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Global Notebook 5/98

World Bank Questions Washington Consensus

LONDON – Many of the tough conditions imposed on poor, debt-ridden countries by international financial institutions have been challenged by the World Bank’s own chief economist. In a little-noticed January speech, Joseph Stiglitz charged that policies such as trade liberalization, deregulation, and privatization are "sometimes misguided" and "neglect fundamental issues."

Stiglitz criticized what he described as the Washington Consensus, which holds that private markets will produce efficient allocations and growth if government gets out of the way. "I do not believe in blanket statements like, ÔGovernment is worse than markets’," he said. "I have argued that government has an important role in responding to market failures, which are a general feature of any economy." He also attacked the IMF’s obsession with inflation control, criticized policies that create unemployment in the name of efficiency, and argued that budget deficits are acceptable if they involve wise spending. read more

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Global Notebook 3/98

 Global Tax Gets Another Look

LONDON – Proposals to pay for international aid, peacekeeping, and other humanitarian causes through global taxes have long been shunned by the US Congress. Suggestions range from an international lottery to a tax on the arms trade. But one idea – a tax on foreign currency transactions – may have a better chance after the currency fluctuations that crashed the “Asian miracle.”

Although congressional Right-wingers see it as a plot against US sovereignty, cuts in Western aid budgets and recent economic jitters are reviving consideration of the so-called Tobin Tax. Originally suggested by US Nobel laureate James Tobin, a tax on currency transactions supposedly would discourage trading and reduce exchange-rate volatility. With $1.2 trillion washing through the global economy every day, the proceeds could reach $80 billion a year. Princeton economist Peter Kenan suggests that funds be used for projects like disaster relief, AIDS research, and environmental clean-ups. read more

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Global Notebook 2/99

Moving Beyond Borders

PRETORIA – When southern Africa was wracked by civil wars in the 1980s, an electric fence was strung across the no-man’s-land separating South Africa from Mozambique. But it’s about to be replaced by a huge, trans-boundary "peace park" linking Kruger National Park in South Africa with two others across the border. Together with a reserve in Zimbabwe, the plan represents a new trend in nature conservation and regional cooperation. read more