On the whole, his treatment of the bubble years is a little thin. You get a much more detailed (and technical) treatment in the book "Infectious Greed" by Partnoy. He also repeats the standard liberal canards about not funding education enough. For example he says US students do not score as well on science and math tests and students in other countries. But he fails to give the real reason: survivor bias. These tests are given to a much more selected and elite group of students in foreign countries. He also seems to believe US students aren't as good as foreign students because you find a lot for foreigners in US graduate schools, so we have to beef up our educational system by spending more money. Again he fails to identify what's really going on. Foreign students are after the green card and see graduate school as a means to that end. The reason so few Americans want to pursue graduate studies in science and engineering is the tremendous surplus of people in these fields. It's a natural and rational reaction to a surplus. Stigliz seems to accept the shortage myth.
There are also some errors and omissions in the book. For example the author says you can't buy an inflation-indexed annuity in the US. But you can, at least until about March 2003. See the book "Worry Free Investing" for where to go to buy an indexed annuity. His discussion of inflation indexed Treasury Bonds is incomplete. He fails to tell the reader about the yearly imputed income tax on the increased principal, which really cuts into the yield. Perhaps this is why they were so unpopular. These bonds are only good in a tax-free account.
Stiglitz is a brilliant economist and a terrific textbook author. He has made many important contributions to the field of economics. I opened the book expecting a lot, I'm sorry to say I was somewhat disappointed.
It's hard to think of a man more qualified to write such a book as this one. Joseph Stiglitz is perhaps America's leading economist. For the last few decades he has made enormous contributions to numerous fields (hence his Nobel Prize), and he was on the front lines of economic policymaking in the Clinton administration and the World Bank. For people who are used to getting economic 'wisdom' from non-economists, Stiglitz's book is a refreshing splash in the face of rigorous economic thinking.
This book has numerous merits. Most prominent, perhaps, is Stiglitz's encyclopedic command of the issues: deficit reduction, telecom deregulation, the California energy crisis, the 1997 tax cuts, Enron, creative accounting, the IMF, Fed interest rates, stock options, banking regulation - you name it. More important, though, is the analytical sophistication with which Stiglitz approaches these issues. There's no graphs or differential equations (this isn't a technical work) but you can feel Stiglitz's genius at work cutting through all of the BS.
Stiglitz sees the 1990s as a brilliant economic success, but also a period in which faulty accounting, conflicts of interest, and botched deregulation schemes inflated a bubble that, when it burst, gave rise to the 2001 recession. This is not a partisan tract ("More regulation! Punish big business!"), but Stiglitz has vast disagreements with the free market camp in the GOP and the New Democrats who see lower taxes and less regulation as the solution to every problem. His disagreements with them are not ideological, but economic.
Where ideology does come in is his commitment to social justice - he clearly wants to tax the rich to help out the people on the bottom. But Stiglitz doesn't disguise these views as economic analysis: he sets aside a chapter to describe his vision for the world economy. Also, while he feels that Greenspan pays too much attention to inflation and not enough to growth, he doesn't impose his views as the right ones - he simply suggests that the Fed's priorities be open to political debate rather than left up to the Fed. It's clear that Stiglitz is a liberal, but he's very self-conscious. He writes in a humble, delicate tone that expresses his views, seeks to back them up, and admits that his values are different from those of the GOP.
You won't agree with everything he says (I certainly didn't), but it's still a really fantastic contribution to the debate over the bubble and the recession. Nobody writing about recent economic history has more credibility than Stiglitz does, and it's a great read.
I must say I am annoyed by the other reviewers who try to pass themselves off as economists and point out the supposed "flaws" with Stiglitz's book. True, there's a lot in Stiglitz's book to disagree with, but you're not going to find objective economic analysis on Amazon.com customer reviews. It's also totally false that Stiglitz dismisses the significance of the economic boom of the 1990s or that he denies the important role that deficit reduction played in fueling the boom.
For me, Stiglitz's book was a courageous intervention into really critical and contentious issues by one of the century's leading economic geniuses. Since the corporate governance scandals died down, there's been an unfortunate lull in the discussion of issues like stock options and financial accounting, but the debates that Stiglitz contributes to are debates that we need to have. I'm buying a copy of this book for a number of my friends. It's timely and brilliant.
Stiglitz's well written book examines the process of creation and the decay and corruption that can help undo these bursts of economic activity. Stiglitz doesn't point the finger at any one group of individuals more than another--he feels comfortable doling out the blame where it belongs and Washington is just as much a target as corporate America. Without the political stilts to support economic circus we all participate in, it would never happen. As a reflection on what's wrong (and occasionally right) with America's political and economic system, The Roaring Nineties is unstinting look at the harshness and ugliness underneath the system. It's also a book that argues for reform in a way to keep the economy moving without allowing criminal profiteering.