http://www.blastitude.com/13/ETERNITY/wallace_berman.htm

http://www.cannabisculture.com/articles/2154.html

Mushrooms were the topic of Paul Stamets’ stirring speech, which received the loudest, most enthusiastic
applause of the entire conference. The world is covered in a network of mycelium, said Stamets, a small underground web of mushroom “roots”.

“Mycelium is sentient. It is a part of the mindscape of Gaia, an overlying mosaic of neural membranes,”
he said, showing with slides how mycelia looks exactly like the neural network of the human brain. He also showed how mycelia seek and destroy bacteria like E Coli, how they break down diesel and oil, making fungi ideal for cleaning up spills. He pointed to the lowly slime mold, and its eerie ability to navigate a maze in search of food, “choosing the best possible route.” He also suggested that mushrooms may be some kind of Gaian secret agents.

“Mycelium responds to catastrophe,” Stamets said. “As we chop wood and build houses, psilocybe [psychoactive] mushrooms grow in the disturbed areas. The psilocybe mushrooms are following
the activities of humans. It is no coincidence.”

Stamets believes that a part of mushrooms’ secret-agent role is to save the world from human folly by
helping us to evolve more environmentally conscious ways of living. He told how taking magic mushrooms unfolded the mystery of the many uses of fungi to him. He described how he used non-psychoactive fungi to rid his home of termites, a patented process that would replace harmful pesticides
and for which he is now being offered large sums of money. He also explained how he uses mushrooms to rehabilitate forests near watersheds, by creating a mycelial network along logging roads that filters fish-killing silt before it can leak into their marine habitats.

There were many other earth-shattering revelations at the conference, which took eight sessions to complete and lasted three days. Alexander Shulgin, famed entheogenic researcher, author of Phikal and creator of MDMA (ecstasy) and many other empathic psychedelics, presented his latest research on the biochemical content of psychedelic San Pedro cacti, showing us indecipherable chromatographic charts and explaining how picking San Pedro at different times of the day could give you slightly different highs.

From THE NEW YORK TIMES:

November 5, 2002

On Profit, Loss and the Mysteries of the Mind

By ERICA GOODE

“Kahnemanandtversky.”

    Everybody said it that way.

    As if the Israeli psychologists Daniel Kahneman and Amos Tversky were a single person, and their work, which challenged long-held views of how people formed judgments and made choices, was the product of a single mind.

    Last month, Dr. Kahneman, a professor at Princeton, was awarded the Nobel in economics science, sharing the prize with Vernon L. Smith of George Mason University. But Dr. Kahneman said the Nobel, which the committee does not award posthumously, belongs equally to Dr. Tversky, who died of cancer
in 1996 at 59.

    “I feel it is a joint prize,” Dr. Kahneman, 68, said. “We were twinned for more
than a decade.”

    In Jerusalem,
where their collaboration began in 1969, the two were inseparable, strolling
on the grounds of Hebrew University or sitting at a cafe or drinking instant
coffee in their shared office at the Van Leer Jerusalem Institute and talking,
always talking. Later, when Dr. Tversky was teaching at Stanford and Dr.
Kahneman at the University of British Columbia, they would call each other
several times a day.

    Every
word of their papers, now classics studied by every graduate student in
psychology or economics, was debated until “a perfect consensus” was reached.
To decide who would appear as first author, they flipped a coin.

    Wiry,
charismatic, fizzing with intelligence, Dr. Tversky was younger by a few
years. Dr. Kahneman, as intellectually keen, was gentler, more intuitive,
more awkward.

    Together,
the psychologists developed a new understanding of judgments and decisions
made under conditions of risk or uncertainty.

    Economists
had long assumed that beliefs and decisions conformed to logical rules.
They based their theories on an ideal world where people acted as “rational
agents,” exploiting any opportunity to increase their pleasure or benefit.

    But
Dr. Kahneman and Dr. Tversky demonstrated that in some cases people behaved
illogically, their choices and judgments impossible to reconcile with a
rational model. These departures from rationality, the psychologists showed,
followed systematic patterns.

    For example,
the exact same choice presented or “framed” in different ways could elicit
different decisions, a finding that traditional economic theory could not
explain.

    In an
oft-cited experiment, the psychologists asked a group of subjects to imagine
the outbreak of an unusual disease, expected to kill 600 people, and to
choose between two public health programs to combat it.

