Good books 2021

Over the summer holidays we like to blob out and read, and I've caught up with some great titles.

In economics, top of the list are two excellent books, Zachary D Carter's The Price of Peace: Money, Democracy, and the Life of John Maynard Keynes; and Matt Ridley's How Innovation Works. I've also enjoyed Daniel Markovits' The Meritocracy Trap (and in the same area I've got Michael Sandel's The Tyranny of Merit: What's become of the common good? lined up); and next on the runway will be Robert Skidelsky's What's Wrong with Economics? A primer for the perplexed. Tim Harford's How to Make the World Add Up: Ten Rules for Thinking Differently About Numbers focuses on the behavioural biases we bring to statistics, and is likely to prompt you to have a go, if you haven't yet, at Daniel Kahneman's fascinating Thinking Fast and Slow.

In biography, I hugely enjoyed Fredrik Logevall's JFK: Volume 1, 1917-1956, where the story reaches JFK's (in retrospect fortunate) failure to get the Democratic vice-presidential nomination in 1956 and his decision to go for the big one in 1960. Volker Ulrich's second volume, Hitler: Downfall, 1939-1945, necessarily has more military history than the politics and personalities of the previous Hitler: Ascent 1889-1939, but is also a good read. We've been blessed with some great biographies in recent years: try Ron Chernow's Grant (Ulysses S, that is), or Charles Moore's three-decker biography of Margaret Thatcher.

In politics, I defy anyone not to enjoy Sasha Swire's ringside view of the Cameron years, Diary of an MP's Wife. Still in the UK, both Gabriel Pogrund and Patrick Maguire's Left Out: The Inside Story of Labour Under Corbyn, and Tom Bower's Boris Johnson: The Gambler, are well worth reading. Anne Applebaum's Twilight of Democracy: The Failure of Politics and the Parting of Friends will get you thinking about the origins of polarisation, populism and demagoguery, and dovetails nicely with Ian Dunt's How To be a Liberal.

And in history I'm well into Ritchie Robertson's enormous The Enlightenment: The Pursuit of Happiness 1680-1790, and when that's finished I'll be starting Katja Hoyer's Blood and Iron: The Rise and Fall of the German Empire 1871-1918. If you've any nostalgia for hereditary rule, Martin Rady's The Habsburgs: The rise and fall of a world power will put you right. While you're wandering around central Europe, try Richard Fidler's The Golden Maze: A biography of Prague. 

After all that highbrow fare, I confess my fiction tastes run to private eyes and the more intelligent espionage thrillers. This summer's haul included the third in Glen Erik Hamilton's Seattle-based Van Shaw series, Every Day Above Ground, Peter Hanington's A Single Source (an oldstyle BBC Radio journalist gets caught up in illicit arms smuggling during the Arab Spring), Henning Maskell's After the Fire (he's best known for his Inspector Wallender books, this is a one-off), and Liz Moore's A Long Bright River (Philadelphia policewoman on trail of someone killing young women,and her drug addict sister is one potential target). I'm halfway through Cecilia Ekbäck's very well written The Historians, set in the murky politics of WW2 Sweden.

I'm a big fan of the physical book. I like the heft, the shape, the smell of a new book. Our house is stacked with them. So I've had to be dragged kicking and screaming to the idea of a Kindle. But now that I'm there, I have to say, it's terrific. See a good review, and you can have the book on your Kindle a few minutes later. It's great on a plane or anywhere else bulk comes into consideration. While I'll never begrudge the price of a good book, and I'm still reading both physical and digital versions, the Kindle price for the e-version is quite handy, too.  And if your partner's sleeping habits aren't synchronised with yours (ours aren't), with a backlit Kindle you can keep reading in bed when the lights are off.

The good old days. Not

Marilyn Waring's interesting memoir The Political Years is an eye-opener on New Zealand in the late 1970s and early 1980s. While she has a particular perspective to emphasise, there's no doubt that the casual sexism, racism and conservatism of the day that she recalls do not square with the "we've always been progressive since women got the vote in 1893" story we like to tell ourselves.

From an economic policy point of view, it's also a reminder to those who put 'Rogernomics' and 'Ruthanasia' in the 'awful neoliberalism experiment' basket that reform was needed. Even Waring, down the left end of the political spectrum, concludes (p46) that

Within just a few months [of first being elected in 1975], I was getting a picture of incredible inefficiencies. Tariff structures were a nightmare, and were still in hangover mode from the Second World War. Licensing was a mess: those who had import and transport licences ran small fiefdoms. Transportation regulations intended to protect the railways restricted truck movements without a special licence, adding significant costs. Vast amounts of primary production were subsidised. Far too much discretionary power rested in the hands of ministers. Certainly, that meant I might lobby for gains for my constituents, but the process needed a wholesale clean-out.

She gives examples (pp45-6) of the kind of lobbying involved: letters to ministers with "requests for relief of import duty on a sports cup for presentation at the local high school and for a licence to import woven woolen fabric for the Te Awamutu and District Pipe Band".

Mercifully most of that nonsense went overboard after trade liberalisations, but it's doubtful whether our chronic propensity for micromanagement is permanently buried at a crossroads with a stake through its heart. It's not that long ago that a government minister's approval was required for a Tourette's Syndrome sufferer to have access to a medical cannabis product. And in my own narrow neck of the woods, the Commerce Commission's "cease and desist" powers - designed to provide a timely interim stop to anti-competitive conduct until the substantive issues got litigated later - were so hedged about with preconditions and provisos that they were eventually abandoned as useless.

Another bad habit not fully kicked is unnecessary secrecy. In Waring's day, Robert Muldoon would not even share Treasury's analyses with his own MPs: on p256 she recounts how

Ruth Richardson, one of six new MPs in caucus [after the 1981 election], wasted no time in asking to see the Treasury reports on the state of the economy. Muldoon replied they were confidential, amd Hugh Templeton added that the secrecy gave Treasury the 'freedom to report'. The PM noted that the reports referred to high interest rates, devaluation, running down cash balances and internal liquidity under pressure. There was no cause for alarm, he said.

You can see why the Labour government of 1984-90 brought in the Public Finance Act to require a step change in transparency.

The same dubious "freedom to report" rationale was invoked to keep the proceedings of the Public Expenditure Committee secret. The Committee - which I'd guess was a forerunner of today's Finance and Expenditure Select Committee - was charged with "examining the Annual Reports and Accounts, and the Estimates of Expenditure, for every government ministry, department and agency" (p56), a highly important accountability role, especially given the limited other avenues at the time for scrutiny of the executive. Waring, appointed to the Committee and later its chair, questioned the secrecy and was told by the Clerk of the House (p56) that

Official papers prepared at the request of the Committee have always been regarded as confidential, and the assurance of confidentiality has been fundamental to the willingness of departments to supply frank and detailed examination.

We have, thankfully, largely moved on. But even today s9(2)(f)(iv) of our Official Information Act includes, as a valid reason for withholding information, "the withholding of the information is necessary to ... maintain the constitutional conventions for the time being which protect ... the confidentiality of advice tendered by Ministers of the Crown and officials" or under s9(2)(g)(i) to "maintain the effective conduct of public affairs through — (i) the free and frank expression of opinions by or between or to Ministers of the Crown or members of an organisation or officers and employees of any department or organisation in the course of their duty".

There may be genuine occasions when these confidentiality provisions need to apply, but a few minutes on Twitter will tell you that some entirely responsible and proper 'citizen journalists' will be wondering, after bumping heads with the OIA, exactly how far we've progressed from the Sir Humphrey Applebys of Waring's day.

Future plans, past tragedies

I'm no fan of regional development as a policy priority - a remote sparsely populated country of five million people ought to be putting its energies into agglomeration benefits, not into dispersion inefficiencies - and still less of how we're executing it. But that said, I'm not sorry Dunedin's the latest winner drawn from the Lucky Dip bag ('Dunedin projects secure multimillion-dollar Provincial Growth Fund investment'). It would be one of my agglomeration corridors anyway, plus it's a surprisingly interesting place, as I've posted before ('On holiday? In DUNEDIN??').

Over the Labour Day weekend we went to the Dunedin Art Gallery which was hosting a near-definitive exhibition of Frances Hodgkins. We explored the thriving café scene - particularly good coffee at Heritage, and lovely raspberry and coconut cake at Perc - and had fine Chinese food at Papa Chou's. In Dunedin you have to visit the University Book Shop, where I bought Binyamin Appelbaum's The Economists' Hour: How the False Prophets of Free Markets Fractured Our Society (purchases are not endorsements), followed by a fossick in the Hard to Find bookshop, where I added to my First World War collection with John Terraine's 1963 military biography, Douglas Haig: The educated soldier.

The Great War kept intruding. Just to remind you of the seismic scale of the war for New Zealand, in the foyer of the wonderful Railway Station I read the plaque commemorating the Dunedin staff of New Zealand Rail who died in the war. Guess how many, just from one company's staff, in one city*. Or see the West Taieri war memorial across the road from the deservedly popular Wobbly Goat café in Outram (try the pinwheels), with the desperately sad pattern of multiple names from the same families. On the one small monument are three Sprotts, two McLeods, two Whites.

