What’s the Alternative?

  • 2016-01-05
  • The Economist

CAPITALISM lacks defenders these days, while protests against it have fresh vigour. A vocal coalition of critics, from Occupy Wall Street to Pope Francis, castigate global trade as being exploitative and people’s fixation on money as the “dung of the devil”.

Worries about the impact of economic inequality on social cohesion lend new urgency to moral questions about markets. But, as John Plender points out in his new book, “Capitalism”, discontents about its effects are as old as the world’s most powerful -ism itself. The pursuit of profit has been “unloved” since Socrates declared that “The more [men] think of making a fortune, the less they think of virtue.” Anti-business sentiment characterises the lampooning of Trimalchio’s feast in Petronius’s “Satyricon”, and persists through Molière’s miserly 17th-century lucre-seekers to the portrayals by Charles Dickens and Emile Zola of dreadful 19th-century bosses and the modern incarnation of greed on the screen, Gordon Gekko in “Wall Street”.

Mr Plender, who once worked for The Economist, is a columnist with the Financial Times. He has written incisively for decades on the excitements, oddities and disasters of financial markets. He approaches the quandaries of capitalism with a shrewd eye for detail. The reader discovers, for example, that Voltaire turned up at the court of Frederick the Great as a pet Enlightenment intellectual, only to run a bond-market scam that could have bankrupted the Prussian exchequer. In the mid-1980s Japanese fund managers visited the shrine of Madame Nui, a restaurateur whose porcelain toad delivered tips on stocks—for a while successfully, acquiring its own portfolio worth $10 billion—until they collapsed when the Japanese bubble burst in 1990. If free markets emerge from this survey as dynamic, their claim to be rational is suspect indeed.

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