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How the West Was Lost: Fifty Years of Economic Folly--and the Stark Choices Ahead

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In How the West Was Lost, the New York Times bestselling author Dambisa Moyo offers a bold account of the decline of the West’s economic supremacy. She examines how the West’s flawed financial decisions have resulted in an economic and geopolitical seesaw that is now poised to tip in favor of the emerging world, especially China. Amid the hype of China’s In How the West Was Lost, the New York Times bestselling author Dambisa Moyo offers a bold account of the decline of the West’s economic supremacy. She examines how the West’s flawed financial decisions have resulted in an economic and geopolitical seesaw that is now poised to tip in favor of the emerging world, especially China. Amid the hype of China’s rise, however, the most important story of our generation is being pushed aside: America is not just in economic decline, but on course to become the biggest welfare state in the history of the West. The real danger is a thome, Moyo claims. While some countries – such as Germany and Sweden – have deliberately engineered and financed welfare states, the United States risks turning itself into a bloated welfare state not because of ideology or a larger vision of economic justice, but out of economic desperation and short-sighted policymaking. How the West Was Lost reveals not only the economic myopia of the West but also the radical solutions that it needs to adopt in order to assert itself as a global economic power once again.


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In How the West Was Lost, the New York Times bestselling author Dambisa Moyo offers a bold account of the decline of the West’s economic supremacy. She examines how the West’s flawed financial decisions have resulted in an economic and geopolitical seesaw that is now poised to tip in favor of the emerging world, especially China. Amid the hype of China’s In How the West Was Lost, the New York Times bestselling author Dambisa Moyo offers a bold account of the decline of the West’s economic supremacy. She examines how the West’s flawed financial decisions have resulted in an economic and geopolitical seesaw that is now poised to tip in favor of the emerging world, especially China. Amid the hype of China’s rise, however, the most important story of our generation is being pushed aside: America is not just in economic decline, but on course to become the biggest welfare state in the history of the West. The real danger is a thome, Moyo claims. While some countries – such as Germany and Sweden – have deliberately engineered and financed welfare states, the United States risks turning itself into a bloated welfare state not because of ideology or a larger vision of economic justice, but out of economic desperation and short-sighted policymaking. How the West Was Lost reveals not only the economic myopia of the West but also the radical solutions that it needs to adopt in order to assert itself as a global economic power once again.

30 review for How the West Was Lost: Fifty Years of Economic Folly--and the Stark Choices Ahead

  1. 5 out of 5

    Nigel

    Reading this book was a little like having a dinner party and listening to a know-it-all who can tell you a million reasons why the world is going to shit in a hand basket and, worse, a million different remedies. Many of those remedies are so drastic that a few of the guests choke on their steak when they are mentioned. Others sound so outlandish (America defaulting on its debt to "press reset") that a hitherto quiet and unnoticed English gentleman in the corner says, "this has all gotten a bit Reading this book was a little like having a dinner party and listening to a know-it-all who can tell you a million reasons why the world is going to shit in a hand basket and, worse, a million different remedies. Many of those remedies are so drastic that a few of the guests choke on their steak when they are mentioned. Others sound so outlandish (America defaulting on its debt to "press reset") that a hitherto quiet and unnoticed English gentleman in the corner says, "this has all gotten a bit silly" and excuses himself from the gathering. Sure, the West is on a general slight decline in relation to "the rest", but do we all need to pretend like we saw it coming, and that if only we'd played our cards different it could have been avoided? Basically if you don't want to read the book - this is why the West was "lost". What's wrong: Unemployment, debt, housing bubble, bubbles in general, credit cards, free trade, oil resources, global warming, population expansion, currency manipulation, welfare system, democracy, etc, etc...

  2. 4 out of 5

    Jeremiah Seyrak

    What a great summary of the prevailing issues that America’s economy is facing and how it got there. This is more than a academic book, it touches on real life facts and problems with education, war, debt, and housing to name a few. You will learn a lot from this book and it is all supported by referenced material. It helped me to understand a century worth of US economic policy along with a good amount of focus on key events. Some of the negative reviews of this book I have seen I believe are u What a great summary of the prevailing issues that America’s economy is facing and how it got there. This is more than a academic book, it touches on real life facts and problems with education, war, debt, and housing to name a few. You will learn a lot from this book and it is all supported by referenced material. It helped me to understand a century worth of US economic policy along with a good amount of focus on key events. Some of the negative reviews of this book I have seen I believe are unfounded; this book, with an open mind, will inform you on areas you probably never knew. 5/5 from me.

  3. 4 out of 5

    Cathy

    My old economics professor's favorite phrase: "There is no free lunch." It has been quite a while since I have read a book on economics, so I was particularly drawn to this one. It would be interesting to see an update as it has been a few years since its research and publication. I probably liked the book, because the author shares my own view, that one of the reasons BRIC(Brazil, Russia, India and China) is able to accomplish many economic feats is because their capitalistic activities are oft My old economics professor's favorite phrase: "There is no free lunch." It has been quite a while since I have read a book on economics, so I was particularly drawn to this one. It would be interesting to see an update as it has been a few years since its research and publication. I probably liked the book, because the author shares my own view, that one of the reasons BRIC(Brazil, Russia, India and China) is able to accomplish many economic feats is because their capitalistic activities are often state controlled, sponsored or directed. Our form of government and view of private enterprise is working against us from many perspectives including making decisive, and clear policies that benefit the country as a whole. What can be accomplished to make us competitive in a global marketplace when the leaders spend more time campaigning than governing? The increasing use of referendums nationwide will only make our condition worse. Our culture, our historic geographic isolation, our roots, all create scary challenges when it comes to competing with these huge countries. We are who we are....how do we harness our unique advantages as a people to hold our own, economically? What does all this look like if you overlay the equally challenging environmental and socio-political challenges in our world?

