Book Review: Why Nations Fail: The Origins of Power, Prosperity, and Poverty by Daron Acemoglu and James Robinson
You have to wade pretty far into the stream before you reach the central thesis of “Why Nations Fail.” But on page 74, there it is: “Inclusive economic institutions, such as those in South Korea or in the United States, are those that allow and encourage participation by the great mass of people in economic activities that best make use of their talents and skills and that enable individuals to make the choices they wish. To be inclusive, economic institutions must feature secure private property, an unbiased system of law, and a provision of public services that provides a level playing field in which people can exchange and contract.”
In other words, in the authors’ view, governments with fair economic policies that provide incentives for innovation and invention succeed. Those that don’t, fail. To put it another way: All a country needs to do to achieve power and prosperity is create a just government that promotes a free market economy in which everyone has a fair shot.
It is hard to argue with the authors’ examples of what constitutes failure: “Most adults in Nogales, Sonora [Mexico] do not have a high school degree, and many teenagers are not in school. Mothers have to worry about high rates of infant mortality. Poor public health conditions mean it’s no surprise that the residents of Nogales, Sonora, do not live as long as their northern neighbors. … Roads are in bad condition south of the fence. Law and order is in worse condition.”
Unfortunately, the book’s definition of success relies less on sociology and more on capitalist dogma. Consider this account of South Korea’s success. “South Korea is a market economy built on private property. South Korean teenagers know that, if successful as entrepreneurs or workers, they can one day enjoy the fruits of their investments and efforts; they can improve their standard of living and buy cars, houses, and health care.”
Authors Daron Acemoglu and James A. Robinson would certainly seem to have the intellectual heft to back up their arguments. Both are full professors, Acemoglu at m.i.t. and Robinson at Harvard. Sadly, however, their bona fides do little to prevent them from succumbing to the same hubris that affects so many of today’s economists: i.e., viewing the entire world solely through the lens of economics. Reducing all sociological problems to whether or not governments embrace free market capitalism is beyond simplistic. It is patently insulting. For example, by their limited metric — cars, houses and health care — few aboriginal cultures in the world can be seen as happy or successful.
As a piece of literature, it is hard to overstate how truly tedious this book is. Not only are the points in the book overly simplistic, many are also obvious and totally devoid of insight: “Politics is the process by which a society chooses the rules that will govern it. … When there is a conflict over institutions, what happens depends on which people or group wins out in the game of politics — who can get more support, obtain additional resources, and form more effective alliances. In short, who wins depends on the distribution of political power in society.” Wading through 529 pages of this sort of perpetual pedantry is a task of Sisyphean proportions.
The most irritating thing about this book for me, however, is not the patronizing tone or the soporific writing style. It is instead the unquestioning, almost fawning, reverence the authors seem to have for the United States and our system of government.
Acemoglu and Robinson present copious examples of developing countries where disparate wealth keeps much of the population mired in poverty, but nowhere do they examine the growing disparities of wealth in our own country, much less what it bodes for our future. They delight in trotting out legislation such as the Sherman Antitrust Act, which bans business activities that minimize marketplace competition and requires the federal government to investigate violations, as a triumph of our government’s ability to fight the corrupting influence of monopolies. But no mention is made of the monopolistic power wielded by today’s international mega-corporations.
And while the authors make a point of denigrating Franklin Roosevelt for — in their view — attempting to bypass and subvert our system of checks and balances by “packing the Supreme Court” with supporters of his New Deal policies, there is a conspicuous absence of any discussion of Citizens United, the recent Supreme Court decision that currently threatens to drown our electoral process in a tsunami of corrupting, corporate, special-interest cash.
One could argue this is really a book about history, not current affairs. Still, to be relevant, even books about the past must relate to the time in which they are written. It is striking that in discussing the historical role political institutions play in the prosperity of nations, the authors should make so little mention of the ominous economic and political trends that are happening right under their noses.
I must say it is hard for me to picture the target audience for this book. It’s long, poorly written and way too boring to take to the beach. It’s not nearly controversial enough to make waves among economists. In short, if you are fishing around for a book to read this summer, “Why Nations Fail” is not a keeper. I’m afraid it falls more in the category of catch and release … with the emphasis on the latter.