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Jeffrey Sachs

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Jeffrey Sachs

Jeffrey David Sachs (born November 5, 1954, in Detroit, Michigan) is an American economist known for his work as an economic advisor to governments in Latin America, Eastern Europe, the former Yugoslavia, the former Soviet Union, Asia, and Africa. He is currently a professor and director of the Earth Institute at Columbia University. He is also Special Advisor to United Nations Secretary-General Ban Ki-moon. From 2002 to 2006, he was Special Advisor to United Nations Secretary-General Kofi Annan and Director of the UN Millennium Project. He proposed "shock therapy" (though he himself dislikes the term) as a solution to the economic crises of Bolivia, Poland, and Russia. He is also known for his work with international agencies on problems of poverty reduction, debt cancellation, and disease control — especially HIV/AIDS, for the developing world. He is the only academic to have been repeatedly ranked among the world's most influential people by Time magazine. He has been appointed the 2007 lecturer for the BBC Reith Lectures.

Biography

Sachs graduated from Oak Park High School in Oak Park, Michigan in 1972 and received his B.A., summa cum laude, from Harvard University in 1976, and his M.A. and Ph.D. from Harvard in 1978 and 1980 respectively. He holds honorary degrees from several institutions, including Simon Fraser University and Ohio Wesleyan University.

Before coming to Columbia University in July 2002, Sachs spent over 20 years at Harvard University. Sachs passed the general examinations for his Ph.D. and was invited to join the Harvard Society of Fellows while still a Harvard undergraduate.[1] He joined the Harvard faculty as an Assistant Professor in 1980, and was promoted to Associate Professor in 1982 and Full Professor (with tenure) in 1983, at the age of 29, eventually becoming Galen L. Stone Professor of International Trade.

Bolivia was the first country in which Jeffrey Sachs began to develop his theories. In 1985 the economic situation in Bolivia was undermined by hyperinflation and the country was unable to pay its debt to the IMF. Jeffrey Sachs, at that time active as economic adviser to the Bolivian government, drew up a plan that was adopted as decree 21060. Whereas inflation had reached 20,000% per year in 1985,[2] when Jeffrey Sachs left the country two years later it had fallen to 11%. But his plan resulted in "lateral damage" of the already meager productive sector. The only sector which thrived was the production of coca. Whereas only 17% of labor market was employed in the coca sector in 1980, that had risen to 37% by 1990.[citation needed]

Sachs began advising the Polish Solidarity Movement before it took control of the government in August 1989. On January 1, 1990, following the advice of Sachs and ex-International Monetary Fund economist (former Sachs student and future assistant Treasury secretary for international affairs) David Lipton, the Polish government introduced what came to be known as "shock therapy" — the rapid conversion of all property and assets from public to private ownership. After initial shortages and inflation, prices eventually stabilized.[3]

The Russian government invited Sachs' advice on reproducing the Polish success in late 1991. Sachs introduced fellow Harvard economist Andrei Shleifer around the Russian government and it was decided that Shleifer would advise on privatization while Sachs advised macroeconomic issues.[4]

In 1995 Sachs replaced Dwight H. Perkins as director of one of several international consulting entities of the John F. Kennedy School of Government, the Harvard Institute for International Development (HIID; established in 1974),[5] resigning in 1999 to head a 1998 spinoff, the Center for International Development (CID). The CID, started with the transfer of roughly half of HIID's endowment, survived the dissolution of HIID in 2000 after two years of financial deficits and filing of an eventually successful lawsuit against Harvard by the U.S. Agency for International Development(USAID) over Andrei Shleifer's 1992–1997 HIID consulting project in Russia.[6][7][8][9] When fired by HIID in May, 2007 Shleifer laid responsibility for the scandal at Sachs' door ("I was just a consultant. It was Jeffrey's [Sachs] program, and he ran it."[10]).

