Book Reviews

31 maio, 2010

What Darwin Got Wrong? - Jerry Fodor and Massimo Piattelli-Palmarini

Not So Natural Selection
by Richard C. Lewontin
The New York Review of Books, May 27, 2010

Book Review:
What Darwin Got Wrong
by Jerry Fodor and Massimo Piattelli-Palmarini
Farrar, Straus and Giroux, 264 pp., $26.00

Nothing creates more misunderstanding of the results of scientific research than scientists’ use of metaphors. It is not only the general public that they confuse, but their own understanding of nature that is led astray. The most famous and influential example is Darwin’s invention of the term “natural selection,” which, he wrote in On the Origin of Species,

is daily and hourly scrutinising, throughout the world, every variation, even the slightest; rejecting that which is bad, preserving and adding up all that is good….

Darwin, quite explicitly, derived this understanding of the motivating force underlying evolution from the actions of plant and animal breeders who consciously choose variant individuals with desirable properties to breed for future generations. “Natural” selection is human selection writ large. But of course, whatever “nature” may be, it is not a sentient creature with a will, and any attempt to understand the actual operation of evolutionary processes must be freed of its metaphorical baggage. Unfortunately, even modern evolutionary biologists, as well as theorists of human social and psychological phenomena who have used organic evolution as a model for general theories of their own subjects, are not always conscious of the dangers of the metaphor. Alfred Russel Wallace, the coinventor of our understanding of evolution, wrote to Darwin in July 1866 warning him that even “intelligent persons” were taking the metaphor literally.

The modern skeletal formulation of evolution by natural selection consists of three principles that provide a purely mechanical basis for evolutionary change, stripped of its metaphorical elements:

(1) The principle of variation: among individuals in a population there is variation in form, physiology, and behavior.

(2) The principle of heredity: offspring resemble their parents more than they resemble unrelated individuals.

(3) The principle of differential reproduction: in a given environment, some forms are more likely to survive and produce more offspring than other forms.

Evolutionary change is then the mechanical consequence of variation in heritable differences between individuals whenever those differences are accompanied by differences in survival and reproduction. The evolution that can occur is limited by the available genetic variation, so in order to explain long-term continued evolution of quite new forms we must also add a fourth principle:

(4) The principle of mutation: new heritable variation is constantly occurring.

The trouble with this outline is that it does not explain the actual forms of life that have evolved. There is an immense amount of biology that is missing. It says nothing about why organisms with the evolved characteristic were more likely to survive or reproduce than those with the original one. Why, when vertebrates evolved wings, did they have to give up their front legs to do it? After all, insects can have two pairs of wings and six legs, so there cannot be any deep general biological constraint on development. Why don’t birds that live in trees make a living by eating the leaves as countless forms of insects do instead of spending so much of their energy looking for seeds or worms? Perhaps possessing characteristic A rather than B was just a secondary consequence of a different developmental or biochemical property that was variable and heritable. Or perhaps characteristic A was the only available variation that differentiated the selected from the unselected organisms. It is these considerations that lie at the heart of Jerry Fodor and Massimo Piattelli-Palmarini’s discussion of What Darwin Got Wrong.1

Evolutionary biologists are of two sorts. A minority really do not care why one inherited characteristic confers a reproductive advantage to its possessors. They are content to show that such an advantage exists for a particular inherited difference, thus exemplifying natural selection. The dominant figure in experimental and observational evolutionary genetics in the middle of the last century, Theodosius Dobzhansky, spent most of his life showing convincingly from observations of both natural and experimental laboratory populations that natural selection was the cause of both the year-to-year stability and the repeatable seasonal changes in the proportions of certain variants in the chromosomes in natural populations of fruitflies.

Despite spending time every year on horseback, visiting localities in the Great Basin and California where he trapped fruitflies, Dobzhansky never, in fact, saw a fruitfly in its native condition. He collected living flies by putting out rotting banana traps, so the flies came to him, but from where he never knew. When flies were brought back to the laboratory and bred in large populations in which the proportions of the chromosome types were initially very different from the ones found in nature, those proportions changed in repeatable ways in a few generations. It was sufficient for him to be able to demonstrate that natural selection really worked.

In contrast, most evolutionary biologists work on natural populations of plants or animals that they have chosen because they believe they can tell a natural historical story of how selection actually operates in a particular case. The most famous example is the increase in the black form of the wings in the peppered moth that has occurred in England since the mid-nineteenth century. The explanation offered and repeatedly appearing in textbooks (although since called into question because of faulty methodology) was that the moths rested on tree trunks where they were at risk of being eaten by birds. Before the spread of heavy industry the tree trunks were covered with lichens whose speckled appearance was matched closely by the “peppered” appearance of the moth’s wings, so the camouflaged moths were only occasionally attacked. With the air pollution caused by heavy industry, the lichens were killed, so the moths were easily visible on the naked dark bark and were heavily preyed upon. A mutation to black wings appeared and was strongly favored by natural selection since the black-winged forms were now once again camouflaged.

