Welcome to Scribd, the world's digital library. Read, publish, and share books and documents. See more
Download
Standard view
Full view
of .
Save to My Library
Look up keyword
Like this
1Activity
0 of .
Results for:
No results containing your search query
P. 1
Joseph E. Stinlitz Free Fall)

Joseph E. Stinlitz Free Fall)

Ratings: (0)|Views: 2 |Likes:
Published by xaxif8265
Free Fall Economy of America,
Free Fall Economy of America,

More info:

Categories:Types, Speeches
Published by: xaxif8265 on Nov 01, 2011
Copyright:Attribution Non-commercial

Availability:

Read on Scribd mobile: iPhone, iPad and Android.
download as DOCX, PDF, TXT or read online from Scribd
See more
See less

04/30/2012

pdf

text

original

 
The current global financial crisis carries a made in America label. In this forthright and incisive book,Nobel laureate Joseph E. Stiglitz explains how America exported bad economics, bad policies, and badbehavior to the rest of the world, only to cobble together a haphazard and ineffective response whenthe markets finally seized up. Drawing on his academic expertise, his years spent shaping policy in theClinton administration and at the World Bank, and his more recent role as head of a UN Commissioncharged with reforming the global financial system, Stiglitz then outlines a way forward building on ideasthat he has championed his entire career: restoring the balance between markets and government;addressing the inequalities of the global financial system; and demanding more good ideas (and lessideology) from economists. Freefall is an instant classic, combining an enthralling whodunit account of the current crisis with a bracing discussion of the broader economic issues at stake. Winner of the 2001Nobel Prize for Economics, Joseph E. Stiglitz is the author of Making Globalization Work, Globalizationand Its Discontents, and The Three Trillion Dollar War with Linda Bilmes. He teaches at ColumbiaUniversity.
No one can say they weren't warned. A decade ago, newly sacked from his job as chief economist atthe World Bank, Joseph Stiglitz laid bare how the free-market ideologues at the US Treasury and theInternational Monetary Fund had botched the Asian financial crisis of the late 1990s. It was a full-onattack from a Washington insider and it hurt, especially when Stiglitz said many of those responsiblefor forcing countries such as Thailand and Indonesia into deeper, longer recessions were "third-rategraduates from first-rate universities".He concluded his essay in the New Republic by warning the IMF and the US Treasury that unlessthey began a dialogue with their critics "things will continue to go very, very wrong".Now they have. The Asian crisis of 1997-98 was merely the warm-up act for the events of the pasttwo and a half years. Problems that first surfaced on the periphery of the global economygradually worked their way to its core
 –
the United States. The warnings of Stiglitz and a handful of other -dissident voices were ignored, as a naïve belief in the self-correcting nature of markets allowed theconditions to develop for the biggest financial and economic shock since the great depression in the1930s.In the circumstances, it is hardly surprising that
Freefall 
reeks of "I told you so". Stiglitz has waited along time for his views to be vindicated and was not going to spurn the opportunity to settle somescores. Some of the targets are obvious enough
 –
corporate welfare for Wall Street, George Bush'stax breaks for the rich, the failed nostrums from the Chicago school of free-market economists. Buthe also finds time for some personal revenge.Larry Summers, formerly Bill Clinton's treasury secretary and now chief economic adviser to BarackObama, is a particular hate figure. Stiglitz says Summers was too accommodating to the demands ofWall Street in the 90s and is making the same mistake now. It was Summers, incensed by theconstant criticism of the Washington consensus, who orchestrated Stiglitz's departure from theWorld Bank.There is more, though, to
Freefall 
than sheer gloating
 –
however justified. Stiglitz's argument issimple; the period of unchallenged American economic hegemony lasted a mere 19 years, from thedemolition of the Berlin wall in the autumn of 1989 to the collapse of Lehman Brothers in September2008. Swift action by governments
 –
forced to abandon a hands-off approach to economicmanagement by the scale of the crisis
 –
has prevented a great recession from turning into a secondgreat depression. Lessons need to be learned from this near-death experience; if they are not, if thewarnings go unheeded as they did a decade ago, the future will be punctuated by systemic crises.
 