  4. 5 out of 5

    Jeremy

    A must read for any socially aware citizen... Moyo presents a clear picture of how the west, USA specifically, lost their economic superiority to the emerging "rest" through systematically implementing myopic economic policies over the last three decades. From the tech boom in Asia of the early 80's to the 21st century housing bubble bursting in the 2008 economic crash, Moyo gives a succinct, if bleak, account of American missteps that virtually handed the reigns freely to the developing world. Alt A must read for any socially aware citizen... Moyo presents a clear picture of how the west, USA specifically, lost their economic superiority to the emerging "rest" through systematically implementing myopic economic policies over the last three decades. From the tech boom in Asia of the early 80's to the 21st century housing bubble bursting in the 2008 economic crash, Moyo gives a succinct, if bleak, account of American missteps that virtually handed the reigns freely to the developing world. Although we've created a workforce comprised of undereducated, unskilled, expensive citizens that are uncompetitive in the global marketplace, Moyo's conclusion offers a sliver of hope to the west in the form of 4 possible scenarios of the rest of the century, not all of which end with the west at the bottom. She reminds us of our savvy and resilience, which is needed now more than ever to pull us out of this nose dive... and the responsibility we have to invest in our own people in the form of education and innovation.

  5. 4 out of 5

    Alex

    This book started strong. Moyo's description of the West's mis-allocation of labor and capital were awesome and eye-opening. But at times the book seemed to descend into doomsday predictions (hence, the title), calls for a stronger centralized state, and lists upon lists of stats that I could pull off the Internet myself. That said, her concerns about America's economic position were intimidating and not without basis. My largest concern with the book's thesis is that it seems to assume a world This book started strong. Moyo's description of the West's mis-allocation of labor and capital were awesome and eye-opening. But at times the book seemed to descend into doomsday predictions (hence, the title), calls for a stronger centralized state, and lists upon lists of stats that I could pull off the Internet myself. That said, her concerns about America's economic position were intimidating and not without basis. My largest concern with the book's thesis is that it seems to assume a world in which cultures rise and fall based primarily on economic policy. I don't buy this. As a final little critique, the book's scope seemed to occasionally lack clear focus. At times, it seemed all about America v. China, but paragraphs later it would go super broad in discussions about all the West v. all the Rest. This is probably a stupid critique. Overall, I'm glad I read it and am torn between 2 and 3 stars.

  6. 4 out of 5

    Stefanie

    Great explanations about the financial crisis and the US-construction policies. Explains how allocation of capital is either beneficial on the long-term or not. In addtion, it explains the general differences between the econo-political systems in China, USA, Russia, Europe and the rest of the world. A bit black-white with China and the general evaluations of the future.

  7. 4 out of 5

    Chinyimba Mando

    This review has been hidden because it contains spoilers. To view it, click here. It was a bit of jarring ride reading this book, it flipped a lot of the half formed notions I had about the world and helped me understand a bit more about the global economy. Firstly when she pointed out the weaknesses of the Western Bloc and how they've shifted significantly from their far more economically sound actions in the sixties, I failed to fault her reasoning. Among the ills in the Western Blocs's policies, she lists; their willingness to freely share data and innovations, their failu It was a bit of jarring ride reading this book, it flipped a lot of the half formed notions I had about the world and helped me understand a bit more about the global economy. Firstly when she pointed out the weaknesses of the Western Bloc and how they've shifted significantly from their far more economically sound actions in the sixties, I failed to fault her reasoning. Among the ills in the Western Blocs's policies, she lists; their willingness to freely share data and innovations, their failure to recoup investments they make in research (especially the pharmaceutical industry), unfair trade deals by China, America's heavy investments in Defense and adventurism on the seas and abroad, Badly designed or implemented Welfare polices, China's artificial devaluation of its currency, a failure by people in the west to adequately train up a productive labour force among other factors. However it can be argued that one of the biggest contributing factorDambisa feels that American consumers had failed to understand the difference between leverage and ownership which led to far too many Americans investing in real estate and living a life centred on consumption which significantly contributed to the 2008 global financial crisis. This led to a downward spiral where America grew heavily indebted to China and is now in a precarious situation where it owes trillions to China, a situation that would have been unthinkable in forty years ago. While on on the other end of the Spectrum Chinese nationals were saving their money and were far less willing to spend their money on investments which had little impact socially on their nation but instead made far more sound investments. As well as had more actual usable cash in their Banks. The Book is an incredibly sobering look at the world of Banking and Finance and makes the average reader (me) question just what the Banks do with the money we give them and if we are safe from a second crisis. I personally feel it is important to see the world through her lens, because as the saying goes. People who don't know their History often times repeat it and reading Dambisa explain just how myopic investment into the Housing Market and the failure of financial regulatory bodies like Central Banks and the IMF to fulfil their fiduciary duties beyond monitoring and adjusting inflation; makes me wonder if the world has learnt much from the 2008 crisis or of the world is even willing to change to avoid another similar event. Once again Dambisa makes a great argument and supports her well researched arguements with fine writing and research...I feel this book was better written than Dead Aid, due to the more elegant flow of the prose in this one as opposed to Dead Aid which even though it was brilliantly written, felt a bit more essay like. I didn't have many issues with it, except for the fact that the book was written from a purely economic perspective and she herself admits in her book that other factors like Democracy and free speech also have a significant impact on the Economic success of a nation, and I feel that these factors were not adequately explained, of course that's no fault of hers she's an economist first and foremost. Further I'm not sure if her world view fully tallies with reality, she seems to see things in an us versus them scenario (East versus West) with little to no chance of mutual benefit a zero sum game so to speak. I must argue that there might be other less warlike scenarios out there that might play out, provided we are willing or are forced to consider them. All in all I loved the book (plain to see from my long rant) and I can't wait to read her other works.