    Program
A, the subjects were told, had a 100 percent chance of saving 200 lives.
Program B had a one-third chance of saving 600 lives and a two-thirds probability
of saving no lives.

    Offered
this choice, most of the subjects preferred certainty, selecting Program
A.

    But when
the identical outcomes were framed in terms of lives lost, the subjects
behaved differently. Informed that if Program A were adopted, 400 people
would die, while Program B carried a one-third probability that no one
would die and a two-thirds probability that 600 people would die, most
subjects chose the less-certain alternative.

    Over
more than two decades, working together or with others, Dr. Kahneman and
Dr. Tversky elaborated many situations in which such psychological “myopia”
influenced people’s behavior and offered formal theories to account for
them.

    They
established, among other things, that losses loom larger than gains, that
first impressions shape subsequent judgments, that vivid examples carry
more weight in decision making than more abstract ˜ but more accurate ˜
information.

    Anyone
who read their work, illustrated, as one admirer put it, with “simple examples
of irresistible force and clarity,” was drawn to their conclusions.

    Even
economists, unused to looking to psychology for instruction, began to take
notice, their attention attracted by two papers, one published in 1974
in Science, the other in 1979 in the economics journal Econometrica. Eventually,
the psychologists’ work provided the undergirding for behavioral economics,
the approach developed by Dr. Richard Thaler.

    In a
recent conversation, Dr. Kahneman, who carries both American and Israeli
citizenship, talked about what happens when psychology and economics meet.

Q. Did you set out to challenge
the way economists were thinking?

A. We certainly didn’t have
in mind to influence economics.

    In the
first years, economists, and philosophers, too, were simply not interested
in the trivial errors that we as psychologists were studying.

    I have
a clear memory of a party in Jerusalem around 1971, attended by a famous
American philosopher. Someone introduced us and suggested that I had an
interesting story to tell him about our research. He listened to me for
about 30 seconds, then cut me off abruptly, saying, “I am not really interested
in the psychology of stupidity.”

    Our work
was completely ignored until our 1974 paper, which eventually had an impact
on both economics and epistemology. Of course, we did not mind in the least
because economists were not our intended audience anyway; we were talking
to psychologists. It came as a pleasant surprise when others started to
pay attention.

Q. Why is the rational model
of human behavior so entrenched in economic theory?

A. There’s a very good reason
for why economics developed the way it did, and that is that in many situations,
the assumption that people will exploit the opportunities available to
them is very plausible, and it simplifies the analysis of how markets will
behave.

    You know,
when you’re thinking of two stalls next to each other selling apples at
different prices, then you’re assuming that the fellow who is selling them
at too high a price is just not going to have customers.

    So you
get rationality at this level, and it buys a lot of predictive power by
this assumption. When you are building a formal theory, you want to generalize
that assumption, and then you end up making people completely rational.

Q. You and Amos Tversky
are perhaps best known for prospect theory. Could you explain what this
is based on?

A. When I teach it, I go
back to 1738. In 1738, Daniel Bernoulli wrote the big essay that introduced
utility theory. Utility really means pleasure more than anything else.

    The question
that Bernoulli put to himself was “How do people make risky decisions?”
And he analyzed really quite a nice problem: a merchant thinking of sending
a ship from Amsterdam to St. Petersburg at a time of year when there would
be a 5 percent probability of the ship being lost.

    Bernoulli
evaluated the possible outcomes in terms of their utility. What he said
is that the merchant thinks in terms of his states of wealth: how much
he will have if the ship gets there, if the ship doesn’t get there, if
he buys insurance, if he doesn’t buy insurance.

    And now
it turns out that Bernoulli made a mistake; in some sense it was a bewildering
error to have made. For Bernoulli, the state of wealth is the total amount
you’ve got, and you will have the same preference whether you start out
owning a million dollars or a half million or two million. But the mistake
is that no merchant would think that way, in terms of states of wealth.
Like anybody else, he would think in terms of gains and losses.

    That’s
really a very simple insight but it turns out to be the insight that made
the big difference. Because, if that’s not the way that people think, if
people actually think in terms of gains and losses and not in terms of
states of wealth, then all the mathematical analysis that has been done
which assumed people do it that way is not true. It took us a long time
to figure it out.