Outside of Sachs' own projects CID failed to attract sustainable funding or broad scholarly involvement and, in March, 2002 Sachs resigned from Harvard to become director of The Earth Institute at Columbia University, effective July 2002.[11]

Since that date Sachs has been, in addition to his directorship, a professor in Columbia's Department of Economics, School of International and Public Affairs, and Department of Health Policy and Management; in 2003 he became Quetelet Professor of Sustainable Development. He is also Director of the United Nations Millennium Project, President and Co-Founder of Millennium Promise, and Research Associate at the National Bureau of Economic Research. Previously, Sachs has been an advisor to the IMF, the World Bank, the OECD, the World Health Organization, and the United Nations Development Programme.

In his 2005 work, The End of Poverty, Sachs wrote that "Africa's governance is poor because Africa is poor." According to Sachs, with the right policies, mass destitution — like the 1.1 billion extremely poor living on less than $1 a day — can be eliminated within 20 years. China and India serve as examples; China has lifted 300m people out of poverty in the last two decades. For Sachs a key element is raising aid from the $65 billion level of 2002 to $195 billion a year by 2015. Sachs emphasizes the role of geography, with much of Africa suffering from being landlocked and disease-prone, but stresses that these problems once recognized can be overcome: disease (such as malaria) can be controlled, and infrastructure created. Without specifically addressing these issues, political elites will continue to focus on getting resource-based wealth out of the country as fast as possible, and investment and development remain mirages.

In early 2007, the Sachs for President Draft Committee, a non-profit organization, formed to draft Jeffrey D. Sachs to run for the presidency of the United States of America in the 2008 election. [12]

Sachs claims he has developed a new branch of economics, called "clinical economics." His research interests include the links of health and development, economic geography, globalization, transitions to market economies, international financial markets, international macroeconomic policy coordination, emerging markets, economic development and growth, global competitiveness, and macroeconomic policies in developing and developed countries.

Sachs is married to Sonia Ehrlich Sachs, who is a pediatrician. They have three children, Lisa, Adam, and Hannah.

Criticism

Although Sachs is a hero to many, some economists view his proposals as dangerously naive. One of his strongest critics is New York University (NYU) Professor of Economics William Easterly who reproached The End of Poverty in his review for The Washington Post. Easterly's 2006 book, White Man's Burden, is a more thorough rebuttal of Sachs's argument that poor countries are stuck in a "poverty trap" from which there is no escape, except by massively scaled-up foreign aid. Easterly presents statistical evidence that he says proves that many newly developed countries — indeed, most of them — attained their higher status without large amounts of foreign aid as Sachs proposes. Easterly states that "So yes, do read Sachs's eloquent descriptions of poverty and his compelling ethical case for the rich to help the poor. Just say no to the Big Plan."

Daniel Ben-Ami, writing on the British Internet magazine Spiked, has criticized Sachs from an opposite perspective to Easterly. Ben-Ami argued in a review of The End of Poverty that Sachs’ views represent an acceptance that underdevelopment is here to stay. He argues that despite Sachs’ "grandiose rhetoric" his goal is the long-term eradication of extreme poverty rather than the economic development and transformation of poorer societies. Ben-Ami also argued that the Sachs 2007 BBC Reith lecture embodied low horizons for the poor.

Another person to criticize Sachs is Amir Attaran, who is a scientist and lawyer and currently the Canada Research Chair in Law, Population Health and Global Development at the University of Ottawa. Sachs and Attaran have worked closely as colleagues, including to coauthor a famous study in The Lancet documenting the dearth of foreign aid money to fight HIV/AIDS in the 1990s, which led to the creation of the Global Fund to Fight AIDS, Tuberculosis and Malaria. However, Sachs and Attaran part company in their opinion of the Millennium Development Goals, and Attaran argues in a paper published in PLoS Medicine and an editorial in the New York Times that the United Nations has misled people by setting specific, but immeasurable, targets for the Millennium Development Goals (for example, to reduce maternal mortality or malaria). Sachs dismisses that view in a reply to PLoS Medicine by saying that only a handful of the Millennium Development Goals are immeasurable, but Attaran also replies citing the United Nations' own data analysis (which the UN subsequently blocked from public access) showing that progress on a very large majority of the Millennium Development Goals is never measured.[13][14]

