Time is up for neoliberals
Democracy requires a new, progressive capitalism.
By Joseph Stiglitz, Washington Post
Amid another election season, our impulse to debate American democracy through a single political lens is understandable. But we’d be better served considering a second closely related question too: Which economic system serves the most people?
Summary by Claude.ai and lightly edited by me:
The article, written by Joseph Stiglitz, a Nobel Prize-winning economist, argues that the neoliberal economic system, championed by Milton Friedman and Friedrich Hayek, has failed to deliver on its promises of freedom and prosperity for all. Instead, it has primarily benefited corporations and billionaires while exacting a steep price on the well-being and freedom of the rest of society.
Stiglitz contends that neoliberalism’s emphasis on free markets and minimal government intervention has led to economic instability, insecurity, and inequality. He argues that the surge in support for populist nationalism can be attributed, in part, to the unaddressed economic stresses faced by people in countries with inadequate social safety nets and public services.
The author highlights the importance of distinguishing between positive and negative freedoms, emphasizing that the freedom of some can come at the cost of others, using examples such as gun violence, the COVID-19 pandemic, and the 2008 financial crisis.
Stiglitz proposes an alternative economic system called “progressive capitalism,” which involves a mix of decentralized institutions, including profit-making firms, cooperatives, unions, civil society, nonprofits, and public institutions. Central to this system are government regulations and public investments financed by taxation, which he argues will lead to greater productivity, prosperity, equality, and freedom for all.