Notwithstanding such pressure, a growing number of people within the World Bank seem to be questioning the official wisdom--and to be paying the price. In June 2000 the economist Ravi Kanbur resigned from the bank after reportedly feeling pressure to tone down the emphasis on poverty reduction in the annual World Development Report. More recently, the World Bank launched a disciplinary investigation into the conduct of William Easterly, a staff economist who had published an editorial in the London Financial Times (based on his book, The Elusive Quest for Growth) that questioned the effectiveness of IMF and World Bank development assistance projects in the postwar era. "The World Bank is like a church--it has a dogma," says David Ellerman, another staff economist, who recently published an editorial in a World Bank newsletter calling for greater tolerance for dissenting opinions. "The problem is that we are dealing with some of the most complex issues facing mankind."

Now that he is no longer bound by institutional constraints, Stiglitz is speaking his mind more than ever. His message is at once simple and incendiary. As he declared recently before a packed hall at Columbia's School of International and Public Affairs, "Countries have to own their development strategies.... Development is not just the accumulation of capital--it is about a transformation of society, a change in ways of thinking. That can't come if countries have everything dictated to them."

Stiglitz was there to talk about his new organization, the Initiative for Policy Dialogue, through which he hopes to do nothing less than end the World Bank and IMF's fifty-year monopoly on development policy. The IPD will, among other things, bring together task forces of economists to outline alternative approaches to a range of policy questions (trade, macroeconomic policy, pension reform). It will also oversee country dialogues, in which economists, policy-makers and members of civil society from developing countries will debate strategies and ideas. Such dialogues have already taken place in Serbia, Vietnam, Ethiopia and the Philippines.

Though ambitious, there is something amorphous about the IPD's mission. The organization does not, for example, put forward a clear-cut, alternative blueprint to the policies of the Washington Consensus. There are also questions about whether Stiglitz, whose lack of management skills was notorious at the World Bank, is capable of running such an organization effectively.

If the IPD's agenda seems nebulous, however, that's in part because its founder does not really believe in blueprints. The whole problem with the Washington Consensus, Stiglitz argues, is that it represents "cookie-cutter" economics: a uniform set of prescriptions imposed regardless of history, social conditions, institutional factors, information asymmetries. In a forthcoming essay on the ethics of serving as an economic adviser, Stiglitz argues that rather than prescribe solutions, economists should emphasize choices, underscoring the risks and trade-offs of pursuing various alternatives. As a rallying point for activists, promoting dialogue and highlighting alternatives may seem frustratingly murky. Yet there is also something potentially radical about it. At bottom, it is an argument for an end to unilateral rule by global elites, and for greater democracy in economic decision-making. It also puts the lie to the notion that in a global marketplace, there is only one true road to prosperity.

As Stiglitz notes, during the 1990s the number of people living in extreme poverty (less than $2 per day) increased by nearly 100 million. Other studies show that in places like Latin America, the policies of the Washington Consensus have not even succeeded in promoting growth, much less in reducing inequality. The events of September 11 bring home the fact that addressing such issues is important for security reasons as well as for moral ones. The point has not been lost on Stiglitz. "Clearly, terrorists can be people like bin Laden who come from upper-income families," he told me. "Nevertheless, abject poverty and economies without jobs for males between the ages of 18 and 30 are particularly good breeding grounds for extremism. Solving the economic problems doesn't eliminate the risk of terrorism, but not solving them surely enhances it."

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