Contents | October 2002
More on politics and society from The Atlantic Monthly.
The Atlantic Monthly | October 2002
[From "The Roaring Nineties," by Joseph Stiglitz]
The Agenda: Inside the Clinton White House (1994), by Bob Woodward, provides an incomparably detailed look—complete with a dramatis personae of the President's wonks, factotums, and Svengalis—at how the Clinton Administration formulated economic policy early in its first term. (This book appeals especially to those who think that Alan Greenspan should be canonized—a process Woodward began in this book and continued in Maestro: Greenspan's Fed and the American Boom ). For a more succinct—and more jaundiced—assessment of Clinton's (and Greenspan's) economic policy, an assessment that looks astonishingly prescient in light of current events, read John Judis's "Method Acting," in the January 22, 2001, issue of The New Republic. Judis's piece is available at http://www.tnr.com/012201/judis012201.html. American Economic Policy in the 1990s (2002), edited by Jeffrey A. Frankel and Peter R. Orszag, provides extremely comprehensive (in more than a thousand pages) analyses of Clinton's policies. Each of the fourteen sections consists of a paper by a major economist or a Clinton adviser, with responses from several other economists.
Two good books on the broader economic context that Clinton inherited when he took office—that is to say, on the long period of stagnation in productivity and income growth (roughly 1973-1995) that followed the country's economic golden years (1947-1973)—are The End of Affluence (1995), by Jeffrey Madrick, and The Age of Diminished Expectations (1990), by Paul Krugman. On globalization, Joseph Stiglitz's recently published Globalization and Its Discontents is a good introduction for the non-economist to both the "Washington Consensus" (the IMF-World Bank-Treasury Department belief that what emerging economies in crisis need is stiff doses of fiscal austerity and market liberalization) and its (in Stiglitz's view) welcome unraveling. Paul Blustein's The Chastening: Inside the Crisis That Rocked the Global Financial System and Humbled the IMF (2001) provides a play-by-play account of the East Asian meltdown of the late 1990s.
The sweep of history may yet prove James K. Glassman and Kevin A. Hassett to be prophets, but it looks more likely that their optimistic prediction—memorialized, as it happens, in a 1999 Atlantic cover story—was spectacularly wrong. Their book Dow 36,000 (1999) was once a best seller; that in itself should have signaled that a bear market was nigh. Better, then, to read a book that appeared serendipitously at the stock market's peak, in the early spring of 2000: Irrational Exuberance, by Robert Shiller, which argued that investor psychology had run amok, driving stocks to unsustainable heights.
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The Atlantic Monthly; October 2002; ; Volume 290, No. 3; 89.