  8. 4 out of 5

    Graham Mulligan

    How the West Was Lost, Fifty Years of Economic Folly – And the Stark Choices Ahead; Dambisa Moyo “once an idea is out it can be used and improved upon by anyone, anywhere, an idea has a marginal cost of zero” This quote is referring to the spinoffs from the magnificent technology that enabled the Apollo moon landing in July 1969. I was a vagabond watching it on a storefront TV in Athens, Greece, along with a small crowd who didn’t own their own sets, or had to be in downtown Athens on that day, aw How the West Was Lost, Fifty Years of Economic Folly – And the Stark Choices Ahead; Dambisa Moyo “once an idea is out it can be used and improved upon by anyone, anywhere, an idea has a marginal cost of zero” This quote is referring to the spinoffs from the magnificent technology that enabled the Apollo moon landing in July 1969. I was a vagabond watching it on a storefront TV in Athens, Greece, along with a small crowd who didn’t own their own sets, or had to be in downtown Athens on that day, away from the comfort of their own home. We were all looking for free. Technology, labour and capital all combined to make America the winner of the Space Race and the Cold War, and the Superpower of the planet. Then came the Financial Crisis of 2008. Dambisa Moyo contends that it is not just the quantity of capital, of labour and of technology that matters, but also the quality. By ‘quality’ she means the manner in which capital is allocated, the aptitude of the workforce and the nature of the technology. Beginning with capital, Moyo points out how the cash-strapped West is losing out in the international bidding war for commodities. The 50 year-long policy to enable the chase for the American Dream by extending credit against an ever-weakening collateral has left America at the cliff-edge of collapse. Too much capital was drawn into the housing market (by risk-loving banks backed by government guarantees) where it becomes ‘non-productive’ capital, ‘non-cash-generating’, and ‘low-yielding’. The combination of easy debt (like mortgages) and the mistaken belief that home equity would always rise led to the housing bubble and collapse of 2008. Moyo says “in a sentence, debt claiments failed in their fiduciary duty to police the equity holders because they were hedged by public policy”. The second misallocation is Labour. Expensive future-debt in the form of pension (I enjoy mine) is one problem. Bad labour-pricing that rewards the wrong groups (sportsmen, CEO’s, and financial services managers) whose societal benefits are low, versus those whose work benefits society more broadly (doctors, nurses, teachers) is another. The global migration of labour is also an issue where quantity and quality are considered from their economic impact. The key demographic factor in the West is the looming retirement of the baby-boomers. The UN forcasts that by 2050 one in three persons in the rich countries of the West will be a pensioner. The median age for all countries in 2050 will rise from today’s 29 years to 38 years. Contrast this with the expectation that the emerging economies (BRIC, for example) will add 2 billion people to the middle class. The quantity question is in the numbers. The quality question is illustrated by Moyo through a discussion about engineering degrees. “According to a 2009 Forbes article, the US prefers lawyers over engineers by 41:1”. The economic trajectory of agriculture to manufacturing, to service sector predominance in maturing economies may explain some of this preference, but the service sector economy is also in jeopardy (witness the call-centre outsourcing described by Tom Friedman in his Flat Earth book). But its not just this aspect of technology that has shifted labour, its also R&D. The education systems in India and China favour a ‘meritocratic’ style where streaming students is practiced, in contrast to the egalitarian practice of broadening access is favoured in the West. I have some disagreement about this latter point and the validity of the evidence. Firstly, the top place in the TIMMS and PISA testing regimes has consistently gone to Finland, a Western country, with Canada close to the top as well. Secondly, the recent high rankings of ‘city states’ like Shanghai and Singapore, are not the same as saying all of China or Malaysia is excelling in the same way or that the system is better. Thirdly, the US scores can be disaggregated to show that some schools and districts are indeed failing but others are excelling, depending on socio-economic status and racial makeup (which is a problem of another kind). Besides capital and labour inputs, a third factor contributes to the growth of economies. This is the ‘total factor productivity’ (TFP). Think of this as all possible contributing factors combined such as geographical factors (terrain and weather), rule of law, property rights, human rights, freedom of expression and technological growth and efficiency. The West’s superior ‘know-how’ has been eroding in a number of ways in this input area. One example of this is the R&D in the pharmacological industry. Drugs developed in the US and Europe privately, soon show up abroad as generics. Another example is the auto industry, where the big three (GM, Ford and Chrysler) failed to keep up to the technological innovations of such manufacturers as Nissan, Toyota, Honda and Hundai. Big global problems become economic challenges as well. Healthcare and education, energy and food security, all require marshalling innovation in new ways. The new world order must now acknowledge other players at the table such as Brazil, Russia, India, China (BRIC) Turkey and South Africa. These players come with a different view of how to organize their economies. Instead of allowing the market to decide how to behave unfettered by regulation and government direction, these countries accept governments with larger roles in directing the economy. 75% of global oil reserves, for example, are controlled by state-owned companies from emerging markets. Moyo, the economist, explains how a country’s wealth comes about: Y = C + I + G + (X – M) Y is a country’s GDP (its income); C is individual consumption; I is total investment in the country (private and public); G is the net position of government (revenues less expenses); (X – M) is exports less imports.

