In Globalization and Its Discontents, Nobel laureate and former World Bank Chief Economist Joseph Stiglitz attacks the ways in which IMF policy has been (mis)managed in recent decades. His focus moves from Eastern Europe and Russia to South America and Asia and examines botched transitions from communism, development lending and conditionality as well as liberalisation and capital market stability. Broadly speaking, Globalization and Its Discontents is a diatribe against “market fundamentalism”.
He attacks several of the institutions of global economics with a passion, but saves his worst and most bitter criticisms for the IMF, with which – according to his own account at least – he battled for years. In this way, Stiglitz has written what is in essence a work of self-defence. He is perhaps more modest than he could have been but nonetheless rarely misses a chance to but highlight his achievements and pre-emptively defend himself. One example is his tendency to say “I would have done this” rather than “they should have done this”.
Meanwhile, Stiglitz presents his argument as one of common sense versus the doctrinaire “market fundamentalists”. He attacks the ideological motivation of the Washington Consensus, yet his own prescriptions are often no more commonsensical, and certainly just as ideological. The only difference is that where the IMF takes its cue from Hayek, Stiglitz takes his from Keynes.
The most significant problem is with the text itself. Stiglitz’s book is simply far too repetitive. To say that he labours the point is a gross understatement. It’s not just that he tells the same sort of story over and over, but more that so many of his sentences and paragraphs are needlessly followed by another that rephrases the same point in another way. This kind of padding is unnecessary and extremely frustrating. It renders the text a chore rather than a pleasure.
Unfortunately, the second problem with the book is a simple failure to deliver. To give this book the title Globalization and Its Discontents vastly oversells the content. If you are interested in the policies of the IMF over the ‘80s and ‘90s, you will be reasonably well served, but if you desire to know something about globalisation and its discontents, I would advise you look elsewhere.
Sometimes the copy-editing seems to be inadequate, or else perhaps the fault is with Stiglitz’s writing. At one point, he tells us that “they focused on the rapidity of privatization, a sign that the privatization process was proceeding apace.” This kind of phrasing is both common and extremely frustrating.
I am also irked by the way Stiglitz presents the phenomenon of globalisation. He seems to be claiming that globalisation is not “working”. This makes it sound as if it were some project being badly managed. My conception of globalisation is more one of a historical process. It neither works nor fails. It is neither efficient nor inefficient. It simply is. I don’t think this is a simple debate over the use of terms – how we conceive of these phenomena significantly affects the ways in which we react to them. For me at least, globalisation isn’t something one can manage, but rather something that can be harnessed.
In summary, this book is useful, enlightening and highly valid. But only up to a point. This book kicked off a valuable debate when it first came out, but one cannot help feel that there must by now be simply better books on this same topic, more wide ranging, more interesting, more helpful. The reader should not expect a “guide to the misgovernment of globalization” as Jamie Galbraith called it. However, Globalization and Its Discontents does stand as a good introduction to the failings of the IMF.
Globalization and Its Discontents by Joseph Stiglitz is published by Penguin (2002).