Ancient Greeks seen as precursors of modern free-market economics

Petros Doukas, the deputy economy and finance minister responsible for managing Greece’s enormous debt, among other tasks, has obviously spent a considerable amount of time studying ancient Greek writers, whether philosophers, historians or poets, ranging well beyond the compulsory lessons of his high school years. After earning a BA in international affairs, Doukas specialized in economics, where he gained a PhD. He has spent his career in the financial sector, except for a 14-month stint in government, in the early 1990s, where he had held a portfolio very similar to his present one. In recent years, he also served as chairman of the board of Ericsson Hellas, a telecommunications company, and NetMed TV, the pay-TV group. Doukas has developed a coherent world view through economic theory: He is a free-marketeer and a believer in the tenet that striving for individual gain is better for the welfare of all than working within the constraints of a command economy as a cog in the machine. Doukas apparently feels comfortable enough both with his ideas and his knowledge of ancient Greek thought to write a book illustrating how the former have their roots in the latter. Or, as he says in a press release, he wants to illustrate how ancient Greek «views on human behavior, economics and government apply to today’s high-tech and fast-paced economies, and are just as relevant as they were in their own times. It was ancient Greek philosophers who first discovered the relativity of risk and return, who conceived economics as a particular body of knowledge, who addressed what constitutes leadership and management skills, even the concept of ‘cyclicality’ in social development.» This is a vast intellectual undertaking, one which Doukas in fact undertook in a book called «Economic Theories, Principles of Management and Ancient Greek Thought» (in Greek, published by journal and website content provider Knowsys). A first edition was published in October 2003 and the book sold well enough to warrant a second edition. An English version is planned for later in the year. The project could easily turn into an academic book, full of footnotes and read by few. Still, that is probably the most appropriate format. Doukas chose the most difficult course: to write for a wider audience. The book jacket offers a list of topics which the book touches on: Marxist theory, globalization, principles of management, the role of the state in the economy, company valuation and the stock market, corporate governance, leadership principle, economic inequality. The list implies ancient Greek thought is pertinent to all of those topics. Tackling such a broad range of subjects, even in a book oriented toward lay persons, is a hazardous move. It risks diluting the thrust of the main idea and may easily lead to contrived analogies to sustain the argument. Actually, Doukas tackles even more subjects than those mentioned on the jacket. In 24 chapters, grouped into four parts, he covers enough ground for several academic textbooks. Part 1 (Basic Economic Concepts) deals with principles of economic behavior, factors of production, the meaning and value of knowledge, inflation, deficits and interest rates. Part 2 (Economic Systems, Economic Freedom, Private and Public Interest and the Role of the State) deals with freedom and economic action, social solidarity, competition, capital accumulation, enterprise growth and monopoly trends, meritocracy and wage differentiation, individual responsibility, private and public interest, globalization and its critics, problems caused by the operation of a free economy, protectionism, Keynes’s call for state intervention, the role of the state, Marxist theory and common ownership. Part 3 (Management and Leadership Qualities) describes what a good enterprise should do, in practical terms, and adds a chapter on leadership qualities in ancient Greek thought. In Part 4 (On Markets, Company Valuation, Investing in the Stock Market and Corporate Governance), Doukas tackles the technical aspects of a company valuation – cash flows, P/E ratio, asset replacement cost, etc – auditing, advice to investors, share price fluctuations, market efficiency and rationality, borrowing from banks versus raising capital on the stock market, the rise and fall of the Athens Stock Exchange, corporate governance, the international economic environment, adds a discourse on the usefulness and the accumulation of wealth and ends with remarks on economic equality and economic justice, touching upon wider theories of social justice. That’s more than a handful, and it would take someone exceptional to pull it off. Doukas has a great store of knowledge and is not a bad writer, but doesn’t quite pull it off. First of all, he does not keep to his basic premise of using ancient Greek thought for purposes of illustration, but also throws in modern Greek poets, such as Cavafy, Varnalis and Seferis and even light-pop artist Jenny Vanou, for good measure. Perhaps he is being flippant, especially in the latter case, or he strives too hard to make the book a pleasant read. If he had kept to the task of just making it intelligible, it would have been preferable. It would have been too difficult a task, and one beyond the scope of the reviewer to check on the pertinence of all the quotes. There are, however, glaring instances where an ancient Greek text has been mistranslated, giving it a meaning that suits the author. For example, one of the quotes on the book’s back cover has Aristotle declare that «if some people wanted to derive pleasure for themselves only, they would do no thing other than philosophize, because other pleasures require (the participation of) other people.» Doukas’s translation is: «The most important thing of all is to seek wisdom, because only it offers self-contained pleasure. Every other sort of pleasure requires other people to help consummate it.» Wrong, but handy for a free-market individualist. Likewise, a poem by Costas Varnalis, a communist, describing the proletariat’s alienation and hopelessness is taken to illustrate the futility of overdependence on the state. To sum up, Doukas’s book is a trove of knowledge, but the execution has flaws, some of them glaring.