The Wealth and Poverty of Nations: Why Some Are So Rich and Some Are So Poor. - book reviews

Reason, August-Sept, 1998 by Deirdre McCloskey

by David Landes, New York: W.W. Norton, 650 pages, $30.00

It's nice to know someone willing to attack every politically correct opinion in history. David Landes, a retired Harvard professor of history and of economics, has come to play, and if Edward Said or anyone else wants to play rough, he stands ready to give it back double.

Landes plays squash on the Harvard courts and in his younger days was said to have beaten regularly the members of Harvard's squash team. He writes well, too, and has read broadly, beating in this sense quite a few other Harvard types. There are few historians with as much argumentative verve as Landes, and few living economists with his breadth of learning. He has combined these talents in his big, rambling, readable book about why the West (and now the East) has grown rich.

On page after page, intense intellectual squash matches develop, a hundred or more of them, a season's play: a deceptive serve, a full-strength volley, a passing shot whipped just out of his opponent's reach. Now that he is in his 70s, Landes's game must be slowing down, and one can picture him these days using an old man's guile, and winning with it. You see a lot of that in the book, too. It's tremendous fun, delivered with folksy sophistication.

Landes's theme will outrage the politically correct: "Over the thousand and more of years...that most people look upon as progress, the key factor - the driving force - has been Western civilization and its dissemination." There. We Europeans did it. You late-comers want to argue with success? Wham!

And the way to wealth? As Adam Smith said in 1776, so Landes in 1998: Leave people alone, enforce the laws justly, provide a few public goods, and in 50 years Scotland can be as wealthy as Holland, or Korea as wealthy as France. Do as we Europeans did. Slam! Point and game.

It's the kind of book I want to write someday, a what-happened-in-history book that counters Karl Polanyi's wrongheaded 1944 classic, The Great Transformation. Polanyi's work remains a catechism of historical dogma for the left's faithful; the Marxists (who have all the best songs) have too many of the best historical books.

Landes's book is one of a number of anti-marxoid attempts to usurp the position of Polanyi as the typical New York Times reader's guide to What Happened. It's not an easy task, since economic history can be made b-o-r-i-n-g. Yet there are a number of lively contenders: William McNeill's The Pursuit of Power (1982), Nathan Rosenberg and L.E. Birdzell's How the West Grew Rich (1986), Eric Jones's Growth Recurring (1988), Joel Mokyr's The Lever of Riches (1990), and others more or less distinguished: a crowded field.

It should be crowded. We need to get beyond the understanding of the economic past that was plausible in 1848, before the development of professional history: sweet peasants, wicked mill owners, alienated workers. The Marxist view of economic history has poisoned our political lives for a century and a half. If we're going to have a future, it's urgent that we know what really happened. Landes takes us from the Stone Age to the Asian financial crisis, but his main interest is the past 1,000 years. In the year 1000 no one would have thought Europe a likely place for world leadership. By 1492, says Landes, it was a sure thing.

Landes - whose elusive politics seem to resemble Lester Thurow's or Robert Reich's - spends almost a quarter of his book attacking the notion that the Europeans did it by being empire builders. It was not by stealing from the Third World that the West grew rich, says Landes, noting at length how Portugal and then Spain threw away their advantage in a frenzy of Catholic orthodoxy.

Success came through ingenuity, which arose, he argues, from the special freedoms of Protestant Europe. Like the Northwestern School of Joel Mokyr and Eric Jones, Landes admires the Middle Ages. Far from the period of stagnation the men of the Renaissance claimed it to be, the Middle Ages, according to Landes, was the time when Europe surged ahead of the rest of the world, applying the ox plow, eyeglasses, the mechanical clock, the water mill, the printing press, and gunpowder with an enthusiasm bordering on insanity. These were all possibilities elsewhere - China or Japan or India or the Middle East - but the other places, he says, with their despotisms trying to keep society fixed the better to control and tax it, entirely muffed it. (Well, almost entirely. Landes admires Japan, which he reckons was on the way to its own industrial revolution.)

The book is comparative, as any story of Why We Got Rich has to be. As Adam Smith realized, you can't know why Britain succeeded if you have no account of why Madras or Satsuma failed. Landes's answer, like Smith's, is an optimistic - and Europe-admiring - story of Greek city-states and Germanic law leading to free institutions, contrasted with oriental despotism and God-kings. As history, it has a musty odor, because Europeans have been making the claim for two centuries. In China, said Adam Smith, "the poor or the owners of small capitals...are liable, under the pretense of justice, to be pillaged and plundered by the inferior mandarines." Concludes Landes: "All this made Europe very different from civilizations around." The rich are different from you and me: They're smarter.