  9. 4 out of 5

    Jeremiah

    When I picked up this book, I did not check when it was written. I feel like the book was largely influenced by the 2008 economic collapse. There is also the fact that the West is essentially the US of A while the Rest is China. Maybe the author intentionally used the two as examples to illustrate her point, but she does not explicitly say so. I am no economist, so I was really enlightened by the numbers showing the economic state and history of the two nations. And I think that maybe in 100 yea When I picked up this book, I did not check when it was written. I feel like the book was largely influenced by the 2008 economic collapse. There is also the fact that the West is essentially the US of A while the Rest is China. Maybe the author intentionally used the two as examples to illustrate her point, but she does not explicitly say so. I am no economist, so I was really enlightened by the numbers showing the economic state and history of the two nations. And I think that maybe in 100 years, China will be the super power and the US will be somewhere lower. All in all, a very informative read. Also, I can draw parallels to some of the things my country is currently doing. I surely hope that Dambisa Moyo is wrong, for our sake.

  10. 4 out of 5

    Wodin

    Starts out pretty good, with some interesting insight into economic history. Then goes completely off the rails, displaying absurd misunderstandings of basic concepts like comparative advantage and the effects of protectionism, concluding with 'solutions' that a clearheaded look into the history from the first part of the book show to be the exact opposite of correct. The last 50 or so pages truly infuriated me.

  11. 5 out of 5

    Jeff Doquesa

    Highly recommended for those who have little to no background in economics but are interested in the reasons for thr economic underperformance of the West especially those leading to the 2008 financial crisis.

  12. 4 out of 5

    Tiaan Goussard

    It is impossible to read this book and not learn anything. The world is changing and Dambisa Moyo expertly shows how we got to where we are and where we are going as a global community.

  13. 5 out of 5

    Jonathan Lu

    Opening quote is a great one: "A senior business executive tells the story of a conference where the head of an established and leading Western telephone company boasted about all the things the company could do, and innovations it had in the pipeline. He went on for quite a long time, as he demonstrated the company's range, depth, and brilliance. His speech was met with enthusiastic applause. Then came the turn of the head of a similar Chinese company; undaunted, pointing to the western executi Opening quote is a great one: "A senior business executive tells the story of a conference where the head of an established and leading Western telephone company boasted about all the things the company could do, and innovations it had in the pipeline. He went on for quite a long time, as he demonstrated the company's range, depth, and brilliance. His speech was met with enthusiastic applause. Then came the turn of the head of a similar Chinese company; undaunted, pointing to the western executive, he said: 'We can do everything be can.... For 40 per cent less.' He promptly sat down." First chapter is pretty dry - very analytical in breaking down how the financial crisis in the west was perpetuated by a system that rewarded risk over jurisprudence. Taking very basic microeconomic principles of debt and equity combined with behavioral economics of decision making, when the consequence of a loss is that of leverage to the creditor and not the one holding the debt, it's easy to see how housing/business/ finance bubbles can perpetuate and burst. 2nd chapter delves more into behavioral analysis of debt vs equity and how companies and nations since WWII have historically been encouraging over expenditure, living beyond means, and housing ownership for all which led to the sub prime crisis. Mentally we all have in mind that we own our houses - and not the bank that owns it, as part of the always striving for more and living beyond means to keep up with the joneses. 3rd chapter talks about demographics of the west as our aging populations deal with paying for pensions of previous generations when we have fewer workers coming up since so few students are now studying stem fields. Interesting to see the actual numbers that only 31% of those with stem backgrounds actually work in a stem field today in the US. "Graduates used to be doers (as engineers and diplomats in the 1950's and 1960's State Department and oil companies) [...] then they became talkers, as investment bankers and management consultants, and finally as speculators as hedge find and private-equity managers in the 1990s and 2000s to today." This is the fundamental point of the book - one of culture in which a series of seemingly "good idea at the time" actions taken by policy makers, corporations, and individual consumers led to this perfect storm of disaster in which America is on the road to becoming a welfare state of the worst kind - where we do not have the coffers nor will to support the public destitution. Moyo continues with an astute breakdown of the challenges facing the US in the future: "herein lies the essential difference between the mindset if the Rest an the mindset of the West. In places like China, the state is the paramount and its government acts in the interest of and for the greater good of China as a hole, even if at the expense of the individual. Western governments, in contrast, have embedded in their very foundations that the rights of the individual supersede all." Since WWII, we have seen an erosion in the power of western governments to take control and act on behalf of its citizens - as corporations have become the power brokers. "But, unlike governments, companies do not act on behalf of the population a large; they act on behalf of their shareholders." Naturally we will always be at a disadvantage vs governments who can negotiate directly on behalf of their people. This is a fundamental truth that Moyo recognizes, not to say that she supports moving to a central realm of authority with all of the downsides (individual freedom, abuses, etc). Interesting breakdown of the 5 types of political supporters in the US: labor democrats who see china negatively as stealing their unionized jobs; high technology democrats who are highly educated, urbane, and see china as intriguing and challenging; religious republicans who see china negatively due to human rights violations; defense republicans who see china as a future opponent a la Cold War ussr; big business republicans who see china as a great way to lower production costs for TSR - all 5 factions ally and fight intermittently and alternatingly for various causes. The end message is not a positive one and spells a bleak future under pretty much all circumstances. Among Moyo's 4 possible outcomes, surprisingly the only one in which there is a light at the end of the tunnel (for the US - impact will be drastic for the globe) is an American default on debt in order to hit the reset button. Global catastrophe, drop of greenback value overnight, and loss of nearly all savings by foreign investors (especially china), so the US can go into isolation mode for a while and eventually break out of this funk with a dramatic overhaul of bad policies to shift culture to one of more savings, frugality, and long term strategy vs short term rewards. Not a likely one to play out.m

