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Econopower: How a New Generation of Economists Is Transforming the World MP3 CD – Audiobook, MP3 Audio
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"...offers practical advice on personal finance matters, earning, saving, investing and retiring, based on the breakthrough contributions of behavioural economics." Pensions World July 2008 "...you can pick up nuggets of insight into behavioural economics, game theory, the flat tax debate, auction theory (particularly good)..." Financial World June 2008 "...check out Mark Skousen's Econopower...The book shows how economics has come to influence every aspect of our life" (Sunday Times Ireland Edition, December 18th 2008) --This text refers to the Audio CD edition.
From the Inside Flap
In 2006, the Nobel Peace Prize was for the first time awarded to an economist. Once ridiculed as the "dismal" science, economics has now emerged as the "imperial" science that influences every aspect of daily life, from politics to education to religion to Wall Street. Like an invading army, the science of Adam Smith is overrunning the whole of social science--law, finance, politics, history, sociology, environmentalism, religion, and even sports. In EconoPower, professional economist Mark Skousen shows how this is happening--and how economists are solving the world's problems on both the individual and national level.
EconoPower offers practical advice on personal financial matters--earning, saving, investing, and retiring--based on the breakthrough contributions of behavioral economists. It reveals exciting discoveries by economists to solve domestic problems, such as road congestion, health care, public education, crime, and other issues high on the public's list. And it looks at how economists are working successfully on international issues from global warming to religious wars. Looking toward the future, the book also reveals what kind of new dynamic economic philosophy will dominate the new millennium.
Skousen reveals how economists have gone beyond writing abstract academic papers and books and are now applying their theories in the real world by running businesses, consulting companies, and taking positions in government. Economics can change people's lives and nations' fortunes for better or for worse, he explains, depending on how closely they adhere to or violate basic principles. Those key principles include accountability, cost-benefit analysis, investments, and entrepreneurship. By understanding and incorporating these principles, better decisions will be made on individual, corporate, and government levels. To explain this thesis, the author offers analyses of key economists who have changed their views over time, an examination of major domestic and international issues, and an explanation of how economists can predict which politicians will be successful.
With EconoPower as their guide, readers will gain a firm understanding of the influence of economics and how it can be used to improve the world we live in. --This text refers to the Audio CD edition.
Top customer reviews
Why does Skousen not make it clear that this "new generation" is really old wine (Austrian school economics) in new bottles (Skousen and a few modern economic policy experts who heed the ancient Austrian doctrine)? I think probably the reason is that the Austrians were extremely elitist and arrogant, having little appreciation for the ignorant masses who actually vote leaders into and out of office in a democratic society. Hayek himself, a brilliant thinker and Nobel prize winner, once said, when asked what he thought of the brutal Chilean dictator Pinochet, that he preferred a "liberal dictator" to a "democratic government lacking liberalism" (of course, "liberalism" here means classical free market ideology, not the modern American liberalism, which is more akin to social democracy, which the Austrians despised).
Because of their rigid purism in defense of free markets and a minimal state, their policy views have been largely ignored in the modern world. There is no nation that even remotely conforms to the Austrian idea of laissez-faire. Nor will there ever be one, in my opinion, because (a) the Austrians were incorrect in their belief that a laissez-faire economic could be dynamically stable, and (b) no electorate in a democratic society would ever vote for such a system, and in a despotic society, there is little chance the dictator would be of Hayek's cherished "liberal" sort, any more than would the fox in the hen house set out to establish chicken paradise.
This does not mean, however, that the Austrians have nothing to contribute to contemporary policy debates. They certainly do, and Skousen does a fine job in this book in modernizing, democratizing, and softening Austrian positions so that they make economic sense and might serve the needs of the common folk. Skousen's strategy is to start with the well-known policy suggestions of the behavioral economists (e.g., change the default position on voluntary savings plans from "not contribute" to "contribute"), as well as the solid stock market advice of previous generations of economists (e.g., treat the stock market as a random walk, diversify your portfolio, and the like). Then he moves into one of the most attractive successes of the free-market ideologues, the Chilean system of private retirement savings plans. This system was the brainchild of the Chicago school economists whom Pinochet asked to come reorganize the economy after he overthrew a democratically elected socialist government in Chile. Now, the Chicago school certainly bears the brand of laissez-faire, but they were (and are) dedicated to empirically testing theories and finding alternatives that are viable and widely popular (democracy was restored to Chile many years ago, but they have not given up their private retirement plans). As Skousen notes, the Chilean system has been copied in many countries, and parts of it are reflected in the US 401(k) retirement plans.
It is critical to understand why the Chilean system works: it is not purely private, but an intimate entanglement of state regulation and private initiative. For instance, workers are required to contribute at least 10% of their salaries to the retirement fund, although they may contribute up to 20% if they so desire. Second, workers may choose from about two dozen government approved private retirement funds, but these funds are highly regulated so that they have virtually zero possibility of bankruptcy. Finally, there is a minimum guaranteed pension provided by the government, should a worker's private savings be wiped out by market forces.
The relevance of the Chilean and 401(k) plans to the recent debate about privatizing the Social Security system is obvious. American liberals generally dislike markets and don't believe people can make choices in their own interest, and hence favor the current system of social security. Some free-market crazies believe that people should not be forced to save at all. If someone ends up in poverty after a lifetime of work, that's his or her problem. The alternative presented in EconoPower is powerful and nuanced, providing a cogent alternative to the ideologues of right and left. Most of the proposals in this book are similarly transformed Austrian ideas, presented to the public as desirable alternatives for the non-well-to-do, and without the slightest trace of laissez-faire ideology. Old wine in new bottles, but attractive wine.
by Joseph Kenneth Brady-Amoon firstname.lastname@example.org
He writes, "In many ways, the poor have advanced the most and are now capable of living in decent housing, owning an automobile, and enjoying many of the pleasures previously afforded by the wealthy. Cheap airline services allow them to travel extensively. Television gives them the chance to see sports events and musical shows previously limited to the rich and the middle class. Compared to yesteryear, every house today is a castle, every man is a king. As Gregory Clark concludes, "The envious have inherited the earth."10
This section and others that deal with the poor (E.g.,"...Habitat for Humanity builds homes for the responsible poor...") betray so complete an ignorance of who the poor are and how they live and how they are increasing year by year in this era of Austrian and University of Chicago economics.
The poor I see in my medical practice do not travel extensively on airplanes. They do not travel in cars, sometimes, because they cannot afford to buy them or fix them. They take the bus if their community is sufficiently enlightened to have a bus service. Or, they walk. I see them walking day or night sometimes with their children in our cold, wet northern climate.
For many of the poor, every day is an emergency: Where will I stay?, How can I afford to buy my insulin? What can I get for my child and me to eat; something at the food shelf or the soup kitchen, both very busy places in our town? Will I be safe when my husband comes home intoxicated or just angry? (I heard a story second-hand recently of a woman telling her social service counselor that her husband cut off her cat's head in front of her. Stop and imagine that scene; all the blood pouring out of that animal's severed neck. How likely is it that family will sit down and plan a flight to Disney World for the holidays? Lastly, if the poor contrive, somehow, to deal with the emergencies of that day, what about the next?
That Mr. Skousen could write such things betrays an ignorance and isolation so profound that I feel it's a waste of time to read his book.