subject: Book Review and Summary of "Eat the Rich" by P. J. O'Rourke [print this page] Book Review and Summary of "Eat the Rich" by P. J. O'Rourke
In "Eat the Rich", P.J. O'Rourke provides for an interesting and humorous outlook on the topic of economics. O'Rourke uses a witty and humorous approach to try explaining economics to the reader. He tried to take a "big issue", economics, and tries to make it understandable to the average person. I personally think that he did an excellent job of explaining the world of economics to the everyday person while adding humorous and witty tidbits. His book, subtitled, "A Treatise on Economics", is just that, a series of essays that a more complex and in depth than a single essay. Although the book was written in 1990, some of the material and facts remain the same. However, some are outdated, like the example of ancient China being very productive, but today (1990), "China stinks". Obviously this is not true today (2009), as China has become a world economic power. I enjoyed O'Rourke's travels around the world to find out the answer to his biggest question, "Why do some places prosper and thrive, while others just suck?" In "Eat the Rich", O'Rourke builds economic theory from keen observation of various governmental, social and economic systems (Rayment).
He begins the book by introducing himself just like every other person who slept through ECON 101. O'Rourke decides that he finally wants to catch up on the information that he missed during that class because it seems pretty relevant in the world today. He decided that he would, "visit different economic systems: free market socialist, and systems nobody could figure out" (O'Rourke 10). He also decided that he wanted to visit some economically successful societies, some economically unsuccessful economies, and some societies that hadn't decided whether to be successful or not. The economically successful societies included the United States, Sweden, and Hong Kong. The economically unsuccessful societies were: Albania, Cuba, and Tanzania. The societies that were somewhere in between were Russia and mainland China.
In O'Rourke's first stop in his world travels is Wall Street to view the "Good Capitalism" of the United States. He decides to start his investigation of money at the New York Stock Exchange because he wanted to go somewhere lots of money is made (11). Here, he explains stocks, bonds, debentures, commodities, derivatives and "why the floor of the exchange is America's last refuge for nonpsychotic litterers" (Inside Cover). He mentions that over four thousand pounds of trash are taken off the floor of the NYSE daily (16). O'Rourke believes that the NYSE is very important and that we should pay attention to it, but that American's pay too much attention to it. He thinks that the NYSE has almost become a celebrity, and that's not how it should be.
I think that the NYSE receives a lot of attention, but that attention is well deserved. How the NYSE did the previous day is on the front page of the Business section of every major newspaper nationwide. I think that it should be like this because I believe that America is run by large corporations which sell stock on the NYSE. That is why we should pay so much attention to the NYSE, because the companies that sell stock on it control our country.
Next, he travels around the floor of the NYSE following a floor broker named David. O'Rourke describes how David is doing several things at once while keeping track of tons of numbers inside of his head. O'Rourke describes David's job as hectic and is amazed at all of the things that he could do. He then finds out that Wall Street people believe that the investment industry provides liquidity for society (31). He defines liquidity as, "the Wall Street word for having things you can do with your money and being able to do them" (32). O'Rourke concludes by saying although he lives and functions in a capitalist society daily, it scares him. He said that free-market capitalism was terrifying even under the best circumstances, so he decides to go Albania, a place full of crooks and with no rules.
O'Rourke begins by saying, "Albania shows what happens to a free market when there is no legal, political, or traditional framework to define freedoms or protect marketplaces" (36). He then goes on to explain that Albania had been destroyed by the pyramid scheme. In 1992, communist rule ended in Albania and people began to invest in pyramid schemes. Then, in 1997, all of the pyramids collapsed. Violent protests then occurred and the government banned public meetings. The government then sent the military on the people, but the soldiers had money in the schemes, so the violent protests turned into armed rebellions. O'Rourke found out that the people believed that the pyramid schemes were the free market and that it was capitalism. He noted that the capitalism that he found on Wall Street was based upon freedom, and Albania also has lots of freedom. He then goes on to explain all of the poverty in Albania and that everyone carries a gun around. O'Rourke says that even though Albanians have so many freedoms, their lives are very dull. They spend all day gambling and drinking. However, there is a 10pm "shoot to kill" curfew enforced by an Italian-led contingent of around 7,000 troops. After noting that Americans and Albanians both have many freedoms, although radically different, he moved onto the next country, Sweden.
Sweden is the country that has Good Socialism, as opposed to Cuba's Bad Socialism. While traveling to Sweden, O'Rourke assumes that he would find a place that had the propensity of Wall Street without the chaos of Albania (57). He finds that Sweden is exactly how he assumes that it will be. He mentions some of the perks of living in Sweden, such as living in a welfare state from cradle to grave. Although Sweden is a socialist paradise, he ultimately concludes that Sweden has too much government regulation. He determines that the Swedish Model assumes that the government is good, and therefore, the voters must also be good. He finishes by saying that socialism scares him almost as much as capitalism and that Swedes are all a little crazy. However, compared with Cuba, Sweden seems like a paradise.
