Carney's "Value(s)" Reviewed

4 years ago, I was writing a review of Mark Carney's newly released book for a journal which became inactive before the review was completed. Time to finish it.

The premise of this book is something that Carney and I are in 100% agreement on: “The three most significant crises of the twenty-first century – of credit, Covid and climate […] were driven by a common crisis of values”. A value crisis! I couldn’t have said it better.

When Mark Carney’s book “Value(s)” came out in 2021, colleagues immediately asked what I thought of it. I had (of course) picked up an early copy, and was still slogging through it. Anyway, I started work on a review for a journal I’d done book reviews for in the past, but they had become inactive before I could pitch it. So I pitched it (in another sense).

Now that Mark Carney is the Prime Minister of Canada, I decided I was overdue for hauling my review out of the archive folder, dusting it off, and putting it out there.

Published in 2021 by Penguin Random House Canada, 600 pages (hardcover)

A few years ago, some new graffiti appeared somewhere in Hong Kong that read: “We can’t return to normal, because the normal that we had was precisely the problem.” In a sense, Mark Carney has seen the writing on the wall. However, he seems to have trouble seeing the composition of the wall itself, and fully imagining what might be on the other side.

One of his inspirations was a metaphor conveyed to him by Pope Francis, who remarked that humanity is like wine, which has bouquet, colour, richness of taste, and alcohol to enliven the mind. The market, on the other hand, is like grappa, a distilled wine that has only alcohol. The pope’s challenge (and the book’s premise) is to turn grappa back into wine.

Mark Carney offers up the right ideas, but he has not pulled back his focus far enough. He offers few concrete solutions – and certainly nothing that can be done on an individual level, because he has not made some essential connections – namely that values measured by number are unnatural and tend to be doomed from the start.

He does start from the right place. He says what’s important in life is “integrity, fairness, kindness, excellence, sustainability, passion, and reason” - noble thoughts which I support (though perhaps easier to exclude money when you’re part of the nobility class). His very book title is supposed to highlight the inherent theme of the book: “value” (monetary) versus “values” (subjective human concepts), but he does not explore their respective attributes sufficiently.

Let’s be fair. Carney has a most impressive economics resumé: Harvard, Oxford (PhD) and former Governor of both the Bank of England and Bank of Canada. I’m thrilled that such an experienced thinker is now Canada’s Prime Minister. However, that same CV means that he was raised in classical ideas and worked almost exclusively as a big banker. That can limit one’s ability to think outside the box, and also one’s ability to talk to the common person. He has written a book for bankers, economists, and finance ministers—people like himself. The good news is that, being one of them, and writing in their language, he has a fighting chance of broadening perspectives amongst those colleagues with dangerously narrower value concepts, and conveying the essence of value versus values:

“Like the financial crisis, the tragedy of the horizon represents a crisis of valuation and values. Compare the valuations of Amazon and the Amazon region. Amazon’s $1.5 trillion equity valuation reflects the market’s judgement that the company will be very profitable for a very long time. In contrast, it is only once the rainforest is cleared and a cattle herd or soya plantation is placed on the newly opened land that the Amazon region begins to have market value. The costs to the climate and biodiversity of destroying the rainforest appear on no ledger.”

While he is clearly a deeply thoughtful person, the idea of the book was no doubt solidified by what he described as “arguably the most difficult, and undeniably the most significant, weighing of sacred and secular values ever performed”—that being the COVID-19 pandemic that raged as he was writing. Throughout, he recognizes that commodifying human values is wrong, but doesn’t know (or ask) why.

The book does reference Michael Sandel’s “What Money Can’t Buy - The Moral Limits of Markets” (2012), which, in my opinion, offers a much more accessible exploration of the same topic. Again, I believe it is Carney’s upbringing and biases that diminish the breadth of his explorations. He still sees the market as the solution for everything – it just needs tweaking. In his words: “The action plans in this book for leaders, companies and countries unabashedly recognise that the dynamism of markets is essential to our prosperity and wellbeing.” He reveres the marketplace because of its ability to weed out the bad ideas before any more capital is wasted on them – the bad ideas being, of course, the ones that didn’t make any money.

