The above article doesn't include anything specifically critical or admiring of Mexico's response, so it's hard to say. Despite the conspicuous lack of finger-pointing, the article carries the following title: "Mexico didn't know how to combat the crisis: Stiglitz".
Wednesday, November 18, 2009
Stiglitz on Mexico
The Nobel Prize-winning economist says that Mexico's recovery will be weak, and that it needs a fiscal plan that stimulates the economy. Stiglitz singled out Brazil and Australia as having responded well to the crisis, thank to strong governmental supports and timely adjustments to the banking industry. I'd actually like to hear a little more about exactly what Mexico should have done differently. The stimulus in Mexico probably wasn't strong enough nor was it pursued with enough gusto in Los Pinos, but that wouldn't seem to be a sufficient explanation for a 7 or 8 percent GDP contraction. The banking adjustments in Australia and Brazil aren't particularly helpful, because Mexico's banks weren't in danger. If Stiglitz could have personally designed and implemented the Mexican response with all the benefit of 20-20 hindsight, how much different would the past year have been, in GDP, job losses, peso strength, etc? Or put another way, how much of the horrible 2009 was an unavoidable effect of the crisis and the US recession, and how much of it stems from specific bad decisions from the Mexican government?