Q. What kinds of things
does prospect theory explain?

A. I think the major phenomenon
we observed is what we called “loss aversion.” There is an asymmetry between
gains and losses, and it really is very dramatic and very easy to see.
In my classes, I say: “I’m going to toss a coin, and if it’s tails, you
lose $10. How much would you have to gain on winning in order for this
gamble to be acceptable to you?”

    People
want more than $20 before it is acceptable. And now I’ve been doing the
same thing with executives or very rich people, asking about tossing a
coin and losing $10,000 if it’s tails. And they want $20,000 before they’ll
take the gamble.

    So the
function for gains and losses is sort of kinked. People really discriminate
sharply between gaining and losing and they don’t like losing.

Q. How did prospect theory
influence economists?

A. Correcting Bernoulli’s
error was influential, because it was picked up by Richard Thaler, who
started behavioral economics. We provided cover for behavioral economics,
because the challenge to the rational model was taken seriously and presented
in a way that readers of the work found compelling.

    But it’s
not as if this has swept economics. It hasn’t, and for very deep structural
reasons, it’s not going to. The rational model has a hold on economics,
and it’s going to stay that way. Behavioral economists fiddle with it,
improving the assumptions and making them psychologically sensible. But
it’s not a completely different way of doing economic theory.

Q. One of the things you
are studying now is well-being. Does this connect in any way to economics?

A. I would like to develop
a measure of well-being that economists would take seriously, an alternative
to the standard measure of quality of life.

We’re attempting to measure
it not by asking people, but by actually trying to measure the quality
of their daily lives. For example, we are studying one day in the lives
of 1,000 working women in Texas. We have people reconstruct the day in
successive episodes, as recalled a day later, and we have a technique that
recovers the emotions and the feelings. We know who they were with and
what they were doing. They also tell us how satisfied they are with various
aspects of their lives. We know a lot about these ladies.

Q. What are you finding
out?

A. I’ll give you a striking
finding. Divorced women, compared to married women, are less satisfied
with their lives, which is not surprising. But they’re actually more cheerful,
when you look at the average mood they’re in in the course of the day.
The other thing is the huge importance of friends. People are really happier
with friends than they are with their families or their spouse or their
child.

Q. Why would divorced women
be more cheerful?

A. So far, I don’t understand
it, but that’s what the data says.

31 OCTOBER 2002:
“Currently there’s a medium-sized coronal hole on the Sun’s visible disk…”

FROM CNN.COM:

Spooky auroras light up autumn nights

By Richard Stenger

Thursday, October 31, 2002
Posted: 12:07 PM EST (1707 GMT)

(CNN) — Green ghosts, wispy
witches and other glowing phantoms are dancing and darting around in the
night skies of October, which has proved a particularly productive month
for aurora hunters the world over.

    Sky watchers
photographed everything from a floating fairy ring in Norway, multicolor
spires in Arizona and pulsating swirls in Australia.

    In Finland,
Juha Kinnunen captured a glowering witch face with a considerable schnozzle
and two greenish ghosts looming over the Lapland.

    “Of those
three images, only one looked like a ghost with my own eyes as well, for
a brief moment. The other two turned up that ‘spooky’ during the exposure,
which was 4 to 6 seconds,” Kinnunen said Wednesday.

    “This
shows you how an active aurora changes shape continuously. The ghost I
photographed appeared for one horrifying moment only.”

    Auroras,
also known as the northern and southern lights, emit light as highly charged
particles from the sun excite atoms and molecules high in Earth’s atmosphere,
which creates a glow in the same manner as neon lights.

    While
concentrated in the most northerly and southerly regions, particularly
strong aurora displays can extend down into the mid-latitudes. Northern
lights, for instance, occasionally creep down to Mexico.

    The seasonal
lights tend to perk up in the autumn and spring for reasons that are not
entirely clear. What scientists do know is that the strength and scope
of the sky shows are directly tied to solar activity.

    From
time to time the sun unleashes powerful salvos of ionized gas that, if
they collide with Earth’s magnetic field, can spark nocturnal aurora displays
as well as disrupt satellites and power grids.

    Moreover,
coronal holes in the solar disk can leak out strong gusts of solar wind,
which can produce the same striking results if headed in our direction.

    Earth
is now exiting a solar wind stream that sparked numerous auroras since
October 23, according to NASA’s Spaceweather.com, which regularly posts
aurora images.

    “There
is a slim chance that trick-or-treaters in the northern United States and
Canada might see some ghostly auroras of their own on October 31st,” the
Web site said.