The chances of that happening are quite high. Already, there is a whiff of business as usual as areceding sense of danger blunts the appetite for radical reform. Obama soft-pedalled on reform ofWall Street until goaded into action this month by the loss of the Senate seat in Massachusetts; inBritain the imminent election will be dominated not by which party has the right policies to cut theCity down to size but which can be trusted to cut the budget deficit. Revisionist versions of the crisis,suggesting the problem was too much government rather than too little, are doing the rounds.In that respect,
Freefall 
is the wrong title for this book. It was clearly commissioned and conceivedabout a year ago, when the charts showed industrial production and trade collapsing at the samepace as they had in the early 30s. But conditions have improved since the panic of late 2008 andearly 2009; by pursuing policies that were diametrically opposite to those foisted on struggling Asiancountries by the IMF and the US Treasury in the late 90s, growth has returned far more quickly thanexpected. China is booming, while Europe, Japan and the United States all started growing again bythe third quarter of 2009.Having dished it out, Stiglitz can expect to cop it from his opponents if, as looks entirely possible,2010 is a year of recovery. But his underlying analysis is correct. The global economy was
 –
andremains
 –
seriously unbalanced between debtor and creditor nations. Corporate welfare hasreached fresh heights with the billions of dollars ladled out to commercial banks, investment banksand America's biggest insurance company, AIG. America, as the book rightly notes, has lived off onebubble after another for years.Stiglitz wants this to be a moment of "reckoning and reflection"
 –
a reassessment of the sort ofeconomy in which financiers enriched themselves by selling over-priced and risky products to someof the most vulnerable citizens in America. Materialism has outweighed moral commitment, theneeds of the environment have been ignored, and there has been a catastrophic break down in trust.He concludes the book by asking: "Will we seize the opportunity to restore our sense of balancebetween the market and the state, between individualism and the community, between man andnature, between means and ends?" Faced with a similar set of circumstances in the 30s, the NewDeal generation of Roosevelt proved ready to meet the challenge. Stiglitz clearly doubts whetherObama is made of the same stern stuff.Larry Elliott is co-author, with Dan Atkinson, of
The Gods That Failed: How the Financial Elite Have Gambled Away Our Futures 
(Vintage).
Joseph Stiglitz on our economic freefall
Freefall: Free Markets and the Sinking of the Global Economy by Joseph Stiglitzby Larry Elliott[reposted from The Guardian]No one can say they weren't warned. A decade ago, newly sacked from his job as chief economist at theWorld Bank, Joseph Stiglitz laid bare how the free-market ideologues at the US Treasury and theInternational Monetary Fund had botched the Asian financial crisis of the late 1990s. It was a full-onattack from a Washington insider and it hurt, especially when Stiglitz said many of those responsible forforcing countries such as Thailand and Indonesia into deeper, longer recessions were "third-rategraduates from first-rate universities".He concluded his essay in the New Republic by warning the IMF and the US Treasury that unless theybegan a dialogue with their critics "things will continue to go very, very wrong".Now they have. The Asian crisis of 1997-98 was merely the warm-up act for the events of the past two
 
and a half years. Problems that first surfaced on the periphery of the global economy gradually workedtheir way to its core
 –
the United States. The warnings of Stiglitz and a handful of other dissident voiceswere ignored, as a naïve belief in the self-correcting nature of markets allowed the conditions to developfor the biggest financial and economic shock since the great depression in the 1930s.In the circumstances, it is hardly surprising that Freefall reeks of "I told you so". Stiglitz has waited a longtime for his views to be vindicated and was not going to spurn the opportunity to settle some scores.Some of the targets are obvious enough
 –
corporate welfare for Wall Street, George Bush's tax breaks forthe rich, the failed nostrums from the Chicago school of free-market economists. But he also finds time forsome personal revenge.Larry Summers, formerly Bill Clinton's treasury secretary and now chief economic adviser to BarackObama, is a particular hate figure. Stiglitz says Summers was too accommodating to the demands of WallStreet in the 90s and is making the same mistake now. It was Summers, incensed by the constantcriticism of the Washington consensus, who orchestrated Stiglitz's departure from the World Bank.There is more, though, to Freefall than sheer gloating
 –
however justified. Stiglitz's argument is simple;the period of unchallenged American economic hegemony lasted a mere 19 years, from the demolition ofthe Berlin wall in the autumn of 1989 to the collapse of Lehman Brothers in September 2008. Swift actionby governments
 –
forced to abandon a hands-off approach to economic management by the scale of thecrisis
 –
has prevented a great recession from turning into a second great depression. Lessons need to belearned from this near-death experience; if they are not, if the warnings go unheeded as they did adecade ago, the future will be punctuated by systemic crises.The chances of that happening are quite high. Already, there is a whiff of business as usual as a recedingsense of danger blunts the appetite for radical reform. Obama soft-pedalled on reform of Wall Street untilgoaded into action this month by the loss of the Senate seat in Massachusetts; in Britain the imminentelection will be dominated not by which party has the right policies to cut the City down to size but whichcan be trusted to cut the budget deficit. Revisionist versions of the crisis, suggesting the problem was toomuch government rather than too little, are doing the rounds.In that respect, Freefall is the wrong title for this book. It was clearly commissioned and conceived abouta year ago, when the charts showed industrial production and trade collapsing at the same pace as theyhad in the early 30s. But conditions have improved since the panic of late 2008 and early 2009; bypursuing policies that were diametrically opposite to those foisted on struggling Asian countries by theIMF and the US Treasury in the late 90s, growth has returned far more quickly than expected. China isbooming, while Europe, Japan and the United States all started growing again by the third quarter of2009.Having dished it out, Stiglitz can expect to cop it from his opponents if, as looks entirely possible, 2010 isa year of recovery. But his underlying analysis is correct. The global economy was
 –
and remains
 –
 seriously unbalanced between debtor and creditor nations. Corporate welfare has reached fresh heightswith the billions of dollars ladled out to commercial banks, investment banks and America's biggestinsurance company, AIG. America, as the book rightly notes, has lived off one bubble after another foryears.Stiglitz wants this to be a moment of "reckoning and reflection"
 –
a reassessment of the sort of economyin which financiers enriched themselves by selling over-priced and risky products to some of the mostvulnerable citizens in America. Materialism has outweighed moral commitment, the needs of theenvironment have been ignored, and there has been a catastrophic break down in trust.He concludes the book by asking: "Will we seize the opportunity to restore our sense of balance betweenthe market and the state, between individualism and the community, between man and nature, betweenmeans and ends?" Faced with a similar set of circumstances in the 30s, the New Deal generation ofRoosevelt proved ready to meet the challenge. Stiglitz clearly doubts whether Obama is made of thesame stern stuff.

You're Reading a Free Preview

Download
/*********** DO NOT ALTER ANYTHING BELOW THIS LINE ! ************/ var s_code=s.t();if(s_code)document.write(s_code)//-->