[.ca] Everything for Sale: The Virtues and Limits of Markets (ISBN 0226465551)

From Amazon.com:
Everything For Sale is an erudite reprieve from the deluge of books written in praise of free markets. Robert Kuttner fires back with a book that documents relevant, real-world examples of market failure and makes the case for intelligent intervention to attain more desirable outcomes. His exhaustive litany of successful (some, even cherished) government interventions in the market--from National Public Radio to the Internet--creates a persuasive case for a mixed program of political and market-based approaches in the shaping of public policy. When Kuttner pushes his argument for a culture with less commercial emphasis, his preferences exhibit an anti-market bias. But overall, his argument is clear and compelling, exposing blind adherence to market outcomes as largely arbitrary, ideological, and often, an affront to democracy. Academic economists who ignore the political desires of the people in order to protect the purity of their mathematical models draw Kuttner's fire in particular. He writes about ideas and economic details with great verve and ability. Kuttner's book is certain to be a touchstone of debate, if not reform, among public policy makers.

Marginal theory:
This insightful, hilarious actually, treatment of free market mania and economics is important reading since there are few books around that can stand up to the legitimation tactics (Foucault stuff, if you recall) of the current theories. There are two questions, markets, and the theories that justify them, and/or make them worse than they need be because of theoretical obsessions that are really ideologies. Looking at the complex arcana in most economic treatises would leave most silenced in awe by the triumphs of reason, little suspecting that most of it is paper airplane category pulp fiction. At least economists manage to allow some critique of their subject (delusions can cost real money). The field of evolutionary theory needs a book like this, but unfortunately the domination of the paradigm there is so total as to allow no dissent at all in normal channels and it in fact costs no one anything since it all happened long ago and good for the dog eat dog economy anyway (real money) to be deluded in that case.

Challenging the Rhetoric of Market Purity:
Robert Kuttner takes on free trader's myth, which perpetuates the need for pure markets and limited government. He points out how this ideology, which has brought about the deregulation of many industries and continually pressures for reduced government spending -- on infrastructure, research and development -- has seriously retarded wide economic growth. The result of the U.S. economic policy over the last thirty years has created widening income inequality, limited access to universalities such as health care and basic economic security, and a breakdown of democracy that was established to protect American citizens from private tyranny. He challenges the free-market ideologues that continually influence politics and law by preaching the rhetoric of whatever the outcome of the market must be optimal if it is the result of the operation of the market. Kuttner explains that the myth is allowed to perpetuate not do to economic problems, but because of a lack of political power on the part of most Americans. Kuttner makes a fine argument through his comprehensive survey of most sectors of the American economy and the social effects of unregulated capital. Moreover, he points out that pure market efficiency is only possible in spot markets, and rarely occurs in reality. He further faults the free market ideologues on their notion that everything can be reduced to markets, citing that markets in certain items are contrary to public policy or unlikely to be produced due to the theory of free-riders, such as with public infrastructure. Kuttner explains that the corporate call for "pure markets," freed from regulatory constraints, is really a corporate call for liberation from its extra-market commitments to community and charity. Kuttner's position for alleviating most of these problems that have arisen through the "pure market" myth is to increase the size and stance of government to a more socialist form similar to those of Western Europe, with a mixed economy. He calls for the government to intervene by taking over administration of extra-market commitments and universalities such as health care and pension benefits, and provide incentives to corporations that are socially responsible to their employees. Moreover, Kuttner seeks a redistribution of economic and political power through a return to a progressive tax system that weighs heavier on persons with greater wealth and income. He contends that Americans need to display the habits of a strong democracy in order to keep markets in their place. After reading this book, it is obvious that Mr. Kuttner is very passionate about the subject for which he writes. My only critism of his work is that it is a bit cumbersome.

At last, an economist in touch with reality:
If you really want to understand how the economy works to create winners and losers, this book is the place to start. It is a dangerous book. Four hundred pages overflowing with historic detail. No simplistic models or mathematical equations. No easy answers. Savy analyses of real industries that will be helpful to any stock market operator. The book will be attacked by ideologues and some of its proscriptions are debatable. But no intelligent person can come away from it without a clearer understanding of our business system and the compelling need for mature political solutions to contemporary economic problems.

