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Keywords: Free market economics, libertarian, globalisation

Title: In Defence of Global Capitalism

Author: Johan Norberg

Publisher: Cato Institute

ISBN: 1930865473

 

The title itself is something of a challenge. It's confident, unapologetic and straight to the point. For those readers who are instinctively anti-capitalist the title alone smacks of deliberate confrontation. Isn't it the anti-capitalists who are supposed to be strident and ideological? Aren't pro-capitalists supposed to be apologetic, almost ashamed of their belief in a system of exploitation and oppression? If the title is a challenge, then it's one that it's worth rising to. Johan Norberg has written an impassioned, ideological and persuasive book that ought to be required reading for people on both sides of the pro/anti-capitalist divide.

Norberg's central thesis is that global capitalism delivers. It has delivered massive poverty reduction, improvements in infant mortality, longer lifetimes, improved educational opportunities, greater freedom and autonomy to individuals. This flies in the face of 'common sense'. There is a constant litany that things are getting worse: poverty, health, environmental degradation, oppression. Things have been getting worse for so long that we know it in our bones. Except that most of us are doing better than we were, things are getting worse, but for other people… As with Bjorn Lomborg's mind-bending 'The Skeptical Environmentalist', Norberg has amassed an impressive array of facts and figures — from authoritative sources — to bolster his case.

But how can we all be getting richer, healthier and smarter? And what about Africa? Norberg explains the benefits of free trade and shows how it is those countries that have opened markets and liberalised barriers that have benefited the most. Those countries that have erected barriers or have tried to go it alone have suffered. A point that he makes repeatedly is that trade is not a zero-sum game. In other words capitalism does not mean that one person gets rich only at another's expense. It's not true that there's only so many slices of the pie to go around - capitalism ensures that the size of the pie increases all the time.

Of course this doesn't mean that everything is wonderful. Poverty, wars, pestilence and so on still exist. Utopias don't exist, not even capitalist ones. Poverty can be relative as well as absolute - but Norberg presents figures that show that even in relative terms the gaps between rich and poor have been growing smaller. What is more he contends that it is precisely in those countries which have been most open to trade that the gaps have narrowed the most. And, of course, periodic crises also occur, with disastrous consequences. Here again Norberg does not duck the issue, in a chapter entitled 'Irrational, international capital?' he tackles the issue head on, including a detailed analysis of the Asian melt-down of the late 1990s.

What emerges from the book is more than a well-argued case for trade liberalisation and free markets. What motivates Norberg more than that is that he sees capitalism as a force for good. Grounded in those old-fashioned Enlightenment virtues of liberty and reason, Norberg sees capitalism as the engine that can delivery autonomy and freedom to most of the worlds population. And he knows that freedom is a social as well as economic concept, one without the other is incomplete, and that both have to be founded on a bed-rock prosperity.

This is book is optimistic, libertarian and extremely persuasive. It's the sort of politically engaged book that is normally seen as the preserve of the left. Above all it is a brilliant critique of the arguments presented by the anti-globalisation movement. For this reason alone it is very highly recommended.

Contents © London Book Review 2006. Published April 12 2006