The Great Divide books –

In The Great Divide, Joseph E Stiglitz Expands On The Diagnosis He Offered In His Best Selling Book The Price Of Inequality And Suggests Ways To Counter America S Growing Problem With His Signature Blend Of Clarity And Passion, Stiglitz Argues That Inequality Is A Choice The Cumulative Result Of Unjust Policies And Misguided PrioritiesGathering His Writings For Popular Outlets Including Vanity Fair And The New York Times, Stiglitz Exposes In Full America S Inequality Its Dimensions, Its Causes, And Its Consequences For The Nation And For The World From Reagan Era To The Great Recession And Its Long Aftermath, Stiglitz Delves Into The Irresponsible Policies Deregulation, Tax Cuts, And Tax Breaks For ThePercent That Are Leaving Many Americans Farther And Farther Beyond And Turning The American Dream Into An Ever Unachievable Myth With Formidable Yet Accessible Economic Insight, He Urges Us To Embrace Real Solutions Increasing Taxes On Corporations And The Wealthy Offering Help To The Children Of The Poor Investing In Education, Science, And Infrastructure Helping Out Homeowners Instead Of Banks And, Most Importantly, Doing To Restore The Economy To Full Employment Stiglitz Also Draws Lessons From Scandinavia, Singapore, And Japan, And He Argues Against The Tide Of Unnecessary, Destructive Austerity That Is Sweeping Across EuropeUltimately, Stiglitz Believes Our Choice Is Not Between Growth And Fairness With The Right Policies, We Can Choose Both His Complaint Is Not So Much About Capitalism As Such, But How Twenty First Century Capitalism Has Been Perverted His Is A Call To Confront America S Economic Inequality As The Political And Moral Issue That It Is If We Reinvest In People And Pursue The Other Policies That He Describes, America Can Live Up To The Shared Dream Of A Prosperous, Equal Society

10 thoughts on “The Great Divide

  1. says:

    There is little that is technically new in this book It is a collection of previously published newspaper columns, essays, speeches, and one new interview and a few essays.The main point here can be summarized by one of the essay titles Inequality is not inevitable He makes the point that the relative extremes of inequality in the United States were not a natural law of capitalism, but a deliberate result of political forces, particularly the neoliberal policy reforms made from 1980 onward There are subtle differences here between Stiglitz and Piketty on limiting the accumulation of capital, but Stiglitz regards Piketty and Saez s work high enough that he writes multiple essays on how important it is.After this, there are multiple essays on the economic consequences of inequality That phrase is a reference to Keynes Economic Consequences of the Peace There s a lot to talk about here, and Stiglitz touches on a wide spectrum without diluting his message too much One major component is that income inequality lowers aggregate demand, thus preventing economic recovery Not to mention all the externalities such as social mobility, health, and educational status Even the IMF, hardly a collection of economic radicals, acknowledges the damages of income inequality His policy suggestions are simple to explain, have a sound theoretical and historical backing, and have worked to some degree in the past They are also damn near politically impossible These include a return to improved market competition by breaking apart the worst monopolies, avoiding the extremes of rent seeking intellectual property laws, reinstating the separation between investment and savings banks as seen in Glass Steagall, and a social safety net to protect the poorest from the vagaries of market forces These essays show comprehensive understanding of what the problem is, and some suggestions of what needs to be done It s a Greatest Hits selection from Stiglitz You likely know how this goes already, but it s important to understand the ideas in his own words.

  2. says:

    Imagine an economist who doesn t have his head up his butt That s Stiglitz This is a collection, so some of the stuff is from the Bush years Still much of it is classic.

