James Galbraith

James K. Galbraith is the Lloyd M. Bentsen Jr. Chair in government-business relations at the Lyndon B. Johnson School of Public Affairs at the University of Texas at Austin, a senior scholar of the Levy Economics Institute, and chair of the Board of Economists for Peace and Security. His most recent book is Welcome to the Poisoned Chalice: The Destruction of Greece and the Future of Europe.

Recent Articles

How the Economists Got It Wrong

The American Economic Association (AEA) met January 7-9 in Boston, for a millennial program distinguished by its attention to international policy issues, most particularly financial crises (as in Asia) and the failure of the so-called "economic transition" (as in Russia). And yet, in this odd rush to relevance, something was curiously awry. Apart from a panel including former World Bank chief economist Joseph Stiglitz, the meetings featured almost no one with a record of criticizing the institutions that gave us the Asian crisis or the transition failure. Instead, they were dominated--in session after session--by the architects of the present world order, including Yeltsin advisers Andrei Shleifer and Anders Aslund, the International Monetary Fund's Stanley Fischer, and U.S. Treasury Secretary Lawrence Summers. Even the arch-speculator Myron Scholes appeared. Never, perhaps, has such a luminous crowd gathered to discuss so disastrous a set of its own failings...

Watching Greenspan Grow

Greenspan: The Man Behind Money , Justin Martin. Perseus Publishing, 284 pages, $28.00. Maestro: Greenspan's Fed and the American Boom , Bob Woodward. Simon and Schuster, 270 pages, $25.00. For those seeking a personal portrait of America's maximum economic-policy maker, Justin Martin's biography of Alan Greenspan will serve nicely. Informed and sympathetic, Martin traces Greenspan's personal and professional lives: his early days in jazz and objectivism, his roots as an economist in the Conference Board, his participation in the old-style business-cycle studies of Arthur Burns, his ties to five presidents, and his liaisons and enduring friendships with interesting, intelligent, attractive, and loyal women. Greenspan emerges here as observers usually find him: reserved, dispassionate, thoughtful, not very pretentious--an even-tempered professional with a stable inner self, oddly at home in the outsize trappings of the chairman...

Life After Tight Money

The conservative experiment with tight money has failed. Popular monetary prescriptions—low interest rates and a more accountable Federal Reserve—are steps in the right direction. But they must go hand in hand with structural reforms to get the economy back on track.

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The Surrender of Economic Policy

As long as the big choices in macroeconomic policy are off the table, other efforts to raise living standards will not make much difference.

T here is a common ground on economic policy that now stretches, with differences only of degree, from the radical right to Bill Clinton. Across the spectrum, all declare that the main job of government is to help markets work well. On the supply side, government can help, up to a point, by providing education, training, infrastructure, and scientific research--all public goods that markets undervalue. But when it comes to macroeconomic policy, government should do nothing except pursue budget balance, and leave the Federal Reserve alone. To accept a balanced budget and the unchallenged monetary judgment of the Federal Reserve is, by definition, to remove macroeconomics from the political sphere. Thus, the remaining differences between Clinton and the Congress are over details. Should we head for budget balance in seven years, eight, or ten? Should we cut (or impose) this or that environmental regulation? Do Head Start, the AmeriCorps, and technology subsidies justify their cost? And...

The New Dialectic

Modern economic life crosses national boundaries to form a web of intricate association that retards aggressive and regressive nationalism. Trade, investment, enterprise, technology, communications, and travel are today relentlessly transnational. Yet this same globalism undermines the capacity of the nation-state to stabilize its economy. From this paradox comes the first of the dialectics of our time. On the one hand, there is the broad impulse toward closer economic and political association. This is evident in the European Union, the new North American Free Trade Agreement, and a very preliminary economic alliance between the Pacific Asian countries and Australia. Countering this trend are the lingering social and economic responsibilities of the modern state. The provision of medical care, education, housing, and such -- and therewith the budget, taxation, macroeconomic policy and maintenance of employment levels -- are now the duty of individual governments. Thus the dialectic...