Friday, March 5, 2021
Home Specials OpIndia Explains Joseph Stiglitz, the economist that Rahul Gandhi praised for attacking Modi, is known for...

Joseph Stiglitz, the economist that Rahul Gandhi praised for attacking Modi, is known for his questionable policies and wrong predictions

Joseph Stiglitz, who was fired from World Bank for publicly criticising the policies of the bank, is also known for indulging in character assassination of others

After claiming that a Congress govt would have thrown out China from Indian land in 15 minutes and continuing with his lies on the farm bills, Congress leader Rahul Gandhi on Wednesday quoted Nobel laureate Joseph Stiglitz saying that he agrees with the views of the economist. Rahul Gandhi said that he agrees with the critical comments of Stiglitz towards India, adding that his life’s purpose is to bring people of all faiths together in this land. Joseph Stiglitz is an American economist who won the Nobel Memorial Prize in economics in the year 2001, and currently a professor in Columbia University in the US.

Rahul Gandhi quoted a report by The Telegraph where the economist made some very critical comments on India. He described ‘India as a poster child of what not to do’, and bracketed India with the United States and Brazil as “utter failure” in dealing with the Coronavirus pandemic.

Joseph Stiglitz made the comments in a webinar hosted by FICCI. He said that governments need to focus on both helping the poor and containing the disease. “The first priority is to help the vulnerable but also contain the disease. Spending the money in a way that prevents contagion and also helps people gives double dividends. Let me say very clearly, you can not control the economic aftermath if you cannot control the pandemic,” he said. Stiglitz advised the Indian govt to raise tax on the rich and spend the amount on the poor.

Stiglitz said that PM Modi is practicing “politics of division”, and the govt must get rid of it to bring economic prosperity. He said, “I will start by trying to create an inclusive society. Politics of division is an antithesis of what needs to be done. Modi has tried to divide your country, Moslems against Hindus, and that is going to undermine your society and economy no matter what else happens. This fundamental division will weaken India forever.”

Undoubtedly, such harsh criticism of Modi govt was welcomed by Rahul Gandhi.

Although Stiglitz is an influential economist, he was chairman of President Bill Clinton’s Council of Economic Advisers, is former chief economist at the World Bank, he is not alien to controversies. Several other economists have disagreed with him on various issues, and criticised him for his views. His fellow economist at Columbia University Jagdish Bhagwati had said about him, “there are many things wrong with Stiglitz as a policy economist. One is that he doesn’t learn from his mistakes.” Another economist from the same university who chose not to be named had said, “Joe’s career tragically demonstrates that if one combines legitimate credentials as a clever and creative theorist with extreme left-wing bias and a colossal ignorance of history, one can accomplish a great deal of harm in the world.” Moreover, Some of the stands taken by Stiglitz have proved to be disastrous.

Praise of Venezuelan govt

The most famous among them his praise for the policies of Venezuelan President Hugo Chávez. He had said that Chávez government was working towards bringing higher economic growth, and to ensure that the results of the growth is shared more widely. He had praised the health and education policies of the leftist Venezuelan govt in 2007, and had said that the economic growth of the nation was “very impressive”.

Just like what Joseph Stiglitz is suggesting now, the Venezuelan govt had spent a lot on the social sector, which led to the eventual collapse of its economy. The govt spent so much on the social sector that it didn’t have money left to fight the economic depression. For almost a decade now, the Venezuelan economy has been marked by hyperinflation, shortage of food causing mass starvation and diseases, increased crime and mortality rates, all of which have resulted in massive emigration of the population from the country.

The communist government praised Joseph Stiglitz has become one of the most autocratic govts in current times. Hugo Chávez, and his successor Nicolás Maduro has been heading the govt by brutally suppressing the opposition, and had tried to hide the economic collapse initially. When the opposition parties won majority in National Assembly in 2016, Maduro created a National Constituent Assembly, which only has supporters of the government as members and has the power to supersede the national assembly.

U-turn on policies

Joseph Stiglitz is also known for taking U-turn on various issues. Earlier, he had opposed raising the minimum wage, saying that it will lead to job loss as more wage will mean more price which will reduce sales of the product. In his 1993 book Economics, he had correctly written that if the minimum wage is more than the market equilibrium wage, the demand for workers will come down. But when he was part of the Clinton administration, he had supported the hike in the minimum wage. When reminded about his earlier position, he had replied that the negative impact will be negligible.

In the fourth edition of his textbook published in 2006, Stiglitz supported higher minimum wage saying that it will lead to increased motivation of workers. He endorsed government forcing firms to pay higher minimum wages through legislation.

Predicted that impact of mortgage crisis will be effectively zero

One year after winning the Nobel prize, Stiglitz had declared that the risk of Govt. sponsored mortgage firms Fannie Mae and Freddie Mac defaulting on their debt was “effectively zero”. It was declared in a paper co-authored by Jonathan Orzag, Peter Orszag and Joseph Stiglitz. They have said that they had put the companies through “millions of potential future scenarios,” and then judgef the likelihood of default. Even though the assumptions in the test were said to be severe, they found that the probability of a default was “so small that it is difficult to detect.”