Noting his first visit to Havana, O'Rourke notes all of the things outside of his hotel that are falling apart. He talks about how the government has eliminated the concept of a job because there was no such thing as unemployment. He noted that although the streets grew crowded, people did not seem to be doing anything or going anywhere in particular. The cause of the Bad Socialism, O'Rourke concludes, is the poverty of Cuba. Problems with the economy can be found everywhere from empty buildings to pesos hardly being worth anything. He finally states that socialism was adapted because it would be for the good of humanity. Obviously, in Cuba, this has not worked.
The next chapter, entitled, "From Beatnik to Business Major", O'Rourke takes a break from his travels around the world. He provides some explaining economic theory, using some humor, to the reader. He reiterates points that we learned in class like the fact that goods are limited, but wants are unlimited. He explains that economists try to make everything as efficient as possible. He then provides "Ten Less-Basic Principles of Economics" which to me, seem like common sense. After talking about comparative advantage, money, and value, he continues his world travels.
The next stop on his travels, is Russia in the chapter entitled, "How (or how not) to Reform (maybe) an Economy (if there is one)". As the title suggests, the economic state of Russia is very confusing. As the inside cover states, the Russian economy can provide for a wonderful case study, unless you are, of course, Russian. O'Rourke goes on to talk about how the people in Moscow are very busy and the city is somewhat beautiful. He shows how everything in Russia is expensive and how high taxes are on businesses. Because of these high prices and tension of businesses, it is estimated that four businessmen a day are killed in Moscow. O'Rourke believes that Russia does not have an effective system of civil law as shown by these murders. He shows how the absence of the rule of law in that country has lead to the rise of the Russian Mafia. After his ideas about change and reform had been simplified, he wanted to leave.
The next stop on his trip around the world was Tanzania. O'Rourke wonders how a country like Tanzania can be full of natural resources, but an economic failure. Hong Kong, which even as the British prepare to hand it over to the communists, has a thriving economy. These two countries provide for a clearer view between socialism and capitalism through the explanation of their histories. Between 1961 and 1964, Tanzania received $20 billion in aid from the United States, yet remains one of the poorest countries in the world. He blames this on President Nyerere's collectivization of agriculture. Although O'Rourke blames President Nyerere, he recognizes the fact that he admitted failure. He attributes the success of Hong Kong to John Cowperthwaite, a British officer sent to Hong Kong in 1945 to take charge of its economy.
The final stop on his travels is Shanghai. Here, he shows how difficult economic reform can be for countries in financial distress or undergoing political change. He notes that Shanghai is just one giant construction site. He says that Shanghai began as an enclave of market freedom, although it was market freedom imposed by military force. He states that a free market is a natural evolution of freedom (228). He also believes that the Chinese Communists are attempting to build capitalism from the top down. O'Rourke pokes fun at the fact that he believes that the icon that dominates the streets is not Chairman Mao, but Colonel Sanders. This is where he finally concluded his travels around the world.
In his conclusion, O'Rourke says that the free market is ugly and stupid, like going to the mall. The unfree market, on the other hand, is just as ugly and stupid, except there's nothing in the mall and if you don't go there they shoot you. He concludes that capitalism is important to a people's well-being, and rule of law even more so. In spite of its inherent faults, the surest way out of poverty is the free market. Wealth, he says, is the result of economic liberty, while poverty comes from economic repression. Free market capitalism is not perfect, and at times it is not fair to everyone, but it does work. In the last chapter, he also explains the joke of the title of the book. He said that he had no intention of actually doing that because eating the rich would be destroying the better part of ourselves. He concludes by saying that wealth is good, no matter what form it takes.
I found my agreeing with O'Rourke on many of his points. Just like him, I have been born and raised in a free market system so I do not know any better. After being taken through his journey around the world, I have a greater appreciation for where I live. I would not want to live in a country that is really poor and I would be shot if I went outside too late at night. I am glad that I do not live in poverty and spend my day doing nothing. O'Rourke also admits that free market capitalism is not perfect, but it is better than everything else. I think that people in the United States are so rich because everyone strives to earn as much money as possible. This is what creates more wealth and prosperity. I also believe that we have a law enforcement system that will severely lower my chances of being robbed or killed compared with a country like Tanzania. I also agree with O'Rourke's point that any amount of wealth is good, whether a few people have it or a lot of people. Because once wealth is acquired, it is spread to your family and people that you buy are sell things from. Wealth makes people's lives better. Wealth does not necessarily have to refer to money, it can refer to other things that you have an abundance of.
Overall, I think that O'Rourke did a good job of explaining his main points while going through different economies throughout the world. He showed that although free market capitalism is the best system compared to ones found in the rest of the world. I thought that the book was humorous and taught economics while keeping the reader interested. I enjoyed the book a lot partially because I found myself agreeing with a lot of O'Rourke's points. The other reason was that he managed to keep me entertained while teaching me about economies around the world. Finally, he taught me that I should be happy to live in the good ol' U. S. of A.
