“Globalisation today is not working.. for many of the world'spoor? for much of the environment? for the stability of the global economy?? Strong indictment this. And who is this to express this strong condemnation? The author is Joseph Stiglitz. Does it ring a bell? For those who may not have heard the name, one might introduce Stiglitz as a former Chief Economist of the World Bank until January 2000…. and prior to that Chairman of President Clinton'sCouncil of Economic Advisers. Currently he is Professor of Finance and Economics, but what is even more relevant to know, he won the Nobel Prize for Economics in 2001. If Stiglitz is not competent to air his views on globalisation, who else would be Stiglitz is a widely travelled economist his travels covering not developed countries alone but many developing countries especially in Africa and elsewhere, where he conducted micro studies to understand what globalisation did at the micro-level. His conclusions are, to say the least, frightening. He is critical of the World Bank. He is critical of the International Monetary Fund (IMF) and he is critical of the US Government. What is important is that he has had the courage to speak out his mind, freely and openly in this book. Thus if the IMF he writes: ?The IMF'spolicies in part based on the outworn presumption that markets, by themselves, lead to efficient outcomes, failed to allow for desirable government interventions in the market?. When crises hit, the IMF prescribed outmoded, inappropriate, if ?standard? solutions without considering the effects they would have on the people in the countries told to follow these policies?. And he adds: ? Rarely did I see thoughtful discussion and analyses of the consequences of alternate policies.? Developing countries were frightened of the power exerted by the IMF. Writes Stiglitz: ?Those (IMF) policies weren'tquestioned by many of the people in power in the IMF, by those who were making the critical decisions. They were often questioned by people in the developing countries but many were so afraid they might lose the IMF funding, and with it the funding from others, that they articulated their doubts most cautiously, if at all, and then only in private?. The attitude was that the IMF knew best. According to Stiglitz, ?the critics of globalisation accuse western countries of hypocrisies and the critics are right?. The western countries pushed poor countries to eliminate trade barriers, but kept their own barriers, preventing developing countries from exporting their agricultural products and preventing them of desperately needed export income?. Stiglitz does not forget that there are, apart from the World Bank and the IMF other important bodies as well that play a role in the international economic system like regional banks and a large number of UN organisations such as the UN Development Programme or the UN Conference on Trade and Development (UNCTAD) which has often differed strongly with the views of the IMF or World Bank. The International Labour Organisation (ILO) for example worries that the IMF pays too little attention to workers'srights while the Asian Development Bank argue for ?competitive pluralism?. His strongest condemnation of the IMF is that ?a half century after its foundation, it is clear that the IMF has failed in its mission (and) has not done what it was supposed to do?provide funds for countries facing an economic downturn, to enable the country to restore itself to close to full employment?. Indeed Stiglitz charges the IMF for contributing to ?world instability??a remarkable charge to make. His attack is merciless and sustaining. Stiglitz even lays down a better road map for the future and this adds to the relevance and meaningfulness of this book. Coming as this from a respected expert, it calls for wide discussion and study, especially in the developing world which often exhibits an inferiority complex when faced with the World Bank and the IMF as if they are the last word in economic wisdom. It is time the developing world stands up to unbearable pressures from these two world bodies and one must be grateful to Stiglitz for telling them how. When Stiglitz remarks that the IMF policies are badly formulated, it is time to sit back and evaluate them.
(Penguin Books India Pvt. Ltd, 11 Community Centre, Panchsheel Park, New Delhi-110 017.)
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