In the middle of nowhere we detoured from a day's fishing at Lake Mahinerangi to the Old Waipori cemetery, where there is a memorial (pictured below, with his image from Discovering Anzacs) to Wilfred Victor Knight, the first reported New Zealand casualty at Gallipoli. Knight came from Waipori, since submerged by the hydro lake, went to Otago Boys High, and was working on the Sydney trams when war was declared on August 4 1914. He signed up on August 22, made his will in his pay book on April 25 1915, and died probably on April 27. He was 25.

* 56. Bear in mind that the population of New Zealand was only one million at the time. Multiply by five to get an idea of a proportionate loss today.

Stagnation?

I've been reading Linda Yueh's The Great Economists: How Their Ideas Can Help Us Today.  It's a clever way of teaching the history of economic thought by imagining how the big names would have dealt with current issues. We get, for example, Ricardo looking at Trump's trade wars, and Keynes looking at post-GFC 'austerity'.

In the chapter on Schumpeter ("What would Joseph Schumpeter think about how contemporary companies and countries should innovate?"), I came across a remarkable quotation which bears on another of today's supposed problems, 'secular stagnation'.

This is popularly taken to mean, as its Wikipedia entry says, ""a condition of negligible or no economic growth in a market-based economy". Lawrence Summers, the former US Treasury Secretary, who is often credited with giving the idea its modern boost, says the Wikipedia version is "fatalistic" and not what he meant. He says he meant a more Keynesian notion: "the idea of secular stagnation is that the private economy — unless stimulated by extraordinary public actions especially monetary and fiscal policies and, or, unsustainable private sector borrowing — will be prone to sluggish growth caused by insufficient demand". But the downbeat version has taken root.

The idea in its fatalistic format, that we are moving into an extended period of slower growth or no growth, has always seemed to me to be completely off the wall. I don't believe that we are in some kind of diminishing-return world where the payoff from the next innovation is generally less than the payoff from the previous one. I don't believe that the latest rounds of invention - such the internet and the digital revolution more generally - are in any way less momentous than their industrial and chemical and electrical predecessors. And I strongly suspect that GDP as currently measured, despite statisticians' best efforts to capture changes in its quality, is hugely underestimated. We're producing far more, properly accounted for, than the doomsayers think.

I think it's far more likely that we in the earliest stages of a huge transformation of modern economies and societies where we are only beginning to see the impact of new innovations, let alone the further payoffs that will come from the interplay and recombination of our new technologies. "Ideas having sex", as Matt Ridley put it in his excellent book, The Rational Optimist.

The stagnation believers are, in my view, akin to someone thinking that the factory system had done its dash by 1800, or that modern business methods had peaked with Ford in the 1920s. In the middle of one of the most vibrantly inventive periods of all time, we are supposed to believe that growth is running into the sands?

It's extremely implausible. It's also at odds with some of the other doomsdays the pessimists worry about. You can't believe that the robots are going to take all our jobs and think that technological change has stopped having a big impact. And It's also an enormously bad guide to policy, if it takes you down the road of thinking that the big issue is fighting over a fixed pie, rather than growing the pie.

In any event, the quotation in The Great Economists that caught my eye was this. Schumpeter felt that the Classical economists - Smith, Ricardo, Mill - had missed what was going on round them. In his History of Economic Analysis he said:

Those writers lived at the threshold of the most spectacular economic developments ever witnessed. Vast possibilities matured into realities under their very eyes. Nevertheless, they saw nothing but cramped economies, struggling with ever-decreasing success for their daily bread.

The Classical economists were wrong then. The latest crop of stagnationists are wrong now.

Three excellent economics books

The prospect of some long distance air travel prompted me to reach for something big and chunky from one of the many books on my bookshelf I've always meant to get round to. Eric Roll's A History of Economic Thought and George Sabine's A History of Political Theory - both unfinished since my undergraduate days - were in the frame, but I eventually settled on Robert Skidelsky's one-volume biography John Maynard Keynes 1883-1946: Economist, Philosopher, Statesman.

Eight hundred and fifty three pages later, I'm glad I did. It's a great book: intelligent, comprehensive, balanced. You'll know before reading the book that Keynes was right on two big things - German reparations after the Great War, 'Keynesian' demand management to avoid slumps - and instrumental in creating two institutions (the IMF and the World Bank) desperately needed post World War Two. These are well covered, as are other good calls (eg on the UK's poor decision to go back on to the gold standard in 1925) but you'll also discover that Keynes could be wrong on a lot else. He was, for example, as prepared to resort to protectionism in the Depression as the justly maligned Smoot and Hawley, and supported cartels as a device to prevent deflation (as did Roosevelt's 'New Deal'). His speech in Dublin in 1933 to the assembled Irish worthies pandered to their nonsensical 'self-sufficiency' programme. In a way, though, that reflected another of his great abilities: his willingness to adapt his message to the audience made him a formidable player of the British and international civil servant game, prepared to compromise and adjust to get the core of what he wanted through an often ignorant and hostile policy process.

A big theme of the book is his outstanding intelligence (albeit too often deployed in a brutal take-no-prisoners style): Bertrand Russell said in his autobiography (and requoted in the book) that Keynes' intellect was "the sharpest and clearest I have ever known. When I argued with him I felt that I took my life in my hands, and I seldom emerged without feeling something of a fool". Others recognised it, too. At the formal dinner ending the Bretton Woods conference which created the Fund and the Bank, "as he [Keynes] moved slowly to the high table, stooping a little more than usual, white with tiredness, but not unpleased at what had been done, the whole meeting spontaneously stood up and waited, silent, until he had taken his place. Someone of more than ordinary stature had entered the room".

Another excellent book I've finished is the second edition of Economics for Competition Lawyers, by three of the people at Oxera, Gunnar Niels, Helen Jenkins, and James Kavanagh. For all I know, this is already the established font of all knowledge for lawyers required to come to terms with the black arts of competition economics, but if it isn't already, it ought to be: it's an absolutely first class textbook. It goes out of its way to make the economics accessible to non-specialists, and even economists will get a lot out of it. I wish I'd had it to hand sixteen years ago when I was first appointed to the Commerce Commission, and I'd say that every other Commissioner appointed since then would have felt the same way. Very few of us came to the Commission with a deep knowledge of the area - the economists tended to have serviceable general purpose economics rather than a specialty expertise, and the non-economists had little or nothing - and a comprehensive guide like this one is exactly what we all needed.

It covers everything you'll need to know, from the absolute basics of supply and demand through the core areas of market definition, market power, abuse of dominance, cartels, vertical restraints, and mergers to the design of remedies (often overlooked) and the quantification of damages, and finishes with a very useful chapter on 'The use of economic evidence in competition cases'. I found myself agreeing with virtually everything they said, with the exception of what I thought was an over-charitable view of 'pay for delay' agreements (where patent-holding pharmaceutical companies pay producers of much cheaper 'generic' drugs not to produce). There may well be cases, as they say, that are genuinely welfare-enhancing, but as I've argued before, it's generally not the way to bet.

But that's a minor quibble: this is a highly practical guide to a wide and complex field that takes you from ground zero to close to the cutting edge, and is thoroughly recommended. New Zealand, by the way, gets the odd look in: two cases are cited, Oh Bloody Eight Six Seven in the context of what the Baumol-Willig rule is all about, and Air Cargo (where the authors acted for the Commission) on the geographical dimension of market definition. If you missed it, by the way, the very last act in the Air Cargo market definition bunfight has just played out in the Australian courts.

There's a school of thought that says too much choice can bamboozle consumers, who'll resort to rules of thumb (possibly missing out on their best options) when confronted with menus that are too big to come to grips with. I'm not a great fan myself, but I saw the point when I got into Powell's City of Books in Portland, Oregon, the world's largest bookstore. Before my faculties melted down completely, however, I did manage to buy Niall Kishtainy's new book, A Little History of Economics. Kishtainy, a lecturer in economic history at the London School of Economics, has done a very clever thing: produced a 'what is economics all about anyway' book through the medium of a history of economic thought. It works a treat, and is also handsomely produced. If you wanted to get someone interested in economics, this should be high on your list.

Good books - May 2017

Leading off with economics, George Mason University professor Tyler Cowen's The Complacent Class: The Self-Defeating Quest for the American Dream (with its dedication "To the rebel in each of us") argues that America has become more static and less risk-taking, pointing  for example (on p177) to "lower residential mobility, less building in America's most productive cities, more segregation by income and status, a much greater concern with safety and risk, the coddling of our children, and fewer start-ups and slower growth in living standards, among others", including a reduced willingness and increased inability to undertake grand projects like those of the past (a moon landing, the interstate highway system). He also reckons the current zeitgeist of complacency will have nasty geopolitical results - along Minsky lines, a long period of stability encourages increasing risk-taking, culminating in the GFC in the economic sphere and who knows what in international politics.

