On Friday night, February 19, Nobel Prize-winning economist and bestselling author of Freefall: America, Free Markets, and the Sinking of the World Economy, will speak at the Victoria Hall Theatre in downtown Santa Barbara. His talk, presented by UCSB Arts and Lectures, promises to be an intriguing one, as Stiglitz is scheduled to discuss, among other things, President Barack Obama’s recent economic proposals. I got a chance to speak briefly with Stiglitz—former chair of President William Clinton’s Council of Economic Advisors, former chief economist of the World Bank, and a Columbia University professor, as well as a best-selling author of several books—in advance of his talk.
Stiglitz described the problem of our nation’s oversized banks as “not only too big to fail, they are too big to manage; they are, in fact, too big to be,” in a recent Los Angeles Times interview. When I asked him to elaborate further upon this idea and suggest how we can stop this problem from occurring in the future, Stiglitz replied that “we need to create a more level playing field … implicitly, the big banks are being subsidized; everybody knows that the government will bail them out and they can gain on their competitors not because they are more efficient, but because they are being subsidized.”
As to the potential for an American recovery in the near future, Stiglitz said, “I do not see a robust economic recovery in the near future.” He continued, “What is really important to the American people is very simple: ‘Are there jobs?’… Right now there aren’t, and it will be around the middle of the decade before unemployment rates return to normal, is the broad consensus.”
In light of President Barrack Obama’s recent speech outlining his ideas for economic recovery, I asked Stiglitz his opinion on Obama’s priorities when it comes to the various crises that our nation faces. He responded with cautious optimism: “The president has a very difficult task, one that I try to describe in my book Freefall. The first task is to restore the economy to health … His overall strategy seems reasonable.” Stiglitz said the federal government should take a larger role by creating a proper stimulus, while drastically changing our system of maintaining the larger banks. “The economy remains weak,” he said. “We need more government action if we are going to get our unemployment rate down to an acceptable level.”
Stiglitz will speak at 8 p.m. on Friday, 2/19, at the Victoria Hall Theatre, 33 W. Victoria Street. Tickets are $10, or $8 for students who present I.D. Presented by UCSB Arts and Lectures, (805) 893-3535.