Economic growth, as for most politicians and neoclassical economists, remains the unquestioned objective. For example, he bemoans wealth inequality… why? Because “a comprehensive OECD study […] finds that inequality has a statistically significant negative impact on economic growth.” As a matter of fact, at the end of a chapter on climate change, he declares: “Economic growth isn’t a fairy tale; it’s a necessity.” (This is probably because his climate change solution emphasis is on technology, not on reducing demand/consumption.) Not having his experience, but not being limited by it either, I suggest that he is missing the point that unlimited growth on a finite planet is not possible. The change required is bigger than he can imagine.

He talks of how money-based marketplaces are susceptible to corruption and then suggests little more than Market players should make better choices. Still, his heart (and his banker soul) is in the right place. “We need to support workers, not jobs. Companies should guarantee employability, not employment. Governments need to redesign labour market and educational institutions so that new ways of working respect the enduring values of dignity and purpose in work.”

Carney’s proposed core values are: solidarity, fairness, responsibility, resilience, sustainability, dynamism, and humility. In other words, the components of a fair and just market. His reasoning behind the 2008 financial crisis was (for example) that finance lost track of its core values of fairness, integrity, prudence, and responsibility. So, where is compassion? interconnectedness? joy? He still believes that you can have both sides of the polarity, while playing from the same old playbook. You can’t.

Some of the conflicts are right in front of him. For example, instead of questioning the principle of intellectual property, he doubles down and says that we need to strengthen idea ownership in order to provide greater incentives for innovation. “The prospect of owning the fruits of their labours incentivises people to strive and innovate.” A few chapters earlier… “As Sandel concludes, when people are engaged in an activity that they see as intrinsically worthwhile, offering them money may weaken their motivation by depreciating or crowding out their intrinsic interest or commitment.” The dots are there, waiting to be connected.

Overall, the book is a very tough read, but reasonably comprehensive. It also gives one access to a perspective that we don’t normally get to hear, but I’m not sure what to do with it. The hardcover jacket promises that the book “…goes to the heart of what we got wrong in the past and offers action plans to set it right for individuals, businesses, investors and governments.” I could not exactly find these action plans. I would say it is more of an excellent educational reference; there are really no new ideas to be found in it.

Some Nitty-Gritty

On top of the shortcomings listed above, the book is repetitive, with the same concepts and even some quotes being repeated over and over. Fact-checking reveals that some of his supporting data accuracy was sloppy. For example, he quotes: “New Zealand ranked 54^th on the 2019 Global Health Security Index.” False. It ranked 35^th out of 195. (It scored 54/100.) “Singapore ranked 28^th.” Nope. It ranked 24^th. And that was all from one chart.

I like that Canada is the only country that gets a chapter to itself. It is a nice reminder of one of Carney’s value-superpowers (being Canadian), and of the unique role that my home country could play on the world stage. Alas, this chapter also contains his “ten-point plan” which has all the excitement of an election flyer hung on your doorknob while you were out. We’ll have to see what happens now that he is running the show.

The premise of this book is something that Carney and I are in full agreement on: “The three most significant crises of the twenty-first century – of credit, Covid and climate […] were driven by a common crisis of values”. A value crisis! I couldn’t have said it better. We also share other conclusions, such as: “The prevalence of these quantification techniques is due to the fact that with clear numbers can come clear decisions.”

But if you want to know what’s missing, you need only look at his index, where there are no entries for: basic income, degrowth, Henry George, demurrage currency, gift economy, sharing economy, access economy, moral economy, minimum wage, genuine wealth, ecological economics, volunteerism, inequity, poverty, land value tax, or fossil fuels. For a treatise on “Value(s)”, if these topics are unworthy of the index (and possibly the book), I suggest that someone needs to explore other perspectives more.

To bookend this review the same way Carney did for his book, I say you can’t turn grappa into wine. You can’t put the bouquet and colour and rich taste back in. You just have to stop distilling it all off in the first place. That is the lesson that he’s missing.

In conclusion, if you already move in Carney’s circles, please do pick up a copy of the book, read it carefully, and perhaps get him to sign your copy the next time you see him at the club. Otherwise, save your money; it is highly unlikely that you will ever get through it, and it won’t inspire anything that you can do anything about.