Review: Joseph Stiglitz, Making Globalization Work

Overall, Making Globalization Work seems shockingly light: akin to Stiglitz lending his Nobel Economic credentials to the agenda of the World Social Forum. Instead of an independent viewpoint, Stiglitz seems to fully endorse the “anti-globalization” thesis defined activists like Vandana Shiva and Naomi Klein.

However, for me, there were a few interesting takeaways:

1. In The End of Poverty, Jeffrey Sachs writes of natural resources as the key differentiator between countries that did and did not make it out of the "poverty trap"—UK and Bolivia, for example.

Stiglitz, on the other hand, points to the "resource curse": "It's no accident that so many resource-rich countries are far from democratic. The riches breed bad governance." He cites Nigeria, Congo, Iraq, Middle East, and Russia.

It seems you’re thus “damned if you have” and “damned if you don’t.” Perhaps another explanation of the underlying phenomenon is required.

2. Throughout the book Stiglitz condemns colonialism, IMF, and "shock therapy", similarly to (right-leaning) William Easterly in The White Man's Burden.

This is a stunning policy agreement, as it is rooted in completely different ideologies. While Easterly links all three policies to Western governmental meddling in “exotic lands,” Stiglitz considers the first two as examples of (mercantilist/pro-corporate-interest) "globalization" and the last as "market fundamentalism"—exactly the reverse of Easterly.

3. Finally, Stiglitz recognizes—as does Sachs—"free markets" as the foundation of a happy, abundant society and condemns socialist excesses. However, almost in the same breath, he proposes heavy Keynesian, if not essentially socialist, reforms to help "improve” these markets.

This rhetorical give-and-take is an important economic reform consideration. It seems that given such liberal concerns of the slippery slope towards unfettered markets and their opposite—conservative apprehension of the slide towards socialism—any sound, bipartisan economic reform proposal will have to appeal to the language and thinking of both to gain broad support.

This is particularly true of current economic institution reforms in the U.S. and internationally. If past is any example, these are likely to turn out as the battle of two lobbies—pro-aid and pro-corporate interest—neither one of which is necessarily pro-freedom or pro-prosperity.