- Joseph Stiglitz
Nobel Prize-winning economist, Columbia University professor and chief economist for the Roosevelt Institute. He is the author of numerous books. His new book, The Euro: How a Common Currency Threatens the Future of Europe, will be out next month.
As President Obama addressed the Democratic National Convention last night, delegates held up signs denouncing the sweeping trade deal called the Trans-Pacific Partnership. Obama has been pushing through the TPP, which encompasses 12 Pacific Rim nations, including the United States, and 40 percent of the world’s economy. Both Hillary Clinton and Donald Trump have come out opposing the deal amid a wave of public protest by those who say it benefits corporations at the expense of health and environmental regulations. This week, Virginia Governor Terry McAuliffe told Politico that he believes Hillary Clinton would support the TPP if she were elected president. The trade agreement will be one of the main economic issues the incoming president will have to address. Others include unprecedented levels of inequality, mounting student debt and financial sector reforms. We speak with Joseph Stiglitz, Nobel Prize-winning economist, Columbia University professor and chief economist for the Roosevelt Institute.
AMY GOODMAN: We’re here in Philadelphia, Pennsylvania, covering the Democratic National Convention, inside and out, from the streets to the corporate suites to the convention floor. We turn now, right now, to talk about the economic policies that are being put forward. We’re joined by Joe Stiglitz, who is the Nobel Prize-winning economist, to talk about—well, let’s go first to the delegates who held up a banner saying "TPP kills democracy." Hundreds of others held signs denouncing the sweeping trade deal called the Trans-Pacific Partnership. President Obama has been pushing through the agreement, which encompasses 12 Pacific Rim nations, including the U.S., 40 percent of the world’s economy.
Both Hillary Clinton and Donald Trump have come out opposing the deal amidst a wave of public protest by those who say it benefits corporations at the expense of health and environmental regulations. But earlier this week, Virginia Governor Terry McAuliffe told Politico he believes Hillary Clinton would support the TPP, if she were elected president. He is a close friend of Clintons. When asked by Politico if Clinton would change her position and support the deal, if elected, McAuliffe said, quote, "Yes. Listen, she was in support of it. There were specific things in it she wants fixed," unquote. Speaking to NBC Wednesday, McAuliffe clarified his position.
GOV. TERRY McAULIFFE: There are things in the agreement she does not agree with. Unless she can get those to the point that she’s happy with it, she’s not going to support it, plain and simple. That’s what Senator Kaine said the other day; he said the same thing. If she can’t get the things that she wants changed, then she’s not going to support it.
AMY GOODMAN: One of the major concerns around the TPP is its anticipated impact on the cost of life-saving medicine. This is California delegate Alex White, who took part in the protest on the convention floor Wednesday.
ALEX WHITE: In October, when the full text released and it was made known to the public that there was a death sentence clause in it, that would basically mean that pharmaceutical companies would have a 20-year monopoly on medications, that would cause a single medication to cost anywhere between $50,000 and $100,000 a year. My wife was diagnosed with a rare form of lung cancer three years ago, and through our—I have to do it for her and everybody who is diagnosed with cancer. I mean, that’s why—I don’t want to mean any disrespect to President Obama, but I’ve got to—I’ve got to stand up for people who are diagnosed with cancer. When they’re fighting for their lives, they shouldn’t have to fight to afford their medications.
AMY GOODMAN: The trade agreement, the TPP, will be one of the main economic issues the incoming president will have to address. Others include unprecedented levels of inequality, mounting student debt, financial sector reforms.
For more, we are joined by Joe Stiglitz, Nobel Prize-winning economist, Columbia University professor, chief economist for the Roosevelt Institute, author of numerous books. His latest is The Euro: How a Common Currency Threatens the Future of Europe. It’ll be out next month.
Welcome back to Democracy Now!, Joe Stiglitz.
JOSEPH STIGLITZ: Nice to be here.
AMY GOODMAN: It’s great to have you with us. So, you know, I was there on the convention floor yesterday, each day, hundreds of anti-TPP signs. You advise Hillary Clinton. What is her position on the TPP?
JOSEPH STIGLITZ: She’s against it. And she’s against bringing it up to a vote in the lame-duck session, which was allegedly part of the Obama strategy, you know, that they’re not going to present it to Congress until they—the idea was not to do it until the lame-duck. Everybody has come out against the lame-duck. And so, I think it’s dead for Obama’s administration.
