International Monetary Fund vs. Joseph Stiglitz Globalization Debate

¶ … Globalization: Matter of Perspective There is little doubt that the globalization debate is highly polarized between those who see it as a "good thing" for the majority of nations, and those who see it as just another means to exploit the poorest countries. The two articles "Globalisim's Discontents," written by Joseph Stiglitz, and "Globalization: Threat or Opportunity," authored by writers working for the IMF, or International Monetary Fund, are excellent examples of this polarity.

Joseph Stiglitz notes that the trend of globalization has "brought huge benefits to a few with few benefits to the many. But in the case of a few countries, it has brought enormous benefit to the many." He then explains the main difference between those countries that are globalizing "successfully," and those that are not is their ability to: substantially control the terms on which they engaged with the global economy.

By contrast, the countries that have, by and large, had globalization managed for them by the International Monetary Fund and other international economic institutions have not done so well. (Stiglitz) Thus, Stiglitz sees it as a "management problem," specifically laid at the feet of organizations like the IMF who push their own self-serving agendas in direct defiance to economic principle and ethical and democratic standards.

Moreover, Stiglitz notes that as a direct result, the poor of the developing countries left behind and pushed under by the IMF suffer politically and economically, and, even worse, suffer from the IMF's reliance on the whims of selfish corporate and financial interests unfettered by issues of morality.

Although Stiglitz does note that "successful" emerging global economies in Asia have benefited from Globalization through their ability to globalize their knowledge, opening their doors to multinational companies, and by creating their own enterprise (all possible because of globalized competitive knowledge), all of these countries "determined its own pace of change; each made sure as it grew that the benefits were shared equitably; each rejected the basic tenets of the "Washington Consensus," which argued for a minimalist role for government and rapid privatization and liberalization.

In contrast, however, those countries which are not in a position to globalize through knowledge, or, perhaps are at the mercy of IMF interference and regulation, are unable to globalize in a way that benefits the majority of citizens.

Of course, the IMF responds that it is true that "the income gap between rich and poor countries has been widening for many decades," yet it asserts that, "incomes do not tell the whole story; broader measures of welfare that take account of social conditions show that poorer countries have made considerable progress." Further, the IMF writers assert that if "well-targeted social expenditure" is pursued, "then there is a better chance that growth will be amplified into more rapid poverty reduction." Indeed, the IMF continues in its rosy description of just how poor countries can place themselves in position to benefit from globalization -- if they would just promote "pro-poor policies that are properly budgeted -- including health, education, and strong social safety nets.

A participatory approach, including consultation with civil society, will add greatly to their chances of success." However, the IMF article fails to acknowledge its role in many of these nation's inability to do just the things they recommend -- after all, in imposing its will on these countries, essentially in dictating their road to globalization for them, many of these countries are unable to attain a strong enough domestic footing to even begin the journey -- note Argentina, for example -- crippled under the recommendations and austerity programs of outside interests -- all undermining the political, welfare, and social stability of the country -- the very things necessary to allow the poor to rise above their misery.

Unfortunately, the IMF does little to buoy its position as a leader of the "good,".