There is little doubt that this example, widely taught in lectures and textbooks, had a powerful influence in convincing evolutionary biologists who came into the field from their prior interest in natural history that one could tell the causal story of natural selection. One unfortunate feature of this case is that the caterpillars of the dark-winged forms also have a slightly higher survival rate than those of the speckled-wing form, even though they are not black, so something more is going on, but this fact is not part of the curriculum.

The interest of modern evolutionary biologists in natural historical stories is partly a reflection of the origin of the science in the genteel nineteenth-century fascination with nature that characterized men of Darwin’s social circumstances. The country curate who is an amateur collector of butterflies is a cliché of Victorian life. The success of evolutionary biology as an explanatory scheme for its proper subject matter has led, in more recent times, to an attempt to transfer that scheme to a variety of other intellectual fields that cry out for systematic explanatory structure. As Hegel lamented in The Philosophy of History, “Instead of writing history, we are always beating our brains to discover how history ought to be written.”

One answer has been to transfer the formal elements of variation and natural selection to other aspects of human activity. It is by no means an anomaly that one of the authors of What Darwin Got Wrong comes to the subject from cognitive studies and linguistics. We have evolutionary schemes for history, psychology, culture, economics, political structures, and languages. The result has been that the telling of a plausible evolutionary story without any possibility of critical and empirical verification has become an accepted mode of intellectual work even in natural science.

The central claim of What Darwin Got Wrong is that “Darwin’s theory of selection is empty” (their italics). That is, to say that some trait was the object of natural selection and was established by the force of selection for that trait is to say nothing. If this seems a perverse claim, an example is helpful. There is a species of wild mouse that lives on both dark and light backgrounds. In the populations on light backgrounds the mice have what we think of as a “normal” mousy light brown color. The populations on dark backgrounds, however, are much darker colored. An evolutionary adaptationist argument that has been offered is that a mutation to a dark coat was favored by natural selection when it occurred in the population living on the dark surface because predators could not see the dark mice as well and so these mice survived better and eventually the gene for dark coats took over the population.

Fodor and Piattelli-Palmarini would argue that one cannot simply isolate coat color as the object of natural selection. They discuss the large body of evidence in many organisms of a number of complexities at the molecular, cellular, developmental, and physiological level that need to be taken into account as well.

First, the proteins that result from the processing of genetic information may enter into multiple metabolic and developmental pathways. From the earliest days of experimental genetics it was known that mutations that had been detected from a change in some obvious feature of an organism also affected other outcomes of the organism’s development and metabolism. For example, it is almost always the case that a mutation in fruitflies affecting any morphological character also reduces the rate of survival of the larvae, i.e., the worm-like early stages of development. So, any mutations that alter the normal dark red eye color of adult flies, making it bright red or orange or colorless, will also result in lower survival rates of larvae, even though they have no eyes.

The causes of a reduction in survival in larvae that results from mutations with obvious visible effects in adults must be as varied as the morphological character in question, and it would require a detailed examination of the process of fruitfly development to elucidate. It is precisely this phenomenon that compromises the elegant natural historical story about the industrial dark color of the peppered moth or the story about predation in the dark-colored mice. Is it the dark coat and not some other metabolic product that is changed in dark-coated mice and that is responsible for their greater success in reproduction? Perhaps the mice with dark coats are also more fertile or better able to digest their food.

It is, of course, not true that every process in a living organism interacts strongly with every other process. If interaction were both universal and effective, the organism would be so inflexible as to make life impossible and no evolutionary change could ever occur. The intensity of interaction between parts is also strongly dependent on the circumstances of life. Were I to lose the little finger of my left hand it would have little effect on my life, but if I were a cellist it would be a catastrophe. Thus it matters to the result of natural selection which of the possible multiple pathways of protein metabolism and interaction exist in each kind of organism.

Second, Fodor and Piattelli-Palmarini point out that there are molecular interdependencies that arise from the fact that genes are organized onto long thread-like chromosomes. The translation of a gene that is the first step in the process of producing a protein is sensitive to changes in DNA that is nearby on the chromosome strand, so that several genes of quite different specificity can be affected by the same change in the chromosome.

Third, the organization of genes onto the chromosomes in the cell means that when an offspring has inherited a particular form of one gene from a parent, it will also, with high probability, inherit the forms of a number of other genes that lie nearby on the same chromosome strand in that parent. It takes many generations for such historical linkages between genes on the same chromosome to be dissolved. Therefore selection on one function may result in inherited changes in other functions.

While Fodor and Piattelli-Palmarini put considerable weight on these actual functional interactions in organisms, the main issue for them has to do with how we describe the actual objects of selection. If we are to describe what is going on in nature as “natural selection,” then we must remember that it is not traits that are selected but organisms; the traits they possess as properties will determine what their contribution will be to the next generation. This is not an idle distinction because organisms will be “selected” as a consequence of their total biology. In our example we say that dark-colored mice are selected over light-colored mice. But not all dark-colored mice are candidates for natural selection because some of them might be sterile, or have a poor sense of smell, or any other of a vast list of properties that organisms may possess, and those properties may work against the survival of their offspring and thus their natural selection.

