Joseph Heath's "Filthy Lucre"

I thoroughly enjoyed this book. It is written by a non-economist, a philosopher, and it has the right tone and topics to appeal to me. He points out the foibles of the economists (something which most economists are loathe to do) and it takes up a nice stance between the crazy right and the crazy left (pointing out fallacies in their thinking). It is an excellent book to get you thinking about the economy, economic theory, and political arguments about the economy.

The author takes the eminently sensible position that capitalism is the only system of organizing economics that has been shown to work. But he willingly shows you all the flaws in capitalism in operation and freely admits the needs for regulation. This is refreshing because most ideologues of left and right fail this test miserably.

Here's a sample:

In the decades immediately following the Second World War, many firms in Western Europe were either nationalizedor created under state ownership, not because of natural monopoly or market failure in the private sector, but out of a desire on the part of governments to have these enterprises serve the broader public interest. ...

But something strange happened on the road to democratic socialism. Not only did many of these corporations fail to promote the public interest in any meaningful way, many of them did a worse job than regulated firms in the private sector. ...

We tend to think of these problems as the primary rationale for the privatization of many state-owned enterprises during the neoconservative backlash of the '80s. But this is incorrect. The "public interest mandate of state-owned enterprises was abandoned by socialist, liberal, and conservative governments long before that wave of privatization. ...

The most widely accepted explanation for this extraordinarily perverse outcome is that, during the heyday of public sector ownership, government simply lost control of the managers of these companies -- or else never had it to begin with.

He then goes on to point out that even 'normal' corporations have a similar loss of control by stockholders because of the 'principal-agenct problem'. The book is chockablock full of these insights and discussions. It is a wonderful read, a 'must' read.