In the winter of 2011, my Vietnamese friend brought along an English guest to one of the gatherings I used to organize in New York. Tall, red-haired, and with a dry humor lavished in unmistakable London accent, Paul fitted impeccably in the British stereotype. During the meal, while talking about a trip to Africa, someone remarked that if you were a Western, people would immediately assume that you were rich. Paul added that something similar happened to him in the United States: if you were English, people would immediately assume that you were clever.
The consistent quality of language of The Economist might have the same effect. Readers assume that the magazine delivers incisive analyzes or forecasts, rather than mere situation summaries. And they elevate it to the rank of global intellectual authority, even if that status lies beyond its means.
The Economist was founded by James Wilson in 1843 in order to “take part in a severe contest between intelligence, which presses forward, and an unworthy, timid ignorance obstructing our progress”. With a fairly factual, succinct, and elegant track of global news, it reached 1.5 million subscriptions for the printed edition and 123 thousand for the digital version in March 2012. Many of these subscribers, as the magazine itself declares, are part of the global political and corporate elites.
But despite this undeniable success, The Economist remains at marked variance from its pompous mission. Although it is an efficient source to learn about issues that one does not follow, it is mainly limited to a mechanical review of these issues. While wisely written, it consists mostly of conventional wisdom.
Reading The Economist may often inspire a complacent nod, but it seldom involves learning something new about a familiar topic. Or surprising. Or inciting one to reconsider a rooted conviction.
There would be nothing wrong with this if it were not for the pretense that the magazine exudes. Or if it were not for the fact that, in part encouraged by the magazine’s marketing, The Economist’s readers often take gracefulness for insight.
This is also the case with the February articles on Argentina: the magazine’s cover story, “The parable of Argentina”, and the more detailed briefing, “The tragedy of Argentina: A century of decline”. Between the two, the edition covers all the possible clichés about the country: the past splendor, soccer, meat, the military as culprit, the agro-exporting versus the industrial-import-substituting models, the sensuality of tango, even the good looks.
There is a glimpse of analysis in the briefing, when it enumerates three possible factors to explain our irrefutable relative decline: commodity dependence combined with bad education, trade policy, and weak institutions. But the selection is less innovative than it is arbitrary, and its rationale is full of inconsistencies, loose ends, and biased comparisons with data summoned capriciously to back a point, or simply at hand.
Why is it terrible, for example, that Argentina has depended upon commodities since 1914, but it was not terrible during the previous 43 years, when the article admits to a 6% annual growth and when according to a 1997 edition the country had its “golden age” thanks to its wheat, meat, and wool exports to the British Empire? And why was it a problem for Argentina, but not for the rest of Latin America, which narrowed their relative output gap? Or for Australia, listed among the few countries richer than Argentina in 1914? Oddly enough, the article “explains” that Australia developed a broader-based economy and that it “grew faster”. Then it “explains” that this happened because Australia had a democracy in which the working class was represented, while in the same paragraph acknowledging that Argentina granted universal (masculine) suffrage in 1912.
A little more innovative but very poorly supported is the notion that the decline was caused by education. The Economist states that, compared with the 95% of literacy in Chicago, “less that three quarters of the Buenos Aires population could read”; but only two paragraphs above it had praised that “half the population had not been born in the country”. Couldn’t this be the reason why they couldn’t read? And dismissing the fact that Argentina was ahead of its time in offering free, secular, and compulsory public primary education, the article criticizes the lack of higher education. Was this better in Australia, at least? A mystery the article does not bother to find out.
The same happens with the supposed consequences of the supposed educational deficit: “Argentina consumed foreign technology instead of inventing its own”. Was this not also the case in other peripheral countries, all of which have grown more than Argentina? Or “the immigrants spent all their money instead of saving it”, presumably as opposed to what happened in Brazil, which according to the article closed a 1-to-4 gap vis-à-vis Argentina’s per capita GDP, but today has a saving rate below 15%?
Not to mention the “bad-institutions” cliché. The Economist makes a quick list that goes from military coups, to constitutional reform attempts, to weak property rights. But this is nothing beyond what a poorly informed in-law might mention at the Christmas table, and it is even conveyed with a similar tone and similarly sketchy arguments: “Property rights? Ask Repsol”.
