This book is worth reading. That's unfortunate; it has about 30 pages of interesting material scattered amongst 300 pages of verbiage. It's a book about Globalization--mostly about opening up markets between nations and about international aid. The author, Stiglitz, was on the IMF, but he's dour about how globalization has proceeded so far. What went wrong?
Protectionism and corruption.
This example is vague and hand-wavy and I'm getting the details wrong. I'm too lazy to slog through that book again to pick out the correct details. Nevertheless, here goes: Some treaty comes along "opening up markets" between the USA and some developing nation. There is much fanfare. Someone paying close attention will notice that the USA hasn't agreed to open up all markets, just 97% of markets. Well, that's mostly an open market, right? Except that the 3% that the USA leaves closed is... the small intersection of the USA's industry and the developing nation. Under the treaty, Bangladesh can import anything to the USA except cloth... which is the only thing Bangladesh makes that's also made in the USA. The USA's open-ness towards the fanfared "free trade" is lip-service.
He mentions USA cotton as a protected industry. That's pretty sad--cotton farming has been pretty bad for California, gobbling up the precious fresh water of our desert state. Shutting down California cotton water subsidies sounds like a fine idea to me. Importing cheap textiles from Bangladesh sounds like a fine idea to me. But that won't happen as long as politicians can be bought.
He also pointed out a hole in my don't-worry-about-kleptocracies-privatizing-government-because-kleptocracies-are-screwed-anyhow thinking. It doesn't make much difference if a kleptocracy sells an industry or bleeds it for cash over several years. But what about a short-lived kleptocracy? If they can sell off the national assets for quick short-term gain, they will. After the thieves retire to their dachas on the Black sea, that stuff is gone. If those thieves had just skimmed government funds instead, then when they were chased out, the government wouldn't be hurting so hard.
Anyhow, the gist of the book is to please slaughter all:
- People seeking to extend copyright
- People and organizations who loan money to developing nations only if those nations are willing to shut down all services that help nations develop
...only I don't think he used the word "slaughter".
Labels: book, business, economics