An Interview with Joseph Stiglitz

Source: Slate Magazine, September 8

[Apart from receiving the Nobel Memorial Prize in Economic Sciences in 2001, Stiglitz has been awarded more than 40 honorary degrees, including from Harvard, Oxford, and Cambridge Universities.]

Interviewer: Isaac Chotiner

Question: What struck you about the differences between the way Americans and Europeans, particularly Germans, view economic problems?

josephstiglitzStiglitz: Germans by and large, have a fixation on inflation and a belief that seems to be unshakable by the evidence that austerity will restore countries to growth and prosperity. It just never happened. That is a difference. I won’t say it’s a European difference, because when I visit most countries in Europe I don’t find a large difference between American economists and European economists. There are differences in views, but the Germans are in that sense an outlier.

Question: Do they defend austerity on economic grounds?

Stiglitz: They try to defend it on economic grounds. They often do raise issues like feeling very strongly that Greece was profligate, and why should they come to the aid of Greece, but I point out that Spain and Ireland had surpluses before the crisis, and it wasn’t their deficit that caused the crisis, it was the crisis that caused the deficit.

Question: Saying someone’s profligate is not an economic defense. That’s saying that they did something wrong and therefore they shouldn’t be helped.

Stuglitz: That’s right. That’s what I’m saying. They both say that they agree that austerity’s going to work and they say that these countries should not, in some moral sense, be helped.

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