In This Review
The Roaring Nineties: A New History of the World's Most Prosperous Decade
W. W. Norton, 2003, 256 pp.
This interesting book is a critique of the Clinton administration by a Nobel Prize-winning economist who served on Clinton's Council of Economic Advisers. It is partly a mea culpa and partly an effort by the author to distance himself from administration decisions, which were dominated by a Treasury Department too often beholden to the financial industry. But Stiglitz's more general message concerns the balance struck in a free society between the government and the market -- a balance that even under Clinton, not to mention under the current administration, tilted too heavily toward nonintervention.
Stiglitz submits that although politicians often wrongly claim credit for positive economic developments that occur on their watch, their actions do in some instances make a difference. He lauds Clinton's efforts to reduce the deficit and predicts that Bush's tax cuts will produce budget shortfalls that plague the country for many years. He goes on to argue that the mantra of free markets has been accepted far too uncritically by policymakers, as was evident in the flawed deregulation of the energy, telecommunications, and financial industries. He emphasizes, accordingly, the importance of timely, accurate information for both policymakers and the informed public -- and the corresponding need to be aware of the incentives that motivate decision-makers, especially businesspeople and their close advisers. Stiglitz's arguments are well written, cogent, and nontechnical and will likely make their way into electoral debate.
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