I'm not sure what I think about his ideas, though if he's right people should be deeply concerned, in particular, about higher economic and social immobility: for us economic liberals (why, yes I am) high equality of opportunity is one of the bedrocks of a fair - and efficient - society. Could we be going the same way in New Zealand? It's possible: you look at deeply regressive ideas like ever more prevalent, and tighter, school zoning in Auckland, for example, or our inability to progress infrastructure build-out to any defensible timeframe, and you can see aspects of the same issues. In any event, it's very well written and well worth a read.

Not every economist, to put it mildly, writes so well. If you want to improve your own writing style (and want to understand why you should), or you're teaching economics students, who may get little (and possibly no) formal in-faculty communications training, try Deirdre McCloskey's Economical Writing. It's short (only 98 pages including the index), geared to economics examples, spot on in its advice, and (if you've got cash-strapped students), cheap. My copy arrived from The Book Depository for $27.24, delivery included.

In politics, the definitive account to date of the Brexit campaign is Sunday Times political editor Tim Shipman's All Out War: The Full Story of How Brexit Sank Britain's Political Class. It's a big book, and there's a cast of thousands at the beginning to get your head around, but stick with it. It's enormously well informed, and persuasive. One thing I learned is that David Cameron didn't fight the Remain side as hard as he might have, because (a) he thought he was going to win anyway and (b) he was thinking strategically about the embittered and disunited Conservative party he'd have to manage later if everyone had earlier put the boot in hard. Another was that I'd been inclined to blame the European Union for their short-sighted churlishness in not giving Cameron a renegotiation 'win' to wave in front of the UK voters. They're not blameless, but as it happens Cameron never asked for as much as he might have. And finally Cameron himself comes as a decent human being - one of the very few to keep their cool through the dramas of the campaign, even on election night as the shock vote came through - which is more than can be said for practically everyone else involved.

Which leads me to now freelance journalist (and previously with the Daily Mirror and Daily Telegraph) Rosa Prince and her Comrade Corbyn A Very Unlikely Coup: How Jeremy Corbyn stormed to the Labour leadership. Talk about unintended consequences: a Labour electoral system specifically designed to produce a short list of candidates acceptable to the parliamentary Labour party, before going to the wider electorate of unions and members, was subverted to produce the exact opposite. Oddly, at one level, I came away with a somewhat better opinion of Corbyn himself: he's loyal, honest, a hardworking and locally respected constituency MP, and (for the most part) straight up about what he believes in, unlike the trimmers and hedgers he faced in the run-off for leader. But a lot of what he believes in is either misguided or obnoxious: in particular, he strongly believes in "my enemy's enemy is my friend", leading to his support for the likes of the IRA and Hamas.

He's also got one asset that none of the other contenders had, and none of his plausible future rivals have, either: he's paid his dues over decades and decades. No demo was too small, no fund-raiser too insignificant, no campaign too tiny: he turned up for all of them. He's consequently built a devoted, well left of centre, activist supporter base that eats out of his hand, and which got a further big boost from the "three pound vote" feature of the leadership election. My guess is that there's little chance he'll resign if (as seems likely) he loses next month's general election: why would he? His 'Momentum' group has finally succeeded in grabbing control of Labour, where earlier 'entryist' conspiracies had failed. They won't be going away.

We were tweeting each other about something else, and Westpac's acting chief economist Michael Gordon reminded me that I'd never got round to reading Irish Times columnist Fintan O'Toole's Ship of Fools: How Stupidity and Corruption Sank the Celtic Tiger. It does what it says on the tin: it's a devastatingly hard-hitting, and accurate, critique. It perhaps underplays the role of joining the euro, which for already red-hot Ireland meant getting the monetary policy of slow growing Germany (and which helped do for Greece for similar reasons), but is otherwise bang on the mark.

My father used to tell the story of how one Irish MP would find out when constituents were due to receive the old age pension, and would write to them saying, "I've been in touch with the Department, and I'm pleased to be able to tell you that as a result of my inquiry you will get a pension of...". Shabby stuff - but the really shabby thing is that constituents expected MPs to deliver goodies by using 'influence' within the system. In one example in Ship of Fools, a building developer got a biddable politician to change the postal district of his development, so it would be reclassified into a more upmarket area. There are very good reasons for keeping MPs away from micromanagement of personal cases.

In fiction, we've sadly reached the end of the road for Peter Corris's epic Hardy series of Australian private eye stories, with the 42nd and last, Win, Lose or Draw, where Hardy is on the very cold trail of the abducted daughter of a wealthy businessman: she may or may not have been sighted, in very bad company, in Norfolk Island. Corris is flagging it away, after diabetes induced blindness has got too much for him. It's a real shame: the series is one of the classics of the private eye genre.

Joseph Knox's Sirens is a debut novel about police detective Aidan Waits in Manchester, who is called in to help rescue the runaway daughter of an important politician and goes undercover in her drug-running circle. She eventually dies from adulterated heroin as do seven middle class kids at a party (they turn blue). There's vivid detail about drug use and gang wars: one minder is force fed black and white paint, for reasons I'll leave you to discover for yourself. It's a complex plot, maybe almost over complex at the start, but otherwise it's very well written.

Another debut is L S Hilton's Maestra, where a  low on the totem pole woman at a posh art auction house rumbles a crooked art deal, gets fired, but ends up getting her revenge: it  involves a sting on Mafia art dealers (plus a lot else). Violent, with remarkably explicit sex from a female point of view: it ends 'To be continued'. I'm looking forward to the next instalment.

Finally I broke one of my own best rules - don't read private eye books where the private eye has a silly name - but I'm glad I did. George Galbraith, aka J K Rowling, is now up to three in her series about ex-military London private eye Cormoran Strike. Galbraith/Rowling is excellent at characterisation and tension-building: I loved the first, The Cuckoo's Calling; was okay with the second, The Silkworm (which may have elements of a roman à clef in the publishing world), though my wife thinks it's just as good as the first one, so what do I know; but in any event Rowling is back on song in the latest, Career of Evil. I gather there's a fourth on the way. Recommended.

More good books - April 2017

A history of Britain's Census may not be many people's first idea of a good read, so you'll be pleasantly surprised by Roger Hutchinson's The Butcher, the Baker, the Candlestick Maker: The story of Britain through its census, since 1801. It's full of interesting themes and 'fancy that' detail: the 1841 census, for example, was the first to record people's names and ages (the previous ones were effectively just enumerations), but among the details it got wrong was Queen Victoria's birth date ('about 1821') when in fact it was 1819. As Hutchinson says (pp60-1), "If the national census could consistently get wrong the personal details of the Queen of Great Britain and Ireland and future Empress of India, what hope had anybody else?".

But that's to do the early census takers a bit of an injustice. In the days when the IT infrastructure was paper, pens and horses, the early censuses got the job done remarkably quickly: first results from the census of March 1 1801 were published in June 1801, and 600 pages of summaries and abstracts in December 1801. I doubt if we could manage the same today. Our technology has improved out of all recognition, but so have assorted deadweight managerial costs and, especially, mission creep. You should see the form that our census enumerators will be using in 2018 to record answers to the religion question, which includes at its most detailed level 167 different 'Religions', 'Beliefs' and 'Philosophies', including Satanism, Maoism, and the Church of the Flying Spaghetti Monster (aka Pastafarianism).

Some of the recurrent themes remain highly topical. The late 19th century influx of Jews from eastern Europe, as documented in the 1891 census, got the racists slavering: as the author says (p225) "Right-wing populists denounced an 'alien invasion' which was apparently taking British jobs from British workers. Ratepayers were, according to the Manchester Evening Chronicle, being bilked of excessive poor relief" (the rates-financed social welfare of the day), just like today's incoherent reactions where immigrants are supposedly both stealing jobs and bludging on the dole. An inquiry as part of the 1901 census, however, found that in the archetypal Jewish refuge, the East End of London, "The proportions of indoor Paupers [i.e. totally destitute and reliant on workhouse relief] among the general population and among the European Foreigners were 15.1 and 1.7 per 1,000 respectively" (p233). And among those damn job stealers were people like Michael Marks (first counted in the 1891 census), who had the temerity to go on and build Marks & Spenser. Shouldn't be allowed.

We've moved on from that, haven't we? Then you read on Wikipedia that in the 2011 UK census, "Other new questions involve asking migrants their date of arrival and how long they intend to stay in the UK; respondents also required to disclose which passports they held". But no doubt that's all intended to inform sound policy analysis. In any event, you'll find yourself following Hutchinson down all sort of interesting historical side alleys, and learning a fair amount of economic history on the way. It's a good read.

I try to stay in touch with Aussie politics, and my latest foray is David Marr's Faction Man: Bill Shorten's Pursuit of Power, a short portrait of the Australian Labour Party leader that is an updated and extended version of a 2015 Quarterly Essay. Shorten has made it to the top of Labor via the Australian Workers' Union, where he was initially an organiser, then National Secretary from 2001 to 2007, when he became a federal MP. I knew next to nothing about Shorten before this book, which broadly makes the case that he is a rough-house player of Australia's factional politics, with little commitment to any settled philosophy beyond self-advancement: a Paul Keating without a programme. I'll be interested to learn more beyond this initial worrying impression.