  14. 5 out of 5

    Marcus

    This is an important book, but not a good book. Dr. Moyo answers the questions that is on everyone's lips in America these days, is something wrong with our economy? If so what? Dr. Moyo states that the United States has misallocated: capital, labor and intellectual property over the past 50 years. The country and it's people have made poor choices with regard to these area. Capital - Dr. Moyo lays blame on the equity culture in America, specifically the high amounts of leverage used by equity hol This is an important book, but not a good book. Dr. Moyo answers the questions that is on everyone's lips in America these days, is something wrong with our economy? If so what? Dr. Moyo states that the United States has misallocated: capital, labor and intellectual property over the past 50 years. The country and it's people have made poor choices with regard to these area. Capital - Dr. Moyo lays blame on the equity culture in America, specifically the high amounts of leverage used by equity holders. She describes the asymetric risk that allows equity holders to gain a lot if the company is heavily indebted and things go well while losses are borne by banks and ultimately the public when things go poorly. This is doubly so with stock options. This type of thinking was also introduced to main street during the housing bubble where for 1% down a "homeowner" has leverage to 100% of the move in the housing price. If the house increases in value by 5%, the "homeowner" earns 5x the money they put down, if things go badly they send the keys back to the bank. The end result is that Americans have invested too much capital in housing which is an unproductive asset and most companies and banks employ too much leverage. Labor - Dr. Moyo points out how engineers built the great American companies of today, but today few American youth seek engineering degrees. Today's youth aspire to be sports stars, celebrities, lawyers, consultants and investment bankers. These occupations have the highest pay, but do not create the businesses to sustain or grow employment in America. Such misallocation of talent and intelligence has hurt America, particularly in the case of sports stars where many millions of youth forgo education and fail to become pros. Intellectual Property / Trade - America has assumed the rest of the world will play fair as pertains to free trade and intellectual property. This has not been the case and many jobs and trade secrets have been stolen. Dr. Moyo suggests that the USA adjust it's approach to trade to better protect their intellectual property and to acknowledge the fact that some countries are cheating. She correctly points out that all the benefits of free trade accrue to shareholders and large companies, while the workers are ill positioned to benefit and have suffered as a result. I say this is not a good book, because Dr. Moyo's tone comes across as demeaning and anti-American at times. While an important and thought provoking economic book, her tone makes it difficult to read.

  15. 5 out of 5

    Kwame

    I am not a tough grader of books because producing a sensible piece of work is very very difficult but found that the author here could have done better with her categories. The title of the book is so far removed from its content because it concentrates on some of the real economic policies blunders of successive US administrations but to add examples from Uk once in a while does not constitute what is known as "The West". I have no doubt about the author's credentials at all but would be cauti I am not a tough grader of books because producing a sensible piece of work is very very difficult but found that the author here could have done better with her categories. The title of the book is so far removed from its content because it concentrates on some of the real economic policies blunders of successive US administrations but to add examples from Uk once in a while does not constitute what is known as "The West". I have no doubt about the author's credentials at all but would be cautious when the solutions proposed involved protectionism and closing up into a north American alliance. Also startling for me is the neo-Malthusian argument that the world is running out of energy, land and food on account of growing populations. Now, this is an argument that is not only set against the grain of history but also requires far more sophistication to pull off than merely stating that it requires 9 kilogrammes of grain to produce an equivalent weight of beef and therefore that the world is doomed. On the same path is the argument made without evidence that conflict around resources such as water will shortly be normal without evidence for it. In conclusion, I agree that david Ricardo's theory of comparative advantage has been questioned several times but just because China is a "Volume Maximizer" is not evidence that comparative advantage is obsolete. As it is, the simple mathematics of comparative advantage show that no country could hold an absolute advantage in every product imaginable. More recently China's labour costs have been rising and this alone means that Ms Moyo may need to update her arguments. Similarly, the fact that the US is close to being self sufficient in energy undercuts the argument that reliance upon energy imports harms its economy. Finally, I find that the book is a very good polemical work but ignores countries that have managed economies very well. In the entire publication, i am surprised that Canada was hardly mentioned except towards the end in the suggestion that the US should go into a North American alliance with its neighbor. In the end, the book puts up a lot of information on the misallocation of resources in the US but does not provide evidence to me that the US, leave alone the West, is really lost.

  16. 5 out of 5

    Alesa

    I really love books that shake up your entire world view -- or rather, cause you to questions the way everybody around you seems to perceive things. And this book certainly did that, in much the same way that Martin Jacques did in "When China Rules the World". The first half of this book kind of does basic economics, explaining things like why the crash of 2008 occurred. This is not exactly new territory. But then, she moves on to discuss the overall failure of US economic policy, and the lack of I really love books that shake up your entire world view -- or rather, cause you to questions the way everybody around you seems to perceive things. And this book certainly did that, in much the same way that Martin Jacques did in "When China Rules the World". The first half of this book kind of does basic economics, explaining things like why the crash of 2008 occurred. This is not exactly new territory. But then, she moves on to discuss the overall failure of US economic policy, and the lack of strategic planning. It's the latter half of the book that I enjoyed the most, where she discusses the 3 types of capitalism. There's unfettered greed, like in the US. There's quasi-socialism, where the state takes care of infrastructure, like Europe. Both of these are poised to fail with the change in demographics. Then there's state-run capitalism, like China or Singapore, where the state plays a very active role in the economy. The good thing, the author says, is that in the latter, there may not be as much freedom, but there is a group will that permits long-range thinking. In this way, China is investing in resources in Africa, and other places, in order to secure its 50 - 100 year security. Moyo stresses that this puts them at a huge competitive advantage, especially when they are able to steal technology from the West. "How the West Was Lost" is a very unsettling book, challenging America's blindness and inability to put the common cause over individual desires. I wish more people would read this book, especially people with a better background in economics than I have, in order to talk about it with me.

