Joseph Heath

Harper Collins, 2009, 338 pages, C$29.95 hc, ISBN 978-1-55468-395-6

Given the importance of money, it almost goes without saying that a good understanding of the world goes hand-in-hand with a good grasp of economics.  “Follow the Money” isn’t just good for crime thrillers: it’s a solid way to figure out what’s really happening around us.  Unfortunately, economics isn’t called the dismal science for nothing: often politicized into uselessness, the study of money has attracted, well… people with money, intent of using the results to further their political aims.  As a result, activists from the right and the left now come with preconceived notions about economics that are actively harming any rational policy discussions.

To truly understand economics, argues Joseph Heath in Filthy Lucre (subtitled, somewhat incompletely, as “Economics for people who hate capitalism”) we have to let go of a few myths, cherished preconceptions and long-held statements of faith about economics.  To this end, he presents and demolishes twelve fallacies about economics: six that are favoured from a right-wing perspective, and six that are usually held by the left.

Heath isn’t an economist; he’s a philosophy professor at the University of Toronto and already well-known in Canada as one of the country’s most interesting intellectuals after a few well-received books such as The Efficient Society and The Rebel Sell.  He’s a skilled rhetorician, and Filthy Lucre is at its best when it starts poking at beliefs that have been ingrained in us through lazy consumption of political debates.  (His metaphors aren’t always convincing, but he can usually offer further sources for readers who would like a deeper understanding of his arguments.)

In the first half of the book, he demolishes a few right-wing fallacies: Libertarianism is the first target in explaining why capitalism isn’t natural.  In successive chapters, he argues that incentives aren’t all that matters, that competition isn’t always better, that taxes are usually at their optimal level, that international competitiveness isn’t required and that moral hazard doesn’t necessarily embed morality into economics.  Game theory figures heavily in his metaphors and readers are almost guaranteed to come away from this section with a better understanding of economics in general.

What’s more interesting, however, is the second section which takes aim at economic fallacies cherished by the kind of left-leaning readers most likely to pick up a book on “economics for people who hate capitalism”: Here, Heath serves some tough counter-examples to people who still believe that prices must be set by governments, that the pursuit of money is evil, that capitalism is doomed, that equal pay is an ideal, that all wealth accumulates to the top or that equality is more desirable than efficiency.  If the book’s first section is fun to read, this second half makes the book even better, because it forces equality-minded left-leaning readers to confront their own prejudices with colder facts and ponder the trade-offs required to get to their shiny progressive utopia.

Anyone who’s familiar with Heath’s previous work will find a continuity of argument in Filthy Lucre: Heath may be writing from a deep and self-acknowledged left-wing perspective, but he’s remarkably successful at explaining the status quo, its advantages over most alternatives and the wonders of steady incremental changes.  The book argues for a keener, more nuanced understanding of the current system before setting out to improve it, and it’s hard to argue with such even-handed reason.

After The Efficient Society and The Rebel Sell, Filthy Lucre also marks a third great popular book in a row for Heath.  If anyone has missed his work so far, don’t wait for another excuse: Read the books and wait for his next one –he deserves a spot on anyone’s must-read list.

Penguin Canada, 2002 reprint of 2001 original, 339 pages, C$22.00, ISBN 0-14-029248-0

From time to time, I find myself wishing that I’d read some books earlier.  Part of it is a reflection on my stack of things to read: Even if I completely stopped buying books right now, I would still have about two years’ worth of stuff to read.  Part of it is the vertiginous realisation that the universe of good books is vast, and there are still thousands of them to read.  The Efficient Society is one of those; a book that, in 2001, first brought philosophy professor Joseph Heath to national attention.  Heath would go on to write The Rebel Sell with Andrew Potter, which is the book that made me realize that I should be reading more of Heath/Potter’s work.  Going back in time to The Efficient Society, I end up cursing myself for not reading it ten years ago.

The basic thesis (“Why Canada is as close to Utopia as it gets”) is that our country is one of the best in the world largely because of its pragmatic efficiency.  This may be surprizing, even worrying to some: after all, most people frown at least a little when “efficiency” is praised.  Trained by decades of cost-cutting exercises presented as the epitome of efficiency, all-too-aware that “efficient” usually means cutting away the extras, fat, lubrication and slack time that make life worthwhile, readers may be forgiven for not being entirely well-disposed toward the notion of “an efficient society”.  But Heath isn’t using the word in that sense.  In his mind, efficiency means finding the best way of co-existing, the best way to deliver services, the best way to live.  It means not caring about the proclivities of other people (because being nosy is inefficient), finding a balance between private and public service delivery (because ideological approaches are usually wasteful) and understanding how social forces compel us toward common lifestyle decisions (because society works like that, and understanding why is the first step toward changing it).

As a philosophy professor, Heath is well-equipped to vulgarized grand ideas.  For instance, in the section of the book which concerns itself with moral efficiency, he proposes that old-fashioned morality is based on an ideal of human perfection.  Living up to these expectation is practically impossible; hence, the more efficient idea of tolerance; as long as others aren’t actively interfering in our lives, as long as everyone’s actions aren’t harming others, what’s the point of measuring others against an ideal that is impossible to reach?

The book is on even firmer ground in discussing economics and efficiency.  Canada, argues Heath, has found an ideal balance between European pro-state and American pro-business ideologies.  The United States, after all, seems perfectly happy wasting a few percentage points of GDP to health care billing services that a single-payer model doesn’t even need.  Europe, on the other thand, wastes GDP points by over-nationalizing businesses that should be handled by the private sector.  This efficient Canadian equilibrium between the state and private enterprise is to everyone’s benefit.  Many other examples abound, exploring the delicate interaction of the market in its modern, efficient form.  Eventually, the narrative becomes an argument for improving the status quo rather than burning everything down –a theme that Heath carries through to The Rebel Sell.

From this promising start, The Efficient Society wanders a bit during a last third notionally dedicated to social efficiency: While there are a few striking passages –the deconstruction of typical gender roles in couples raising young children seems particularly implacable- the book seems to become an anthology of Health’s ideas without much of a guiding theme to carry it along.  It’s also in this segment that The Efficient Society most clearly shows its age.  The technological references are obviously a decade old, and developments since then (particularly in democratization of web publishing, and the increasing universality of web access devices.) would be interesting to study through the efficiency prism.

Still, The Efficient Society easily contains more thought-provoking material than most other non-fiction books of its length.  Heath interrogates economics from a philosophical viewpoint (a left-wing one, albeit a more sophisticated left-wing perspective than the activist fringe) and the rest of his investigation can be just as revealing as any of the Freakonomics-style books that have been published since then.  I wish I’d read this book upon publication; maybe the world would have made a bit more sense.