I've been having a good run with fiction. Top of the list is debut author Jane Harper's The Dry, a riveting and extraordinarily well written novel about murders in rural drought-ravaged Australia: even if you're not normally a crime/murder reader, make an exception for this one. I came to Jonas Jonasson backwards - I read his later Hitman Anders and the meaning of it all ahead of his earlier (and now filmed) The 100-year-old man who climbed out the window and disappeared - but they're both good, though hard to categorise (black comedy? satire on modern Sweden?). If time's short, try Hitman Anders and see if you like the style. And I very much enjoyed David Thorne's East of Innocence, where an ex City of London lawyer is now reduced to scraping by in Essex and gets involved with police brutality and the local Essex hard men.

In 'more of the same but just as enjoyable', there's the fourth (Silk Chaser) in Peter Klein's series about an Australian professional better on the horses who finds himself caught up, Dick Francis style, in industry shenanigans, this time the serial murders of 'strappers' (horse grooms). And there's the latest (Tatiana) in Martin Cruz Smith's series about Russian police investigator Arkady Renko, where an investigative journalist falls foul of the Russian powers that be.

Good intelligence/espionage novels can be hard to find, so you might want to try Alan Judd's series about a chap making his way up through the British security service. I've finished Legacy and am half-way through Uncommon Enemy, with Inside Enemy still to come. And then there's the ever reliable Gerald Seymour's latest, Jericho's War, about a semi-officially-sanctioned raid on high value Al Qaeda targets in the back blocks of Yemen. All good stuff. And let's hope that one of the great maestros of the genre, Alan Furst, gets his mojo back into top gear this year.

Books for politics junkies

With our mainstream media generally undercovering our closest geographical and philosophical neighbour, you'll have to educate yourself about Australia. For your latest edification, try Troy Bramston's Paul Keating: The Big-Picture Leader, which as the author says "offers a broadly favourable but not uncritical account of of Keating's public life and legacy". It's well written, convincing, highly informed: Bramston has talked to everyone who was anyone. I didn't know, for example, that Keating was the ultimate 'numbers man', with a Lyndon Johnson ability to steer issues through factions, caucuses and Cabinets. It will get you thinking, in particular about the future of once successful combos of social liberalism and economic reform - Hawke/Keating, Lange/Douglas, New Labour in the UK (Blair was influenced by Keating) - who now find themselves uncomfortable coalitions of Chardonnay socialists and the old union-centred left, and have yet to work out a renewed, electorally viable role.

As you read, you'll find many parallels with New Zealand. Critics of our 'Rogernomics' like to think we went on a weird extremist trip of our own, but as this book shows, Australia started before us (1983), as did the UK and the US, and although we blitzed the Aussies for a while with the speed and depth of our own reform programme, and in some respects (eg fiscal policy) we're still ahead, by and large they've kept going while we've slacked off. Few would doubt that (as this book demonstrates) Australia's reforms in Keating's time formed the bedrock for the recession-free period Australia has enjoyed since, and conversely our low productivity record suggests unfinished domestic agendas.

Still on politics, the upcoming French presidential election is in the near term one of the bigger risks to currently richly-priced financial markets and in the longer term to the prospects for the eurozone and the global economy. If, like me, your knowledge of French history goes a bit hazy between the French Revolution/Bonaparte and the World War Two Resistance, then the book for you is Jonathan Fenby's The history of modern France: from the revolution to the present day. He's got some sharp insights: "Successive presidents and governments had applied a self-serving logic in refusing structural change to the economy - if times were hard and growth was low, reform was impossible; if things were going better and there was no expansion, there was no need to change anything. It was an evasion of reality, and of necessity" (p484), which explains why France has been running a Nordic social welfare system but not paying for it (the fiscal budget been in deficit for 35 years).

Does history give us any tips on how the election might go? If you're worried about Le Pen (as you should be), you won't take much comfort from Fenby's conclusion that "the various narratives of the last two centuries have shown that the country invariably opts for right over left with occasional eruptions to prove that its revolutionary legacy is not dead" (p463). Nor from "The idea of the Hexagon [France] as a model for the world is not one which many people could objectively defend in the twenty-first century, but it remains a potent reason to repel change of foreign influences. The French want to see their country as the bearer of a special mission bequeathed by their history...If the present really contradicts such a vision...this leaves them deprived of what they believe should be theirs by historic right and opens them to the temptation of extremist illusions" (p461).

History also reminds us of the suicidal factionalism of the French Left. In 2002 Marine Le Pen's dad Jean-Marie came second (with 16.8%) to Jacques Chirac (19.8%) and made the run-off second round, principally because the Left split between Lionel Jospin (16.1%) and 10 (!) others. And guess what? This year the Left has fielded two big name candidates - the official Socialist, Benoît Hamon, polling around 13%, and independent far-left Jean-Luc Mélenchon (around 11-12%). Unsplit, the left vote could see off the right's François Fillon (around 19%) and give the independent Emmanuel Macron (low to mid 20s) a real run for the second run-off slot, behind Le Pen. What is it about déjà vu the French left doesn't understand?

Good books - December '16

Surrounded by "isn't it awful", "the world is going to the dogs" types? Here are two antidotes: Nobel laureate Angus Deaton's The Great Escape: Health, Wealth and the Origins of Inequality and Johan Norberg's Progress: Ten Reasons to Look Forward to the Future. Both document the immense progress made in the past three hundred years by large parts of the world on multiple fronts - not just in living standards, but also in health, longevity, literacy, freedom, peace and global equality. Deaton's book in particular will remind you that a prime reason many poor countries have missed out is political: they are kleptocrat tyrannies (another reminder, if you haven't yet, to read Acemoglu and Robinson's Why Nations Fail), which is one of the reasons why Deaton is critical of foreign aid (it keeps the Mugabes going). He's got better ideas on how to help them, including making trade with the developed world easier. And Norberg is full of interesting facts, including that "285,000 more people have gained access to safe water every day for the past 25 years", and that 2,000 more people will have escaped from poverty in the time it takes you to read his first chapter.

I didn't profit from George Lakey's recent Viking Economics: How the Scandinavians Got It Right - and How We Can, Too. It's as if he went on a Seventies demo, fell asleep mid-chant - "The workers! United! Will never be.." - and woke up yesterday. And while good ideas on economic policy can and should come from anywhere and anyone, sociology isn't where I'd go looking first. It doesn't help that the "we" in the title is "the US", not "everyone", which means that when he compares Nordic health systems with America's, they're better, but then, whose isn't? So it's hard to draw conclusions about Nordic implications for everyone else. I'm pretty sure there are some good Scandinavian ideas we could pirate (particularly the Danish 'flexicurity' of jobs, and possibly the Finns' education ideas), but I wouldn't use this book as the instruction manual.

If you did want a good guide, try Helen Russell's The Year of Living Danishly: Uncovering the secrets of the world's happiest country. Great armchair travel from a very good freelance writer. One interesting fact is that by international standards Denmark is a high trust society - you can, and they do, leave your baby in the pram outside the restaurant - which is one reason they tolerate the government taking 54.6% of GDP: they trust their representatives to do the right thing with it. More than I could say about any recent New Zealand (or Aussie, British or Irish, let alone American) governments.

Speaking of Aussies, we don't get enough mainstream media coverage of their politics other than at moments of high drama (though there have been a fair few of those recently). I liked Annabel Crabb's Stop at Nothing: The Life and Adventures of Malcolm Turnbull: concise, punchy, well-informed. The back jacket summarises Turnbull as "colourful, aggressive, humorous and ruthless" in his pre-politics days, and looks at whether he's changed much since: not a lot, I'd say. He's also a good deal more interesting as a person than I'd imagined: it may not help his liberal-trapped-in-a-conservative-party day job much, but he'd make a good addition to most pub quiz teams.

Timothy Garton Ash's The File: A personal history is the story of what he finds when he reads the file the East German Stasi security service kept on him. He comes to a relatively generous conclusion about the 2% of the East German population who were informers for the Stasi - "What you find, here in the files, is how deeply our conduct is influenced by our circumstances...What you find is less malice than human weakness...when you talk to those involved, what you find is less deliberate dishonesty than our almost infinite capacity for self-deception" - without losing sight of the big point: "Yet the sum of all their actions was a great evil".

Boston must be the setting for more good thrillers per square mile than anywhere on the planet, the latest being Michael Harvey's Brighton (a Boston locality) where a Pulitzer prize winning journalist who'd escaped the poor Catholic Irish 'burb comes back to help his teenage friend, who is suspected of several murders. The blurb on the cover says "riveting and elegiac", and it is: fine writing. Harvey's also got a series about a Chicago based private eye, Michael Kelly: I've read the fifth of them, The Governor's Wife, which was also very good.