  17. 4 out of 5

    Jill

    I'm rather conflicted on this book. I want to like it but I just don't. I have a couple of problems with the book generally. First, although her discussion of how and why over-investment in real estate (specifically homes) has created a treadmill of ever-rising prices that regularly creates disastrous bubbles in the economy is very clear and persuasive, it still bothers me to hear her speak of homes, pensions, and healthcare as terrible ideas. She does acknowledge that a welfare state can be well I'm rather conflicted on this book. I want to like it but I just don't. I have a couple of problems with the book generally. First, although her discussion of how and why over-investment in real estate (specifically homes) has created a treadmill of ever-rising prices that regularly creates disastrous bubbles in the economy is very clear and persuasive, it still bothers me to hear her speak of homes, pensions, and healthcare as terrible ideas. She does acknowledge that a welfare state can be well-designed and managed but neither elaborates on that or, to my dismay, advocates for it. Second, I found some arguments to be too broad and unsupported. In some instances I noted her comparative statistics to be differently 'denominated' or (personally judged them) to be too narrow to provide an accurate picture of actual 'development.' Overall I felt her analysis lacked sufficient discussion of the growing income inequality in both the West and the Rest to provide an accurate depiction of actual development (or decline) anywhere. Ultimately, I was disappointed to find her recommendations all centred on maintaining the status quo of winners and losers in global economics and finance. Personally, I consider the entire foundation of classical economic theory to be reverse engineered to justify the status quo rather than explain it and believe that any discussion of future economic policy should include an effort to change, rather than reinforce, a fundamentally corrupt system. And Ms. Moyo did not come through for me in that.

  18. 5 out of 5

    Jordan Palmer

    I quite enjoyed this book, the discussion on the misallocation of labour, capital, and technology was very informative. A lot of reviews here claim that there was a patronising tone throughout the book, while I can see where these people are coming from, these people also seem to have read quite widely on economics, and therefore Moyo is merely spelling out in detail what they take as common knowledge. I on the other hand have very limited experience in economics (my reading topics mainly focus o I quite enjoyed this book, the discussion on the misallocation of labour, capital, and technology was very informative. A lot of reviews here claim that there was a patronising tone throughout the book, while I can see where these people are coming from, these people also seem to have read quite widely on economics, and therefore Moyo is merely spelling out in detail what they take as common knowledge. I on the other hand have very limited experience in economics (my reading topics mainly focus on history, religion, biology, the cosmos, and broad-scope politics) so I found her careful breakdown of economic concepts quite useful as an economic novice. The two main issues I had with the book were firstly; Moyo has a tendency to compare figures on a topic regarding two different countries but the figures are from different years. Not sure if I explained that well, an example being she compared contrasting debt figures between two countries, but she used the 2000 figure for one country and then a 2004 figure for the other, which doesn't really provide an accurate analysis. The second issue I had was with one of her solutions, which was for the US to default on their debt as a way of wiping the slate and damaging Chinese growth, appropriately found under the paragraph heading "murder-suicide in Chimerica", She seems to genuinely support this unbelievably drastic measure as a viable option, which I personally think is ridiculous. These aren't enormous problems with the book, the overall argument provided by Moyo is still quite strong, and very accurate.

  19. 4 out of 5

    Linda

    The Table of Contents and the bold headings tell the main information. China reflects the U.S.A. a decade ago. China needs to learn from our mistakes--debt vs. equity/savings, over consumption vs. conservation, quantity vs. quality. U.S. GAVE economic, military, political supremacy away. Economy = capital, labor and technology/knowledge. Cash is king, labor cheap, knowledge stolen, high salaries for the lucky few (sports/entertainment/CEO's--with little return on investment. Need to invest in ed The Table of Contents and the bold headings tell the main information. China reflects the U.S.A. a decade ago. China needs to learn from our mistakes--debt vs. equity/savings, over consumption vs. conservation, quantity vs. quality. U.S. GAVE economic, military, political supremacy away. Economy = capital, labor and technology/knowledge. Cash is king, labor cheap, knowledge stolen, high salaries for the lucky few (sports/entertainment/CEO's--with little return on investment. Need to invest in education, science/math, health care, R&D. Government controlled/regulated capitalism seems to be adopted by a majority of the countries. Human greed benefits the few. Americans are buying foreign goods. Issues: wars, environment, health costs/disease, resources (clean water/air), crime, overpopulation Chinese currency = renminbi Large Chinese population (Baby Boomers)sets trends. That can be an advantage and disadvantage. Baby Boomers now are less productive and more expensive (pensions, social security, health care). Social Security/Medicare Ponzi Schemes. If U.S. defaults on debt--stock market crash, cost of debt soar, dollar would turn into monopoly money, international uproar. America needs to become more self sufficient. Throughout history, the world keeps advancing.

  20. 5 out of 5

    Clivemichael

    Well presented prescient, dense and detailed analysis of our current, albeit progressing, situation. She energetically paints a dismal picture. Although her figures and explanations are well defined, my lack of economic understanding had me somewhat overwhelmed by the excess. I get the concept, but cannot embrace the process which had some win and many lose. Without directly saying so she appears to endorse GMO along with nuclear power, the energy panacea, conveniently ignoring the ongoing issue Well presented prescient, dense and detailed analysis of our current, albeit progressing, situation. She energetically paints a dismal picture. Although her figures and explanations are well defined, my lack of economic understanding had me somewhat overwhelmed by the excess. I get the concept, but cannot embrace the process which had some win and many lose. Without directly saying so she appears to endorse GMO along with nuclear power, the energy panacea, conveniently ignoring the ongoing issue of dealing with the waste. Perhaps the Fukashima event has altered her perspective. How this for irony: "Of course, in light of the current economic circumstances, short-term, tactical considerations are important. But, unfortunately, as ever, the myopia around the political imperative in the West mitigates against long term thinking." and pause for thought in her conclusion:" .. the US is on a path to creating the worst and most venal form of welfare state (poorly developed and designed)- one born of desperation from many years of flawed economic policies and a society that rapaciously feeds on itself."

