Book Bits: 16 March 2024

● The Price is Wrong: Why Capitalism Won’t Save the Planet
Brett Christophers
Review via Financial Times
Why is it so difficult to wean renewable energy off public support? While higher interest rates and steel prices clearly haven’t helped, Christophers argues we’ve missed the answer for a structural reason: we are looking at the wrong measure. It isn’t just relative power prices that determine how many wind or solar parks get built; more important is how profitable entrepreneurs think these investments will be. And here’s the rub: the anticipated returns are unappealing. On average, renewable projects earn just 5 to 8 per cent on their equity, Christophers reports, compared to more than 15 per cent for oil and gas.

● Vulture Capitalism: Corporate Crimes, Backdoor Bailouts, and the Death of Freedom
Grace Blakeley
Q&A with author via Jacobin
Q: You write that one of the biggest neoliberal myths is their claim that they want to “shrink the state,” when their aim is actually to “seize and then task it.” How has this myth served the neoliberal project?
A: It’s not just the neoliberal project. It also served the Keynesian project. Politics in most of the rich world has settled into this divide between a left Keynesianism and right neoliberalism, with these right-wing populist outcrops coming up in the back as well. But this divide on the economic front between “Should we have freer markets or a larger state?” has been the terms of debate in politics for at least a century now.

● Capitalism and the Market Economy: Bringing back together what banking pulls apart
Jonathan McMillan
Review via Publishers Weekly
McMillan, a joint pseudonym for Jürg Müller, an economics editor at Switzerland’s Neue Zürcher Zeitung, and an unnamed employee of a global bank, who claims his position necessitates anonymity, follows up 2014’s The End of Banking with a bracing treatise on the history of banks and how they can be made more stable. The authors explain that the concept of credit arose from interpersonal trade relationships when humans still lived primarily in small groups, and created in turn the idea of risk. Bankers could act on their belief that a debt would be repaid and loan money borrowed from customers’ deposits. Such exchanges created centuries of instability because loans were not always repaid, causing “recurring boom-and-bust cycles, banking panics, and deep economic crises.” To avoid such volatility, the authors recommend establishing a license to certify financial institutions that “stay systemically solvent at all times” and incentivizing safe practices by exempting licensed institutions from risk regulations, reasoning that solvent banks would never need state bailouts.

● The Greatest Ponzi Scheme on Earth: How the US Can Avoid Economic Collapse
Les A. Rubin and Daniel J. Mitchell
Essay by authors via Foundation for Economic Freedom
The United States is in fiscal trouble. The burden of government spending has increased by nearly $3 trillion over the past 10 years—nearly doubling in just one decade! And that means more resources diverted from the economy’s productive sector, which is bad news whether the spending is financed by taxes, borrowing, or money printing.

● The Little Book of Robo Investing: How to Make Money While You Sleep
Elizabeth MacBride and Qian Liu
Summary via publisher (Wiley)
In The Little Book of Robo Investing: How to Make Money While You Sleep, a pair of long-time investors and founding team members at the pioneering and award-winning online investment platform Wealthfront deliver a fun, invaluable, and simple roadmap to making your money make money. You’ll learn how to start investing with the easy, automated, and low-cost strategies that robo investment advisors have made super accessible to everyday people. You don’t need a ton of detailed knowledge about the financial and investment sectors to make impressive returns. The authors walk you through how to use techniques like automation, diversification and indexing to manage your risk and keep things absurdly simple.

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