In a parting shot as he departed the Bank on February 1st, Joseph Stiglitz, in an interview with the International Herald Tribune, said the interests of poor countries had not been “adequately represented in a lot of the international fora”, even when decisions were potentially harmful to them.
Commenting on the financial crisis in Asia, Stiglitz said policy decisions adversely affected working people and small businesses, who were not party to the decision-making processes. And, contrary to much official analysis, that it was the “international financial markets that were at the root of the problem.” He remarked that the challenge for the international financial community is “to establish a framework in which economic policies are made which affect everybody,” and to make sure that all those affected “can have a voice in those policies.”
Also in a speech to the American Economics Association in January, Stiglitz suggested that workers’ rights should be a central focus of development and criticised Washington policy on labour market flexibility. Stiglitz said “there is no safety net that can fully replace the security provided by an economy running at full employment, no welfare system will ever restore the dignity that comes from work”.
Stiglitz also said that free capital movements had brought few benefits for ordinary workers. “Capital market liberalization has not only not brought people the prosperity they were promised, but it has also brought these crises, with wages falling 20 or 30 percent, and unemployment going up by a factor of two, three, four or ten”.