Moreover, an alternative way that selection might have acted is by selecting mice that were active only after dark when the predators could not see them, in which case color would be irrelevant. The fact that no such mice happened to exist at the time certainly does not rule out that they might have come into existence. Thus, to give a correct description of the objects of selection we would have to say that what was selected were mice that were dark-colored and not nocturnal. But suppose the mice could make a loud screaming noise that would frighten away predators. Then too, their color would be irrelevant so the correct statement is that what was selected were mice that were dark-colored and not nocturnal and made squeaky noises. We cannot stop there. According to Fodor and Piattelli-Palmarini our specification of what kind of mice were selected properly includes an infinite number of descriptors that take into account all the actual properties of our selected mice. This logic would then include that the mice are smaller than Manhattan.2

The authors are driven to this by a logical necessity because we must, in fact, implicitly take into consideration why it was mice of a certain coat color and not, say, of a particular diurnal activity that were selected. If we are to understand the actual path of evolutionary change, the lack of variation in certain traits is of as much importance as the presence of variation in others. In fact, it often happens that artificial selection in the laboratory for a particular trait when replicated in different genetic strains results, in addition to the trait being directly selected, in different changes in other characteristics in the different lines. This is because in different strains genetic variation for different hitchhiking traits is present on the same chromosome as the genes influencing the directly selected trait.

One way to escape from the logical necessity of an impossibly complete specification of the actual living objects that are selected is to stop talking about “selection for” certain kinds of organisms and refer only to “selection of” the trait or traits that actually change as a result of the process of differential reproduction.3 It is certainly true in artificial selection experiments that you don’t always get what you asked for and there is no reason why the differential reproductive success in nature of different types that we call “natural selection” should not produce the same result. This alternative, however, will make most evolutionary biologists very uncomfortable, because they want to provide narratives of what is really happening to the different sorts of creatures in nature.

A major issue to which Fodor and Piattelli-Palmarini give insufficient attention is the concept of “adaptation.” They point out, correctly, that every living creature must be in some sort of adaptive correspondence to its conditions of life or else it would be dead, so the fact of apparent adaptation of living organisms to the world they inhabit is hardly a surprise. But the “adaptation of organisms to their environment” is a characterization of the relation between organism and environment that misses half the story. It is based on the metaphor of the “ecological niche,” a preexistent way of making a living into which organisms must fit or die. But there is an infinity of ways that organisms might make a living, an infinity of ways of putting together the bits and pieces of the external world. Which of these is an “ecological niche”? The only way to tell is if some organism makes a living in that way. Just as there is no organism without a niche, there is no niche without an organism. A famous example of how niches are defined by the organisms that inhabit them comes from the attempt to find life on Mars. How does one detect life on Mars? One suggestion was to send up a sort of microscope, collect some dust from the Martian surface, and see if anything wiggled. If it wiggles it is alive. This seemed too unsophisticated for the space scientists.

Instead they sent up a sort of vacuum cleaner filled with a nutrient solution containing a radioactively labeled simple sugar. If the dust sucked up from the surface contained living cells, they would start to grow and divide, metabolize the sugar, and release radioactive carbon dioxide, which would be detected by a counter. The Mars lander never detected any life activity although it was determined to be in perfect working order. But that does not mean that there is no life on Mars. It means that there is no life in Martian dust that grows on the sort of sugar provided. This device certainly would not have detected a science-fiction Martian. What the space scientists had done was to provide an ecological niche for a specific kind of life that they knew from earth, a niche that does not match a vast variety of earthly organisms. If you do not specify the kind of organism you are looking for you cannot specify its ecological niche. Perhaps the space program should look again for wiggly things.

Fodor and Piattelli-Palmarini do not discuss the fact that every kind of organism, as a consequence of its life activities, reforms the world around itself and creates its own “ecological niche” that is in constant flux as the organism behaves and metabolizes. Organisms do not “fit into” niches, they construct them, and biologists’ realization of this fact has led to the creation of theories of “niche construction.”4 It is not simply that birds and ants build nests or humans build houses. The metaphor of “construction” covers a number of activities of metabolizing creatures that create the world around themselves. Plants, putting down roots, change the physical structure of the soil in which they are growing and they extrude into the soil chemicals that encourage the growth of certain fungi. These molds, far from “infecting” the plants, form intimate connections with the roots that are a pathway for substances that promote plant growth.

In a great variety of organisms the chance of survival and the growth rate of individuals are not the highest at the lowest population density, but at intermediate numbers. Fruitflies, in their immature worm stage, for example, are farmers. They eat yeast that grows on the surface of the decaying fruit on which they live. The worms burrow into the fruit and the yeast grows on the linings of these tunnels. So, up to a point, the more worms, the more tunnels; and the more tunnels, the more food. Animals and plants create storehouses of energy on which they call in nonproductive times. Bees store honey and squirrels store acorns. Humans store grain and, in modern times, have a commodity futures market, so that affordable bread is available in the winter.

