases slavishly after ever-higher gross domestic product, a purely material measure that takes no account of the blessings of nature or leisure. Humanity has become insatiable, in short. It is time to stop and rediscover the “good life”. This they identify with a list of “basic goods”: health, security, respect, “personality” (autonomy, if you prefer), harmony with nature, and leisure.
You might expect the Skidelskys to make common cause with those economists who believe that maximising “happiness” should be the goal of public policy. Not a bit of it. What makes people happy, they argue, is not necessarily good. They have little time for statistical measures of happiness—or the pursuit of any single metric. That would imply that the elements of the good life could be traded off against each other, which they deny. Nor do the Skidelskys ally themselves with environmentalists. Greens reject growth because they believe it cannot be sustained without wrecking the planet. But what if it can? Better, say the Skidelskys, to pursue the good life for its own sake.
Capitalism, they note, has “made possible vast improvements in material conditions”, but it also fuels human insatiability. One way it does this is by “increasingly ‘monetising' the economy”. Monetisation is what vexes Michael Sandel, a Harvard political philosopher, in “What Money Can't Buy”. Mr Sandel poses a single question: has the role of markets spread too far?
He argues that it has, and packs his book with examples. Some, such as the sale of a poor man's kidney for transplanting into a rich man's body, will make many people squirm. Others, such as the sale of naming rights for sports stadiums, may yield only a resigned shrug. But almost all give pause for thought. Mr Sandel poses two objections consistently. One is inequality: the more things money can buy, the more the lack of it hurts. The other Mr Sandel calls “corruption”: buying and selling can change the way a good is perceived. Paying people to give blood does not work. Giving schoolchildren money as an incentive to read books may make reading a chore rather than a lifelong pleasure.
Mr Sandel does not say precisely where he thinks the limit should lie. That should be left, he hopes, to public debate. The Skidelskys are bolder, proposing policies that would encourage the pursuit of the good life rather than endless growth: a basic income; a tax on consumption rather than income; and an end to the tax-deductibility of company spending on advertising. This would reduce the incentive to work and the temptation to consume.
Does the rat race always detract from the good life? Only a few years ago, it would have been hard to imagine that whole libraries of books, music and information could be summoned to a phone in your palm; yet the pursuit of profit has helped to put them there. Nevertheless, “How Much Is Enough?” is a good question. Even if just now the West could do with more, not less, GDP, the pursuit of wealth for its own sake is folly. Anyone who sets store by capitalism and markets will find both books uncomfortable reading. They should be read all the same.