This is a nice book - def worth a read. Chang sets out to expose how wealthy nations via the main financial institutions act to keep poorer nations in a condition of perpetual underdevelopment. This occurs in numerous ways - not least through the use of debt but also through the way in which trade policy is structured. Institutions such as the IMF make developing nations abolish subsidies on export goods ect. When developing industry within the third world becomes exposed to first world competition - it flatlines. Chang points out what may seem like the obvious ie. subjecting developing economies to the same rules as advanced economies doesn't create a level playing field. Not that this takes a genius to realize - but it does make you wonder why right wing economists have been ignoring the point for last few decades.
Ha spends a fair deal of the book de-constructing the historic mythology espoused by proponents of economic liberalism. Neo-liberals have a particularly nasty habit of arguing that developed nations (in the main) are prosperous due to their relatively low levels of regulation ect. The implication is that free trade = wealth, rainbows and happiness. http://www.heritage.org/Index/
However Chang refutes this argument - illustrating that the most developed nations advanced via massive regulation/protectionism, and only recently have many of them brought down their barriers. This stuff would be brilliant for pissing off Ron Paul supporters on US forums (not that I do that - i have a life...i swear). Additionally, he takes note of the fact that while developed nations may have low average protection - they disproportionately protect products that poor nations export - garments/textiles ect.
Interesting as a the book might be - Chang isn't a socialist. Despite his seething contempt for neo-liberalism, he remains grounded in the idea that capitalism can be reformed. He advocates something called the (infant industry argument) - essentially proposing that developed nations reduce all their barriers - and allow developing countries to engage in rampant protectionism. Fair trade on steroids is what comes to mind. He also seems rather taken with Keynsian style programs ect. In all what Chang stands for seems a fair deal more equitable than the current arrangement - but its still capitalism and as such is pre-disposed to crisis ect. Chang doesn't deal with the structural inadequacies of the system - nor does he highlight the fact that neo-liberal policy was the result of a periodic deficiency within keynesian capitalism (something I hope to discuss in a future post).
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