AMY GOODMAN: And what will that mean for the next president?
JOSEPH STIGLITZ: I think it makes it very clear that if there is ever to be a TPP, it has to be totally renegotiated. And the interesting thing is, I’ve talked to some of our trading partners, they would welcome that. Some of the worst provisions in there were not because our partners demanded it, it was because we demanded it. When I say "we," it was the corporate interests that, unfortunately, were represented in the negotiations, not we the American people. And, you know, to me, I was an early opponent of TPP. And it’s so heartwarming to see that an issue that I thought would never get raised—you know, I thought it—and I think the Obama strategy was to try to push it through when nobody was looking—to see that it’s now become a mainstream issue. So, to me, this is a real victory for democracy.
AMY GOODMAN: Now, you said you were an early opponent. The person you advise, Hillary Clinton, was not an early opponent. She said it was the gold standard, I think was her term, for trade agreements. She has been immensely pressured by, I think, what has shocked the Clinton juggernaut, and that is the tremendous popularity of Bernie Sanders, even if he doesn’t have much corporate media amplification of his views, like Donald Trump does, and she saw she had to change. I mean, you see it on the floor every single day of the convention.
JOSEPH STIGLITZ: Yeah, I think that’s right, but it’s more than that. I mean, as people started looking at what actually emerged from the negotiations—remember, it was all secret. What we—all we could only figure out was what was coming out of leaks, which turned out to be remarkably accurate. You know, the leaks often do provide some information that, for good reason, the Obama administration didn’t want. And as others have looked at that agreement—even the U.S. government did an estimate of what would be the trade benefit. You know, how would—what would be the benefit to GDP? Negligible. Outside studies, like at Tufts University, said it would actually decrease our GDP. So, the benefits, as the agreement has become out in the open, have clearly—have been seen clearly negative. And the cost—you mentioned, you know, the cost in terms of access to drugs, pricing of drugs. And, to me, the most important aspect, the dampener on regulation, what is called the ISDS provision, the investment agreement, that’s the provision that Elizabeth Warren has really nailed the TPP on, and she’s absolutely right.
AMY GOODMAN: So, what makes you so sure what Hillary Clinton’s stance is? She chooses her running mate, Timothy Kaine. And Tim Kaine, the senator of Virginia, I think as early—as late as Thursday, was hailing the TPP, but then chosen, given the climate, you know, says he is against it. You have McAuliffe, the governor of Virginia, extremely close to the Clintons, who says she’s for it. What do you know that he doesn’t know?
JOSEPH STIGLITZ: Well, I think part of this is that the Democratic platform, which is a commitment of the Democratic Party, came out with a set of principles that any trade agreement, current or past, has to satisfy it. And if you look at those principles, the TPP, in its current form, doesn’t satisfy it. NAFTA doesn’t satisfy it. So, to me, although they didn’t make it explicit—
AMY GOODMAN: But, I mean, that was—a lot of especially the Bernie delegates on that platform committee pushed hard for no TPP, and Clinton campaign pushed very hard back, and she won.
JOSEPH STIGLITZ: Yeah. But, to me, my understanding of that was they didn’t want to embarrass President Obama. But you read those principles, what a trade agreement has to satisfy, and it’s pretty obvious that TPP doesn’t satisfy it, NAFTA doesn’t satisfy it. So, my interpretation, it’s a commitment of Hillary, the next Democratic administration, to renegotiate NAFTA and to renegotiate TPP. The interesting thing is, again, I’ve talked to some of our trade partners in NAFTA, in TPP, and they would welcome that. So, it’s an open door.
AMY GOODMAN: What does Hillary Clinton say privately to you?
JOSEPH STIGLITZ: Well, I haven’t talked to her particularly on this, but I have talked to the policy team on it, and I think they are very aware why there’s such hostility, where TPP went wrong. And that, I think, was a wake-up call. You know, there was this sort of ideology that was very strong—you know, trade is what promotes growth, we’re in favor of growth, we want to create jobs, you know, all that. And now that you actually see the agreement and you look at what the studies say, there’s no GDP coming out of this.
AMY GOODMAN: What does Clinton’s selection of Kaine tell you?
JOSEPH STIGLITZ: Well, I think it’s—she’s looking for somebody that gives her credibility with the middle. And she was trying to make a political judgment about what was the best way to win the election, because, let me say, I believe unambiguously there’s one big issue here. The damage that Trump would inflict in our society, if he were elected, is enormous.