University of Wolverhampton professor Gary Sheffield has come out with Douglas Haig: From the Somme to Victory, an updated and revised version of his earlier (2011) The Chief: Douglas Haig and the British Army. It's a balanced account that gives Haig more credit than he usually gets, and particularly on the logistical side of running an enormous enterprise. As Sheffield notes (pp154-5), at its peak the British army in France had to feed 2,700,000 men: "To keep one division in the field for one day required 'nearly 200 tons dead weight of supplies', and Haig's army consisted of more than 60 divisions". Haig as chief executive comes out well; Haig as general, somewhat well, though I haven't been entirely shifted from the "lions led by donkeys" camp. You could argue that Haig's "one last push and we'll break though into open country" was indeed finally vindicated, but too many people died to get there. Then again, it's also hard to shake the thought that, with the technologies of the day, there was little alternative to an attritional strategy, however appalling the casualties became.

Military historian Allan Mallinson doesn't like the "lions led by donkeys" line (it's "facile"), but in his Too Important for the Generals: Losing and Winning the First World War he's not impressed by the generals' strategic grip: "nothing can acquit the high command of its failure to see beyond no-man's-land [on the Western Front] and its embrace of the 'strategy of attrition" (p330). He also believes that the politicians should have taken a stronger hold of the overall direction of the war, and in particular gone for more flanking initiatives (like a better run Dardanelles operation) as well as boosting support for Russia and Serbia, rather than letting Russia slide into revolution and Serbia lose to Austria. All of which reflects the still unsettled scholarship on the Great War: you no sooner read one book suggesting the generals were doing as well as they could than the next suggests the opposite.

In brief: anything Robert Harris turns his hand to (the life of Cicero; a dystopian world where Hitler won) is highly readable. You'll like Conclave, which (natch) is about a papal election. Carl Hiaasen's written a series of high-paced comic novels about Florida bizarrenesses: his latest, Razor Girl, is right up with the rest of them. And if you like private eye novels set back in the Roman Empire - and let's face it, who wouldn't - you've probably worked your way through Lindsey Davis' Falco and Flavia Albia series and John Maddox Roberts' SPQR series, but don't miss the equally good Russo ones by Ruth Downie. I've just finished the latest, the fifth in the series, Vita Brevis.

Good books - October '16

Top billing this month goes to Timothy Garton Ash and his Free Speech: Ten Principles for a Connected World. It's enormously well researched (19 pages of bibliography) and amounts to a full-on defence of the right to free speech against the assassin's veto, the heckler's veto, the fundamentalists' veto and indeed the crybully victims' veto as they flee from "trigger alerts" and quiver in their "safe spaces".

As a practical matter it "proposes a framework for civilised conflict in a world where we are all becoming neighbours" (the 'cosmopolis') with 10 principles that I reckon most Kiwis would sign up for, ranging from the bedrock Principle 1 - "We - all human beings - must be free and able to express ourselves, and to seek, receive and impart information and ideas, regardless of frontiers" - through to (say) Principle 8, "We must be empowered to challenge all limits to freedom of information justified on such grounds as national security". It's a tricky area: even people way down the progressive liberal end of the world can sometimes wonder where any limits should be drawn (cartoons of Mohammed, if likely to lead to deaths?). This book will put you back on the right post-Enlightenment track, where we have a duty to think for ourselves and a right to say what we think. It's rather sad that large parts of the world, including people in the 'West' who should know better, are slipping into - or even embracing - a new Endarkenment.

Sarah Bakewell's At the Existentialist Café: Freedom, Being, and Apricot Cocktails is an excellent explanation of existentialism. Like many others (including me) she dabbled with it as an angsty teenager, flagged it away, but has now come back to have another look. It's not easily summarisable as a philosophy - the most I'd take away from it is that your big task in life is to be responsible for your own decisions - and it hasn't benefited from a progressively more obscurantist lineage from Husserl through Heidegger to (especially) Sartre. Incidentally, if you'd like to explore some historical context behind the annoying French predilection for complex metaphysics, try Sudhir Hazareesingh's How the French Think : An Affectionate Portrait of an Intellectual People.

There are good portraits of the leading personalities. Bakewell makes a good case that Simone de Beauvoir may prove to have the greatest legacy, and Maurice Merleau-Ponty comes out well, too. I tried to buy into her appreciation of Sartre, but I couldn't get there: for me his fiction remains as unreadable as his prose, and I wouldn't swap Boris Vian's little Froth on the Daydream (let alone anything by Albert Camus) for all Sartre's output. Heidegger's reputation has been, probably irreparably, damaged by his enthusiasm (never retracted) for Nazism, but that wasn't all that was wrong with him. The book has the story of how Heidegger arranged, when a poet was visiting him, for the local bookstores to have the poet's works displayed in their windows. Nice gesture, but as Bakewell acidly observes (pp304-5), "it is the only documented example I have come across of Heidegger actually doing something nice".

Bakewell's got a good line going in explaining philosophy to the intelligent reader: if you like At the Existentialist Café, have a go at her earlier How To Live: A Life of Montaigne in one question and twenty attempts at an answer.

Joseph Lelyveld's His Final Battle: The last months of Franklin Roosevelt covers the last year or so of FDR's life. It doesn't add a huge amount to the big picture of what we already know about him: probably the most effective politician of the twentieth century, with an unrivalled mastery of political strategy and tactics, and a most remarkable capacity for cunning and artifice. But it does flesh out a lot of the detail of his last year. How times have changed: even in the middle of World War Two, Roosevelt was able to clear off for weeks at a time from the White House (and without letting the public know where he actually was); press briefings were off the record; air travel was primitive; and his doctors were able to cheerfully and repeatedly lie through their teeth about his precarious health and get away with it. Physically, over that last year, he wasn't up to the demands of the office, and there's a good case that the strain of keeping going killed him, though his health was so poor that even the lower demands of a peacetime presidency might also have carried him off. That said, Roosevelt half-dead was twice the calibre of most of his successors.

I like to browse the 'Just returned' shelves at the library - you probably do too - which is where I found John Hornor Jacobs' The Incorruptibles. It is described by a reviewer on its back cover as "One part ancient Rome, two parts wild west, one part Faust. A pinch of Tolkien, of Lovecraft, of Dante. This is strange alchemy, a recipe I've never seen before", and neither had I, and on that description (which leaves out a soupçon of vampires) you mightn't ever want to. I'm still not entirely convinced it isn't some sophisticated parody of 'quest' tales. But for all of that, it was a rollicking good read. My wife also thought it was very strange,but she got into it, too.

On the go: Angus Deaton's The Great Escape: Health, Wealth, and the Origins of Inequality; Richard T Kelly's The Knives (novel set in modern UK politics); Timothy Garton Ash's The File: A Personal History (the file is the one the East German Stasi kept on him); Anthony Gottlieb's The Dream of Enlightenment: the Rise of Modern Philosophy; and Jeffrey Lee's God's Wolf: The Life of the Most Notorious of All Crusaders, Reynald de Chatillon.

Good books - September '16

Economics reading has been a bit thin on the ground recently, so instead let me pass on some third party recommendations. Diane Coyle at The Enlightened Economist got asked to recommend "some general reading for someone about to start a masters in public policy" and came up with this reading list. It's excellent: I've read four of them (Reinventing the Bazaar, Who Gets What and Why, What Money Can't Buy: The Moral Limits of Markets, and Economics Rules), and they were all very good, so I reckon you can trust the rest of the list as well.

And on the strength of this fine review by Deirdre McCloskey in Prospect magazine, I've pre-ordered my copy of economic historian Joel Mokyr's latest, A Culture of Growth: The Origins of the Modern Economy. Out on November 8, the hardback was only $40.71 (postage included) from The Book Depository in the UK. Mokyr's earlier book, The enlightened economy : Britain and the Industrial Revolution, 1700-1850, is also very good, if you'd like an update on where modern thinking has got to on the genesis and progress of the Industrial Revolution in the UK. If you're an economics student in New Zealand and you're interested (as you should be) in economic history, you're going to have to take this DIY route since, apart from a new course AUT is bringing out, there's virtually nothing offered on the economics syllabi anywhere (as I documented here).

Politics: I enjoyed Michael McManus's Edward Heath: A Singular Life. It's not a conventional biography - it started life as an intended collection of tributes and anecdotes from people who knew Heath but morphed as the material accumulated and McManus decided to make something bigger out of it - but it is still fascinating. Towards the end (p366) McManus summarises Heath as a "decent, shy, sometimes frustrated, often difficult, rarely charming, wantonly brusque, proud public servant who always believed in fairness and who loved his country".