    There
could be more eye candy in the works in November too.

    “Currently
there’s a medium-sized coronal hole on the Sun’s visible disk,” Kinnunen
said. “It probably will create auroras within less than a week.”

FROM NME.COM:

Former KLF man BILL DRUMMOND
is launching a set of playing cards aimed at prompting people to take part
in a day of silent protest against “The War.”

    Drummond
will launch the ‘Silent Protest’ cards during a special presentation at
the Marx Memorial Library in London (October 29). Following the event,
he’ll move to The Foundry in east London, where Tracey Sanders-Wood will
release 1,000 helium-filled balloons.

    Attached
to each balloon will be a randomly selected card from a pack of Silent
Protest. Anyone who retrieves one of the balloons and returns the card
will be sent a complete pack of Silent Protest.

    The cards
are just like regular playing cards. However, instead of numbers and suits
on the front are simple everyday phrases – such as ‘Today I’m silent as
a protest against the war’, ‘coffee’, ‘Where is the lavatory’ and ‘Fuck
you’ – which the silent protestor can use to get through.

    “The world seems to want to go to war. I don’t want it to,” Drummond explained.
“Nobody who can do anything about stopping it is going to listen to me.

    “Instead
of thinking about my futility, I thought maybe I could manage a day of
silence, and I thought about the practicalities of getting through a normal
working day without saying a word. Maybe I could cut up a sheet of white
cardboard so that I would have a stack of cards that could fit in my pocket?
Instead of four suits there would be 52 cards with 52 short statements
or questions or single useful words – maybe leave a couple blank for whoever,
to add their own.

    “I might
not be able to manage more than a day of silence but if I got these Silent
Protest cards printed up and distributed to bookshops, maybe other people
would do days of Silent Protest which would soon mount up way past the
365 days that I originally envisaged.”

    Drummond
added that the silent protest was against “whichever war you want to stop:
the one in your family or bedroom; the one at work or the war in a far-flung
land”.

Moonchild: The Films of Kenneth Anger (Persistence of Vision, 1)

by Jack Hunter (Editor),
Mikita Brottman (Introduction)

List Price:   $17.95

Paperback: 128 pages ; Dimensions
(in inches): 0.47 x 8.30 x 7.04

Publisher: Creation Books;
ISBN: 1840680296; (February 2002)

Book Description

Kenneth Anger, responsible
for such classic underground films as Scorpio Rising and authoring Hollywood
Babylon, is almost certainly the most original, talented and subversive
film-maker of the 20th Century. Fully illustrated and featuring an original,
in-depth interview with Anger, Moonchild explores his fascination with
Hollywood history, the occult and Aleister Crowley,and reveals how he is
often hailed as the Godfather of MTV.

About the Author

Jack Hunter’s previous publications
include Eros in Hell: Sex, Blood & Madness in Japanese Cinema, House
of Horror: The Complete Guide to Hammer Films, and Inside Teradome: An
Illustrated History of Freak Film (all published by Creation Books).

The McDonald’s window through which the two deer jumped was blocked by police tape on Friday.

Pair of deer smash through D.C. McDonald’s window

Four women taken to hospital

Friday, October 25, 2002
Posted: 2:57 PM EDT (1857 GMT)

WASHINGTON (CNN) — A pair of deer interrupted the lunchtime rush Friday at a McDonald’s restaurant
in Washington when they smashed through a plate glass window and pranced around the store, a fire official said.

    Four women suffered minor injuries — including abrasions to the head — as they tried to get out of the animals’ way, fire department spokesman Alan Etter told CNN.

    The women were taken to a hospital. One of them complained of chest pains.

    Etter said the deer jumped through a 4- by 6-foot window about 11 a.m. and walked through the dining area and the kitchen. One of the deer jumped back through the window and escaped. Etter said he saw the animal running nearby about an hour later.

    The second deer suffered severe cuts, so animal control workers tranquilized it and
took it away to try to treat its wounds, Etter said. He said
he did not know how seriously the deer was hurt.

    Etter said the injured deer appeared to be an adult. He said he did not know
anything about the other deer.
He said he did not know what caused the deer to jump through the window.

A lobster fisherman from Maine in the US has told a BBC documentary on human instincts of the extraordinary lengths he went to in order to preserve his own life:   Doug Goodale cut off his own arm at the elbow in order to survive an accident at sea.

    He had become caught in a winch hauling lobster pots up from the sea floor, and could not free himself.