Sachs has been variously criticized for his staunchly neoliberal perspective on economy. Socialist feminist Nancy Holmstrom pointed out in a 2000 article that, in advising implementation of his shock therapy on the collapsing Soviet Union, Sachs "supposed the transition to capitalism would be a natural, virtually automatic economic process: start by abandoning state planning, free up prices, promote private competition with state-owned industry, and sell off state industry as fast as possible [...]" Holmstrom goes on to cite the drastic decreases in industrial output over the coming years, a nearly halving of the country's GDP and of personal incomes, a doubling of the suicide rate, and a skyrocketing unemployment rate. [1]

What is viewed as one of Sachs' great successes, the reversal of hyperinflation in Bolivia the late 1980's by using extreme methods of economic shock therapy, is analyzed in depth in chapter 7 of Naomi Klein's The Shock Doctrine: the Rise of Disaster Capitalism (New York: Metropolitian Books, 2007). Klein shows that the story of Sachs' Bolivian "success" is clearly not true. In Klein's analysis, the radical reforms pushed by Sachs were neither democratically agreed upon nor achieved without violent state repression, and left the majority of Bolivians in far worse circumstances.


Publications

Articles and columns

  • Economics and Justice. A monthly column for Project Syndicate, a non-profit association of newspapers around the world, concerning the social and environmental implications of economic growth around the world.

Monographs (books)

  • Humphreys, Macartan, Sachs, Jeffrey, and Stiglitz, Joseph (eds.). "Escaping the Resource Curse" Columbia University Press ISBN 978-0-231-14196-3
  • Sachs, Jeffrey (2005). The End of Poverty: Economic Possibilities for Our Time Penguin Press Hc ISBN 1-59420-045-9
  • Sachs, Jeffrey (2003). Macroeconomics in the Global Economy Westview Press ISBN 0-631-22004-6
  • Sachs, Jeffrey (2002). A New Global Effort to Control Malaria (Science), Vol. 298, October 4, 2002
  • Sachs, Jeffrey (2002). Resolving the Debt Crisis of Low-Income Countries (Brookings Papers on Economic Activity), 2002:1
  • Sachs, Jeffrey (2001). The Strategic Significance of Global Inequality (The Washington Quarterly), Vol. 24, No. 3, Summer 2001
  • Sachs, Jeffrey (1997). Development Economics Blackwell Publishers ISBN 0-8133-3314-8
  • Sachs, Jeffrey and Pistor, Katharina. (1997). The Rule of Law and Economic Reform in Russia (John M. Olin Critical Issues Series (Paper)) Westview Press ISBN 0-8133-3314-8
  • Sachs, Jeffrey (1994). Poland's Jump to the Market Economy (Lionel Robbins Lectures) The MIT Press ISBN 0-262-69174-4
  • Sachs, Jeffrey (1993). Macroeconomics in the Global Economy Prentice Hall ISBN 0-13-102252-0
  • Sachs, Jeffrey (ed) (1991). Developing Country Debt and Economic Performance, Volume 1 : The International Financial System (National Bureau of Economic Research Project Report) University of Chicago Press ISBN 0-226-73332-7
  • Sachs, Jeffrey and Warwick McKibbin Global Linkages: Macroeconomic Interdependence and Co-operation in the World Economy, Brookings Institution, June, 277 pages. (ISBN 0-8157-5600-3)
  • Sachs, Jeffrey (ed) (1989). Developing Country Debt and the World Economy (National Bureau of Economic Research Project Report) University of Chicago Press ISBN 0-226-73338-6
  • Bruno, Michael and Sachs, Jeffrey (1984), "Stagflation in the World Economy"

References

  1. ^ Holmstrom, Nancy, and Richard Smith. The Necessity of Gangster Capitalism: Primitive Accumulation in Russia and China. The Monthly Review, 2001.<http://www.monthlyreview.org/200holm.htm>

External links

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