People certainly remember the brusqueness and the rudeness - for a politician, he had a remarkably low EQ, and whatever lay behind his odd personality is still not obvious - and he became an even more awkward cuss when he was rolled by Margaret Thatcher. But they don't remember the better bits. Purely on merit, he got to the top of the socially hidebound Conservative Party, the first leader to be elected rather than anointed behind the scenes by the well-connected bigwigs: charmingly, he got nicknamed 'Grocer' by the toffs for his middle-class background. He had an admirable contempt for political spin and artifice, which was one reason he despised Harold Wilson (with, as history goes by, ever clearer justification). He had a life outside politics (talented musician, internationally competitive sailor). And he believed in attempting to reach agreement by principled negotiation in good faith - a fine ambition, and effective in piloting the UK into the European Community, but doomed to founder domestically in the dire industrial relations of the time.

The hardline union leaders of his day would have done better to meet him half-way, as they belatedly discovered from 1979 onwards, but they did for Heath, and the last of any legacy he might have claimed was swept away with Brexit. There are elements of tragedy to his story: they won't leave you feeling hugely sympathetic to the man - even the author, who worked for him, couldn't get that far - but you'll likely end up with a fairer overall view.

History: I was a Great War buff in any event, and didn't need the centenary of the Somme to have a go at the new books out commemorating it. I've finished Hugh Sebag-Montefiore's Somme: Into the Breach, and it's a good, solid introduction to what is still one of the bywords for wholesale slaughter. It also marked the New Zealand Division's blooding on the Western Front, at Flers in September 1916: you'll see the name on WW1 memorials all over New Zealand. Things would get worse again at Passchendaele in 1917.

By happenstance, Sebag-Montefiore uses the NZ Division as an example of the prevalence of venereal disease, of war crimes (killing prisoners) and of kangaroo court martials: he says they were equally prevalent in other units, but I can't say I was best pleased. Fortunately you'll get a better overall picture of our guys from Glyn Harper's Dark Journey: Passchendaele, the Somme and the New Zealand experience on the Western Front, where equally by happenstance I point you to how our chaps (and the Aussies) stopped the last great German offensive of the war in 1918 when General Gough's Fifth Army was running away. And if you want a classic example of Kiwi understatement, it's hard to beat the comment (reported on p467) of one infantryman, burying some of the dead after the battle for Bapaume in September 1918: "when there was only two of us left of our lot, I began to think: This is not too good".

Everyone should read a few of these front-line focussed books - it's still hard to go past Martin Middlebrook's 1971 classic The First Day on the Somme, or any of Lyn Macdonald's books, such as 1915: The Death of Innocence or They Called it Passchendaele - but at some point you'll inevitably start to think higher level thoughts about overall strategy and the meaning of it all. There are many thousands of choices, but one good entry point is J P Harris's relatively recent (2008) biography, Douglas Haig and the First World War.

Glyn Harper worries that much of the Great War, and New Zealand's part in it, is being forgotten, and only partly because Gallipoli overshadows everything else: "It is a tragedy that the events of Passchendaele are largely unknown to the majority of New Zealanders (p138)...Though the struggle to capture the town of Bapaume is a relatively unknown battle in New Zealand's military history, it does not deserve this obscurity. It was one of the most costly and hard-fought battles undertaken by the New Zealand Division on the Western Front (p490)". In these days of 'peace studies' and content-lite curricula, he's probably right. But with so many good books now available, at least there's ample opportunity for people to give themselves the education they should have received in school.

On a lighter note, the great Robert B Parker, who died in 2010, set the gold standard for the modern American private eye story with his long-running Boston-centred Spenser series, with its classic themes of honour, manhood, loyalty, courage, and resistance to being pushed around. Dip in anywhere if you've never tried them: they're all good. The franchise has carried on, initially I think because there were unfinished books in the hopper and more recently because some experienced writers have been able to turn the handle on the formula. I just finished one of these recent ones, Ace Atkins' Robert B Parker's Kickback, about the evil connections between a lock-'em-up judge and a privatised prison operator. Excellent, and indistinguishable from the original.

Peter Corris is fortunately still with us, with his Sydney-based Aussie private eye, Cliff Hardy. The latest in this wonderful atmospheric series is That Empty Feeling, a flashback to corporate shenanigans in the Sydney of the 1980s. And if you liked that, you'll also like Philip Temple's Jack Irish series, set in Melbourne, and probably the non-Irish books Temple has written, too.

Good books - August '16

Let's start with the economics: David Evans and Richard Schmalensee, two big names in the field, have written Matchmakers: The New Economics of Multisided Platforms. Highly relevant to today's world of social media and network apps, easy to read, insightful - I especially recommend the checklist (starting on p150) of things people will need to have thought through if they want to create a successful platform - and another fine example of how economists can add value to business strategy. If that's an interest, pair it with Hal Varian's Information Rules: A Strategic Guide to the Network Economy (I lent my copy to someone and never got it back. If that's you...).

Politics: Niki Savva's The Road to Ruin : How Tony Abbott and Peta Credlin Destroyed Their Own Government is fascinating. Apparently there are still people (at the Spectator's Australian edition, for example) who think the more socially conservative Abbott would have been a better Prime Minister than the relatively liberal Malcolm Turnbull. That notion doesn't survive a moment's encounter with this book. It's also very good on the mechanics of coups. Assassins need to plan meticulously, but be ready to move at once when they have the numbers. And incumbents need to realise that the only numbers they can trust are those totting up the people who say they won't vote for you.

History: Philippe Sands' East West Street: On the origins of "genocide" and "crimes against Humanity" has a dry and rather baffling title that might lead potential readers to try something else instead, but carry on regardless and give it a go. It's about the family histories of two Jewish lawyers who came up with the legal doctrines of genocide, and crimes against humanity, for the Nuremberg war crimes trials: before then, there was nothing in international law to stop sovereign governments from persecuting their own citizens. As it happens, their histories, and the author's, and that of Hans Frank, the brutal Gauleiter of occupied Poland, all intersect in Lvov in today's Ukraine: the East West Street in the title is in the nearby town of Zolkiew.

Many of the family histories end badly. Both the Nazis and the Russians were determined to eliminate the Polish intelligentsia, and the Nazis also targeted Jews of every description. The genteel, bourgeois, provincial society that had prospered in what was Austro-Hungary's Lemburg was annihilated, as were others. As one way of remembering what was wiped out, have a look at the photography of Roman Vishniac's A Vanished World.

Still on a historical tack, Mary Beard's SPQR: A history of ancient Rome has had great reviews all round, and for good reason. It covers the rise of Rome from its earliest days through to Emperor Caracalla (d AD 217), is a joy to read, and is near-essential reading for anyone who want to understand the origins of the modern western world. I saw that it featured in the Wellington version of Unity Books' best-seller lists (carried in The Spinoff) but not in the Auckland one, which says something about both places.

You don't need any Latin to read SPQR, but if your interest is piqued or, like me, you learned Latin at school or university (a scholarship in Latin and Irish paid my university fees) but have let it slide since, then have a read of Ann Patty's Living With  A Dead Language: My Love Affair with Latin. At which point you've got two choices (or do both, as I did). You can go the old-fashioned learn-by-rote route, in which case your best bet is N M Gwynne's Gwynne's Latin (his Chapter 4 makes the case for the old ways), or you can go the comic book slide-up-to-it-obliquely route of Maurice Balme's and James Morwood's Oxford Latin Course. There are various commercial editions: mine came with three paperback books of lessons plus a paperback Reader with the usual suspects (Cicero, Caesar, Virgil...)

If you're like me, you'll have a finite appetite for striking camp and slaughtering Gallic tribes, and I've always found Cicero a tedious old gasbag - though he lived a dramatic life, brilliantly fictionalised in Robert Harris's trilogy Imperium, Lustrum and Dictator - so you may want to try some other authors in the original.

This is where you'll need the Loeb Classical Library, which does parallel texts, Latin on the left hand page, English translation on the right. The Letters of Pliny the Younger are worth a look: they include an eyewitness account of the eruption of Vesuvius, and, in what feels like quite a modern section, Pliny's memos back to head office when he was a provincial governor under the Emperor Trajan, including the one asking what to do about these pesky Christians (don't witch-hunt, Trajan replied). Martial's Epigrams are fun, and handily come in mostly bite-sized chunks. The Latin is more difficult than Caesar, and at first you'll need to treat them like crossword puzzles to be teased out, but they're an exceptionally vivid glimpse of Rome in the first century AD.

You'll need a dictionary, but don't go mad about it. My Collins Latin Dictionary & Grammar was cheap and perfectly adequate.

Serious fiction: I don't know what sort of genre it can be slotted into, and others have struggled too ("a madcap new novel" isn't very helpful) but Jonas Jonasson's Hitman Anders and the Meaning of It All is an absolute delight. I gather his big claim to fame is his earlier The Hundred-Year-Old Man Who Climbed Out the Window and Disappeared, which has been filmed.

Thrillers: I mentioned earlier that I love Philip Kerr's series about Bernie Gunther, a police office in the Berlin criminal police during World War Two. I can highly recommend his latest, The Other Side of Silence. Bernie has escaped from a Russian prisoner of war camp, and is working under a false name in the south of France in 1956, where he gets entangled in manoeuverings between the KGB and the Brits, centred around Somerset Maugham's villa.