    The power of the winch left him hanging over the side of the boat, unable to either free himself or clamber back aboard.

    ‘I did it for my children’

    As the boat was rocked by stormy weather, he believes it was only a last, desperate
instinct for self-preservation that kicked in to save him.

    He said: “Nobody near you, no help, no radio, nobody to turn the radio off – that’s
it – you’re going to die.

    Somehow he managed to haul himself back onto the deck, dislocating his shoulder
in the process.

    His motivation was the image of his daughters appearing to him.

    “I don’t know how to explain it to people, but I swear, climbing onto the boat were
my two girls.”

    However, he was still trapped in the winch, bleeding heavily, and with no way of getting free, his only option was to pick up a knife and cut through his right arm.

    He then managed to pilot his boat back into harbour to get medical help.

    He said: “When my six-year-old tells me: ‘It doesn’t matter that you’ve only got one arm – you’re here’.

    “Now if you heard that from your kids, wouldn’t you take a knife and do the
same?”

    Survival
instincts are the theme of the first in a series of BBC documentaries starring
Professor Robert Winston.

    These
are abilities and reactions which are imprinted in us by millions of years
of evolution.

    Even
babies have the instinctive ability to spit out bitter-tasting food – which
may save them from eating poisonous food.

    And modern
phobias, say scientists, are simply left-overs from times when spiders
and snakes represented a genuine threat to life.

    From
the first years of life, humans develop a finely-tuned sense of “disgust”
which can protect them from items which might spread disease.

    And the
classic “fight or flight” response still works, with the first indication
of a threat launching swift brain activity to flood the body with adrenaline,
readying it for action.

    Human
instincts have been honed over 4.5 million years, and account for the natural
human preference for sweet or fatty foods.

    This
harks back, say experts, to millennia in which such food was scarce – humans
who craved it tended to thrive better than those who did not.

    It is
only in the past 100 years that food has become plentiful in any part of
the world.

    Human
Instinct will be broadcast on BBC One at 2100BST on Wednesday 23 October.

DEVENDRA BANHART

Biography of Devendra Banhart written by himself:

Born on May 30 1981, oh what
a time I had coming in. I was born in Texas. Stupid fucking boots. But
I like those boots, I wanna get a pair. Then , after a few years, i moved
to Caracas Venezuela, and I lived there, with my family, (we moved there
because my father was arrested and sent to jail) In Caracas, everything‚s
fucked, but I love my grandmother, whom fed whisky to me from her pinky,
paid me to touch my earlobes, and let me pull her elbow flab. As I first
became a teen-ager, my mother remarried and we moved to California, into
a canyon, Encinal Canyon. I began to play music. Then I moved to San Francisco
to go to an art school, There I lived with Jerry Elvis and Bob The Crippled
Comic. My first show was their wedding , I played my own adaptation of
How Great Though Art and Love me Tender. My next show was at Wazeima, an
ethiopean restaurant. I wonder why I want to tell you how about all the
shows ive played, I will not, the first two are the most significant, I
played many bad places, some good, some people I have played with are:
Black Hearts Procession,Microphones,Smog,Little Wings,Karl Blau,Vetiver,Flux
Information Sciences, The Lowdown,Young People, Old Time Relijun, Jerry
Lee Lewis 60th picnic party, and M.Gira, amongst many other faceless talents
, gay pirates.

I cant do this (too well)

I Devendra Banhart then moved
from san Francisco, to Los angeles, then to paris, then to San Francisco,
then to Los Angeles, then to New york, though, while In Los Angeles he
formed the Black Babies, so he can be Devendra Banhart or The Black Babies,
in New York, he is poor as shit , no, don‚t put that in , today , shit
man , its all coming apart , ive got no phone, news of getting kicked out
the squat , im trying to not let it get to me,blah blah blah)

Flutter away little flute.

In New york, he lives in an old Salsa Club, it is a squat, a shot hole with a dead charm , as in
many people I know for a fact died there, today I found journals of the
boy who died there, he wanted to be an actor, I found his headshots too.
There is a room called the Helter Skelter room and its scary as shit. I
live there, there are no windows, there is no air, but its free.

For Devendra, he feels, that
Mississippi John Hurt, Mississippi Fred McDowell, Karen Dalton, Vashti
Bunyan, and Fred Neil are the most important musicians there ever was,
thank god for them.