In 2008, both the companies collapsed as they faced large losses. Between 2008 and 2012, both the companies lost a total of $265 billion in the subprime crisis. Being govt sponsored companies, their losses were compensated by taxpayer’s money. The companies received $190 billion as bailout from the government. This shows, the authors of the 2002 paper failed to correctly gauge the financial situation of the two companies, and failed to anticipate the future situation in the housing market.

Baseless attacks on others and lies

Joseph Stiglitz, who was fired from World Bank for publicly criticising the policies of the bank, is also known for indulging in character assassination of others. He has been bitter critic of the IMF, and he had publicly insulted IMF staff as “third-rate economists from first-rate universities”. He had also made an unsubstantiated accusation that a potential job offer from Citibank had compromised IMF MD Stanley Fischer’s integrity.

Stiglitz was also accused of lying by IMF chief economist Kenneth Rogoff. After relentless attack on IMF by Stiglitz, Rogoff had written an open letter to him. In the letter, he accused Stiglitz of inventing a meeting between Larry Summers and Jean-Michel Severino that never took place. He wrote, “On page 112, you have Larry Summers (then Deputy U.S. Treasury Secretary) giving a “verbal” tongue lashing to former World Bank Vice-President Jean-Michel Severino. But, Joe, these two have never met. How many conversations do you report that never happened?”

The criticism of India by Stiglitz has attacked sharp criticism. FICCI president Sr Sangita Reddy has said that the economic indicators show a smart recovery for India. “We will soon bounce back. Naysayers like Joseph Stiglitz don’t understand the Indian economy or resilience”, the joint MD of Apollo Hospitals said.  

  Support Us  

Whether NDTV or 'The Wire', they never have to worry about funds. In name of saving democracy, they get money from various sources. We need your support to fight them. Please contribute whatever you can afford

OpIndia Staffhttps://www.opindia.com
Staff reporter at OpIndia

Related Articles

Trending now

Indian Govt should ask badminton coach and Taapsee Pannu’s boyfriend Mathias Boe to quietly do his job or quit

Mathias Boe had tweeted tagging Minister Kiren Rijiju, asking him to do 'something' about the IT raids on his girlfriend Taapsee Pannu

The world praises India as Made-in-India vaccines arrive to help countries start mass-vaccination against Covid

Expressing gratitude, the CARICOM described India as caring country and an example of international cooperation.

India cautions UNSC over weapons of mass destruction falling into the hands of terrorists in conflict regions like Syria

India called for an objective investigation into the alleged use of chemical weapons in Syria and a peaceful resolution of the Syrian conflict.

Anurag Kashyap’s accounts were seized for tax evasion under UPA rule too. Brave dissenter? Netizens ask

As per reports, the I-T raids have unearthed tax discrepancies to the tunes of several hundred crores.

China’s Sinopharm vaccine being developed at a bio-weapons lab operated by PLA, has history of producing sub-standard vaccines: Details

Amidst concerns about the safety of China Sinopharm vaccine, damning disclosures have come out in the public about the lab producing it

‘Freedom House’ downgrades India from ‘free’ to ‘partly free’: Read how it is wholly funded by the US govt and has ties to George...

Freedom House downgraded India based on facts they did not find convenient and a fallacious narrative woven by left and Islamists

Recently Popular

“Are you so creatively bankrupt”? Director of ‘Yeh Ballet’ slams Deepika Padukone starrer new Levi’s ad for plagiarising design ideas

Sooni Taraporevala said that the 'copycat culture' in India needs to be called out and cancelled after the set used in new Deepika Padukone starrer Levi's ad was plagiarised by the makers.

Crores of undisclosed income, unexplained cash receipts and more: IT Dept discovery so far in raids against Anurag Kashyap, Taapsee Pannu

Income Tax department (IT dept) conducted raid on properties linked to filmmaker Anurag Kashyap, actress Taapsee Pannu and others

Her husband used to talk vulgar to girlfriend in front of her: Here is what the lawyer of Ayesha, who jumped into Sabarmati river,...

Ayesha, who committed suicide by jumping into the Sabarmati River in Gujarat on March 1, had a disquiet marital life

Icchadhari protestor Yogendra Yadav finally admits that farmers’ protest is political and is about defeating PM Modi: Read how

Four months after the farmers protest began, Yogendra Yadav has finally admitted that the protests are indeed political

‘Isko maine kaat dala’ – Father beheads daughter after finding her in compromising position, takes the head to police station

After beheading the 17-year-old daughter, Sarvesh Kumar took the head to Majhila police and confessed to the crime

PM Modi and his mother abused live on air by a caller on a BBC radio show on Sikhs in the UK

BBC edited the program and the host offered apology after caller abused PM Modi and his mother during a live radio show
- Advertisement -

 

Connect with us

253,191FansLike
522,071FollowersFollow
23,800SubscribersSubscribe