Review of People, Power, and Profits

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Review

The US economy rewards the few and punishes the many, argues economist and Nobel prize winner Joseph E. Stiglitz. In this penetrating overview of the state of capitalism in the United States, he acknowledges the reasons for the rise of populism after the Great Recession and offers ideas to reverse rising inequality. The former World Bank economist supports a more active federal government and stricter regulation. His engaging analysis seems unlikely to bring conservatives to his view, but it offers important food for thought about the complex, divisive relationship between democracy and capitalism. Stiglitz writes about what matters to him most in a tone that is both personal and urgent.

About the Author

Winner of the Nobel Prize in economics and a best-selling author, Joseph E. Stiglitz served as an economic adviser in the Clinton administration.

 

America is a wealthy nation, but it’s also a country with masses of poor people and a fragile safety net.

Economist and Nobel prize winner Joseph E. Stiglitz commences his argument by pointing out that for decades, politicians have followed a misguided economic policy that embraces deregulation and lower taxes while eschewing common-sense government involvement in markets. In 1981, Ronald Reagan slashed taxes and promised that supply-side economics would create prosperity, but the deep tax cuts failed to deliver. Instead, Stiglitz notes, they created huge deficits, sluggish growth and widening inequality. In 2017, Donald Trump doubled down on Reagan’s missteps, serving up further tax cuts that brought disappointing results. “Supply-side economics did not work for Reagan,” the author writes, “and it won’t work for Trump.” In truth, the United States could use higher taxes; more rigorous regulation would create a fairer economy.

The US is a wealthy nation in the midst of a technological revolution. It’s also a country, Stiglitz reminds readers, with masses of poor people and a fragile safety net. In a politically divided nation, it’s easy to overlook some basic realities. For instance, a more equal society outperforms an unequal one. What’s more, the wealth of a nation shouldn’t be confused with the wealth of certain individuals. “Inequality is a choice,” the author writes. “It is not inevitable.”


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