FROM THE NEW YORK TIMES:

October 19, 2002

Challenging the Growth
Gurus

By MICHAEL MASSING

As the chief economist of
the World Bank in the late 1990’s, Joseph E. Stiglitz got a firsthand look
at how policy was made at its sister institution, the International Monetary
Fund, and he was dismayed. Decisions, he said, were made on the basis of
ideology rather than sound economic reasoning.

    The fund
was made up of “third-rank students from first-rate universities,” as he
once put it. Frank discussion was discouraged, and developing countries
were expected to accept fund prescriptions without question. And those
prescriptions too often failed, leaving many nations sunk in poverty.

    The experience
convinced Mr. Stiglitz of the need to reassess the ingredients of growth.
As he wrote this year in “Globalization and Its Discontents,” “If the developed
countries were serious about paying more attention to the voices of the
developing countries, they could help fund a think tank ˜ independent from
the international economic organizations ˜ that would help them formulate
strategies and positions.”

    Now Mr.
Stiglitz himself has set up such an institute. The Initiative for Policy
Dialogue is at Columbia University’s School for International and Public
Affairs, where Mr. Stiglitz is a professor. It is bringing together economists,
political scientists and policy analysts from around the world to re-examine
the prevailing wisdom about development and to come up with alternative
strategies. “There’s not a Brookings or an American Enterprise Institute
for the developing world,” said Mr. Stiglitz, co-winner of the 2001 Nobel
Memorial Prize in Economic Science.

    It’s
an ambitious and controversial undertaking. Mr. Stiglitz is the I.M.F.’s
most visible critic, and the fund has made little secret of its disdain
for him. In a biting open letter posted on its Web site (www.imf.org),
Kenneth Rogoff, the fund’s director of research, calls Mr. Stiglitz’s ideas
about development “at best highly controversial, at worst snake oil.” His
“alternative medicines, involving ever more government intervention, are
highly dubious in many real world settings.”

    Undeterred,
Mr. Stiglitz is taking aim at the so-called Washington consensus, a package
of free-market, free-trade policies that, critics charge, the I.M.F. and
World Bank have imposed on third world nations. “We disagree with the World
Bank-I.M.F. idea that there’s one approach that’s right for all countries,”
Mr. Stiglitz said. Rather, he said, there is a range of policies that must
be selected based on conditions in each country.

    Mr. Stiglitz’s
effort to rewrite the textbook on development is being conducted through
14 panels that are re-evaluating such critical issues as bankruptcy, poverty,
privatization and trade. For each a dozen or so specialists from the Northern
and Southern Hemispheres are meeting to compare the experiences of different
countries and ponder what policies have worked where. The objective of
each group is to produce a series of papers that will provide a fresh look
at the components of growth.

    But Mr.
Stiglitz hopes his institute will be more than a paper exercise. He has
accused the I.M.F. of acting like a “colonial ruler” and stifling discussion
in developing countries, so in addition to the study groups, he is organizing
forums in some countries. The goal is to expand the policy debate beyond
the usual elite of government officials and business executives to include
civic leaders, activists, academics and journalists. So far, forums have
been held in Ethiopia, Moldova, Nigeria, the Philippines, Serbia and Vietnam.
At the Nigeria session a key theme was the need to raise living standards
in the countryside, where most Nigerians live. Soon after, Mr. Stiglitz
recalled, Nigeria’s agricultural minister obtained more money for agriculture.

    Mr. Stiglitz
spends about a third of his time advising foreign governments, providing
alternatives to the ideas of the I.M.F. He has been to Argentina four times
in the last four years and recently visited Bulgaria at the invitation
of that country’s president.

    “What’s
amazing,” Mr. Stiglitz said, “is how little information is available that
is disinterested and balanced. In many cases the discussion has been very
general. For instance, it’s said that countries need good corporate governance.
But what does that mean?”

    Finding
the answers to such questions is the goal of his institute’s study panels.
The panel on privatization, for example, is looking at the experiences
governments have had in selling state-owned enterprises. Gerard Roland,
a professor of economics at the University of California at Berkeley and
co-chairman of the panel, said that the fund had pushed governments to
give away the assets of such companies “as quickly as possible.” If those
assets don’t immediately end up in the right hands, the reasoning goes,
marketplace incentives will ensure that they eventually do, with less skilled
owners selling to more able ones. But in Russia and other countries that
tried this, Mr. Roland said, the new owners quickly became oligarchs who
blocked future reforms. The outcome was rampant corruption and a sharp
decline in output.