AMY GOODMAN: How?
JOSEPH STIGLITZ: Anywhere from racism to his economic policies. So, to me, there’s no choice. You know, it is really imperative that the Democratic—you know, Hillary wins. And then, if I were in a position, the question is: What is the best vice president to win, consistent with my values? You know, and the vice—
AMY GOODMAN: Would Tim Kaine have been your pick?
JOSEPH STIGLITZ: There are some other candidates that I would have looked at. There’s one other feature that, you know, when I—when you start doing the calculations, some of the best candidates are senators from states where there’s a Republican governor. And if you appoint the Democratic senator, the Republican governor can put a next senator in line. And holding the Senate for the Democrats is extraordinarily important, important for the Supreme Court, one of the really big issues our country faces. So, I guess what I would say is, these are very complicated trade-offs, judgments. You know, the good thing is that in Virginia, I think Kaine will be replaced by another Democratic senator, so that won’t have that negative effect. A lot of the other—well, I’ve met with Kaine. I can understand why she would have a lot of confidence in him. And I do hope he will change his position on TPP. Obviously, if he’s going to support the Democratic platform, he has to change.
AMY GOODMAN: Supported fast track, giving President Obama fast track for pushing through TPP.
JOSEPH STIGLITZ: I think that was a wrong position. But the fact that—
AMY GOODMAN: Also joining with a number of other senators in fighting regulations of large regional banks, this just in the last few weeks.
JOSEPH STIGLITZ: And again, the issue is, once you join on the Democratic platform, I think he’s committed to supporting the Democratic platform. And—
AMY GOODMAN: We’re talking to the Nobel Prize-winning economist Joe Stiglitz. We’ll be back with him in a minute.
AMY GOODMAN: "What the World Needs Now is Love," sung by more than 40 Broadway singers last night at the Democratic National Convention in Philadelphia. Yes, this is Democracy Now!, democracynow.org. We are "Breaking with Convention: War, Peace and the Presidency." I’m Amy Goodman, broadcasting from the DNC here in Philadelphia. We’re speaking to Hillary Clinton adviser Joseph Stiglitz, Nobel Prize-winning economist, Columbia University professor. I want to ask about how Bernie Sanders has impacted Clinton’s economic policies, but turn first to President Obama, who mentioned the Vermont senator, the former presidential candidate, last night.
PRESIDENT BARACK OBAMA: So, if you agree that there’s too much inequality in our economy and too much money in our politics, we all need to be as vocal and as organized and as persistent as Bernie Sanders’ supporters have been during this election. We all need to get out and vote for Democrats up and down the ticket, and then hold them accountable until they get the job done. That’s right. Feel the Bern.
AMY GOODMAN: Wow, so there you have President Obama saying "Feel the Bern," Joe Stiglitz. I think that’s something he certainly felt.
JOSEPH STIGLITZ: I think that’s right. And I think the movement, as actually Sanders has talked about it, is a very important movement, and holding those elected accountable. You know, the Sanders people did have an impact on the Democratic platform, absolutely. And now, we are going to have to hold accountable those people, including Hillary and Kaine. We’re going to have to hold them accountable, so that they actually push for that agenda.
AMY GOODMAN: You advise Hillary Clinton. What is the best way to hold her accountable? Since you don’t agree on a number of issues, what does she respond to?
JOSEPH STIGLITZ: Well, I think, partly, she’s a policy wonk. And so, she does respond to arguments. And, you know, over the last couple years, I’ve been trying to make strong arguments about why TPP is bad, not only in terms of the trade issues, the GDP, but access to health, regulation. I’ve been trying to say it’s not an issue of just dealing with the shadow banking system. It’s not an issue of just dealing with the "too big to fail" banks, the too big to regulate, the too big—we’ve got to do both. So, it wasn’t—you know, Sanders took one position. Hillary took the other. My view has been, look, these banks have done so much damage to our economy, both in terms of the 2008 crisis, but also increasing inequality and changing the focus to a short-term perspective. And that’s one of the areas which she’s picked up very strongly in a couple very powerful speeches about the dangers of short-termism, the kinds of policy that have led to that kind of short-termism. You know, I laid out in a book that we did for the Roosevelt called Rewriting the Rules, showing how, beginning with the Reagan administration, we rewrote the rules of the American economy to promote inequality and short-termism, and what you have to—
AMY GOODMAN: What most damaged the U.S. economy, do you believe, and created, generated the most inequality?
