Book Review: How the West Was Lost

How the west was lost
Book written by Dambisa Moyo
3/5

*****
How the west was lost, provides a general overview of the financial crisis, the hows and whys, and also predictions of the future of the West against the rising "Rest": China, India, South America. She explains how this is changing the landscape of the global economy. With all things staying the same and the general trends continuing, China will become the largest economy, taking the title from the USA within the next decade.

The reasons Moyo attributes to the wests decline is due to its increasingly lowering standard of education, the inconsistency of financial regulations and foreign policies. She also estimates that the US will become a socialist type state within the next two or so decades and in turn be burdened by health care, pension and other benefits eating into the nations output particularly due to the shift to an aging population. Something that is already happening the UK.

While I agree with alot of her analysis (though there are some inaccuracies and errors in the book), the general overview of the past and present seems reasonable.

I do have some qualms in particular to her assessment of China's economic boom. She attributes this to the strict control the government has and its ability to focus its energies on certain projects (like building cities). However I see it differently, in that it's that the government has had to release control to let the capitalistic processes emerge. By far people in China have alot more freedom (although currently its more financial than social) and this is what is driving the boom. Would the boom have occurred if the people of china weren't allowed to make the money and keep it? The situation in China in particular is that the freedoms that are being introduced now have to continue and whether that will lead to some crisis in China leadership, is anyones guess. The general trends of all nations is one which is leading to prosperity of its citizens but this only is happening where dictatorships are collapsing. Places like North Korea, parts of Africa, parts of the middle east are still wallowing in poverty.

Economists are pretty bad at predicting the future, they are really only good at analysing events post crises. So the projections she has made are based on todays technology, todays shortages and governmental status quo. This makes future predictions meaningless.

America's economy may be in decline (I see this due to the added burden of regulation and taxation that is increasingly suffocating business), and its socialist tendencies may impact negatively if trends continue, but the freedom of choice, the ability for people to think unfettered by thought police, are all in its favour for now. It still has the power to produce a Google or Facebook. Whether or not the Rest overtake the US as the leading economic powers really is in the hands of the US voters.