The most remarkable feature of terrestrial organisms is that each one of them manufactures the immediate atmosphere in which it lives. By use of a special kind of optical arrangement (Schlieren optics) on a motion picture camera it is possible to see that individual organisms are surrounded by a moving layer of warm moist air. Even trees are surrounded by such a layer. It is produced by the metabolism of the individual tree, creating heat and water, and this production is a feature of all living creatures. In humans the layer is constantly moving upward over the body and off the top of the head. Thus, organisms do not live directly in the general atmosphere but in a shell produced by their own life activity. It is, for example, the explanation of wind-chill factor. The wind is not colder than the still air, but it blows away the metabolically produced layer around our bodies, exposing us to the real world out there.

The appearance of Fodor and Piattelli-Palmarini’s book at this time and the rhetoric and structure of its argument are guaranteed to provoke as strong a negative reaction in the community of evolutionary biologists as they have among philosophers of biology. To a degree never before experienced by the current generation of students of evolution, evolutionary theory is under attack by powerful forces of religious fundamentalism using the ambiguity of the word “theory” to suggest that evolution as a natural process is “only a theory.” While What Darwin Got Wrong may have been designed pour épater les bourgeois and to forcibly get the attention of evolutionists, when two accomplished intellectuals make the statement “Darwin’s theory of selection is empty,” they generate an anger that makes it almost impossible for biologists to give serious consideration to their argument.

Conscious that Fodor and Piattelli-Palmarini may have overdone it, they have circulated an essay that assures evolutionary biologists that they are not challenging the basic mechanism of evolution as a natural process described by the four principles of variation, heredity, differential reproduction, and mutation. In particular, they reject any notion that natural selection is some sort of “force” with laws like gravitation. For them, natural selection is simply a name for the differential reproduction of different kinds in a population. Not to be misunderstood, perhaps biologists should stop referring to “natural selection,” and instead talk about differential rates of survival and reproduction.

The other source of anxiety and anger is that the argument made by Fodor and Piattelli-Palmarini strikes at the way in which evolutionary biologists provide adaptive natural historical explanations for a vast array of phenomena, as well as the use by a wider scholarly community of the metaphor of natural selection to provide theories of history, social structure, human psychological phenomena, and culture. If you make a living by inventing scenarios of how natural selection produced, say, xenophobia and racism or the love of music, you will not take kindly to the book.

Even biologists who have made fundamental contributions to our understanding of what the actual genetic changes are in the evolution of species cannot resist the temptation to defend evolution against its know-nothing enemies by appealing to the fact that biologists are always able to provide plausible scenarios for evolution by natural selection. But plausibility is not science. True and sufficient explanations of particular examples of evolution are extremely hard to arrive at because we do not have world enough and time. The cytogeneticist Jakov Krivshenko used to dismiss merely plausible explanations, in a strong Russian accent that lent it greater derisive force, as “idel specoolations.”

Even at the expense of having to say “I don’t know how it evolved” most of the time, biologists should not engage in idle speculations.


1. The circulation of the proof copy of What Darwin Got Wrong, the product of a noted philosopher and a prominent student of linguistics and cognitive science, has resulted in a volume of critical comment from biologists and philosophers that has not been seen since 1859. No week has passed that a manuscript expressing bewilderment or outrage from a biologist or philosopher of science has not arrived on my desk or desktop. I have tried but not succeeded entirely in avoiding reading these before making a first draft of this review.
2. This logical result is pointed out by the philosophers Ned Block and Philip Kitcher in "Misunderstanding Darwin," their review of Fodor and Piattelli-Palmarini's book, Boston Review, March/April 2010.↩
3. This suggestion was made by the philosopher of biology Elliott Sober, in response to an earlier version of Fodor's argument. The general tone of argument among philosophers can be judged by the title of Sober's paper in Mind and Language, Vol. 23, No. 1 (February 2008): "Fodor's Bubbe Meise Against Darwinism."↩
4. A recent book on the subject is Niche Construction by John Odling-Smee, Kevin N. Laland, and Marcus W. Feldman (Princeton University Press, 2003).

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29 maio, 2010

Young Tocqueville: a pre-conceived America in his mind

Book Review
The Prophet at Work: Some brand-new insights about Alexis de Tocqueville
Guy Sorman
The City Journal, 28 May 2010

Tocqueville’s Discovery of America
by Leo Damrosch
(Farrar, Straus and Giroux, 304 pp., $27)

American readers usually first learn about Alexis de Tocqueville as an ingenious young Frenchman whose journey here in 1831–32 helped him uncover the essence of the young democracy, which he summarized in a seminal and prophetic book, Democracy in America. Scholars and pundits on both the left and the right find in its two thick volumes ready-made quotations to buttress their arguments about the permanent character of American civilization. In his new book, Tocqueville’s Discovery of America, Harvard literature professor Leo Damrosch breaks with this pristine reading and in the process rejuvenates well-trodden ground. His book arrives at a timely moment, since last fall the Hudson Review published remarkable letters that Tocqueville wrote, mostly to his parents, both on his way to America and after landing. Translated for the first time into English by Frederick Brown, the letters, like Damrosch’s book, shed new light on this giant whom we thought we already knew.

