Has Jeffrey Sachs changed his tune...

Rosser Jr, John Barkley rosserjb at jmu.edu
Tue Sep 15 12:13:11 PDT 1998

I think Sachs's shift began after he got dumped from advising the Polish government when there was the initial political rejection of the initial reform government several years ago. Even though by many measures Poland is doing quite well macroeconomically, and may be the only former CMEA member to have a per capital GDP greater than in 1989 by now, it remains the case that the pains of transition continue to outweigh the gains politically and "pro-reform" governments keep getting booted out of office.

Sachs essentially transferred a model used in Latin America in places like Bolivia to the transitional economies where much more profound changes were going on. "Shock therapy" in many cases involved complete insititutional breakdown and collapse. If I remember correctly, debt reduction (or restructuring) was part of the original Latin American package, as long as the country involved was nicey-nice and did what it was supposed to in terms of budget deficit reduction, monetary tightening, opening of capital markets, and privatizations.

I'll give Sachs credit that he has criticized the IMF crowd for attempting to impose the standard old Latin American plan on Southeast Asia when it clearly does not apply at all in many of these countries. Whatever he is, Jeffrey Sachs is not stupid. Barkley Rosser On Tue, 15 Sep 1998 11:40:07 -0400 Max Sawicky <sawicky at epinet.org> wrote:

> > Carl Remick wrote:
> > > Sachs struck me as the embodiment of Western
> > > arrogance in his meddlesome, market-oriented prescriptions for Russian
> > > "reform." When did he become such a bleeding heart?
> > >
> >
> > After he spent time in Russia.
> > --
> > http://www.geocities.com/~comparty
> I'm no fan of Sachs, but he had been making similar
> recommendations for rescheduling or repudiation of
> Third World debt well before he set foot in Russia.
> All this psychological speculation is quite beside
> the point, if the least bit of his record is
> known.

-- Rosser Jr, John Barkley rosserjb at jmu.edu

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