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Chalmers Johnson book review tackles the Myth of Free Trade

by NBBooks Fri Feb 8th, 2008 at 04:41:30 PM EST

Chalmers Johnson has an lengthy but very informative review of South Korean economist Ha-Joon Chang's Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism at truthdig.org
Publisher: Bloomsbury USA
Pub. Date: December 2007
ISBN-13: 9781596913998

From the Publisher:

With irreverent wit, an engagingly personal style, and a battery of real-life examples, Ha-Joon Chang blasts holes in the "World Is Flat" orthodoxy of Thomas Friedman and other neo-liberal economists who argue that only unfettered capitalism and wide-open international trade can lift struggling nations out of poverty. On the contrary, Chang shows, today's economic superpowers - from the United States to Britain to his native South Korea - all attained prosperity by shameless protectionism and government intervention in industry. We in the wealthy nations have conveniently forgotten this fact, telling ourselves a fairy tale about the magic of free trade and - via our proxies such as the World Bank, International Monetary Fund, and World Trade Organization - ramming policies that suit ourselves down the throat of the developing world.

Unlike typical economists who construct models of how economies are supposed to behave, Chang examines the past: what has actually happened. His pungently contrarian history demolishes one pillar after another of free-market mythology. We treat patents and copyrights as sacrosanct - but developed our own industries by studiously copying others' technologies. We insist that centrally planned economies stifle growth - but many developing countries had higher GDP growth before they were pressured into deregulating their economies. Both justice and common sense, Chang argues, demand that we reevaluate the policies we force on weaker nations. Bad Samaritans calls on America to return to its abandoned role, embodied in programs like the Marshall Plan, to offer a helping hand, instead of a closed fist, to countries struggling to follow in our footsteps.

From Johnson's review:

Ha-Joon Chang's life is conterminous with his country's advance from being one of the poorest on Earth--with a 1961 yearly income of $82 per person, less than half the $179 per capital income in Ghana at that time--to the manufacturing powerhouse of today, with a 2004 per capita income of $13,980. South Korea did not get there by following the advice of the Bad Samaritans. Chang's prologue contains a wonderful account of how post-Korean War trade restrictions and governmental supervision fostered such projects as POSCO (Pohang Iron and Steel Co.), which began life as a state-owned enterprise that was refused support from the World Bank in a country without any iron ore or coking coal and with a prohibition on trade with China. Now privatized, POSCO is the world's third largest steel company. This was also the period in which Samsung subsidized its infant electronics subsidiaries for over a decade with money made in textiles and sugar refining. Today Samsung dominates flat-panel TVs and cell phones in much of East Asia and the world.


With "Bad Samaritans," Chang has succinctly and comprehensively exposed the chief structures of economic imperialism in the world today. What is now required is the leadership to undermine and dismantle the barriers that keep so much of the world so poor.

Chalmers Johnson, author of Sorrows of Empire, is one of the guests I will attempt to land for Live Blogging at ET.

Wish me luck.

by GiantMan (GiantMan2363 aaatttt Gmail.com) on Fri Feb 8th, 2008 at 07:04:16 PM EST
I certainly wish you luck- he is a treasure house of information and insight, and I would love to ask him to elaborate on some things.
Glad you did this review of a review- I read it a day or so ago when it first came out, but since I have flogged the "Empire" so much recently, I decided to let it pass- Also, my other attempts were received with a rather lukewarm reception here, I thought. And it's a lot of work.

His three book series sits on my shelf right in front of my keyboard and broods, having enlightened --and darkened-- my last couple weeks.
"Blowback", "The Sorrows of Empire" and "Nemesis" are easy reads, really- his style is dense without slipping into impenetrability- he's a storyteller, as well as an Asia scholar, economist and historian. When he speaks of the empire, he speaks, rather like Gen. Smedly Butler, from the position of having lived in the belly of the beast.

