Joseph Eugene Stiglitz (/ˈstɪɡlɪts/; born February 9, 1943) is an American economist, public policy analyst, and a professor at Columbia University. He is a recipient of the Nobel Memorial Prize in Economic Sciences (2001) and the John Bates Clark Medal (1979).[2][3] He is a former senior vice president and chief economist of the World Bank and is a former member and chairman of the (US president’s) Council of Economic Advisers.[4][5]some ways I one has to recognize that42:32China may have been lucky they began the42:37development strategy just at the moment42:39when the West was very open to importing42:43manufacturing goods it was a moment42:49where because there were a large profit42:54opportunities in the West that sustained42:58the opening with wrong without regard to43:01the effects and workers over the over43:04the effects and the overall economy so43:09in a way China’s success is testimony to43:13the failures of democratic politics in43:16the United States in Western Europe43:19because the rules the game were designed43:26worked to advantage American43:29corporations Western European43:31corporations with no attention paid to43:37the consequences to the workers as the43:41United States d industrialized now some43:43countries in Europe did pay attention43:45and they did have active labor market43:49policies that shifted workers from the43:53old sectors that were dying into the new43:55sectors and Scandinavia has been very43:58good in these active labor market44:00policies which I think are really44:02important in the United States we didn’t44:06do that even though economic theory said44:11opening up of trade between an44:14banks country like the United States and44:16China West events would result in lower44:21real incomes for unskilled workers44:24there’s a missing Stover theorem and it44:28was unambiguously clear even though we44:31were getting cheaper goods real incomes44:34of unskilled workers would go down and44:36it’s only if you had a mystical belief44:39in trickle-down economics would you44:41think otherwise but our politicians did44:44have a mystical belief in trickle-down44:46economics and they asserted this over44:51and over again and so even when you know44:54in the Democratic Party we tried to get44:57Trade Adjustment Assistance we try to44:59have some active labor market policies45:01when we couldn’t because of concerns45:04about austerity and not enough budget45:07concerns they wouldn’t work we went45:11ahead anyway there is a growing sense45:15the United States though that actually45:16the agenda on the right was to increase45:23unemployment and suffering you say why45:26would they anybody you know why do45:29people want suffering well it was part45:32of a concerted agenda if you look at to45:35weaken the bargaining power of workers45:38and drive down the wages which increases45:41profits so if you look at this from a45:45conservative point of view the reforms45:47and our labor laws and reforms in the45:51way antitrust policy was enforced that45:55reform is a not the right word but45:58changes in those laws changes in46:02corporate governance and implicit46:04understandings the legal frameworks and46:08in the investment agreements in the46:10trade agreements the investment46:12agreements they gave more secure46:14property rights if American firms46:16invested abroad than if they vested at46:18home which meant that they were46:21encouraged to invest abroad which also46:24meant that if the firm if workers came46:27to affirming46:28we want higher wages and the firms know46:31if you we give you if you continue to46:35demand higher wages we’re going to leave46:37that was more credible so I think it was46:43a deliberate strategy to drive down the46:45wages of workers and it worked in terms46:50of the economics that I described before46:52it did drive down the wages but it has46:55now led to these this political backlash46:58with which we are dealing so there is a47:04relationship between China’s success and47:07some of the problems that we’re facing47:09it wasn’t inevitable we could have47:11managed it better we should have managed47:14it better but we didn’t but just as a47:16footnote the point I’m making is that47:20that was a particularly47:23Africa won’t be able to follow the47:25manufacturing export-led growth model47:28that led to the success of East Asian47:32countries including China in fact now47:36globally manufacturing employment is in47:40decline in any country that believes47:44that manufacturing should be at the47:46center of their economic policy is47:48misguided it can be part of it it can’t47:52be at the center well let me just47:57conclude by SEP some let me just48:02conclude by a set of remarks about that48:07in a way that pertain to all countries48:10but we’re we’re china realized this in a48:16way more forcefully than many others48:18have and that is that reform is a48:20never-ending process that societies are48:28always changing technology’s changing48:30and therefore the policies that are48:36going to make a society successful have48:38to change in a corresponding way48:41for China China’s entering a new stage48:43of development it’s facing critical48:46problems of inequality health48:47environment livable cities markets won’t48:51solve those problems in fact many of48:53those problems have been created by the48:56fact that they had markets that were too49:00unfettered to under-regulated49:02they’re going to have to regulate them49:04better there are further questions posed49:09by changing globalization the49:12recognition of the risks of excessive49:14financialization the West49:18I believe hasn’t succeeded in adequately49:20taming financial markets as you know49:23this is this week is the 10th49:25anniversary Lehman Brothers and and a49:27lot of people are talking about have we49:29done enough I think it’s absolutely49:32clear no and what’s particularly49:39disturbing is the Trump administration49:41is trying to undo the inadequate things49:44that we’ve already done again I was at a49:48dinner right before the inauguration of49:51Trump where one of his chief economic49:54advisors was there49:56I don’t normally associate with his49:57people might make it clearer but it was50:02an embassy dinner so I and I didn’t know50:06he was