fresh voices from the front lines of change







Richard Eskow interviewed Dean Baker about his new book, “Rigged.” Audio is here.

Economist Dean Baker appeared on The Zero Hour this weekend to discuss his new book, “Rigged: How Globalization and the Rules of the Modern Economy Were Structured to Make the Rich Richer.” Our conversation focused on one aspect of the “rigged economy”: trade policy, its effect on the US middle class, and its real beneficiaries.

Some excerpts from the book provide a background for the discussion:

“Rather than promulgating policies that would allow developing countries to continue the textbook development path of growth driven by importing capital and running trade deficits, the IMF made debt repayment a top priority. The bailout, under the direction of the Clinton administration Treasury Department, required developing countries to switch to large trade surpluses …

“The countries of East Asia would be far richer today had they been allowed to continue on the growth path of the early and mid-1990s, when they had large trade …

“But the developing world decided they had to build up reserves of foreign exchange, primarily dollars, in order to avoid ever facing the same harsh bailout terms as the countries of East Asia. Building up reserves meant running large trade surpluses, and it is no coincidence that the U.S. trade deficit has exploded …”

As Baker concludes in his introduction:

“There was no reason the textbook growth pattern of the 1990s could not have continued …

“It wasn’t the laws of economics that forced developing countries to take a different path, it was the failed bailout and the international financial system.”

Dean Baker is co-founder of the Center for Economic and Policy Research. The book can be downloaded for free or purchased in physical form here.



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