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Capitalism is the real issue Samuel Brittan: Financial Times 01/12/02 Review of The Eagle's Shadow: Why America fascinates and infuriates the world by Mark Hertsgaard Bloomsbury £12.99 There is one triumph that Osama bin Laden and his followers have already secured. They have managed to shift the political debate, especially in Europe, from the war against fundamentalist terrorism to a hackneyed cultural critique of US capitalism. Some would put the blame on President George W. Bush's unilateralist instincts. This is pretty superficial. Bill Clinton might have raised fewer hackles. But those who hate American capitalism were quick to accuse him of selling out to a Republican Congress. Even some in the New York financial community ask: "Why does everyone hate America?" The Eagle's Shadow is an attempt by an American journalist to answer this question on the basis of a world tour. So long as he is reporting on his travels, Hertsgaard makes compelling reading. He is honest enough to ask: "If America is as flawed as detractors say, why are millions of people from around the world willing to do nearly anything to emigrate here?" He finds that "bin Laden and the Taliban are not representative of international opinion; hatred of America though intense where it exists, is relatively rare". Few of those he spoke to resented America's wealth. They wanted to know its secrets and to work for its rewards. A Chinese miner, turned tour guide, praised America's relative sexual freedom, saying: "America has the most fun. When I am rich I will visit you in America. Without my wife." Unfortunately, the greater part of the book is taken up not with these fascinating observations but with the author's account of why he himself hates US capitalist civilisation. A hundred years ago Thorstein Veblen exposed conspicuous consumption Sixty years later Kenneth Galbraith brought the excesses of auto tail fins to worldwide attention. The core of Hertsgaard's case today is that "the current form of globalisation has punished the world's poor and the working class majority while fabulously rewarding the rich and corporate elites". He does not mention that the US also contains the world's best universities, which publish some of the best studies of European literature and philosophy. Hertsgaard accuses the US news media of pushing the view that "cheerful, endless shopping is every American's patriotic duty". But business people also feel haunted by what they regard as a hostile left-leaning press; and economic liberals feel even more besieged by economic illiteracy. The issue is not "America" at all. It is competitive market capitalism, which is characterised by American values because the US is the largest and most successful world economy. There has undoubtedly been an especially large increase in recent years in the wealth of the more affluent Americans - due partly to technology and partly to the scandals that always accompany the later stages of an unsustainable economic boom. It remains to be seen how far the stock exchange bust of the new century will correct this trend. On the more important world stage, some of the supposed increase in inequality reflects the rapid growth of countries such as the east Asian tigers that have pulled away from those that have yet to embrace global capitalism. In any case it is just intellectually lazy to put everything to do with capitalism into one bundle. Paul Krugman, the US Democrat economist, has written a coruscating indictment of growing wealth disparities in the US. But he has no time for those who declaim against the free trade in goods made from "sweated labour" overseas. By themselves corporations have much less power than envious journalists suppose. If they cannot sell their products they are sunk. They can only exercise political power if they can persuade governments to exclude competition, whether it is George W. Bush trying to protect farmers and the steel industry or Gerhard Schröder combining his pseudo-pacifist anti-Americanism with subsidies for German industry and labour. Another example is the arms lobby, which bends the ears of successive British prime ministers to use taxpayers' money to promote weapon sales to dubious regimes. If only writers such as Hertsgaard would realise it, globalised free trade is their best defence against the corruption of politicised capitalism. Indeed, one sometimes wonders if such writers have ever tried to work coolly through any analysis of competitive markets. If you do not understand how they are supposed to work, you cannot understand how they can malfunction.
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