Naked Economics, by Charles Wheelan

by Chavi

In Naked Economics, Charles Weheelan attempts (and succeeds) to show how relevant Economic principles are and how we encounter them all the time even if we don’t know their academic names. The book is like well packaged common sense with an economic lense. It’s like putting on glasses and the scene you were just looking out becomes a little more focused, the lines a little sharper.

These days (and probably always), the news, and most of politics, is economically motivated, and this book gives you the language to analyze it, at least at a basic level. Wheelan tries to remain objective and he presents both sides to the government/regulation question lucidly. He presents them both so well that he strips all the black and white out of the discussion and you end up more confused than when you started. Which is a good time to start thinking.

The one place where Wheelan is pretty insistent on his own opinion is in regard to the growth economy and that’s where things get interesting. The solution to all problems is to grow the economy because as he says repeatedly economics is not a zero-sum game. As long as the pie gets bigger, there’s more for everyone (except if utility is relative and then people have more relative to the past but not relative to other people). The only loser in this case is the environment since the richer we get, the richer the poor get, and then more we all consume. That’s a pretty big problem and unless your answer to environmentalism is keep the poor poor, an unanswerable one.

Ironically, the definition of economics is the study of unlimited wants and scarce resources.  It is hardly an economic solution to spend our way out of scarcity.

In economics our own mortality and finiteness stand starkly naked. Delusions of everlasting plenty or any other kind are not welcome. Even joy and spirit and love are captive to the resources it takes to produce them. Like it or not we  spend our finite lifespan on this planet trying to navigate the infinite within the confines of scarcity.

But what if more than just spiritual matters were infinite? If God were truly infinite and He created the world, then why can’t there be unlimited material resources? What if the brutally realistic economist is himself deluded by scarcity?

Then growth economy has a chance and the pie can keep getting bigger and bigger without exploding. (Thinking about that can make your head explode though so tread with caution.)

This did start out as a book review but the fun of books is where they take you.