When the Money Runs Out, By Stephen D King. Yale, £20. The Growth Map, By Jim O'Neill. Portfolio Penguin, £10.99

 

Hamish McRae
Monday 03 June 2013 18:19
Comments

We call it globalisation and it is one of the two great economic stories of our time: that shift of economic power from the old developed world to the new emerging one. The other story is the nasty economic cycle we have just experienced. The two stories are linked because the failures of Western economic management that exacerbated the last recession have sped up the power shift.

There are, unsurprisingly, two very different takes on globalisation and two books by prominent bank economists exemplify these different responses.

In When the Money Runs Out, Stephen D King, group chief economist for HSBC (and until recently a columnist for this paper), charts the failures of Western economic policy over the past decade. He shows how we assumed the good times would continue for ever, and how policy-makers made matters worse. He notes how their failure has led to a collapse of trust not only in financial services, but in economic policy. Politicians in the West have promised services they cannot deliver. King argues that unless we learn from the past, the West is doomed to a long period of very low growth and rising mistrust. Globalisation goes into reverse.

The positive side of the story comes from Jim O'Neill who, when chief economist for Goldman Sachs, coined the acronym BRICs to describe Brazil, Russia, India and China. It is the measure of the power of an idea whose time has come that there is now even a BRIC summit. O'Neill's book The Growth Map, just out in paperback, sets out how the West can benefit from this historic shift in economic power.

Both books are beautifully written; both in their own terms quite valid. King's subtitle is "the end of Western affluence"; O'Neill's, "economic opportunity in the BRICs and beyond". It comes down to whether you prefer to see the bottle half full or half empty. If you are interested in this great story, read both.

Register for free to continue reading

Registration is a free and easy way to support our truly independent journalism

By registering, you will also enjoy limited access to Premium articles, exclusive newsletters, commenting, and virtual events with our leading journalists

Already have an account? sign in

By clicking ‘Register’ you confirm that your data has been entered correctly and you have read and agree to our Terms of use, Cookie policy and Privacy notice.

This site is protected by reCAPTCHA and the Google Privacy policy and Terms of service apply.

Join our new commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in