Book Review: The Price of Inequality by Joseph Stiglitz

Introduction and Author Background

In 2013, issues of socioeconomic inequality were perhaps as pressing and problematic as they had ever been. This is the assertion at the crux of Joseph E. Stiglitz's text, The Price of Inequality: How Today's Divided Society Endangers Our Future (ISBN-13: 9780393345063). Released in 2012 by W.W. Norton & Company, the 560-page text is a timely and compelling contribution to the public discourse on the need for greater economic equality in the United States.

Understanding the orientation of the text requires a more complete understanding of its author — an economist, university professor, and winner of the 2001 Nobel Memorial Prize in Economic Sciences. According to his self-composed biography at the Nobel Foundation site, Stiglitz (2001) was born in Gary, Indiana in 1943. By his own account, his interests as a young student led him to become actively involved in his high school debate club. He notes that some of the subjects that stirred the most passion in him as a student would emerge time and again in his later career as issues of great civic importance.

Stiglitz tells us that "the intellectually most formative experiences occurred during the three years 1960–1963 I spent at Amherst College, a small, New England college (at the time, a men's college with around 1,000 students)." (Stiglitz 2001, p. 1) He speaks highly of his experiences at Amherst, where he dedicated the bulk of his undergraduate efforts to physics. By his senior year, Stiglitz reports, he had become enamored of economics and switched courses entirely in order to make it his focus during graduate school. He earned a modest fellowship to assist his transfer to MIT, where he earned his PhD and held an assistant professorship. (Stiglitz 2001, p. 1)

From there, Stiglitz went on to become one of the most decorated, accomplished, and influential economists of the last several decades. According to his Curriculum Vitae (2013), Stiglitz holds honorary doctorates from more than 40 academic institutions, has held professorial positions at a number of top universities, served as the 17th Chair of the Council of Economic Advisers under President Bill Clinton, and held the office of World Bank Chief Economist between 1997 and 2000.

The full scope of Stiglitz's contributions cannot be contained here. However, even a surface view of the author's career reveals an individual highly qualified to offer commentary on the state of the U.S. economy. The highly critical nature of the text in question therefore comes with a strong degree of credibility.

Summary of the Text

Stiglitz makes no mystery of his perspective on economic inequality. From the outset of the text, he makes clear that his perspective is progressive in nature and highly sympathetic to the struggles of the middle class, the working class, and the impoverished. Moreover, the text approaches America's economic inequality as connected to patterns observable on a global scale. According to Stiglitz, the outpouring of protest and discontent that defined the Arab Spring and the Occupy Movement were connected even if separated by wide cultural and geographical gaps. Stiglitz also makes clear, in no uncertain terms, that his point of view has more in common with the protest movement than with the hegemonic forces standing in its way.

Accordingly, Stiglitz observes that "the protesters were right that something was wrong. The gap between what our economic and political systems are supposed to do — what we were told they did do — and what they actually do had become too large to be ignored. Governments around the world were not addressing key economic problems, including that of persistent unemployment; and as universal values of fairness became sacrificed to the greed of a few, in spite of rhetoric to the contrary, the feeling of unfairness became a feeling of betrayal." (p. x)

This passage offers a philosophical framework for the larger part of the text, which takes the view that capitalism has been stifled by a generation of corrupt, entrenched interest groups permeating both industry and politics. This is the prerogative for a text that largely condemns the forces responsible for the economic ailments of inequality and recession. Stiglitz proceeds to lay out an argument that true capitalism should cure rather than intensify socioeconomic inequality. The Price of Inequality asserts that greed and exploitation have created an increasingly sharp wealth divide in which a vast majority of the world's wealth is controlled by a select few — done, Stiglitz argues, at the expense not only of individuals struggling for survival in a stagnant economy but also at the expense of economic stability as a nation and global community.

Works Cited

Chinni, D. (2012). 'The Price of Inequality' and 'The Betrayal of the American Dream.' Jefferson Institute.

[University]. (2013). Curriculum Vitae — Stiglitz. Gsb.columbia.edu.

Edsall, T.B. (2012). Separate and Unequal. The New York Times.

Stiglitz, J.E. (2001). Biographical. The Nobel Foundation.

Stiglitz, J.E. (2012). The Price of Inequality: How Today's Divided Society Endangers Our Future. W.W. Norton & Co.

Stiglitz, J.E. (2013). Student Debt and the Crushing of the American Dream. The New York Times.