Bush critic blasts America’s growing inequality

NOBEL Prize-winning economist Joseph Stiglitz does not like George Bush.

More than that, Mr Stiglitz does not like the fact that his country has become a pariah state, largely because of the US President and a cabal of advisers and special interest groups intent of promoting their economic and political views.

Since the early 1990s, Mr Stiglitz has fought to improve the living standards of his own country and those in the developing world. As chairman of the Council of Economic Advisers to Bill Clinton, he was central in advocating and implementing action to heal the US economy following the recession under the first President Bush

The goal was to reduce the massive budget deficit and create jobs and the result was a success.

When Mr Clinton took over, there was a budget deficit of 5% of GDP. When he left, he presented the current Bush administration with a surplus of 2.5% and an extra eight million people in work.

Few opponents of Mr Bush come with the credentials of Mr Stiglitz. Aside from being the chief economic guru to Mr Clinton for three years, he was also chief economist with the World Bank and the author the acclaimed Globalisation and Its Discontents.

His new book, The Roaring Nineties charts the beginning of the bubble in the US economy and its eventual collapse and asks how this could have been prevented.

"The first Bush President inherited a mistake made by Reagan who had an incredible idea that reducing taxes would lead to more revenues. It didn't work and the country wound up with a deficit. What is so different for the second Bush is that he squandered a huge surplus that was built up by the Clinton administration four months after taking office. It was a remarkable ability to squander so much with so little benefit in such an unfair way."

Not only that but a series of tax cuts, designed says the current US government to stimulate the economy, haven't had that affect and simply further lined the pockets of the wealthy.

"Never have so few received so much from so many," says Mr Stiglitz.

America, despite its status as the world's wealthiest nation, has quarter of its 280 million people living below the poverty line even though they are in full-time employment, he added.

But the downturn and its depth there has been a net decline in employment for the first time since the Great Depression of the 1930s cannot be blamed solely on Mr Bush.

In his book, Mr Stiglitz agues that he and other economists had spotted the potential pitfalls for the economy, such as the rapid deregulation of the telecoms sector, the lack of regulation in the financial sector and the possibility for corporate malfeasance in the mid 1990s. Yet Mr Clinton and his Cabinet had failed to act on these.

But Mr Stiglitz says that President Bush has failed to create a fair society.

He adds: "It is not just the economy. It is a broad scale attack on American values.

"America stood for civil rights around the world, little principals like presumption of innocence and due process, and we're losing that under Bush and (Vice-President) Cheney."

Mr Stiglitz said he is appalled by the fact that America is one of the lowest donators to developing countries.

"The US are spending on the order of $100 billion a year in Iraq. When you put that in perspective, you could eliminate illiteracy among the developing countries for a fraction of that number."

The Roaring Nineties by Joseph Stiglitz, published by Penguin, is now available in paperback.

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