Economics for Everyone: A Short Guide to the Economics of Capitalism
Jim Stanford (2008), Pluto Press, the Canadian Centre for Policy Alternatives, and Fernwood Publishing Inc.
Upon first reading Economics for Everyone I was disappointed. At the time of its publication I was a doctoral student at the end of a long road of education in and around economics, political economy and political science and I was looking for a concise and penetrating settling of theoretical scores. After a couple years, with the polemical urge tempered, I reread Economics for Everyone (Economics) from the perspective of a professor evaluating a potential introductory textbook on economics and political economy. Viewed from this angle Economics is an impressive introductory text.
With respect to introductory economic textbooks there is really only a choice between two genres. The first introduces students to the basic elements of neoclassical economic analysis and its mathematical formalizations. The second genre introduces students to the origins, evolution, key institutions and social relations that obtain in a capitalist economy. It is to this second genre that Jim Stanford’s text belongs. One of the inherent challenges for texts of the second genre is that there is a stark difference between educating students about the economy and educating students about the practice of economics as a social science (i.e. the discipline of economics). More often than not heterodox textbooks end up serving as introduction to the history of the polemics and controversies of economics as a discipline and thus function as prelude or substitute for actually talking about capitalism and its key institutional underpinnings. Economics for the most part avoids this trap.
Economics is organized into five sections beginning with a discussion of “why we should study economics; the origins and evolution of capitalism as distinct form of economic organization; and the political economy of economics. All in 64 pages! Clearly the only way to achieve such a concise statement is via the hegemonic voice. Yet this voice is the voice of agnostic radicalism rather than an orthodox unitarianism. From an educator’s point of view, the schematic nature of the introductory section serves well enough to delimit the objects of analyses while at the same time introducing students to the idea that capitalism is both historically novel and socially mutable. This is important because the world is indeed populated by a series of extant capitalist “models” which produce qualitatively different results across a broad range of metrics. Stanford’s agnostic radicalism thus finds its empirical grounding in the reality that many different types of policies are indeed possible within capitalism.
Section two of Economics is dedicated to the gear box of capitalism—work, tools (capital) and profit. In this section the central agents of the capitalist economies are introduced; i.e., workers and capitalists and their associative economic units and their linkages. Here I wish Stanford had paid closer attention to management and managers and the difference between profit producing labour (workers) and profit maximizing labour (supervisors and administrators). This is unfortunate because one of the major failings of orthodox economics is its near silence on the question management Nonetheless, Stanford does touch on the problem of work effort and some of the carrots and sticks employed by management to elicit higher productivity. Thus for those wishing to go deeper into the issue of supervision and human resource management this text does provide an opening. The same can be said of Stanford’s treatment of the household as the site of reproduction. That is to say there is enough in his schematic presentation to allow both instructors and students to delve deeper into subject matter should they choose.
The third section introduces the dynamic elements of capitalist economies: competition, investment and growth, employment and unemployment, distribution and the environment. Each is taken up with the same rapid-fire vigour which like the previous sections should serve to stimulate the curiosity of students.
The fourth section is likewise a rather hefty presentation of the “Complexities of Capitalism”. Here the list of topics covered is too extensive to present here. All the traditional macroeconomic policy questions are dealt with from monetary and fiscal policy through to international trade and development which culminates in the presentation of a basic macro model of the economy. What I found interesting about this section was that it also raised three issues not customarily broached in introductory texts: the financialisation of the economy, pensions and a rather long discussion of that much neglected topic in orthodox textbooks—the state and liberal democracy.
The last section deals with that age old dispute between reform liberals and socialist reformers and revolutionaries. It is a muddled conversation and wish Stanford had simply presented the Nordic model as one possible alternative vision while noting Kalecki’s observations about the instability of high road equilibrium strategies. Students would be better served in my opinion to focus their attention on the structural barriers to any serious project of economic reform. This could have been partially accomplished by referring back to the chapter on the state and liberal democracy. The question is not if another world is possible for in the abstract it always is. The real question is how and under what conditions it could be possible.
The fuzzy nature of the last section is in no small part, perhaps, a function of Stanford’s agnostic radicalism. Indeed the weakness (strength?) of this textbook would only become apparent should Stanford choose to write an intermediate version. Then all the serious disputes between heterodox economists could not be papered over by the authority of the hegemonic voice that is characteristic of introductory textbooks.
That said, this is an introductory textbook and a very good one at that. It can be used in whole or part depending on the needs of the instructor. There is also an online resource which has course outlines, lesson plans and a glossary. Union educators and summer session instructors will particularly appreciate the truncated course plan for short intensive sessions.
I spent new years eve of 1989 with Jim Stanford and he made a dramatic issue of the fact that his Communist Party membership was lapsing as of midnight. A mutual friend and I, who though committed socialists had never been members of any party, thought it was a good thing that his Party membership was lapsing. However, Stanford was saddened by this fact and as I spoke to him I realized that his notion of political identity was deeply wrapped up in the institutional framework to which he belonged and in which he functioned. I couldn’t help but smile when you talked about his ‘agnostic radicalism’ because at the time it seemed very odd to me that a man as bright and knowledgeable as he would feel a need to belong to the Communists Party, an organization for which I have never had much respect. But at the time he had difficulty imagining being a radical without belonging to a specific party or adhering to a specific ideology. I am sure, like all of us he has grown since then, but I think the ambiguity you picked up on in your review is rooted in this dilemma.
1989 was a long time ago. As for me I was stuck in South Africa and let me tell you the communist party and its platform looked pretty good. Keep in mind sometimes we hold affiliations with certain organizations because of the symbolic virtue they convey. In 1989 the communist party of South Africa conveyed a tremendous amount of hope. My problem (if you can call it that) is with agnostic radicalism. Not all radicalisms can dance together on the same floor. But from the point of view of an introductory text an ambiguous stance towards the tensions within heterodox economic theory is an appropriate position to take. A good textbook introduces students to different currents of thought; opens up questions and leave the students to take doctrinal stance if they so choose. In short, being honest I harbour similar radical pluralist tendencies. And many nights I do not sleep because all the ghost can’t dance together on the same floor.
But that sure beats the the peace that comes from the unified dogma of a neoclassical training. Managing mental discomfort is the key to guarding the revolutionary enterprise which is nothing less than the idea that things can be different.
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Economics In One Lesson by Henry Hazlitt is the only introductory economics book I’ll ever need.
That is sad I have read at least 10 plus the majority of the classic texts. Why would you celebrate the fact that you have only read one and boast about it publicly?
I never said it was the only one I ever read. I just said it was the only I’ll ever need. It’s also the one I recommend to people when they’re looking for an introductory book.
You forgot to tell us why, Caleb
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Just as sad either way Caleb.