JOSEPH STIGLITZ: The single most important thing, probably, in—the most telling event was obviously the 2008 crisis, which is very linked to the financial sector. But one of the things that I’ve emphasized in my work and in Rewriting the Rules is that there’s no single measure. It’s accumulation of thing after thing after thing. It’s the failure to have inclusion, inclusion of African Americans, inclusion of women, because we are almost the only civilized society that doesn’t have family leave, that makes it more difficult for women to be in the labor force. That’s an important—you know, we don’t have a law that says you can’t discriminate in wages against women. That’s one of the things that Hillary has emphasized a lot. That both creates inequality and damages our economy.
AMY GOODMAN: You—
JOSEPH STIGLITZ: Education, access to education.
AMY GOODMAN: You wrote a piece in Vanity Fair headlined "Donald Trump’s Biggest Vulnerability." What is it?
JOSEPH STIGLITZ: What I emphasize there is the difficulty that he’s going to have of even getting good Republicans to serve, you know, creating the administration. It’s not just one person. I mean, he tries to say, and this is—Kaine gave a very powerful speech, and he said, "Believe me, I’ll do it." Government is not that way. And democratic government is particularly not that way. You need to have hundreds and hundreds of people implementing those policies. You know, you have different agencies. And we are different from other countries, where the president has to appoint not only the secretary, the deputy secretary, the undersecretary, the assistant secretary, the—you know, in many cases, the deputy assistant secretary. That’s a huge number of people. And getting—you know, take just in the area of economics, getting people who are good economists, who will work with Trump, is going to be extraordinarily difficult.
AMY GOODMAN: Donald Trump has called for getting rid of the WTO, the World Trade Organization—certainly, activists on the ground, 1999, the Battle of Seattle, that’s what they were calling for—totally challenging the TPP. Mixed message coming out of the Democrats. Are you concerned about this? And do you think Donald Trump could win? I mean, the polls show, coming out at this point, he’s ahead.
JOSEPH STIGLITZ: He could win. And it’s not just the polls. Remember, Bush did not get a majority of votes; Gore got many more votes than Bush. But the way our electoral system works is that you can become the president even with a minority of votes. So, when we say could Trump be the president, he doesn’t even have to win the majority of votes. He could win in the Electoral College. So, yes, I am very worried. And one of the things that I’ve been writing recently is, he’s already done an enormous amount of damage to the United States.
AMY GOODMAN: Trump campaign chief Paul Manafort said today, "Mr. Trump has said his taxes are under audit, and he will not be releasing them." Why does that matter, Joe Stiglitz?
JOSEPH STIGLITZ: Oh, it matters because there is a good reason why we suspect that he has not been honest about either where his wealth is, what his charitable contributions is, or that he’s paid a fair share of his taxes. Now, even if they’re under audit, he can release the taxes that he claims. You know, the IRS may say, "You’re wrong," but you can still say, "This is what I believed my income was. This is what I believed the taxes that I should have paid." And that will tell an important message. You know, when Mitt Romney released his taxes and it became clear he was keeping his money in the Cayman Islands, not because, the Cayman Islands, money grows stronger in the sunshine in the Cayman Islands, but because there were other reasons, that told Americans a lot, that he was paying under 15 percent of his income. What his taxes were as a fraction of his income were much, much lower than a plumber or some other person who’s working for a living. Something was going on that Americans said was unfair. We would like to know, is Trump paying his fair share? You know, he’s engaged in bad practices in Trump University, stiffed his workers and all kinds of bad practice. We want to know, is he a good citizen? Is he paying his fair share of taxes? So I think it’s really important. And I think it’s really important that his vice president release his taxes, as well.
AMY GOODMAN: Joe Stiglitz, we’re going to have to leave it there. Hillary adviser, Joe Stiglitz, Nobel Prize-winning economist, Columbia University professor.
That does it for our show. I’ll be doing a report back from the conventions in two talks: Friday, July 29th, at Provincetown Town Hall in Massachusetts; Saturday, July 30th, on Martha’s Vineyard at Old Whaling Church. You can check out the details at democracynow.org.
Very happy birthday to Rob Young. Special thanks to Laura Deutch, Gretjen Clausing and Ryan Saunders, as we broadcast here, the whole crew, at PhillyCAM.