Brad Setser Is Shrill...

Brad Setser is irate at the continuing Economisterdammerung: the downfall of the Economist:

Roubini Global Economics (RGE) Monitor: The Economist's Lexington columnist needs to get out a bit more... Created: Mar 27 2006 Rather amazingly, the only US public intellectuals that seem to have made it onto Lexington's radar screen come from the American right. The Neocon right and its pet idea (invading Iraq), the economic right and its pet idea (tax cuts), the Harvey C- Mansfield right and its pet idea (manliness). And the ubiquitous Charles Murray. Lexington could not find any public intellectuals (or ideas) from the center, the center-left or the left worthy of mention... Not Mansfield's colleague Robert Putnam, who not only noticed that Americans' now bowl alone but also tried (perhaps without much success) to recreate a nation of civically-engaged joiners. Or any one working on ideas to remake America's costly and increasingly dysfunctional health care system. Warmed-over proposals to provide high-income Americans with yet another tax deduction (health savings accounts) hardly count as innovative.

I would say that the interesting policy debate on globalization currently is found on the left, not the right. The left takes seriously idea that the US needs to find ways to share the benefits of globalization more broadly and address growing concerns about economic insecurity and income volatility, even if there is not quite full agreement on how exactly to respond. At least the left doesn't just argue that higher CEO productivity justifies higher CEO pay (even though higher economy wide productivity doesn't seem to justify higher average pay). Or suggest that the right response to rising job insecurity is less social security.

Certainly the interesting policy proposals for addressing what has come to be called "global imbalances" have tended to come from the center and the left. The right - setting Martin Feldstein aside -- prefers to call Saudi and Chinese central bank financing of the US a market outcome... Or least argue that nothing much should be done about rising US current account deficit.

Policy intellectuals on the center-left, by contrast, have spent plenty of time developing up ideas for a coordinated global response to a growing problem, or even dreaming of new institutions to help emerging economies could get more bang for their (reserve) buck and in the process help to finance the provision of global public goods. At least the FT seems to have noticed. Andy Mukherjee too.

Rant over. I'll return to more technical analysis -- and commentary on the Economist's special section on China -- soon.

Comments

[Richard Green]

This rant led me to free associate, which led me to the following question: what leads someone as brilliant as Mansfield say such embarrassing things?

[Mike]

I subscribed to The Economist for Ten Years. One of my weekly joys was reading it while sitting in a coffee shop or quiet pub. I stuck with it through the run up to the Iraq war and in the two bloody, disastrous years to follow. However, it just got too much to take and I had to stop. They have ceased to be conservative in the "Classic Liberal" sense, and instead have become conservative in the "Justify the Actions of King George" way. Its sad really...it was a week's worth of newspapers (and more) in two hours of reading.

Much to my surprise however, I've found I can live without it...much like my college girlfriend who changed for the worse...and just like dumping her, I realize in retrospect that I waited too long.

[T.R. Elliott]

Hah. I'm just like Mike. When I first start working, around '84 or so, the subscription seemed expensive so I checked out older issues from the library. I did that for years. Then when I had a little disposable income, I subscribed to the Economist. Probably for a good ten years. Maybe more.

Then they supported George Bush in 2000. And the war. They reluctantly supported Kerry in 2004. But I'd had enough.

I think if you read the Economist for ten years, you've absorbed everything good about it. You've got your fill of economic thinking. How the world works from their perspective. And you get a good laugh from their dry humor.

But then it all starts sounding the same. And you realize this is the fifth close look at China in the past five years. And with the web their special issues just seem dated.

Mainly though, they bought into the whole neocon thing. As did the New Republican. Both subscriptions were not renewed after that.

[Tobias Schwarz]

Ah, well, I don't have any question about this anymore - 52% of the roughly 1,100,000 Economist copies are sold in North America (http://printmediakit.economist.com/Circulation.10.0.html), to readers with an annual average income of about $160,000 (http://printmediakit.economist.com/Annual_personal_income.320.0.html) - economist.com claims that every eighth reader is a Dollar millionaire (http://ads.economist.com/web/images/03ReadersSurvey.pdf)

It all adds up for me, including their exceedingly late bashing of Bush's iraq policy.

[wjd123]

Since the Industrial Revolution America has built up laws and regulations governing the economy.

With the advent of world trade the morality that informs our political economie is under assault. Any effort to expand that morality international is blocked by the need of corporations to compete globally. But this is a canard because nothing would promote greater competition than everyone playing by the same rules. Corporations would compete on greater efficiency instead of shedding our moral capital as a means of competition.

But wait you say. Even if poorer countries wanted to have higher standards they wouldn't have the means to enforce them. That's true. It's also the reason that international trade as embodied today in the WTO won't work. First it will lead to an ever growing separation of the haves from the have nots as corporations trade off our moral capital for greater profits. Then it will turn to cut-throat competition. And finally if we are lucky it will lead to global monopolies where the idea of standards can be reintroduced.

We need a system of trade based on the EU model and not the WTO model. The EU model would allow us to protect our moral capital and build on it. At the same time we would have leverage on non-member states who wanted access to our markets through normal trade relations. Leverage to see that minimal standards be maintained. One standard the right of association would make China and Mexico losers in gaining access to our markets.

Under this system we could keep our standards and grow them in other countries instead of a system that leads us back to the evils at the beginning of the Industrial Revolution.

One more point. The international financial sector has grown as a natural phenomenon free from regulations and laws. This is dangerous to the welfare of societies that have to depend on its ability to regulate itself. It't time to regulate and pass laws (preferably international ones) with sanctions that are enforced and fines that hurt. We can't wait until we wake up one morning and find that a derivative firm has gone under because regulating itself would have made it less competetive and effected the whole international market.

[MTC]

T. R. Elliot -

This most annoying thing about this week's close look at China is that it is cogent, informative and fair.

Still, the China report does not compensate for what must be Lexington's worst opinion article ever. "The battle of ideas" (March 25th) represents a staggering achievement: it was inconceivable (clearly this word does not mean what I though it meant) that Lexington could become even more of a sycophantic and obtuse philistine than he already was.

As a Japan resident, the printing this week of a month-old story on the waning of Prime Minister Koizumi's influence leaves yet more of a bad taste in my mouth. I am also appalled that the paper has not apologized for its rancid fluffing of the clearly spurious Mo Yi-tong map.

Can the Economisterdammerung be laid in its entirety at the doorstep of Bill Emmot? If so, then his departure may signal a revival of the publication's probity.

[reason]

I've said this before, Lexington speaks for himself and is, and has been apalling. He is not the Economist however. I like several others have lapsed my long subscription (but mainly because of clerical incompetance on the part of the Economists subscription team).

But you don't judge the New York Times by Friedmann or Brooks do you?

[Ginger Yellow]

Is it really rather amazing? This is Lexington we're talking about, after all.

[Auto]

No magazine on the planet is as overrated as the Economist. Yes, it's well-written, and its snarkiness can be very amusing. But too many readers seem to confuse well-written with cogency. At times, its take on Bush has been downright loony.