going to be there anyway50:10and he was talking about how he was50:16going to deregulate the financial sector50:19within weeks after taking office and the50:26first thing that struck me is he clearly50:28had no idea of our democratic processes50:31yeah he really thought you know Trump is50:34the dictator he gets to write rewrite50:36all the rules no no none of these50:38processes that we put in place as50:40democratic checks against authoritarian50:43leaders no knowledge of that was just so50:46clear but the second point I was going50:50to ask what somebody who asked it before50:51I did quizzically50:55didn’t we have a crisis in 2008 and the51:02implicit answer was that was ancient51:04history and we have to move on but it’s51:09not ancient history and I think the51:12risks are very much with us one of the51:17concerns that I increasingly seeing in51:20China is that as China grows the51:26influence of vested interest will grow51:28and you can feel it already51:32another just a little anecdote every51:36year when I go to China I often talked51:42to the finance minister and I’ve been51:43pushing them to move away from their51:46debt finance growth model to more tax51:50financed in particular I’m telling them51:53they need a carbon tax and it would51:56raise a lot of revenue it would help51:59clean up their air pollution exceed me52:02an obvious idea and the finance minister52:05every year says great idea and he says52:10we have some political problems which he52:14means the auto industry the coal52:16industry this you know steel industry52:18and so forth we’re gonna work on it next52:22year we go through the same conversation52:27as China has grown and it has taken on52:31many of the features of a modern vested52:37interest economy we’re getting change is52:41becoming more difficult and that of52:43course is is very worrisome but the52:49principles that guided China in the52:53first 40 years are likely to continue to52:55be relevant and that by that I mean the52:57pragmatism crossing the river by feeling53:00this still stone they’re going to be new53:02problems not fully foreseen would that53:04appear it will have to address these53:08problems53:09using insights from theory and past53:11experience and the second critical point53:14is openness there is much to be learned53:18from experiences of others and from the53:20ink sykes of non-ideological economic53:23analysis and again we’re in a particular53:29moment where I hate to keep coming back53:34to the United States but we’re a little53:35bit obsessed with with our problems one53:41can’t help but reflect on the closed53:45mindedness of our current administration53:48of not looking around you know if you53:52think you’re number one and you think53:54that you’re the there’s nothing to learn53:57from anybody else that is part of the54:02beginning of the end so we hope that54:05this is just a temporary interlude but54:09as we reflect on what makes I know54:14successful in the ways it is I think54:18there are a lot of lessons for all of us54:19to think about how we can make our own54:21economy successful for all of us thank54:24you54:30
U.S.-China Trade Standoff May Be Initial Skirmish in Broader Economic War
The United States is increasingly wary of China’s emerging role in the global economy and the tactics it uses to get ahead, including state-sponsored hacking, acquisitions of high-tech companies in the United States and Europe, subsidies to crucial industries and discrimination against foreign companies.
The Trump administration has begun trying to limit China’s economic influence in the United States and abroad, warning about China’s ambitions in increasingly stark terms. Mike Pompeo, the secretary of state, compared China’s ambitions to Russia and Iran in a speech in London last Wednesday, saying Beijing poses “a new kind of challenge; an authoritarian regime that’s integrated economically into the West in ways that the Soviet Union never was.”
China, whose ambition is to dominate industries of the future, is pushing back. A column on Saturday in the Communist Party’s People’s Daily newspaper stated, “The United States is again waving the club of tariffs after misjudging China’s strength, capacity and will, further escalating trade friction between our two countries.”
The piece was written under the pen name Zhong Sheng — the “voice of China” — a name used when the paper publishes comments on foreign affairs that are authoritative.
Restraining China’s ambitions and methods is a tricky task — and there is concern that the Trump administration’s effort is creating a new red scare, fueling discrimination against China and its citizens that could ultimately hurt the United States. As many as 30 Chinese professors have had their visas to the United States canceled in the past year, or been put on administrative review, according to Chinese academics and their American counterparts.
“We’ve got decades of painful negotiating with China ahead,” said David Lampton, a China scholar at Stanford University. Mr. Lampton said a trade deal, if reached, would do little to resolve the bigger conflict. “It’s just a skirmish in an ongoing battle.”
.. While a trade deal could calm some tensions and establish more good will between the two nations, it is unlikely to achieve many of the ambitious goals that the administration has set for itself. Mr. Trump’s advisers, in particular the United States trade representative, Robert Lighthizer, have been focused on what the administration calls China’s practices of “economic aggression.”
But the administration has struggled to address the immensity of the problems in the text of a trade deal. People close to the talks say that the negotiators appear powerless to force any changes that aren’t in China’s interest.
Mr. Liu, who is leading China’s team in the trade negotiations, hinted at that uphill battle in a video statement released by the official Xinhua news agency.
Instead, a trade deal between the two countries seems more likely to bring change around the margins — tens of billions of dollars of soybean purchases, some tariffs lifted and changes to the text of Chinese laws or regulations that the country might ultimately disregard, particularly once another administration occupies the White House.
