Picture of the cover of 23 Things They Don't Tell You About Capitalism by Ha-Joon Chang

I couldn’t finish ‘23 Things They Don’t Tell You About Capitalism’ by Ha-Joon Chang. It’s almost as though the author only had four or five solid points before devolving into misleading claims to pad out enough content to publish a book. I persisted with it as long as I could, but when I got to page 180, I nearly threw it across the room. Chang attempts to diminish the role of education in raising an economy’s productivity with the following argument:

“Let’s first take the case of the East Asian miracle economies, in whose development education is supposed to have played a critical role. In 1960, Taiwan had a literacy rate of only 54 per cent, while the Philippines’ was 72 per cent. Despite its lower education level, Taiwan has since then notched up one of the best economic growth performances in human history, while the Philippines has done rather poorly. In 1960, the Philippines had almost double the per capita income of Taiwan ($200 vs $122), but today Taiwan’s per capita income is around ten times that of the Philippines ($18,000 vs. $1,800).”

That’s some dirt cheap debating parlour tricks right there, let’s break it down. So in 1960:

  • Philippines: $200 per capita income with 72% literacy rate.
  • Taiwan: $122 per capita income with 54% literacy rate.

Right, I’m not going to say correlation because there isn’t enough to make such a claim. But the country with the higher literacy rate has a higher per capita income. OK, that implies the opposite of your claim. So let’s jump forward to today and the rest of Chang’s data:

  • Philippines: $1800 per capita income with no literacy rate specified.
  • Taiwan: $18,000 per capita income with no literacy rate specified.

Chang then concludes that this “undermines the common myth that education was the key to the East Asian miracle”. Come on! Where is the other half of the data? Where are the literacy rates for today?? I did a quick Google:

  • Philippines: $1800 per capita income with 96% literacy rate.
  • Taiwan: $18,000 per capita income with 98% literacy rate.

So not only did Taiwan notch up one of the best economic growth performances in human history, but they also notched up an incredible growth in educational performance as well. Yet somehow the role of education in Taiwan’s growth is labelled a ‘myth’? In the words of my sharp witted, 90 year old Grandmother: Poppycock. Not only does this style of argument weaken Ha-Joon Chang’s position, it has the tendency to invalidate his earlier seemingly rational arguments. You start to wonder, what other logical holes did I miss? Maybe all his arguments are this full of shit?

Chang’s book could be titled A Collection of False Equivalences. Like when he tried to compare the Telegraph and Internet (he completely ignored bandwidth and cost), or when he compared the remuneration of American CEO’s with CEO’s from other parts of the world (he should have consistently included stock options, rather than his cherry picking approach that inflated any difference).

I give Ha-Joon Chang’s 23 Things They Don’t Tell you about Capitalism 0.5 out of 5 stars.

0.5 stars out of 5.