Another good one is Tom Wood's A Time To Die, the latest in a series about a professional assassin. As a genre, it can be dire - though I liked Lawrence Block's 'Hit' series, Josh Bazell's Beat The Reaper, and Chris Holm's The Killing Kind  - but this is terrific. It's mostly set in Belgrade, a place I used to know reasonably well. I was there on business in the early '80s, and again in the early '90s, and it's the only place I've ever been where you could see that the standard of living had gone markedly backwards. Which is a cue for one of the best economics books I've ever read, Daron Acemoglu's and James Robinson's Why Nations Fail: The origins of power, prosperity and poverty.

Those who don't know history...

Richard Grossman's book, Wrong: Nine Economic Policy Disasters and What We Can Learn From Them*, is a worthwhile read.

The nine disasters are Britain's loss of the American colonies, the Irish Famine, America's lack of a permanent central bank pre 1913, German reparations after World War One, inter-war protectionism, Britain's return to the gold standard in 1925, Japan's 'lost decade' in the 1990s, the GFC, and the euro. Grossman's take is that they were typically the result of "commitment to outdated or fundamentally flawed economic ideologies", "the outsized influence of private interests", and "efforts to shift costs onto foreigners", and were also "frequently compounded by excessive delay".

We've got better at some of these - reparations are probably a permanent goner (though you could say Trump's Mexican wall is a variant), and trade barriers are much lower than they used to be despite the best efforts of the nutters and the rent-seekers - but some of the underlying drivers of big mistakes are still alive and well. Grossman has a range of suggestions to counter them, and particularly the groupthink that can set in around an ideological (or indeed any) settled way of doing things. While it's never going to be easy to know "when changes in circumstances render a previously sound economic ideology obsolete", he says that

Theoretical and empirical models combine current understanding about the relationships between various elements in the economy and can help predict the consequences of proposed policies. Cost-benefit analysis weighs the hypothesized expenditures associated with a policy against its anticipated payoff. And historical and comparative studies can provide useful analogies adopted at other times and in other places. These tools have proven their worth, although none is perfect...Using these tools to subject proposed initiatives to vigorous testing is far more likely to yield sensible policy prescriptions than blind adherence to ideology or precedent (p183)

All very sensible. But the reference to the value of "historical and comparative studies" reminded me that I've had a vague feeling for a while that economic history isn't in fact being taught to New Zealand economics students. So I went and had a fossick around the websites of all the universities to see what's being offered or required as part of an economics major bachelor degree. My vague feeling was completely right. Here are the results, in alphabetical order (the links go to the source info I used).

Auckland - nothing specific though ECON232, 'Development of the International Economy', has some, mostly focussed on the 20th century
AUT - nothing specific**
Canterbury - aha! The good news is that 300-level ECON342, 'Economic History', is bang on the money and says "We study the causes and consequences of the Three Great Transformations: language, agriculture, and the commercial and industrial revolutions that began in the 16th century". The bad news is it was last offered in 2014, and is not currently on the menu
Lincoln - doesn't seem to offer a straight-up economics major
Massey - nothing specific. You get some local political history in 148.205, 'New Zealand Politics Since 1890'
Otago - nothing specific
Victoria - nothing specific
Waikato - nothing specific. There might be a bit in ECON336-17A, 'Comparative Economics in Global Perspective', but the paper summary is blank, so you can't tell

Not that my own alma mater is any better. I took my degree in economics and political science at Trinity College Dublin in 1969-73: from memory, economic history was compulsory at the time but in any event was well attended (our lecturer was Prof Louis Cullen). The same degree has morphed over the years into today's 'Philosophy, Political Science, Economics and Sociology' (PPES): the good news is you can drop Sociology after the first year, but the bad news is that Trinity has also dropped economic history from the economics options (though there are still 'history of thought' options in both philosophy and politics).

This is a shame from many perspectives. Economics is part of the wider humanities, and any humanities course should involve some commitment to being a well-informed citizen of the world. It's not right that it should implode into a self-absorbed cult of its own. And even if today's students don't give a toss about the history of the world around them and are only after vocational skills and a credentialed meal ticket, economic history has its own utilitarian value. You never know when something like the history of currency unions won't suddenly be the hottest skill in demand when a Grexit comes along. Ask Ben Bernanke: his academic study of the Depression made him an excellent choice to chair the post-GFC Fed.

If I was John McDermott at our own Reserve Bank, and I was looking to hire a new staff economist, given the ceteris paribus choice between someone who'd taken a personal intellectual interest in the history of bank crises and another automaton off the assembly line who can crank the handle on a DSGE model, I know who I'd pick.

*Oxford University Press 2013, ISBN 978-0-19-932219-0

** Happy postscript August 3: AUT's Geoff Brooke tells me that "we will be offering an advanced undergraduate paper in global economic history at AUT from next year (it is currently timetabled for semester 2). The paper descriptor reads: An introduction to the history of long-run economic growth and related changes in population, social and economic institutions. Theories of economic and social organisation, economic growth, and business cycles are examined and evaluated against the historical record. Methodological debates around the relationship between economic history and economics and history are explored". 

Good books - July 2016

Although readers (going by page views) seem to like the odd diversion into the world of books, I haven't had the time to do many recent reports, the latest being 'Then and now', my look at the latest volume of Charles Moore's excellent biography of Margaret Thatcher (before that, I'd written up The Fall of the Celtic Tiger, and earlier GDP: A brief but affectionate history and Wellbeing Economics: Future directions for New Zealand).

Now, along has come another great new biography - Volker Ullrich's Hitler, Ascent 1889-1939, with a follow-up second volume in the works. It's both very readable (Ullrich is as much journalist as historian) and professional: Ullrich has gone back to many of the original sources and found new takes on them.  People at every end of the political spectrum have loved it: the Guardian's review called it "an outstanding study" and the Telegraph's review called it "chilling and superb".  Even if you've already read Joachim Fest's Hitler: A Biography and Ian Kershaw's Hitler 1889-1936: Hubris and Hitler 1936-1945: Nemesis, you'll get a lot out of this book.

His overall approach, responding to the question that German media asked abut the 2004 film Downfall, "Are we permitted to depict Hitler as a human being?", is to say, "The only answer is: not only are we permitted, we are obliged to". It would certainly be easier, he argues, to explain Hitler away as either a criminally energetic cretin or a psychopathic monster, but one-dimensional perspectives miss important parts of the story. He concedes that what he regards as the key chapter, "Hitler as Human Being", has a "somewhat unsettling title" but goes on to say

To depict Hitler in human terms is not to elicit sympathy for him or to downplay his crimes. This biography seeks to show the sort of person he was since the 1920s: a fanatic Jew-hater, who could tactically conceal his anti-Semitism but who never lost sight of his aim of 'removing' Jews from German society

For me the key takeaways were two. One was that the idea of Hitler as a confused grab-bag of incoherent noxious ideas is wrong: all the evidence is that he had a long-held, mutually consistent set of them, melding the Treaty of Versailles and the 'stab in the back', the need to restore German power through rearmament and to claim lebensraum in eastern Europe, and hatred of Jews and Bolshevism (he may have caught his particularly virulent dose of anti-semitism in Vienna, which is an easy place to catch it). And the other was the total shallowness of the Nazis' pretence at being a democratic party: within weeks they had suborned virtually every civil institution - the public sector, trade unions, professional associations - into executive arms of the Nazi party. If you ever needed one insight into the nature of the Nazi regime, it's this: Hitler was appointed Chancellor on January 30, 1933. Dachau opened on March 22.

As a colleague recently wrote to me, "The fact that we study Hitler biographies to understand our own times is frightening". So it is, but here we are, with very ugly movements underway in the US and parts of Europe (and undercurrents of them in Brexit). Time to wise up on how and why these things get going, and why they need to be stopped. And if any of this has piqued your interest, then move on to Richard Evans' wonderful three volume set, The Coming of the Third Reich, The Third Reich in Power, and The Third Reich at War.

On the fiction side, there are some great books set against the backdrop of the Second World War and the run-up to it. If you'd like thrillers generally around the general themes of intelligence agencies' manoeuverings and resistance against German occupation, often entangling civilians and often in obscure parts of central Europe, then you'll appreciate everything Alan Furst has written: I've just finished his latest, A Hero in France. Each is self-contained: you can start anywhere. Another great series is Phillip Kerr's one about Bernie Gunther, an officer in the Berlin criminal police during the war. Best read chronologically: last time I was in the University Book Shop in Dunedin, they were selling a cheap omnibus edition of the first three books, marketed as Berlin Noir. You'll also have to go chronologically through David Downing's Furst-like six book espionage series about an Anglo-American journalist in Berlin from the late 1930s onwards: they're named after Berlin railway stations, starting with Zoo Station and finishing with Masaryk Station.

On a darker note, there's Jonathan Littell's The Kindly Ones, a huge book formally about SD officer Max Aue, actually an allegory about the German people's relationship with Nazism. As flavour, in one incident, Max is with the Nazi annihilation squads in Eastern Europe:  they go to find a clearing in a forest to bury/hide the corpses, only to find all of the clearings already full of victims.