A good counterpoint to the religion of the free market:
Recently, the theologian Harvey Cox published a tongue in cheek article in the Atlantic Monthly comparing free market economics to a religious sect. Judging from the reaction to Kuttner's book, Cox's article was right on the money. The book's detractors make dismissive ad-hominem attacks on Kuttner's credentials, inaccurately portray the thrust and substance of his arguments to make them appear ludicrous, or simply assert that any one who is against pure free market ideology is no more than a heretical imbecile. One user's review here - the one that accuses Kuttner of "bloviating" - was lifted verbatim and without citation from the Reason magazine review of the book, hardly a non-biased source of information. It is a prime example of this form of criticism. Clearly its author and I did not read the same book. I found Kuttner's book to be a reasoned argument against pure laissez faire. Kuttner intentionally aimed the book at the educated general reader and has hit that mark well. His intention was to present empirical examples of non-market interventions that produced better outcomes than market alternatives and he has done that. I challenge the free market critics of the book to address these examples, the book's substance, rather than its theology.

A balanced form of capitalism:
Robert Kuttner's "Everything for Sale" does a fine job of criticizing unregulated markets. The author takes a look at how markets price themselves in various industries and discusses the relative strengths and weaknesses of the pricing model. Kuttner reveals that in most markets, the public good can be best served by both allowing the "virtues" of the market to work freely and by implementing regulations that correct whatever "limits" may be found in any particular market. Kuttner also includes a moral dimension to his discussion, where appropriate. As we all know, markets respond only to money. But as a society, we have decided that it would be immoral, for example, to deny health care to seniors who can't afford to pay; consequently we have Medicare and Medicaid to fix this fundamental market flaw. Similarly, Kuttner shows us where pricing models in certain industries fail to take proper account of environmental, labor and social costs and suggests common-sense ways to correct them. Opinions about the value of Kuttner's work vary widely. Laissez-faire idealogues have charged that the work amounts to "socialism" (see one of the reviews below). To judge for yourself, take a quick look at just one of the industries that Kuttner critiques in the book: airlines. Kuttner calls the Reagan-era deregulation of the airline industry a "failed experiment". He points out the many problems that have occured since deregulation, including: declining levels of passenger service, airline consolidation and monopolistic pricing, loss of service to small cities, circuitous routing of flights, declining safety levels, etc. I think most people would agree with the accuracy of Kuttner's assessment and that indeed, air travel has become much less appealing today. Kuttner's solution is to create a system of "regulated airline competition". Fares would be set at levels that would allow sufficient funds to be allocated to properly maintain planes, better serve passengers, restore service to under-served areas, increase competition, and so on. I found Kuttner's ideas to be reasonable -- not ideological -- in that they balance the needs of business and the public in a fair manner. Of course, Kuttner wrote this in 1999. The terrorist attacks of 9/11 have only made a bad situation worse. Ironically, public funds were required to save the industry from insolvency. Therefore one could argue that Kuttner's recommendations for greater public accountability is far from unreasonable. Again, the airline industry is just one example. Kuttner also has much to say that is useful about healthcare, energy, finance, labor, and more. As some of these industries currently seem to be imploding due to the excesses of laissez-faire (Enron, Arthur Andersen, WorldCom, etc.), Kuttner's thoughts on the dangers of unregulated behavior prevalent in these industries appears to be more valuable now than ever. In the current climate of investor skepticism and high-profile corporate fraud, tighter controls over business behavior may be just the medicine our economy needs to heal itself, restore investor confidence and ensure that businesses become more responsive to people's needs. In that light, I don't view Kuttner's ideas as socialistic at all; rather, I think Kuttner helps us preserve capitalism by curbing its most destructive tendencies. To that end, "Everything for Sale" can provide guidance to citizens and policymakers who may be pondering how we can build an economy that works for everyone, and I highly recommend it.