  3. says:

    Sorry, I cannot recommend this book First, if you re looking for scholarship, this is not it Rather it is nearly totally a collection of newspaper columns and of course we cannot expect good references for those Some of them are many years old and clearly outdated There is a little additional information some of which is documented but very little.Another problem I find bothersome is that the book lacks an index That, for a non fiction book, is a major offense.The author assumes, with some but not nearly enough reasoning, that disparity between the top and bottom of the income levels is a major problem In a country where most of the poor have air conditioning, big screen TVs, cars, cell phones etc that is a bit much Clearly most of us would prefer to see the poor get good jobs and take themselves out of poverty However his assumption that government can do that for them is questionable at best.Stiglitz correctly points out the education problem among the poor However he fails to even mention any possible cause other than money Broken families abetted by the war on poverty that subsidized single motherhood , crime, and the ghetto idea that getting an education is acting white all go unmentioned.This is clearly a statist publication, assuming that government should fix all our problems Stiglitz ignores any non government ideas that would fix the problem Worse, the author comes close to outright lying in some cases For example, he several times refers to the Bush tax cut for the rich That was a general tax cut, including a major increase in child credit which primarily benefited the lower and middle classes He also lists tax cuts in absolute dollars rather than percentages There is no way to give the middle class a tax cut in dollars as great as for those with money since they do not pay that much in taxes in the first place He also claims that the scientists and venture capitalists who support technology advances do not get much money for their contributions That is completely false, most get stock options or other ownership, many enough to become quite wealthy I know because I worked in that industry and got some of those options He also criticizes speculation but venture capital is speculation, and helps the economy a great deal He fails to discriminate between that type of speculation and the speculation some banks engaged in which did cause problems.

  4. says:

    I broadly agree with Stiglitz I am not anti capitalism per se, but markets do need regulation The trend these days for governments to be slaves to ideology, at the expense of those who aren t in the 1%, is worrying, to put it mildly So this book didn t need to work hard to convince me It was a hard read though, not because of the content, which is fine for anyone with a basic grasp of economics or an interest in it, but because there is so much repetition Yes, it is a collection of essays, but he repeats the same points innumerable times, in mostly the same words, and it gets tiresome very quickly Economics is not exactly fun although, to be honest, I love it but it isn t dull, this book makes it feel that way at times.

  5. says:

    The book is a collection of Stiglitz s writings in popular media My low ratings owe mainly to the repetitiveness of the main themes and arguments in various chapters It gets very boring to read Sectional introductions are written pretty well and reading just them is sufficient in my opinion the chapters don t add much value after the sectional introductions

  6. says:

    Neoliberalism A Very Short Introduction xii xii xvii xix trickle down .

  7. says:

    I bought this book in hope to discover Stiglitz s conjecture on inequality, hoping to do so by reading his latest book His promotion of it on Bloomberg might have precipitated this choice If only I knew this would be a mere collection of articles of his most of which are freely available online and an interview Not that the positions he espouses in this book are particularly alien to me I just felt a bit ripped off to buy a book that only contains lots of surface level discussions of such a plethora of issues.

  8. says:

    If you ve read one you ve read them all Stiglitz s the Price of Inequality did a better job detailing his arguments clearly and succinctly His solutions were also very reasonable and straightforward Here, there are or less very similar arguments and the same repetitive rhetoric thrown in with powerful buzz words for effect.

  9. says:

    Since this book is a collection of articels it s a bit repetitive And those that has read some other of Stiglitz books wont find much new stuff Despite this it s a good read.

  10. says:

