Globalization and Its Discontents.

• Author: Griswold, Daniel T.
• Position: Book Review

Joseph E. Stiglitz New York: W. W. Norton & Company, 2002, 282 pp.

A more accurate title for this book should have been, Joseph Stiglitz and His Discontents. What could have been an enlightening look at globalization by one of the nation's best-known economists proves instead to be a score-settling exercise distorted by the author's own political prejudices and personal animus.

The book is all the more disappointing because Joseph Stiglitz is an economist's economist. He's written acclaimed textbooks on public finance and contributed enough to the profession to earn a Nobel Prize in 2001. He served in key advisory positions during what the Chinese would call interesting times, first as chairman of President Clinton's Council of Economic Advisers and then as chief economist at the World Bank during the East Asian financial meltdown and its aftermath.

The author pays lip service to the power of free trade and markets to promote growth and reduce poverty, but then devotes the rest of the book to an attack on "market fundamentalism." The immediate object of his discontent is the World Bank's sister institution, the International Monetary Fund, the tax-supported, multilateral lending agency he accuses of peddling the market gospel to vulnerable poor countries. His dislike of the IMF and its personnel surfaces early in the book. In contrast to his caring colleagues at the World Bank, IMF personnel "pore over numbers in the finance ministries and central banks and make themselves comfortable in five-star hotels in the capitals." He likens them to high-altitude bombers: "[F]rom one's luxury hotel, one can callously impose policies about which one would think twice if one knew the people whose lives one was destroying."

Contrary to economic thinking since Adam Smith, the book reinforces the myth that protectionism enriches those nations that practice it. Stiglitz accuses the West of driving the globalization agenda, "ensuring that it garners a disproportionate share of the benefits, at the expense of the developing world." How have the rich countries garnered those "benefits"? According to Stiglitz, by failing to open their markets to poorcountry exports such as textiles and sugar, while insisting that poor countries open their markets to rich-country exports, and by continuing to subsidize agriculture while insisting poor countries stop subsidizing industrial production.

All of that is economic snake oil. The most basic undergraduate analysis would...