Daniel Friedman

Blundering Back to Balance: TARP and Tear Gas

Western economies crawled for years after 2008. Riots lit up Europe even as a gray miasma settled on household confidence. Citizens began speaking of finance as a predator, and scandals like the rigging of the Libor interest rate kept coming. Once-remote moral issues were now on everyone’s lips.

The World Ahead

We evolved in terrain of grassland and scattered trees so different from our present-day housing tracts and glass towers that we’d have trouble surviving in it—as our ancestors might in ours. The miracle is that our savanna genome made us so adaptable that we could move from hunting antelopes to trading CDSs and building global webs of finance.

Markets and Sin: Murder, Megacasinos, and Drug Wars

Victorian philosophers confidently predicted that crime and vice would fade away as the human species evolved. That hasn’t quite happened. For example, the State of California used to spend twice as much on universities as jails, but now the two are almost equal—though students enrich the economy and prisoners sap it. The War on Drugs cost US taxpayers about

Prologue: A Tale of Two Tilts

15 billion in 2010, down from S40 billion in the Bush era, and it has been about as effective as Caligula’s war against the sea.

From Melqart to Zombieworld: Adventures in Imbalance

Mikhail Gorbachev was relaxing in his lavish villa in the Crimea at 4:50 pm on August 18, 1991, when he learned he had visitors. One was a secret police official. He picked up his phone to see who the others were, but the line was dead. He tried others. They were all dead. He had heard murmurings of a coup before taking this vacation, but had waved them away. Now he gazed around at his palace, with its marble stairways and escalator down to the Black Sea, and felt dread.

Cooling the Earth: The Preservation Markets

Loops feed back. We began with two stories: the heist of Russia’s economy itself and the torment in Greece. But we told you chronicles, almost fairy tales. Great events occurred, but they just seemed to happen. In fact, neither makes sense without the moral background. In both cases, markets and morals were disastrously misaligned. And these are just two examples. Let’s look deeper into these and several others.

Underworlds: The Tao of Gangs

Just off New England’s coast, the cold, mineral-rich Labrador Current mixes with the warm Gulf Stream over a series of underwater plateaus, called banks, and nurtures a startling variety of marine plants, animals, and birds. Some, like pollock, lobster, and scallops, are quite valuable commercially.

The Rise of Wealth: How We Became Civilized and Started Shopping

In a year early in this century, you could have seen a small group of men hauling a TV set and a satellite dish up into the beige, bush-speckled mountains around Khost, Afghanistan. Their leader had asked for this equipment for reasons unknown to them, but they trusted him. Yet once in camp, the TV gave nothing but white noise. They aimed the dish at every part of the sky, but all was static. The outside world wasn’t reaching them. Finally someone turned on a radio.

China: Morals and the Rush to Wealth

In 25,000 BC a few people at Dolni Vestonice, now in the Czech Republic, lived in shelters made of rocks, wood, and mastodon bones. Most tribes back then dwelt in caves or temporary huts, and some on the European steppe made torches by burning animal fat in the bulbs of mammoth femurs. From the era of Homo habilis through 10,000 BC, total global wealth was near zero.

From Hudson’s Bay to eBay: Why Some People Like Going to Work

In 1976, China seemed in ruins. The ten years of strife called the Cultural Revolution had torn society apart, turning kids against parents, emptying schools and universities, and paralyzing the national government. The economy was a wasteland, and both the United States and the Soviet Union seemed poised to take advantage. Yet somehow the Chinese Communist Party (CCP) managed to renew itself and put China on a path of astonishing economic growth.