  21. 4 out of 5

    Sophie

    An interesting book. As others have pointed out, the title is misleading as it not about the 'west' but primarily about the USA and to a lesser extent, the UK and their relationship to China and, occasionally India, Brazil and Russia. This left me wondering how other more social democratic countries were faring. However, my main question - given that the whole premise of the book is that if we don't look out and change everything about our economy and a lot about our society, China will takeover An interesting book. As others have pointed out, the title is misleading as it not about the 'west' but primarily about the USA and to a lesser extent, the UK and their relationship to China and, occasionally India, Brazil and Russia. This left me wondering how other more social democratic countries were faring. However, my main question - given that the whole premise of the book is that if we don't look out and change everything about our economy and a lot about our society, China will takeover as the most important world power - was, so what? Regarding global issues such as terrorism, global warming, and the oppression of women and minorities, I've seen no evidence to suggest that China will make a worse job of ruling the world than the British did or the Americans are doing which makes all the scaremongering in this polemic a little hard to swallow, for me at least. Also, I'm not sure if Moyo meant to argue that democracy will always fail to address important long term issues - such as the economy, education, and infrastructure, and by extension, global warming - but to me, this line of thinking makes a case for handing power over to the Chinese.

  22. 4 out of 5

    Stephanie

    i didn't make it all the way through this book-- as other reviewers have stated, it started strong but her very significant research and factual arguments were interwoven with a lot of opinion, which unfortunately served to undermine the otherwise sound points that were being made. very compelling research, and i don't necessarily disagree with her conclusions, but if they are obvious enough, the data alone will lead people there. this will stick with me: “If one were to put a GDP value on the w i didn't make it all the way through this book-- as other reviewers have stated, it started strong but her very significant research and factual arguments were interwoven with a lot of opinion, which unfortunately served to undermine the otherwise sound points that were being made. very compelling research, and i don't necessarily disagree with her conclusions, but if they are obvious enough, the data alone will lead people there. this will stick with me: “If one were to put a GDP value on the world in 2009, it would be worth US$60tn. That is the sum total ascribed dollar value of the annual output all the world’s countries – rich and poor. For the current global population of roughly 6.5 billion people, this averages out as just over US$9,000 for every man, woman and child on the planet. (Of course the realities of income inequality mean this is not the actual case.) At US$14tn, the largest share of this capital resides in the world’s wealthiest country, the USA; very nearly one third of the world’s GDP. At a rough calculation, this means that, as of 2008, the average American took home about US$45,000.”

  23. 4 out of 5

    Ian

    This is a very scary book about the future that faces the West if we don't get our act together. Is it alarmist or accurate? It does seem to be backed up by a lot of data. One of the scenarios that it points towards is the USA defaulting on its national debt and truning to protectionism to protect and rebuild its economy, with the flow on effects of the collapse of the US dollar and decimation of China's ecomonic growth (given it is the largest holder of US debt and also dependant on debt-financ This is a very scary book about the future that faces the West if we don't get our act together. Is it alarmist or accurate? It does seem to be backed up by a lot of data. One of the scenarios that it points towards is the USA defaulting on its national debt and truning to protectionism to protect and rebuild its economy, with the flow on effects of the collapse of the US dollar and decimation of China's ecomonic growth (given it is the largest holder of US debt and also dependant on debt-financed consumerism for sale of its exports.) Given that US debt is approaching its total GDP this scenario seems increasingly likely. I would have given this book 5 stars except that it doesn't explain very clearly how banks manage to get high loan-to-deposit ratios ( Elsewhere I have read that it is due to banks taking on additional (non-deposit) debt which they loan out, which becomes a problem if the assets used as collateral crash in value.) While it points to actions that Western Governments can take, it doesn't really point to anything that individuals can do to protect themselves.

  24. 5 out of 5

    Ross

    The author, an economist educated at Oxford, details in facts and figures the past events, bad government policies, and trends that spell the bankruptcy of the West and the "rise of the rest." The fundamental cause is the introduction of the welfare state to Europe and America. She makes the point that the northern European states are functioning as better managed than the badly managed welfare states of the U.S. and southern Europe. The U.S. and the southern European states are in fact bankrupt The author, an economist educated at Oxford, details in facts and figures the past events, bad government policies, and trends that spell the bankruptcy of the West and the "rise of the rest." The fundamental cause is the introduction of the welfare state to Europe and America. She makes the point that the northern European states are functioning as better managed than the badly managed welfare states of the U.S. and southern Europe. The U.S. and the southern European states are in fact bankrupt now. There is no way they can ever repay the debts they have incurred to support the welfare economies and for the U.S. the recent wars. In the West today we have the "makers and the takers." Fully half of Americans pay no income tax at all. The U.S. debt is only increasing and the Federal government will either default on the debt or print huge sums of money to create major inflation. The big unknown is what happens when the default occurs or the inflation starts.

