February 5 2014

(Educators)America succeeds because Americans fail and forgive. That's the intriguing message -- or part of it -- of Megan McArdle's new book The Up Side of Down: Why Failing Well Is the Key to Success.

McArdle, a Bloomberg blogger and columnist, stands out among economic writers, and not just because she's the only woman among them who is 6-foot-2. She combines a shrewd knowledge of economics and practical experience with a writing style that every so often segues into comedy

monologue.

Americans fail a lot, she argues. Most new businesses fail. Most predictions are wrong. As the screenwriter William Goldman wrote about Hollywood, "Nobody knows anything."

And attempts to guard against failure can result in greater failures later on. Children prevented from rough-housing at recess may engage in riskier behavior later. Antibiotic overuse makes bacteria resistant to antibiotics, which then don't work when you really need them.

But good judgment comes from experience. And experience comes from bad judgment -- from failures. The key question is how you respond, whether you learn from failure and rebound.

Drawing from pre-history, McArdle contrasts farmers and foragers, the hunter-gatherers who lived before the development of agriculture.

Foragers tend to share success with neighbors, in the expectation that others will share later. They see success as the result of luck -- the hunter who happens to spy a particularly vulnerable mammoth.

Farmers tend to share success only with family members. They see success -- a plenteous harvest -- as the result of their own families' hard work and conscientiousness. They see no reason to share it with the lazy and feckless.

Americans, in McArdle's view, have values like those of farmers. Much more than Europeans, they believe that there is a connection between effort and reward. Those who have earned more deserve it.

Europeans tend to believe that success comes mostly from luck. They enlist government to, in President Obama's words to Joe the Plumber, "spread the wealth around."