Read last week traveling from West Point to NYC.
Basically a "loved Ben, hated Hur" review: great on diagnosis, but then all prescripts are public-sector based. When he has a list of big roles to be played: govs gets most, NGOs get second most, and private sector gets least!
He reveals his stunning bias in one sentence: "The overriding job of business is to make money for the owners"!
That's it! Business doesn't meet demand, doesn't deliver services and goods. Doesn't develop new techs or infrastructure. Doesn't employ. All it does is make money for owners. That's fundamentally WHY it exists.
Only a lifelong academic who's never run a business or actually worked for one could make such a stunningly narrow but revealing sentence.
Smart guy, but the notion that public aid will be THE number one global source for positive change in coming years is--again--a stunningly narrow perspective, virtually as bad as listening to neocons peddling the same on military power--the "other" public aid spending on the Gap.
| Permalink |
Comments (3)
Some economists are really politicians in academic clothing.
Posted by zenpundit
|
April 11, 2008 2:39 PM
While I haven't read his book, I did attend a lecture last evening featuring Dr. Sachs. During his prepared remarks, he stressed the need for public aid - which initially gave me the "impression", as you note above, that official development assistance was THE number one source for positive change.
However, as the discussion continued (and went into Q&A), Dr. Sachs provided a more complete and nuanced explanation of his position that I found relatively satisfying. Specifically, he stated that official development assistance (ODA) is a key source of finance, especially for least developed countries that lack the infrastructure necessary to attract private capital flows - (my read: in order to address market failures) - but indicated that the point of this assistance was to attract FDI in places where private capital is not flowing sufficiently.
Furthermore - along with ODA, Sachs advocated increased trade and foreign investment for developing countries - taking positions that are in line with the 2001 "Road map towards the implementation of the United Nations Millennium Declaration" (see pages 26 and 45) http://www.un.org/documents/ga/docs/56/a56326.pdf which indicated to me that ODA + Trade + FDI are all part of his solution set.
Addressing market failures, by building capacity in order to attract investment, seems a reasonable position and not particularly contentious. As to precisely how those market failures should be addressed - I think there is clearly room for debate - but now we're debating the best way to initiate capital flows and trade, which is a different story than I thought I would hear.
Bottom line: I'm not sure what he says in his book, but I'm now curious to see how Sachs represents his ideas in writing after hearing them in person.
Posted by Sean J Kreyling | April 11, 2008 4:29 PM
One has to wonder how Jeffrey Sachs expects the government to give so much public aid if it didn't have businesses to generate revenue for its owners in order to tax that revenue to give out so much public aid in the first place.
Posted by Chris | May 16, 2008 1:20 AM