    Poland
initially planned to have a similar program, Mr. Roland continued, but
it was blocked by the Polish parliament. So privatization there proceeded
more gradually. As a result Polish enterprises ended up with more seasoned
owners, and its economy grew more briskly. By comparing such experiences,
Mr. Roland’s group is trying to determine which approaches work best in
which circumstances.

    “When
the I.M.F. says that these are the particular policies you should follow,”
Mr. Roland said, “those policies often aren’t thought through and don’t
have a scientific basis. Policies have to be adjusted to each country’s
environment.”

    Similarly,
the panel on trade is examining the effect of efforts to lower trade barriers.
“The I.M.F. and World Bank are pushing across-the-board trade liberalization,”
said Dani Rodrik, a professor of economics at Harvard University and co-chairman
of the committee. In reality, he added, “Trade reform is something that
has to be tailored to each country’s circumstances, taking into account
its geographic advantage, its institutional needs, its relations with its
main trading partners.” He added: “What are the best policies to encourage
foreign investment? Is this good for all countries, or are some countries
throwing away resources through tax subsidies? And how can trade policy
be targeted to reduce poverty? We’re not trying to present a particular
take but to summarize and describe what we know about these issues.”

    Such
an approach troubles Jagdish Bhagwati, a colleague of Mr. Stiglitz’s at
Columbia and a strong advocate of free trade. “Joe assumes that there’s
a monolithic view at the fund and the bank, but that’s not the case,” he
said. The whole idea that there’s a Washington consensus that promotes
a one-size-fits-all policy is absurd, he said, adding, “In practice shoe
sizes are bound to vary and do. The real choice is between wearing shoes
and going barefoot. Socialism didn’t work. In countries like India, Egypt,
Brazil and China, the market was absent. The debate is moving away from
knee-jerk interventionism and excessive controls.”

    Mr. Stiglitz’s
institute, Mr. Bhagwati went on, is not including people “who really have
alternative points of view.” Its trade group, he said, “has none of the
big trade people,” including himself. “The Initiative for Policy Dialogue
is in danger of turning into the Initiative for Policy Monologue.”

    Mr. Rodrik
disputed this. Of the five economists from developed nations invited to
join his panel, he said, two ˜ Gene Grossman of Princeton and Rob Feenstra
of the University of California at Davis ˜ are former students of Mr. Bhagwati.
(Mr. Feenstra declined to join because of time constraints; Mr. Grossman
has yet to decide.) The three other economists “are also utterly mainstream,”
Mr. Rodrik said. Mr. Bhagwati himself may be asked to join the group. “We
have no intention of keeping certain views off the table,” Mr. Rodrik added.
“That would defeat the purpose.”

    The institute’s
architects deny any inclination to turn the clock back to an era of state
farms and five-year plans. Thomas Heller, a professor of international
law at Stanford University and co-chairman of the committee studying the
rule of law, said that while it has become clear that the wholesale withdrawal
of government from the economy is ill-considered, no one would deny the
value of the market. The institute, he said, “is attempting to make a series
of adjustments without getting countries to go back to the state-heavy
systems of the past. We don’t want to throw out the baby with the bath
water.”

    Is the
institute likely to have any impact? That depends on how confrontational
it becomes, said Robert Solow, an emeritus professor of economics at the
Massachusetts Institute of Technology. A recipient of the Nobel in economic
science who has long argued that governments must be prepared to intervene
in the market, Mr. Solow said the idea that a Washington consensus forces
cookie-cutter-type policies on every country is overdrawn. “If you look
at the way the World Bank and I.M.F. operate,” he said, “you will see that
they have regional and country specialists who know their way around. When
they deal with a country, they study it very knowledgeably, and their prescriptions
do pay attention to local conditions.”

    On the
other hand, he said, I.M.F. programs “do tend to have an awful lot in common,
whether they’re aimed at Turkey or Thailand.” So the institute’s effort
to look at how different policies work in different environments could
prove useful, Mr. Solow said. If, however, it “starts with the notion that
it’s going to turn everything upside down, that it’s going to be the dark
destroyer of the I.M.F. and the World Bank, then it won’t succeed.`

    Rather,
he said, the institute should try “to bring around the international financial
institutions, to present a reasonable case and induce them to move a little
bit.”