This is not to say that the letters and the Damrosch book destroy the Tocqueville myth or minimize the man’s genius. But they do make him more human, and above all, they explain the circumstances that underlay his insights. From the early letters, some written on the voyage over, we discover that Tocqueville knew a lot about America already. Just 25 when he set off, he had read much about the New World in French and in English. He knew where he was going and why.

Officially, Tocqueville and his close friend Gustave de Beaumont, both magistrates for King Louis-Philippe, went to the U.S. to study the American penitentiary system, which operated on the principle of reeducation, in contrast with the punishment-based French model. On returning, they submitted a powerful report to the French government that found little to recommend in the American approach. However, behind this official endeavor, they both intended to write about America as a whole, in order to “become famous,” as Tocqueville wrote to his parents. For his part, Beaumont would publish a novel inspired by his travel.

The ingenious young Tocqueville had not just ambition but an agenda. His letter to his father—dated June 1831, at the outset of his American journey—reveals his intentions: “Knowing as we do exactly what we want to ask, the most humble conversation is instructive and no man, whatever his social rank, is incapable of teaching us something.” Tocqueville wanted to learn mostly what would fit the preconceived idea he had for his own book: that America was fundamentally different from Europe. The young nation was inventing a new kind of democratic, egalitarian society. From the outset of the trip, as the Hudson Review letters reveal, Tocqueville had a plan for the book. As Damrosch then shows, he stuck to it. Finding Boston too similar to Europe, he went off to see the frontier—Detroit, Nashville, and Memphis. Tocqueville’s ideal American was the frontiersman: well-educated (at least compared with the European peasant), individualistic, and conquering. This new man—the hero of Tocqueville’s epic philosophy, a true democrat—was free of the social prejudices of his European ancestors. Tocqueville renders him like something out of Jean-Jacques Rousseau’s dreams, with some Hellenistic touches thrown in.

As Damrosch points out, though, Tocqueville had his blind spots. He didn’t understand that most Americans he happened to meet were upper-class New England Brahmins, the American equivalent of aristocracy—and thus his America looks much more egalitarian than it actually was. And Tocqueville’s own prejudices come through in his derisive portrait of President Andrew Jackson, who, in the middle of an electoral campaign, granted Tocqueville and Beaumont an interview at the White House. Tocqueville resented Jackson as uncouth and uneducated, and Tocqueville’s fear of the “tyranny of the majority,” and of public opinion generally, revealed his aristocratic leanings. He loved democracy as an egalitarian ideal but would have preferred that it be guided by enlightened elites, not Jacksonian populism. This built-in contradiction, as Damrosch rightly points out, helps explain the nostalgia that imbues the whole of Tocqueville’s writings.

Damrosch is at his best when discussing Tocqueville’s sources. Based on Tocqueville’s correspondence and notes, and Beaumont’s notes as well, Damrosch has reconstructed Tocqueville’s itinerary and described the people he encountered. They weren’t always happy with his reconstructions of their conversations. When Tocqueville later wrote about “the potential for a stultifying tyranny of the majority,” Jared Sparks, editor of a Boston literary journal and one of Tocqueville’s leading sources, became indignant: he complained that Tocqueville had misunderstood his meaning, which was simply that a majority in the legislature might abuse its power. In Sparks’s view, even if that did happen and the legislature passed oppressive laws, “the majority will certainly be changed at the next election.” Which version of this famous insight in Democracy in America is closer to the truth? It remains an open debate.

Much of Tocqueville’s reputation for prophecy rests on his writing on the inevitability of civil war between the North and the South. Tocqueville was truly shaken by the immorality of slavery, but his fear of a coming civil war, as Damrosch shows, was fully indebted to John Quincy Adams. It was the former president, fluent in French, who explained to Tocqueville how “slavery has altered the entire state of the South.” Before Tocqueville did, Adams envisioned that the conflict over slavery could lead to the dissolution of the Union. Tocqueville deserves credit, however, for understanding and conveying the gravity of the issue a generation before the Civil War occurred.

If Tocqueville had been just a social thinker or a political philosopher, we probably wouldn’t be reading him today. He happened to be a gifted writer as well. Another of the Hudson Review letters, addressed to his mother and dated December 25, 1831, describes the deportation of the Choctaw Indians beyond the Mississippi at Memphis. One feels heartsick today at Tocqueville’s description of “the women carrying children tied to their back or swaddled in blankets.” The Americans, he adds, “being more humane, more respectful of law and legality, never bloodthirsty, are more profoundly destructive of the Indian people than Spaniards. And we cannot doubt that within a century, there will no longer remain on the North American continent, a single Indian nation.” Alexis de Tocqueville may have championed American democracy, but he was not naive.

