The first book on globalization that got me thinking was The World is Flat by Thomas Friedman. It dealt with case studies of the developing nations. The book offered a fresh perspective on how people sitting across the globe are exposed to equal opportunities and are able to operate on a common platform towards the maturity of a common objective—the basis of the flat world. However, it also indicated the demerits of globalization. Subsequently, I went through a number of books on similar topics, of which Confessions of an Economic Hitman by John Perkins was quite a revelation. It unmasked the shocking euphemism of economic globalization and brought to light the corporatocracy, financial manipulations and exploitation by the likes of World Bank, IMF and precisely the Washington Consensus!

Making Globalization Work is a deviation from this genre of books in the sense that besides presenting an extremely well-researched and unbiased analysis of the impact of globalization on international financial system, environment, social governance et al it also advocates the ‘processes’ by which “an engaged and educated citizenry can understand how to make globalization work, or at least work better, and can demand that their political leaders shape globalization accordingly.” There could hardly be any issue more relevant than this to the informed populace of the present age.

This is the third book on globalization by the Nobel laureate Joseph Stiglitz after his two widely acclaimed writings, Globalization and its Discontents and The Roaring Nineties. Before delving deep into the topic, Stiglitz gives an informative account of the background of his write-ups, his tenure as an economic advisor to former US President Clinton and his work as a chief economist in the World Bank. His beliefs that “there is just not one form of capitalism, not just one right way of running the economy” and “without appropriate government regulation and intervention, markets do not lead to economic efficiency” form the basis of this book.

Like Friedman in The World is Flat, Stiglitz portrays a scenario in India followed by a comparative analysis of the global economy through the nineties—establishment of the World Trade Organization to “bring the semblance of a rule of law to international commerce”, advancement of “Anglo-American Liberal Model” and the bursting of the dotcom bubble “accompanied by the massive misallocations of investment”. Although globalization catalysed the increase of GDP in South Asia, the United States and EU between 1999 and 2002, it broadened the disparity between the rich and the poor in every other country with global unemployment reaching a magnitude of 185.9 million! Highlighting the flaws in the policies of trade and capital market liberalization, foreign assistance, debt related agreements and the “shock therapy” for the countries in transition from communism, Stiglitz illustrates the success and failures of various countries through the process of globalization.

Here I must mention that I subscribe to the notion that statistics are sometimes misleading and do not always resemble actuality. So, I am a bit skeptical about the overall success of China (an interesting work on similar lines is the Year of the Rooster by Guy Sorman). Also, being an Indian, I have knowledge of the sorry state of affairs in rural India. The much talked about “guaranteed employment scheme for rural areas” is largely eyewash. However, I was overwhelmed by the intensiveness of the computed data used by Stiglitz in substantiating his work.

Stiglitz puts forth a very thought-provoking analysis of how NAFTA backfired in spite of having the potential of being a success. He also spoke of the difficulty in implementing a trade agreement between two nations as “everyone feels the insecurity”. To bring it in perspective, “when Korea’s currency was devalued, Korean steel exports to the United States increased, and American steel workers complained. When Brazil had a good orange crop, Florida orange growers cry for help…” but nothing is impossible and through an argument on fair trade over free trade, the erudite author depicts the possibility of positive outcomes in numerous pacts and petitions. Not only is it valid for material exports but also for “Intellectual property” patents and copyrights.

“Understanding why developing countries that are resource-rich perform so badly” is yet another interesting issue Stiglitz has written about. We can associate this “natural resource curse” to so many countries from the former Soviet Union, Africa, and Latin America to the Middle-East, Indonesia. Sometimes the bone of contention is oil, at other times it is diamonds and other minerals, and the list goes on. Nigeria, which generated trillion dollars through diamonds ended up with a sagging economy and moral degeneration. The writer lists certain solutions to this typical state of affairs like “greater transparency, reducing arms sales, certification, limiting environmental damage” and understandably enough, the control of corruption and conflict assumes prime importance.

Talking about environmental damage, global warming is no doubt one of the greatest concerns of the scientists and commoners alike today. As the author pointed out, The Kyoto Protocol was formulated way back in 1997 but quite clearly the developed countries are not complying with it. The developing nations are acting ignorant. With relevant solutions, he appealed to his readers to act fast while there is time.

Many people blame the multinational companies for the negative impact on globalization but as with everything else Stiglitz demands a way out to minimize the damages caused by them while maximizing their inputs. Among other things he has drawn attention to Corporate Social Responsibility and other ethical improvisations.

To think about it, it all boils down to good governance and “reducing the scope for corruption”. But the question is whether the bureaucrats are really listening or for that matter, whether the informed citizenry is vigilant enough.

This book promises to be an eye opener.

Somanjana Bhattacharya is a postgraduate from the Department of Social Sciences, Jawaharlal Nehru University. She is a freelance
writer and lives in Hamden, Connecticut.

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