This lack of depth affects the magazine’s content above all, but sometimes even affects its strength: its style. The Economist’s titles generally appeal to puns and wit, and honor the mandate “Brevity is the soul of wit”. But it’s a good habit degenerated into a formula.
For example, “South American airlines: Don’t fly with me, Argentina” (June 7 2001) was okay. But this was then followed by “Don’t cry for me…” (July 13, 2001). Then there was also “Tony Blair in Latin America: Crying for Argentina and farm trade” and “Argentina’s election: Don’t cry for Menem”. Was it necessary to have “Don’t lie to me, Argentina“ (February 25 2012)?
In Politics and the English Language, George Orwell advises never to use “a metaphor, simile, or other figure of speech that you are used to seeing in print”. Yet, the only thing that surprised me of The Economist’s articles on Argentina was that they were not titled, once again, with a variant of “Don’t cry for me, Argentina”. And yet once I read on, there they were, inevitable, these two subtitles: “All through my wild days, my mad existence” and “They are not the solutions they promised to be”. Don’t we have another song? Is there not another reference? Oh, yes, right! “Argentina: the last tango” (June 21 2001).
The thing about these formulas is that they reflect the laziness that The Economist claims to despise. They appeal precisely to the “timid and unworthy ignorance” of a reader that can feel flattered for catching the reference, rather than challenged and motivated by never having heard of it.
This complacent adoption of a mechanical formula to tell about what’s already known is not free. Many times, both to design economic policies and to make financial decisions, when a fact becomes conventional wisdom it is often too late.
A trader from the Swiss bank UBS used to say: “when it gets to the cover of the Financial Times, it is best to sell”. The Economist has boasted such contrarian value many times over the past years. And again, there would be no problem with this if the magazine did not claim to be “what leaders read”.
On October 23, 2003, for example, the cover story was “The End of the Oil Age” just before oil prices began a steep five-year ascent. Similarly, the cover story of November 12, 2009 was “Brazil takes off”, but less than four years later Brazil was again on the cover with the less glamorous “Has Brazil blown it?” On September 11, 2010, when our region was approaching a real GDP growth of 6%, the cover story was “The rise of Latin America”; the next scene: growth slowed to 4.6% in 2011, 2.9% in 2012, and 2.7% in 2013.
In Argentina’s case, The Economist’s lack of predictive value was systematic. The tone during the 90s was all but cautious. On June 12, 1997 the magazine praised the recovery from a 1995 slowdown as long lasting, based on “investments and exports”. And it didn’t seem so disdainful of primary products, praising instead such product developments as “garlic, fruit, and olives” (sic) and a new mining code.
No wonder that in 2001 it might have been caught off guard by a crisis that had been in the works for years. On March 8 it wondered “Can Lopez Murphy save Argentina?”, only to ask, 12 days later, about Cavallo, “Can Argentina’s most charismatic and controversial economist end the country’s recession?”. On November 13, the question was “Argentina on the brink?” while 3 days later it became “Back from the brink?”. And so it kept on posing questions that anyone could ask and that its articles did not answer.
A point for The Economist is that, unlike late-comers such as Paul Krugman[JZ1] , it pointed to problems with the post-2001 recovery as early as 2006, it talked about overheating by 2007, and it deplored the nationalization of the pension funds in 2008. All this was spot-on, but not different from what most of the local economists had to say. Other than this, it ran naively into a succession of mirages of change, such as the possibility of a holdout resolution in 2008 ("Argentina: Better late than never", September 25, 2008) or the possibility of a change of course in 2009 ("Argentina's mid-term election: a chance to change course", June 18, 2009), or the end of “kichnerismo” with the death of Nestor Kirchner (“Latin America: The passing of kirchnerismo”, October 28, 2010).
I am extremely critical of Argentina’s economic policies, for reasons I have outlined here and here.[JZ2] But to see our century of decadence encapsulated in the cover of The Economist does not add any reason to worry. What is more, if I were a bit more superstitious, I would even say it could bring us luck.
Another point for The Economist is that it did not call itself The Prophet (maybe because it was already taken by Khalil Gibran), nor The Philosopher. It boasts instead the name of a profession (my own, alas) that is notorious for its single-sidedness. If we consider the best of my colleagues as its benchmark, however, it does not even deserve that name.
Translated by Victoria Frers.