Guy Sorman, a City Journal contributing editor, is the author of Economics Does Not Lie and other books.

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08 maio, 2010

In Praise of Empire - Deepak Lal

In Praise of Empires
Deepak Lal
(New York: Palgrave, 2004, 234 pages)

In Praise of Empires is based on the Henry Wendt Lecture Deepak Lal delivered at the American Enterprise Institute in 2002, In Defense of Empires. He was preaching to the converted there, but the book presumably is meant to reach a broader audience. Whether he can convince anyone else remains to be seen.
Lal takes a no-nonsense approach in his writing. The evidence is clear to him, the necessary steps obvious. Unfortunately, things are not quite that simple -- and simply stating them like this doesn't make them more so. Still, one has to admire his gumption.
Lal's thesis is simple: America is an empire. Accept it -- and get on with it.
Lal believes empires are special -- and good. Specifically, they maintain peace and promote prosperity -- better, Lal argues, than any other system -- and much of the book is an historic overview of empires and their successes (contrasted to the failures of, especially, the Age of Nations and all those annoying multinational organisations). Especially impressive: the British Empire, creating "the first truly global economic space (.....) the first truly liberal international economic order" (whereby Lal emphasises he mean 'liberal' in the original sense of the word, not the perverted current American usage).
The historic overview is of some interest, though the small number of true empires and their very different circumstances should suggest that the conclusions one can draw are limited -- not that Lal lets that stop him. Historical evidence is hard to deny -- it happened, after all -- but history is also easily twisted, and Lal certainly presents it in light of the conclusions he's after; the book is certainly vulnerable to criticism that has a different take on history.
What Lal leads the reader to is, first, the fairly obvious: the United States is an empire, by far the most dominant -- and thus literally the leading -- nation in the world. And that's where the fun really then begins -- because:

The nub of my case is that the United States, even more than any other economically and militarily dominant powers in the recent past, has acquired an empire but is reluctant to face up to the resulting imperial responsibilities because in its domestic discourse it refuses to face up to the reality.

Lal has little use for multinational organisations (or, indeed, multilateralism in any shape or form). The United Nations ? "It is of little use and in a rational world would be wound up." The World Bank and IMF ? They've outlived their usefulness: wind 'em up. The largest NGOs ? They're "bureaucratic organizations whose interests lie in creating scares to maximize their income and thereby the salaries, perks, and size of their bureaucracies." The specialized UN agencies (from the World Health Organization and Food and Agriculture Organization to UNESCO) ? "It is time to shut them down."
Lal is correct that many of these organisations have become bloated, wasteful, and self-serving -- as most bureaucracies are wont to become -- but refuses to see almost any value in them. The better way he sees is to have the US play the part of the imperial power -- play it as he thinks it should be played, that is. That his idealism is no more realistic than that of those who think the UN and friends can save the world is not something he seems to be aware of. (In theory, after all, the multilateral approach can be made to sound quite convincing, but real-life conditions (as Lal gleefully recounts) prove otherwise; similarly, the unilateral approach can be blamed for all sorts of historic disasters (not that he dwells on these) -- and there's one aspect of the empire-solution that even he can't quite get around: all previous empires have collapsed. Lal offers excuses and explanations, but the fact that all empires have eventually failed is a devastating blow to his argument he never adequately deals with.)
Lal isn't entirely deluded, and much of the book does focus on the fact that the United States has historically been reluctant to assume the imperial role its strength would allow it to take, with occasionally catastrophic results. Particularly after World War I US policy led to global economic catastrophe -- and Lal believes also "led to the two greatest threats to the classical liberal order created by Britain: Fascism and Communism." Woodrow Wilson, in particular, has a lot to answer for -- so Lal.
Lal does recognise that American policies (and attitudes) have been confused -- an empire that isn't sure how to play the part -- , and he is certainly correct in warning that the resulting uncertain approach is dangerous. But In Praise of Empires is more a plea for the leopard to change its spots: a call for America to embrace the empire within, as it were, than realistic blueprint. The transformative leap Lal expects is simply not realistic.
Even the most sensible proposal -- that the US finally do away with its insistence on reciprocity in trade matters, and embrace the "economically correct principle of a unilateral move to free trade" -- does not seem feasible in the current political climate (nor in any future imaginable one, as long as special interest groups continue to play the role they do in American politics). There are some other appealing proposals -- specifically the idea of an "International Natural Resources Fund" (which could conveniently replace the World Bank and IMF ...) as a way of depoliticizing natural resource rents (that benefit only bad rulers and elites of resource-rich nations) -- but almost all are impractical and likely unimposable.
Lal thinks the US should do what needs to be done. Undeniably, it has the military power to squash, on some level, almost any opposition. As the recent misadventures in Iraq suggest, however, that only gets you so far. Lal acknowledges a failure in post-invasion preparation in that case -- but thinks the fault was in the setting of the original goal: the imposition of liberal democracy in a united Iraq. He understands that in this case: "there is no reason to hold this artificial state together" and that American interests would be better served with the imposition of a different model (three autonomous self-governing regions, for example). But the costs of following this very different agenda from the get-go -- especially in selling it to the American public (and voters), not to mention the international community are not something Lal bothers with much.
Lal thinks the US should flex its imperial muscle: forget the pressure groups, forget the international community. The current approach of kowtowing -- or at least going through some of the motions -- before taking action merely muddies the waters -- and prevents the US from doing what is in its best interest; time, he thinks, to go at it completely differently.

