Re: on stiglitz

[Gunnar Tómasson <gunnar.tomasson@xxxxxxxxxxx>]

Paul:

Re. the following;

> No but the Marshall plan ended  only a few years after it began -- making
> long tewrm addiction difficult.  Also after that foreign aid programs were
> on a year by year basis -- that had to be approved by  Congress and
> administered to whom the Administration and the State Department thought
> "deserving".

Comment:

As I read him, Stiglitz is proposing an imaginative use of the SDR aspect of
world monetary arrangements already in place to rebuild economic
infrastructure in developing countries across the globe, including some
whose current external debt burden leaves little room for financing the
foreign exchange component of any domestic investment programs which they
might otherwise be prepared to undertake.

As such, Stiglitz' proposal may be viewed as part of a two-pronged approach
including also work on a new world financial architecture.

Gunnar



----- Original Message -----
From: "Paul Davidson" <pdavidson@xxxxxxx>
To: "Gunnar Tómasson" <gunnar.tomasson@xxxxxxxxxxx>
Cc: <pkt@xxxxxxxxxxxxxxxx>
Sent: Tuesday, September 02, 2003 12:50 PM
Subject: Re: on stiglitz


> At 09:10 AM 9/2/03 -0400, you wrote:
> >Paul:
> >
> >Re. the following:
> >
> > > Citing John Maynard Keynes as the inspiration for his prescription,
> >Stiglitz
> > > suggests creating "global greenbacks" (known as special drawing rights
> >[SDR])
> > > to be issued as handouts to developing countries and other countries
in
> >times
> > > of international financial difficulties. These SDRs can be converted
into
> >hard
> > > currencies to service debts, buy imports, or supplement foreign
reserves.
> > > Unfortunately, such handouts are merely palliatives and not the
solution
> >to
> > > the problem. Moreover, some countries will become SDR addicts, and
when
> >the
> > > handouts end, the economic withdrawal symptoms will be even more
deadly.
> >
> >Comment:
> >
> >In his article, Stiglitz did not address the technical "details" of how
his
> >proposal might be put into action.
> >
> >He did make clear, however, that he had in mind something akin to the
> >post-World War II Marshall Aid Plan.
> >
> >In that earlier case, none of the recipients of U.S. "handouts" became
aid
> >"addicts".
>
>
> No but the Marshall plan ended  only a few years after it began -- making
> long tewrm addiction difficult.  Also after that foreign aid programs were
> on a year by year basis -- that had to be approved by  Congress and
> administered to whom the Administration and the State Department thought

> "deserving".
>
> Paul
>
>
> Paul Davidson
> Editor, Journal of Post Keynesian Economics
> Economics Department - 523 SMC
> University of Tennessee
> Knoxville, Tennessee 37996-0550
> phone # (865) 974-4221
> fax # (865) 974-1686
> home phone  (865) 692-0802
> http://econ.bus.utk.edu/davidsonextra/Davidson.html
>
>
>
>
>