Money, Blood and Revolution by George Cooper
Author: Isabelle Crosby
HOW DARWIN & THE
WORKINGS OF THE HUMAN HEART COULD FIX THE BROKEN SCIENCE OF ECONOMICS ONCE AND
FOR ALL.
Many authors
have written about the failure of economic theory but best-selling financial
author, George Cooper, seems to be the first to have come up with an original
solution on how to fix both economic theory and the economies of the world once
and for all. He has done this by “plagiarising from the masters’ (in his own
words) and taking the key ideas from the greatest scientific revolutions in
history to re-imagine how our economies really work in the first place.
Once you figure that out, it is much easier to identify the flaws. Child’s
play? Why, yes. In fact, it could be taught in junior school.
By illustrating how both our economic theories and our
economic policies can be fixed, Cooper is setting out to present a simple idea
that has the power to revolutionise how we think about our economies and how
our governments set their policies – he calls the idea the circulatory growth model in his new book Money, Blood and Revolution, published by Harriman House.
The circulatory growth model could help policy makers
understand what really drives economic growth. It recognises that capitalism
has a tendency towards wealth and income polarisation and explains how this
problem can be addressed. The model makes it very clear why the financial
crisis happened in the first place and why the policies we’ve been running
since then – quantitative easing for example – have not really brought our
economies back onto a sustainable growth path. If the model gets an audience
and becomes widely understood it should help drag the policy debate back toward
the centre ground. In the last few decades, economic theory has become
surprisingly extremist, in ways that not many people understand. This is doing
a lot of damage to our economies. For example the model makes it immediately
obvious how policies designed to promote borrowing lead directly to lower
economic growth, higher income inequality and, in the end, to higher government
deficits. If the model can help fix that unholy trinity then it will have done
some good.
The way Cooper gets to his circulatory growth model is
as fascinating as the model itself. There are no pages of dry economic
arguments, no equations and even the ubiquitous economic charts are banished to
just the final chapter. Instead Cooper takes his readers on a remarkable
journey through the history and philosophy of scientific progress.
He starts with the scientific philosopher Thomas
Kuhn’s analysis of the process of scientific revolutions. He then goes on to
illustrate Kuhn’s ideas with the stories of four of the greatest scientific
revolutions in history: the Copernican revolution in astronomy, which started
the modern scientific age; William Harvey’s theory of blood flow, which led to
the development of modern medicine; Darwin’s discovery of evolution, which
turned biology into a science; and Alfred Wegener’s theory of continental drift
which allowed geology to also graduate to the science faculty.
Both Kuhn’s work and the stories of Copernicus,
Harvey, Darwin and Wegener are there to soften his readers up for what comes in
the second section of the book.
He compares the confused state of economics today to
the confusion which dogged astronomy, medicine, biology and geology prior to
their respective revolutions. In doing this he builds a persuasive case that
economics is long overdue its very own scientific revolution.
Cooper constructs his circulatory growth model drawing
directly on the ideas of Darwin and William Harvey, the doctor of King Charles
I. The connections which he sees between previous scientific revolutions and
his proposed scientific revolution for the field of economics are fascinating.
The circulatory growth model has some surprising
implications. It shows, for example, why some countries have prospered while
others have failed. It also shows why government spending and taxation are
necessary for economic growth. These
conclusions fly in the face of today’s accepted mainstream economic ideas,
which press always for smaller governments and lower taxation.
Few readers will emerge from Money, Blood and
Revolution with their preconceptions unscathed and a few policy makers may
suffer more than superficial damage to their own ideas. Personally, I was very
entertained by Cooper’s ability to link Captain Kirk to Copernicus, Darwin to
the Declaration of Independence and the workings of the human heart to the
ideas of Karl Marx and Adam Smith. A
jolly good read and renewed hope for a better world in one. How marvellous!
See also:
Review on Money, Blood and Revolution by The Economist
See also:
Review on Money, Blood and Revolution by The Economist
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