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Fair Play: What Your Child Can Teach You About Economics, Values, and the Meaning of Life

by Steven E. Landsburg
(The Free Press, 1997)

Reviewed by Frank Conte, BHI Publications Editor


from NewsLink, Vol. 2, No. 2, Winter 1998

"The disconnect between the standards adults impose on themselves and the standards they impose on their children is rarely to the adults' credit," writes economist Steven E. Landsburg in his new book, Fair Play, a readable exercise in economics as child-rearing.

Adults tolerate the latest transgressions from Congress or the Oval Office without much thought, never asking the key "kid" question, Why?

Adults profess not to tolerate their children's lying or stealing. Yet each year, Landsburg reminds us, the folks from National Public Radio lay claim to roughly five dollars of your income. In doing so, they emphasize ad nauseum that the U.S. Navy spends ten times as much on weapons. Landsburg wonders if the pitch made by NPR is made expressly to childless voters unaware of the manipulation of those in the wonder years. "What parent could accept an excuse like, 'Sure, I stole the cookies, but I know another kid who stole a bicycle.'?"

Nor would responsible adults reward children who forcibly redistribute toys in a playroom or a sandbox. Yet few individuals challenge the "fairness" of the progressive income tax.

Fairness, according to Landsburg, means that those who spend their time earning a dollar rather than enjoying leisure, have a right to bear the fruits of the choices they have made. Why should government have a right to part of that dollar if your neighbor spent that same hour picking wildflowers?

"Children understand that how you spent your day has no moral relevance to how you cut the cake," writes Landsburg dismissing at the same time the claim of egalitarians.

These observations are not an exercise in mixing apples and oranges. Every time a child cries "That's not fair," Landsburg says a parent is forced to confront some issue of economic justice.

Throughout Fair Play, Landsburg argues that one doesn't understand a simple idea until he's explained it to a child. It's clear that Landsburg both as teacher and parent wants his nine-year-old girl daughter, Cayley, to think like an economist. And in turn as parent, much as economist, one finds that "kids say the darndest things."

Given the awful lack of economic literacy in elementary and secondary education, Landsburg's libertarian lessons are sure to rub up against a village mentality.

Knowing that he is sure to leave someone from the National Education Association aghast, Landsburg stands conventional social responsibility on its head.

"If you are ever in a position to sell water for $7 a gallon, I want you to sell water for $7 and not a penny less," he writes, "That's not because I want you to make a lot of money... It's because it's your social responsibility to get that water to those who need it most desperately, and if you charge less than the market will bear then the wrong people will claim the water."

In an age in which foolishness often invades public school curricula, Landsburg recasts the authority of the parent, particularly when that parent faces stiff competition from government.

Nowhere is this more apparent than in the classroom, where the quasi-religious fervor of recycling goes unchallenged. Why should children be forced to rinse and reuse their paper cups? Furthermore, who decided that the paper cups were worth more than their time and effort?

"Thinking like an economist" clears away the debris. That means upsetting conventional wisdom, discarding cultural biases, exposing fallacies, avoiding the blame game, and moving beyond empty phrases such as "buy American" or "ensuring the survival of endangered species."

As in his previous work, The Armchair Economist, and his ongoing columns for Forbes and Slate, Landsburg tackles several issues - immigration, regulations, government debt, savings and investment, racial discrimination laws - with great verve. But of all the issues worth discussing, the most illuminating one deals with free trade.

Given the enthusiasm to be like one's peers, perhaps the best lesson one can give a child is that it pays to be different. When her teacher distributed a litter of guinea pigs, Cayley had her eye on a particular one that no one else wanted to claim. Hence we see David Ricardo's emphasis of the importance of differences between trading partners, whether they be kids bartering toys for collectible pogs or nations exchanging grain for automobiles.

The advantage of trade across boundaries isn't that you obtain new trading partners, Landsberg tells his daughter, is "that you get a lot of new trading partners who are very different from you." Any company in any country can make cars and Americans, for example, wouldn't care if they were allowed or forced to buy Fords. "It's the difference between an American car and a Japanese car that makes the Japanese car a valuable option" for the consumer.

China isn't attractive because it's big. It's attractive because it found its specialties. "If Chinese animators were as good as Disney's animators, Disney would have no market in China. The great opportunity is created by the fact that Americans produce blockbuster movies more efficiently than the Chinese, and Chinese produce silk shirts more efficiently."

Once a child knows the importance of being different, he or she can spend less time worrying about who wants to play with him. People tend to want to trade with you when you are different. If you're the same, there isn't any real advantage.

The winds of trade wars of recent memory suggest that industries that focus on managed trade - with an emphasis on opening markets and raising tariffs - could learn a lesson or two from this simple idea.

It may take a child to illuminate Ricardo for a would-be protectionist.



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