Chalmers Johnson studies and writes about the great forces, the mistakes in governance and vision, the consequences of which will forge all our futures, European or American.  He's an old contract employee of the agencies that enforce the very economic imperialism and militarism that he writes about. But, like other bringers of bad news- Noam Chomsky springs to mind- he is the bill collector at the consumer's ball, the raven on the wall crying "Nevermore. Nevermore."
But he writes better than old Noam, as much as I respect them both.

A reader cannot miss seeing Noam Chomsky's anger--it stands out in every sentence. But a blind man can sense the sadness that suffuses Chalmers Johnson's damnation of a nation- his nation- now fully dedicated to the business of war--and being consumed by that fact.    

Capitalism searches out the darkest corners of human potential, and mainlines them.

by geezer in Paris (risico at wanadoo(flypoop)fr) on Sat Feb 9th, 2008 at 12:35:59 AM EST
[ Parent ]
Oh NBB let me chime in.. let me chime in.. please with a looong comment right...

I want to say that luckily this is a trend  we are expecriencing ina ll major economic instutions.. a new consensus is emerging.. you can feel it reading Krugman and BradLong.. and the heads of a lot of economic departments... the list of new papers of trade and being critic of trade is increasing...

Luckily there is a group of economic theoriest doing what they are supposed to do.. look at the data they have.. it is frankly impossible to make a proper model in economy with the lousy mathematical thought most of them ahave but they can indeed check past results... and apst models.

it turns out that krugman model of trade between rather rich nations was completely correct.. quite surprising for an economc theory to be correct in advance... he looks more more alike Keynes in that sense...

On the other hand it is becoming absolutely clear that the pitifuls models of trade between rich and poor countries were... well hoax... The only explanation for them is deliberate lie.. and you must blame the ideology and the mythology and the narrative exposed byt he the right-wing (the Narrative if you do not want to use the original word since "myth" shound as soemthing false.. and myths are everything except false). So the Narrative was imposed with some absolutely stupid models to back up the system..

It was everything so crazy that even the models never said what most of the defendant said.. soemthing like Darqwin..where a lot of biologists and economsits after Darwin put in darwin's word things that he would  have never said.. (at least scientfically).

the crazy models of trade between rich and poor nations said that both coutnries would benefit.. but they never said that they would exist losers and winners inside the contry... but that fact was forgotten.. and again..the models are so awful that you can actually know the result once you have described it.. it is not a model .. it is nothing.. they were not based in anything.. they were just cafee talk trasnformed to equations.. or in other words, a narrative writen down in amthematical symbols. tehre was not ahrd work behind.

Luckily , it is becoming increasignly clear that the models of rich-poor trade do not fit any of the outcomes, it is clear that it is awful for great sections of both rich and poor coutnries.. and economists at long last recognize the reality they benefited just a few very much...

But they still need to do the last step.. the original models were rubbish..and not there is NO NEED that both nations become wealthier or better in any sense of the word... there are documented cases wher this happened... try to open up to trade a basic commodity in a country... well it will be a disaster... Economist woud say "but that was clearly not the hypothesis of the model"... then they must a look at the mdoels and see how lousy those hypothesis were written...

and then look not only what twould benefit two coutnries.. but what would be better for a country.. adn that would be a headache because trade almost enver it is good fro a poor country....

actually it is very difficult to know for medium advanced coutnries (second region). it seems that brazil, Indica dn China would beenfit the msot by targetting opennes...

Spain is a case of clear succes in opent rade barriers.. once you reached the state of medium stable economy..even trading with rich countries as ong the opening of trade is adiabitacally slow...

It is amazing that only the last mdoel, the onet hat was nto considered standard theory.. the one of Krugmas is the one that stand up better, rich coutnries benefit from trading to each otehr.. and all sections of soceity benefit. A smart open trade policy is absolutely great in middle-rich countries.. but trade for poor coutnries can be an absolute knightmare... and one day, I hope, it will be decided that in those cases one  playing with soemthing similar to explosives...and you have to be very sure what you are doing...and only in some cases test it.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Sat Feb 9th, 2008 at 07:33:15 AM EST

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