    Economy might be a boring subject for the majority of readers, however, a number of economists have been trying to popularise important debates on economic issues Such arguments have caught the imaginations of several citizens concerned with their economic prospects Joseph E Stiglitz, Nobel Laureate and former chief economist of the World Bank, has raised serious concerns about the distribution of wealth in the USA in particular and across the world in general in his latest book, quite provocatively yet aptly titled The Great Divide It is a compilation of articles written for The New York Times over the past seven years.The concept of income inequality is not a new one However, it has long been neglected by mainstream economists and policymakers Income inequality refers to the uneven distribution of wealth in a society which results in a widening gulf between the rich and the poor Stiglitz has explained that conservative economists have focused only on increasing the size of the economy or GDP The distribution of wealth was considered a question of politics despite having enormous economic implications This is why, Stiglitz states, that while GDP was growing, the incomes of most Americans were stagnating This stagnating income of the middle class meant stagnant demand, and that resulted in economic slowdown Therefore, according to Stiglitz, taxing the rich does not cause an economic slowdown, rather, stagnating incomes of the middle class cause economic slowdown This is how Stiglitz challenges the basic tenet of trickle down economics.The failure of market economies to fairly distribute wealth has caused several analysts, particularly those on the left of the politico economic spectrum, to question the very basis of the system, i.e capitalism On the eve of the global financial crisis that started in 2007, Marx s critique of capitalism was once again analysed thoroughly, in an attempt to find a cure for the ills which haunt our global economic model Such rethinking also gave rise to political agitations, such as in the form of the Occupy Wall Street movement The history of capitalism has been marred by successive recessions and a persistent existence of inequality in the distribution of wealth Stiglitz points out that, in the aftermath of the 2008 crisis, hundreds of billions went to save the banks, and little went to help homeowners What sparked this rebellion on both academic and practical planes were the shocking statistics revealed by economic measures Hence, the global rallying for capitalism v2.0 was not as much ideologically motivated as it was grounded in economic data.Stiglitz has backed his arguments with hard facts The average wage of male high school leavers has declined by 12pc in the past 25 years, while CEOs salaries have swelled from 30 times the average worker s wage to 300 times The concern is not only limited to the historical comparison of the US s economy, it also extends to the decline of these measures in comparison to other global statistics The economic and employment prospects of top performing students from poor families in the US are now lower than those of the weakest performing students from families in the top economic quartile A bus with some 85 billionaires has as much wealth as the bottom half of the world s population, some three billion people.Comparing the economic performance of USA with China, Stiglitz states that China moved some 500 million out of poverty over the same period that stagnation seized America s middle class Further, he informs readers that we USA had become the advanced country with the highest level of inequality, and we had among the lowest levels of equality of opportunity Keeping in mind the prevailing politico economic system, it was Stiglitz who, in a Vanity Fair essay in 2011, coined the catchphrase of the 1pc, by the 1pc, for the 1pc , which aptly encompasses his main contentions.Stiglitz has argued that successive governments in the US have not only been complicit in worsening the situation but that, through their fiscal and monetary policies, they have actively contributed towards it Big businesses, large banks, and financial regulators have also collaborated with these administrations.Stiglitz s efforts to popularise these economic issues did not begin with this book In his 2012 book, The Price of Inequality, he introduced concepts such as the 99pc and the 1pc Popular awareness of these issues, in Stiglitz s opinion, is the first step towards solving them Following this trend, a number of books on the subject have been penned by other contemporary economists One such book is Thomas Piketty s Capital in the Twenty First Century, a remarkable treatise which became an unlikely bestseller Everyone now understands that a large percentage of wealth is amassed by the elite class and that the gap between rich and poor is widening day by day.Stiglitz is not just a doomsday prophet He has, along with criticising the current economic policies, suggested remedial measures too He vehemently states that widening and deepening inequality is not driven by immutable economic laws, but by laws we have written ourselves His central message is that any government can address the issue of inequality by astutely utilising the economic tools on hand such as finding the right placement for the burden of taxation, effective monitoring and regulation of financial institutions, investing in human resources to gain long term benefits, providing for the essential needs of its citizens, etc Moreover, he cites the example of free university education introduced in Mauritius which, according to him, should also be adopted by the US.The central theme of the book is also relevant to the economic issues and policy making in Pakistan Although Pakistan s GDP has been increasing over the last 25 years, a larger share of income is concentrated in the hands of a few According to figures released by the government, the reported income of the richest 20pc of households has been almost 7pc higher than the poorest 20pc households over the last 25 years To improve this situation, important lessons can be learnt from the ideas proposed by Stiglitz We need to create a fairer economic regime and a political system that treats everyone equally.The strength of this book is that although it has been written for the layperson, it addresses such issues in a way that can be useful to economists and policymakers as well Stiglitz weaves his narrative in an easy to comprehend style The central message of the book is very clear the level of inequality in America is not inevitable it is not the result of inexorable laws of economics It is a matter of policies and politics.