Asked by Fairfax Media to nominate the two biggest mistakes the government could make that would take it down the American path of widening inequality and economic stagnation, Professor Stiglitz chose the budget changes to university fees and Medicare. Each would make Australia more like the US.....
"Countries that imitate the American model are kidding themselves," he said. "It seems that some people here would like to emulate the American model. I don't fully understand the logic."
In the lead-up to the budget Education Minister Christopher Pyne said Australia had much to learn about universities from overseas, "not least … from our friends in the United States".
Professor Stiglitz said Australia had "a system that is really a model for the rest of the world", and deregulating fees would move the entire system in the wrong direction.
"Trying to pretend that universities are like private markets is absurd. The worst-functioning part of the US educational market at the tertiary level is the private for-profit system,'' he said. ''It is a disaster. It excels in one area, exploiting poor children.
"If you're rich your parents can pay the fees, but if you are poor you are going to worry about how much debt you're undertaking.
"It is a way of closing off opportunity and that's why the US doesn't have educational opportunity.
"While we in the US are trying to re-regulate universities, you are talking about deregulating them. It really is a crime."
Asked what Australia had done right that the US had not, he said: "unions".....
The elite, the top one per cent are not too concerned. When you have so much inequality those at the top say: I don't need public transportation, I have a helicopter, I don't need public schools, I don't need all these other public services and so the result of that is - you look at America today we have some of the best universities, but our average education performance is mediocre.”