Countries were told they had no incentives because of social ownership. The solution was privatization and profit, profit, profit. Privatization would replace inefficient state ownership, and the profit system plus the huge defense cutbacks would let them take existing resources and an increase in consumption. Worries about distribution and competition or even concerns about democratic processes being undermined by excessive concentration of wealth could be addressed later.
Joseph StiglitzThe issue is: $1 trillion or $2 trillion is a lot of money. If our objective is to have stability in the Middle East, secure oil, or extend democracy, you can do a lot of democracy buying for this sum. To put it in context: The whole world spends $50 billion a year on foreign aid.
Joseph StiglitzThe reason that the invisible hand often seems invisible is that it is often not there.
Joseph StiglitzEconomists often like startling theorems, results which seem to run counter to conventional wisdom.
Joseph Stiglitz