Stiglitz documents America (and much of the world’s) descent into crony capitalism (pp. 41-42, 122). He explains that while other bankrupt firms settle claims on credit default swaps (CDS) at 13 cents on the dollar, Paulson and the Fed pressured AIG to pay favored systemically dangerous institutions (SDIs) such as Goldman Sachs 100 cents on the dollar – with the public bearing the cost of this secret subsidy (p. 49). His broader point is that the neoclassical triumph in the battle of ideas (and its triumphalism about winning the battle) led not to the promised utopia of efficient, stable markets and growth, but rather to economic stagnation for the middle class, a catastrophic fall for the working class, and recurrent crises.
|By: William Black Sunday January 24, 2010 2:00 pm|
|By: William Black Sunday June 7, 2009 12:30 pm|
Senator Dorgan addresses the most severe crises America needs to confront, going far beyond the specific problem he tackled in Take This Job and Ship It. Each chapter discusses a specific set of related problems and suggests specific steps to respond to the problems.
There is no universal theme to the book, but there is a consistent approach and tone. The author is a prominent Democrat that is critical of the Bush administration and Congress when Republicans dominated it. The tone of his criticism of Republicans is moderate. The book is not a partisan screed. Indeed, he strongly criticizes the leaders of the Clinton administration’s Treasury department. (Those leaders continue to dominate economic policy under the Obama administration.) His critiques combine populist roots and academic training and an accommodation of his state’s (North Dakota) interests (coal).