In Praise of Empires is an interesting political fantasy book. Lal offers interesting history and some sensible theory -- a significant chunk of the book is also a defence of globalization as being the way to go, with the emphasis here on the US taking a leadership role (as it has not) in its spread. The examination of current and future threats and competition (including the likely rise of China and India as imperial powers) is certainly of some interest and value. But too much is just too far removed from contemporary reality to be of much use. Even if an American government were willing to go down Lal's path it seems unlikely that it could overcome even merely congressional and public opposition to it; the efforts of the jr. Bush administration -- far from Lal's ideal -- show how much America's leaders' hands are tied.
Lal's wholesale dismissal of almost all multi- and supra-national organisations is also problematic. Despite their many faults, these organisations do serve a variety of purposes, though Lal is unwilling to acknowledge essentially any of these. Similarly, he does not dwell on America's frequent failures in its foreign adventures, most notably in Viet Nam, Iran, and now Iraq, but also in countless other small and large interventions over the past decades. Current (2004) support of Pakistan and numerous post-Soviet Central Asian states (in the course of the poorly defined so-called 'war on terror'), as well as continuing deference to Saudi Arabia suggest American political leaders may be congenitally incapable of (or institutionally prevented from) acting in the nation's best interest. Lal may know what's best for America (and he may even be right); American leaders certainly have never shown that they do.
So: In Praise of Empires is interesting -- worth a look -- , but it shouldn't be taken too seriously.

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06 maio, 2010

Landes, Mokyr, Baumol - Invention of Enterprise

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Published by EH.NET (May 2010)

David S. Landes, Joel Mokyr and William J. Baumol , editors, _The Invention of Enterprise: Entrepreneurship from Ancient Mesopotamia to Modern Times_. Princeton: Princeton University Press, 2010. xv + 566 pp. $49.50 (hardcover), ISBN: 978-0-691-14370-5.

Reviewed for EH.NET by Reuven Brenner, Desautels School of Management, McGill University.

Carl Schramm, who wrote the Foreword to this book, and who, through the Kauffman Foundation, paid for it, states clearly that the book is about "entrepreneurship” as people -- entrepreneurs in particular -- understand the term: Someone who creates a _business_ that, in some respects, differs from existing ones.

Yet, just two pages later, William Baumol writes in his Preface that the book is about both "redistributive" and "productive" entrepreneurship, the former covering warfare, crime, bribes, lobbying -- any innovative ideas. Since this covers just about everything from Napoleon and his Code to Robin Hood, and from Muhammad, the merchant and one of the very few of Heavens' intermediaries on this Earth to 35,000 registered lobbyists in Washington -- it is little wonder that most of the 18 chapters, written by 18 different academics are all over the map, and provide little illumination on Schramm's targeted subject matter. If one just went from the Foreword and Preface straight to the Index of the book, one could immediately realize that. "Finance, credit, debt" appear in less than 40 pages of the 541 pages of text, and the terms "equity" and "partner(ship))" do not even appear in the Index, though the few relevant chapters in the book highlight the importance of both in financing entrepreneurial ventures across some countries and time. How can one write anything about entrepreneurs without starting the examination with the ways they were financed? Where was the risk capital coming from and in what shapes and forms? And if there was no risk capital -- then why not? Even if just parts of the book dealt with "productive entrepreneurs," these should have been the questions framing the discussion in the 18 chapters.

Susan Wolcott's chapter, "An Examination of the Supply of Financial Credit to Entrepreneurs in Colonial India," is among the exceptions that actually does that and sheds light on the unusual features of India's credit markets. The chapter describes the options entrepreneurs faced if they wanted their businesses to grow; how the lack of openness of its credit markets forced entrepreneurs to rely on family savings; how the caste system and the English come into the financial landscape. This chapter provides insights into the financial difficulties of launching and growing a business when capital markets are in their infancy, and also a brief glimpse into how lack of tolerance hinders entrepreneurship.

The only other chapters that cover these topics are Oscar Gelderblom's and Timur Kuran's. The first is about "The Golden Age of the Dutch Republic," which shows in detail how equity combined with limited liability financed the Dutch entrepreneurs, though even he gets distracted at first by categorizing things and then stating that Amsterdam's 2,600 shopkeepers (butchers, bakers, cobblers etc.) were the city's entrepreneurs. Luckily, after only three pages, he forgets about this, and deals with the ways "entrepreneurs and innovations" were financed as the Dutch Republic became both the first religiously tolerant place in Europe, and also allowed its financial markets to thrive, with sophisticated futures trading on the world's first stock exchange. Timur Kuran's chapter deals with the same topics but is focused more on obstacles to entrepreneurs under Islam.