“This is a decades-long endeavor,” said Robert Daly, the director of the Wilson Center’s Kissinger Institute on China and the United States. “This can’t be waved away over cake at Mar-a-Lago.”
The notion that the United States has one last shot to change China’s behavior is held by an array of people on both sides of the political spectrum. But it is an aggressive notion of American power to upend a rival system that has delivered prosperity for its people and put China on course to be the world’s largest economy.
Many in China see the United States as a declining power bent on enforcing its will on a world that no longer cowers before its hegemonic might. The troubles in American democracy and the long economic slump after 2008 persuaded many in China that its instincts to chart its own course were correct. In the eyes of many Chinese, their country is simply reclaiming its historic status as a dominant regional power in Asia.
It has also projected power across Asia, Africa and elsewhere while the United States has, on many fronts, retreated from its post-World War II commitment to the global order. But it has done so with little application of military force, in sharp contrast to what many in China see as American militarism.
Many in China have sought to avoid a trade conflict, which could have a larger impact on their economy than the United States’. But they have long thought the United States would have a difficult time accepting a true peer in economic, technology and military power, so consider the management of conflict with the United States to be an inevitable result of their own rise.
While the Trump administration accused China of breaking a trade deal, China’s resistance to the emerging terms stemmed from its belief that the United States was asking too much and offering too little in return. Many of the changes the United States seeks would limit what Chinese officials regard as a tried-and-true approach of using tens of billions of dollars from state-owned banks and government investment funds to turn previously small industries like car production or solar panel manufacturing into the largest industries of their kind in the world.
And the Chinese view some of the Trump administration’s demands as infringing on their sovereignty and giving America too much power over their economy — including requiring the country to codify changes through legislation in the National People’s Congress. To the increasingly nationalistic public in China, the American requests are reminiscent of 19th century history of unequal treaties forced on the country by foreign powers.
Mr. Trump on Saturday suggested China was simply delaying a deal in the hopes that a Democrat would win election in 2020 and continued his pugilistic approach, saying “the deal will become far worse for them if it has to be negotiated in my second term. Would be wise for them to act now, but love collecting BIG TARIFFS!”
In the United States, China’s unwillingness to bow to America’s demands is uniting lawmakers like the Democratic Senate leader, Chuck Schumer of New York, and Senator Marco Rubio, Republican of Florida.
That is a significant shift from the prevailing view in the United States since the death of Mao Zedong in 1976 that close economic engagement with China would produce an increasingly democratic country that would be closely tied to an international economic order founded mainly on Western liberal ideals.
That has not happened.
China has indeed grown in prosperity, leaping into the ranks of what the World Bank defines as upper-middle income countries. Its economy is now bigger than any other country except the United States. Its manufacturing sector is now bigger than those of the United States, Germany and South Korea combined.
But in the last five years, China has veered toward increasingly repressive authoritarianism at home and a rapid military buildup. The State Department estimates that Beijing has put 800,000 to two million Muslims in hastily built internment camps ringed with barbed wire in northwestern China. The Chinese government has built an archipelago of air bases on artificial islands in the South China Sea in between Vietnam, Malaysia, Indonesia and the Philippines. And China now has the world’s largest navy and has conducted
China has indeed grown in prosperity, leaping into the ranks of what the World Bank defines as upper-middle income countries. Its economy is now bigger than any other country except the United States. Its manufacturing sector is now bigger than those of the United States, Germany and South Korea combined.
But in the last five years, China has veered toward increasingly repressive authoritarianism at home and a rapid military buildup. The State Department estimates that Beijing has put 800,000 to two million Muslims in hastily built internment camps ringed with barbed wire in northwestern China. The Chinese government has built an archipelago of air bases on artificial islands in the South China Sea in between Vietnam, Malaysia, Indonesia and the Philippines. And China now has the world’s largest navy and has conducted military exercises as far away as East Africa and the Baltic Sea.
On the economic front, the competition is even fiercer. Trump administration officials warn that China is trying to dominate the global 5G infrastructure that will be the basis for future mobile communications and is competing to set other technological standards that will determine which global companies win.
China is extending low-cost loans and building infrastructure around the globe through its One Belt, One Road program, which critics warn is making poorer countries beholden to China. It is out-investing the United States in some high-tech industries, and is gaining dominance in certain segments, like mobile payment, new energy vehicles and areas of artificial intelligence.
While American companies have long hankered for access to China’s growing market, their position has begun to shift as they see China’s practices and treatment of foreign companies. A survey released by the American Chamber of Commerce in China in February showed that the majority of its members favored retaining tariffs on Chinese goods while trade negotiations continued.
China’s own experts say that the Beijing leadership has been caught off guard by the pace of change in American perceptions of Sino-American relations.
“Even if there is some kind of agreement between Xi and Trump, in the long run the strategic bilateral relationship is already in trouble,” said Zhang Jian, a professor in the School of Government at Peking University. “There is no coming back, even if there is a deal.”