What else have I been reading that's worth a look? Christopher Petit's The Butchers of Berlin, another Berlin police story from 1943. John Guy's Elizabeth: The Forgotten Years, excellent biography of Elizabeth I. Andrew Taylor, The Ashes of London, a fine whodunnit set in the immediate aftermath of the Great Fire of London in 1666. And although I'm not usually a great one for legal thrillers, try Gianrico Carofiglio, who in real-life is an anti-Mafia prosecutor and has written a series set against that background: I enjoyed his latest, A Fine Line. And though they're aimed at younger readers, anyone of any age will enjoy Neil Gaiman's The Graveyard Book and Katherine Rundell's The Wolf Wilder. And for something completely different, Antoine Laurain's The President's Hat (translated from French, the president being Mitterand).

Not much economics in that lot, I know, but I'll make up for it with two I've got on the bedside table, Richard Grossman's Wrong: Nine economic policy disasters and what we can learn from them, and David Evans' and Richard Schmalensee's Matchmakers: The New Economics of Multisided Platforms. Also lined up to go: Philippe Sands, East West Street: On the origins of "genocide" and "crimes against  humanity"; Timothy Garton Ash, Free Speech: Ten Principles for a Connected World;  and Ann Patty, Living with a Dead Language: My Romance with Latin.

Then and now

I've just finished the second volume, Everything She Wants, of Charles Moore's authorised biography of Margaret Thatcher. It covers 1982-87, and it's excellent. Whatever your political views are - and many people will be starting from a strong opinion about her -  you're likely to end up with a more balanced view. The first volume, Not For Turning, was equally good, and won multiple industry prizes.

From an economist's point of view, it's interesting to look back on the economic policy of thirty years ago. One particularly striking aspect was the bizarrely uncoordinated way of running fiscal policy, or as the book puts it (p185)

Under the British system, the Budget is not a Cabinet decision, though the Cabinet is perfunctorily consulted and informed before it is unveiled to Parliament. It belongs exclusively to the Chancellor [of the Exchequer], and 'The only person the Chancellor is obliged to consult is the Prime Minister'

Some other aspects of fiscal policy also looked questionable. One of the motivations for asset sales was the cosmetic effect of appearing to reduce the fiscal deficit by counting the sales proceeds as current revenue - a bad practice. And monopolies such as British Telecom (BT) were sold off to maximise the sale price, with inadequate controls on subsequent profiteering. Not that the UK was alone in taking the money and running - as recently as 2002, the Australian government sold off Sydney Airport on terms which effectively prevented any rival airport getting underway.

The big UK Budget set-pieces also reminded me that once-a-year adjustment of revenue and spending looked odd even back then, and has become even more anachronistic since. There may be some reasons why you can't adjust fiscal policy day-by-day (people would have some difficulty staying on top of their tax owing, as would the IRD in collecting it), but on the other hand there's been a big step forward in automating the likes of payroll systems over the past thirty years, and some of the supposed constraints on more frequent than annual tax or spending changes may well have dropped away. And there's certainly no good reason why (say) increased infrastructure spending has to wait till May 16 (our Budget date this year) for the starter's pistol to go off.

Monetary policy was relatively primitive. Early on the Thatcher government set out on a tough anti-inflation squeeze - my first mortgage, which I took out in the UK in 1979, was on a fixed 14% rate - and ran policy by trying to manage one or more of the monetary aggregates (typically 'sterling M3'). But Goodhart's Law kicked in, and Chapter 13 consequently deals with 'The death-knell of monetarism'. Monetary policy as we mostly know it today - with an independent central bank and an inflation-targetting regime - didn't arrive in the UK till 1997, under an incoming Labour government with more modern ideas.

Not that everything back then was ramshackle. The UK took a trick with a politically adroit way of allocating shares in British Telecom - "Everyone applying for 400 shares or fewer got 100 per cent of what they sought. Those who applied for 100,000 shares or more got nothing" (p198) - which sat nicely with the 'popular capitalism' aim of the sale, and which might be worth revisiting if we ever get round to future privatisations (that 45% stake in Kiwibank, maybe?).

And the Thatcher government (belatedly) came up with regulation for the likes of BT that was state of the art, including Professor Stephen Littlechild's 'RPI minus X':

This was not supposed to be the ultimate answer to the monopoly problem, but was more of a stop-gap measure until sufficient competition developed. As matters turned out, however, it stopped a great many gaps, and became a regulatory model for other privatizations (p196)

I think it can still plug a great many gaps, and I'm not sure we (and other countries) are doing a better job with highly complex and expensive 'rate of return' alternatives.

I was also reminded of the then closed, snobbish, sexist nature of the City of London, where a provincial, middle class woman with a science degree like Margaret Thatcher was, not to put too fine a word on it, outright despised:

[Cecil] Parkinson recalled meeting her returning from lunch at a big bank before her first victory in 1979. 'They had given her hell. She was very depressed. I said: "Don't worry; they'll vote for you, and they'll forget it". "They may", replied Margaret, "but I won't"' (p215)

Final words to the inimitable Denis Thatcher who was accompanying Mrs Thatcher at a Commonwealth conference in India:

At this conference, Denis's irritation with the physical arrangements boiled over. During the leaders' 'retreat' in Goa, there were constant power cuts. He emerged on the balcony of the chalet allotted to the Thatchers and bellowed: 'This place is very high on the buggeration factor' (p548n)

A cautionary tale

I've just finished reading The Fall of the Celtic Tiger (Oxford University Press, hardback 2013, paperback 2014), a fine book cowritten by my old classmate at Trinity College Dublin, Donal Donovan, and our former monetary economics lecturer, Antoin Murphy. Well worth reading from many perspectives: the story of how the best performing economy in Europe became a financial basket case is gripping, and it's got many lessons for countries elsewhere, including for us.

One is the importance of keeping a very close eye on the structural fiscal balance - the true shape of the government's books, shorn of cyclical influences. The Irish government of the first half of the 2000s spent up large on the back of a cyclical and unsustainable boom in revenue, a lot of it emanating one way or another from the massively overheated Irish property sector. In reality, its spending (and the future commitments it also entered into) left it hugely exposed, financially, when its revenues plunged.

At the time, as the book explains, watching the structural balance wasn't much in vogue, and it didn't help that when the first estimates were eventually made of the true Irish position, they didn't correctly pick up the sheer awfulness of the fiscal books. These days we're more on the ball - though the media attention at Budget time is still disproportionately on the government's headline fiscal numbers and not enough on what's really happening under the bonnet - and I was pleased to see that Treasury continues to beaver away at improved ways of calculating where we really are.

I was also struck by how quickly the Irish fiscal situation deteriorated when the balloon finally burst, and there's a lesson there too. Here is what the level of Irish government debt looked like before things went to hell in a handbasket (based on the data in Table 6.1 of The Fall of the Celtic Tiger).

That looks good, doesn't it? Despite the big spendup, revenues were so large that the government could scatter cash to the four winds and still have enough left over to work government debt down to what looks like a conservative level of just under 25% of GDP. You'd think that debt at that level was low enough to be able to cope with anything the domestic or global economy might throw at you, wouldn't you?

But it wasn't.

So when our Fiscal Strategy Report says,

The Government has five fiscal priorities:

...

2 Reducing net government debt to 20 per cent of GDP by 2020, including repaying debt in dollar terms in 2017/18

...

...

5 Using any further fiscal headroom – including from positive revenue surprises – to get debt down to 20 per cent of GDP sooner than 2020 

I say, right on.

And finally there is the whole issue of overheated property markets: as you read the book, you find yourself asking, are we on the same slippery slope to a property bust as the Irish were?

On balance I'm inclined to think not. We do have some of the same characteristics as the Irish did: a surge in property demand from growth in incomes, strong net immigration, and a monetary policy imported from elsewhere that doesn't suit our circumstances (in Ireland's case it was the common eurozone monetary policy, in ours the Fed's which has, for example, helped drive our fixed rate mortgage rates to low levels). But we don't have others, notably the reckless lending of the Irish banks in general and their huge lending to property development companies in particular.

But sorting out what's happening in real time is as hard here as it was in Ireland. You can easily miscategorise things: what looks to you like a 'genuine' increase in housing demand meeting a near-fixed short-term supply curve could as easily be the early to mid stages of a speculative bubble. And often enough there may be elements of both stories happening at the same time.

Which is why I thought this chart was so interesting. It's by Ronan Lyons, an assistant professor at Trinity, and it appeared a few days ago in this article on the Irish economy blog. It's his estimate of the strength of the different factors that were driving the Irish housing boom/bubble.

As you can see, different things mattered at different times. As the boom started (1995-2001), you had decent sized contributions from a variety of sources - people's incomes (blue), demographics (green), bank lending (red), and those too-low eurozone interest rates (yellow) all played a part. The bubble period of 2001-2007, however, was driven overwhelmingly by loose lending.

Wouldn't it be useful to see the same analysis done here?