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But Stiglitz's criticism finally proved too much for the powerful global financial institutions, especially after they endured raucous protests last month at their spring meetings. Last week, even as he was traveling to drought-stricken Ethiopia on a bank mission and his replacement had not yet taken office, the World Bank announced that he would no longer serve as special advisor.

Defenders of the IMF and World Bank could denigrate the credentials of some protesters, but it has been hard to attack the widely published former Stanford professor who also served as chairman of President Clinton's Council of Economic Advisors. His candor made him an unlikely intellectual guru to the world trade protest movement. But while his criticism enhanced the credibility of the protesters, it also prompted new pressure -- some of it from the U.S. Treasury Department -- to quiet him, he told Salon, even as the global financial institutions were promising critics they would be more open and transparent.

During his tenure at the World Bank, Stiglitz irritated many powerful colleagues by publicly criticizing IMF moves and calling for more open debate about global economic policies. Until recently the World Bank and IMF had presented a united front to the world as they tried to solve global economic problems. Often the IMF has helped troubled countries with loans from World Bank funds that are tied to agreements by those countries to take the IMF cure: cutting government budgets and subsidies; privatizing public operations; raising interest rates; opening national economies to foreign imports, corporations and capital; and increasing exports of raw materials or goods made with labor made even cheaper by these policies.

These policy packages made up the "Washington consensus" imposed by the IMF with World Bank support for more than two decades -- despite an unimpressive track record on nearly every count except reducing inflation and budget deficits.

When Stiglitz announced last year that he was leaving the bank and returning to academic life, there were rumors that he was pushed out because he was too outspoken. "Pushed out would not be the way I'd put it," he said, "But it was made very clear ... the way I put it was that whenever you have institutional responsibilities, you have less freedom to express yourself, especially clearly and forcefully. Part of the culture within the institution and within finance ministries is that the two institutions should not criticize each other."

The protests, which Stiglitz thought were "quite successful," challenged that pact of silence. News media coverage of the protests "focused on the broader message: that what is at issue is a question of values, of democratic processes, and how partly because of the absence of democratic process, decisions were made that jeopardized the livelihoods and even the lives of many of the world's poor."

Unfortunately, he said, the bank and IMF did not have a "totally positive" response and became defensive and even less open, as Stiglitz's removal confirms. "There was certainly no engagement on the broad fundamental question about democratic process and whether there was a balance of representation in the decision-making process -- of financial interests vs. workers," Stiglitz said.

"What's remarkable, I see no indication of a grasp of that even as an issue. A reaction one heard within the organization was very much that 'They're impugning our motives.'" Both organizations are accustomed to impugning motives of governments and analyzing how incentives and interests drive other people and institutions, but they "feel very uncomfortable when that light is shined on them," Stiglitz said.

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