Although here and there other chapters mention in a few paragraphs financial conditions (though I cannot recall anyone in the book ever using the term "risk capital"), often the topic is more about impediments and antagonism to the notion of "business." Authors make reference to usury laws and the low social status of businessmen and traders in many societies -- from Babylon to Rome, Cicero defining their endeavors as "vulgar and dishonest." This latter view resonates centuries later within Islam (with the doctrine of bid'a, in Kuran's good piece subtitled "Inhibitive Roles of Islamic Institutions") and later in the English view of commerce: Jane Austen referred to the endeavor in a similar vein as a violation of aristocratic principles, though with timeless humor. And yes, this anti-business view resonates across all countries and time with Jews, always the Jews.

In fact large chunks of the book are more about the topic of _inhibitions to enterprise_ and both the variety of ideas people came up with to rationalize them and the institutions rulers and governments put in place to enforce these ideologies. Strangely there is only passing mention of Latin America, Russia and communism -- and though there is a chapter on China, the twenty pages jumping from 200 BC to our days offer not one insight. It first concludes that politics there is "as central as ever, and having no access to party officials remains a critical impediment to any successful entrepreneurial operation," yet the last sentence reads "if the past record is a guide, [the entrepreneurs] will overcome future challenges that come their way." I am no expert on Chinese history, but as far as I know it has been well documented that under the Ming, and even more under the Manchu dynasties, when rigid Confucianism was imposed by state power, Chinese inventiveness ceased for centuries -- about which the chapter is mum.

Unfortunately most of the chapters dealing with the topic of inhibitions miss the forest from the trees, as not one addresses what is to me the basic issue when examining "the invention of enterprise." There is nothing more threatening to an established order -- any order -- than opening up, deepening, democratizing capital markets -- accountably, allowing people to leverage their inventive, enterprising spirit. True, this would also disperse power -- political power in particular. The deeper capital markets would also threaten established industries and commerce. Entrepreneurs, brilliant and ambitious as they might be, are _not_ a threat. They can be sent to Siberia, forced into complacency by the Maos of this world, and the opportunistic ones will channel their ambition through the established powers.

But entrepreneurs with access to _different_, _independent_ sources of risk capital -- now that's threatening, be they Brin and Page, Jobs or Milken at the time (quickly taking away much of the banks' bread and butter of providing loans). Understanding this, even if not wanting to articulate it, provides enough incentives for those in power to subsidize, spread, and promote ideas and institutions inhibiting the deepening of capital markets under a wide variety of jargons, and thus inhibiting the invention and reinvention of enterprises. With time, people get accustomed to these institutions, their origins lost in the mist of time, inhibiting entrepreneurship and business for centuries. Today this may be happening a bit before our eyes. Suddenly, everything becomes a "bubble" -- Internet, oil, houses, gold, bonds. Guess what: if everything is -- why have capital markets to start with? If pricing no longer offers guidance to allocate capital; if stock and bond markets are not there to help correct mistakes faster -- why should they continue to exist? And if they do not exist, who else remains but politicians, bureaucrats and the academics surrounding them -- none of whom ever worked in a business even one day in their lives -- who would then tax and borrow and subsequently allocate capital and "invent enterprises" based on -- well -- whatever.

While I know who Schramm had in mind with this project -- and it is a worthy project -- I do not know what the editors wanted to convey with their selections, or who they had in mind as an audience for this book. Baumol warns that "entertainment is not the purpose of this book." That's an unnecessary warning: 90 percent of its pages are dry, tedious, and some -- especially those with bombastic titles such as "History of Entrepreneurship: Britain, 1900-2000," "History of Entrepreneurship: Germany after 1815," and "Entrepreneurship in the United States, 1920-2000" -- are little more than jargon-ridden, superficial texts, providing zero insight. They are filled with taxonomies and referenced sentences such as "Computer and computer-based technologies in particular, later collectively known as information technology, extended across all boundaries (Coopey 2004)" or "The one thing that it is impossible to have too much of is good judgment (Casson 2000)" -- Casson quoting himself on this observation. Apparently both sentences were unheard of before the years 2000 and 2004.

Even just a little judgment by, perhaps, talking to some entrepreneurs and following them in the daily execution of their ventures before writing treatises about them, could have reshaped this book into something far more concise, sharply written and surprising. After all, learning means being surprised. There were very few pages where I was.

Reuven Brenner, Repap Chair, Desautels Faculty of Management, McGill University, is the author of _Force of Finance: The Triumph of Capital Markets_ (Thomson/Texere) and _A World of Chance_ (Cambridge University Press). His early books, _History: The Human Gamble_ (Chicago), _Betting on Ideas_ (University of Chicago Press), and _Rivalry_ (Cambridge University Press), were, in part, about entrepreneurship. His latest article, "Venture Capital: Building (or Restoring) National Wealth," appeared in the Winter 2010 issue of the _Journal of Applied Corporate Finance_.

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