August 26, 2010

Matt Ridley: Criticism

A Sentient Developments reader directs our attention to this deliciously scathing review by George Monbiot of Matt Ridley and his work:
He uses [Rational Optimist] it as a platform to attack governments that, among other crimes, "bail out big corporations". He lambasts intervention and state regulation, insisting that markets deliver the greatest possible benefits to society when left to their own devices. Has there ever been a clearer case of the triumph of faith over experience?

Free-market fundamentalists, apparently unaware of Ridley's own experiment in market liberation, are currently filling cyberspace and the mainstream media with gasps of enthusiasm about his thesis. Ridley provides what he claims is a scientific justification for unregulated business. He maintains that rising consumption will keep enriching us for "centuries and millennia" to come, but only if governments don't impede innovation. He dismisses or denies the environmental consequences, laments our risk-aversion, and claims that the market system makes self-interest "thoroughly virtuous". All will be well in the best of all possible worlds, as long as the "parasitic bureaucracy" keeps its nose out of our lives.

His book is elegantly written and cast in the language of evolution, but it's the same old cornutopian nonsense we've heard one hundred times before (cornutopians are people who envisage a utopia of limitless abundance). In this case, however, it has already been spectacularly disproved by the author's experience.

The Rational Optimist is riddled with excruciating errors and distortions. Ridley claims, for instance, that "every country that tried protectionism" after the second world war suffered as a result. He cites South Korea and Taiwan as "countries that went the other way", and experienced miraculous growth. In reality, the governments of both nations subsidised key industries, actively promoted exports, and used tariffs and laws to shut out competing imports. In both countries the state owned all the major commercial banks, allowing it to make decisions about investment.
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1 comment:

Martin said...

"It is only from the safety of the regulated economy, in which governments pick up the pieces when business screws up, that people like Ridley can pursue their magical thinking."

What an epic quote.