  25. 5 out of 5

    Seamus Enright

    I'm not quite sure what to make of this. While she's clearly well-informed on the issues, she spends way too much time discussing the Housing Bubble in the US and not nearly enough on the WTO which basically handed the keys of the World Economy to China. She seems to believe in Free Trade which is basically what has caused the coming Chinese hegemony that in turn alarms her so much. She doesn't emphasise enough how America's decline has been caused by excessive military spending and apportions to I'm not quite sure what to make of this. While she's clearly well-informed on the issues, she spends way too much time discussing the Housing Bubble in the US and not nearly enough on the WTO which basically handed the keys of the World Economy to China. She seems to believe in Free Trade which is basically what has caused the coming Chinese hegemony that in turn alarms her so much. She doesn't emphasise enough how America's decline has been caused by excessive military spending and apportions too much blame to the Welfare State...the bizarre, tea-party-ish statement that America is becoming a socialist state is made towards the end. Her own resource-rich, youthful Continent of Africa hardly gets a mention. That it's still mired in poverty while China, India, etc power ahead seems an inconvenient truth that isn't worthy of discussion. Still, it's a worthwhile read, if you can get over the patronising economics tutorials.

  26. 4 out of 5

    Jason

    I appreciated the main point of Moyo's argument, but as the book went on it felt that she repeated her arguments quite a bit. HTWWL was an easy read, yet provided enough detailed statistical data to explain some complex economic theories. What confused me was that Moyo railed against the way the US (and to some extent the UK) government had so misused its labor, capital, etc. and then turned around and suggested that more government control was necessary to fix what was broken. All in all, I tho I appreciated the main point of Moyo's argument, but as the book went on it felt that she repeated her arguments quite a bit. HTWWL was an easy read, yet provided enough detailed statistical data to explain some complex economic theories. What confused me was that Moyo railed against the way the US (and to some extent the UK) government had so misused its labor, capital, etc. and then turned around and suggested that more government control was necessary to fix what was broken. All in all, I thought the book provided a lot of thought provoking ideas regarding the West's attitude towards debt, risk aversion, comparative advantage and an overall culture of living beyond one's means. Although I disagree with some of Moyo's "fixes," I appreciate her explanations of the problems and how the developed.

  27. 5 out of 5

    Letitia

    I have long been a fan of Dambisa Moyo from her talks and short things I have read, but this was the first book that I sat down to read. I thought it was incredibly well done, but I have to confess to it being a bit over my head. I found it hard to follow. For reference, I have a master's in International Relations, and an acquaintance with political economics, though I do not have a PhD in Economics, and for the fullest comprehension, that may be what this text needs. I still found it insightfu I have long been a fan of Dambisa Moyo from her talks and short things I have read, but this was the first book that I sat down to read. I thought it was incredibly well done, but I have to confess to it being a bit over my head. I found it hard to follow. For reference, I have a master's in International Relations, and an acquaintance with political economics, though I do not have a PhD in Economics, and for the fullest comprehension, that may be what this text needs. I still found it insightful, learned a lot, but struggled not so much with concepts as familiarity with terms used in financial systems and international econ. She covers material quickly and arrives at big conclusions which, as far as my understanding can grasp, she justifies well. I think this makes for an excellent cautionary tale, especially for Americans.

  28. 4 out of 5

    Nyawira Muraguri

    Very enlightening book. Having had more experience with emerging market and developing economies; I sought to understand what ailed developed economies despite their previous dominance.Dambiso discusses various economic themes and provides insighful examples which make it less of a text book experience. It was easy to relate the challenges adressed in the book to the current state of the global economy and it gave that "it makes sense" feeling to the reader. However, I think the recommendations ma Very enlightening book. Having had more experience with emerging market and developing economies; I sought to understand what ailed developed economies despite their previous dominance.Dambiso discusses various economic themes and provides insighful examples which make it less of a text book experience. It was easy to relate the challenges adressed in the book to the current state of the global economy and it gave that "it makes sense" feeling to the reader. However, I think the recommendations made for economic recovery might have been better adressed in a separate book to give them the level of importance that they deserve.

  29. 4 out of 5

    Kerry

    I really enjoyed this book but mainly because it backed up my own opinions of the disastrous economic direction we have going in the West for much of my life. I enjoyed the economic statistics that were supplied and was most impressed by her conclusions as to the choices left to us to avoid bankruptcy (or embrace it as the case may be). On the con side I thought she got onto very shaky ground when she ventured outside of the economic narrative. Citing Wikipedia as one of her historical sources w I really enjoyed this book but mainly because it backed up my own opinions of the disastrous economic direction we have going in the West for much of my life. I enjoyed the economic statistics that were supplied and was most impressed by her conclusions as to the choices left to us to avoid bankruptcy (or embrace it as the case may be). On the con side I thought she got onto very shaky ground when she ventured outside of the economic narrative. Citing Wikipedia as one of her historical sources would not improve her credibility! I was pleased to see that her economic references were more scholarly. Preaching to the converted in my case but a reassuring read nonetheless.

  30. 5 out of 5

    Rowland

    I thought it was a very good read, highlighting the causes of the financial crisis in the US and why if it continues with it's current policies, it is in line to loose it's crown as the global economic power. However, professional economists are not that good at predicting future outcomes. Alot of the predictions are based on alot of "ifs", if the US continues its trend on becoming a welfare state, if the US continues with its current foreign policies, if China and the rest continue on allowing t I thought it was a very good read, highlighting the causes of the financial crisis in the US and why if it continues with it's current policies, it is in line to loose it's crown as the global economic power. However, professional economists are not that good at predicting future outcomes. Alot of the predictions are based on alot of "ifs", if the US continues its trend on becoming a welfare state, if the US continues with its current foreign policies, if China and the rest continue on allowing their people extra freedoms, if oil prices continue to rise or reserves run out, etc etc. . .

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