It might have been better if Congdon had focused more on differences between fiscal advocates and monetarists, rather than on micro-debates in the second camp, where the importance of the battle is lost on those living outside the trenches. As Jorge Luis Borges said of Britain and Argentina during the Falklands war: it’s like watching two bald men fighting over a comb.
In the end, the focus on microscopic internal battles has a point. Congdon illuminates just how politically crucial the most seemingly technical of economic decisions are. With candour refreshing among economists and social scientists, who often purport to be free of bias so their findings have an aura of scientific impartiality, Congdon is adamant that all economic policies are influenced by politics.
With the case of monetarism, he unabashedly admires the way it resonates with conservative mantras such as the individual right to pursue ‘economic freedom’ without the government getting in the way. Whether one agrees or not, Congdon should be praised for illuminating how technical decisions such as the use of interest rates to combat inflation are never made in a vacuum free of political interest.
Another positive is the book’s timeliness. In some ways, Congdon is probably kicking himself for suggesting that we have monetary policies to thank for the current economic stability in Britain (the book has come out just as Northern Rock nosedived, suggesting his praise of the current stability is a bit premature). But that’s precisely why the book is vital.
One consequence of the recent economic turmoil is that citizens driven to complacency by suspecting the only thing more boring than monetary policy is having it explained by Gordon Brown might start taking more interest in the intricacies of economic planning. If that happens, Congdon’s book could be handy, though some might wish it were a bit less academic. It’s written for economists, policymakers and discerning readers. Non-specialists may be put off.
But if anything, the challenge of the book is its best point. After the recent spate of ‘popular economics’ bestsellers such as Malcolm Gladwell’s Blink and Steven Levitt and Stephen Dubner’s Freakononomics, which adopt the tone of a nursery-school teacher (the paper in the bank is called money. Those who have less of it are poor), it’s nice to find a writer on economic policy who assumes readers can multiply, even if Congdon’s repetitiveness suggests less faith in their powers of recall.
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