The Economist's Departure Is Bloomberg's Gain?
By Staff News & Analysis - January 30, 2015

The case for liberal optimism … John Micklethwait, who has edited this newspaper since 2006, leaves today. These are his parting thoughts … THIS newspaper churlishly deprives its editors of the egocentric adornments of our trade. Tragically, these pages include no weekly "editor's letter" to readers, underneath a beaming, air-brushed picture. Online, there is a weekly e-mail, but that comes from your "desk", not you. As editor, you spend your time in deplorable obscurity, consoled merely by the fact you have the nicest job in journalism. But there are two indulgent exceptions: a brief mention when you are appointed; and this valedictory leader, which attempts to sum up the world that has hurtled across your desk. – Economist

Dominant Social Theme: The talented editor of The Economist is moving to Bloomberg and both publications will benefit.

Free-Market Analysis: One way to look at this move is to see it as a benefit for both publications. That's because there is not a lot of difference between Bloomberg and The Economist when it comes to editorial direction.

Bloomberg is in a sense relentlessly authoritarian and so is The Economist. It takes a long time to fully understand the editorial policy, but once you do, it is predictable – and often discouraging.

Bloomberg and The Economist have editors and writers – and owners – who are apparently convinced the world cannot maintain a civilized demeanor without the use of force on a regular basis both domestically and abroad.

In these publications there is a great deal of commentary about taxes, central banks and regulation. Any sense of history – certainly from the standpoint of the US – has been relegated to the proverbial trash-bin. That the US was a successful country without central banking, a graduated tax system and regulatory authorities is never acknowledged much less discussed.

Mr. Micklethwaite's graceful resignation letter provides us, unfortunately, with a continuation of these trends.

Here's more:

… For the things this newspaper cares about, the past nine years have been a battle, one that has left me in a state of paranoid optimism. Paranoia because so much remains under threat; optimism because, for the most part, the creed this newspaper lives by is strong enough to survive.

In this section

… Any modern editor who is not paranoid is a fool. But my optimism remains greater, both about The Economist and the future of independent journalism. … The same guarded hopefulness applies to an Economist editor's only true master: the liberal credo of open markets and individual freedom.

… But freedom's momentum has sadly stalled. Democracy is no longer the presumed destination. Countries that looked mildly hopeful nine years ago, such as Russia and Turkey, have acquired tsars and sultans. The Arab spring has turned to winter. Above all, authoritarians have found a new model in China—in which power revolves at the top every decade and economic growth is organised at the bottom. China's income per person has risen at twice the rate of democratic India's since 2006.

Western democracy, too, looks ever less exemplary. Barack Obama may have stopped his predecessor's waterboarding of American values, but Washington remains synonymous with gridlock. In every year of my editorship a clear majority of Americans have told Gallup that they are dissatisfied with the way they are governed. America's money politics, the target of another editor's valedictory in 1993, looks ever grubbier and more feudal, with a Bush v Clinton contest beckoning in 2016.

The only way to feel good about American democracy is to set it beside Brussels. Woefully unaccountable and ineffective, the European Union is often held together only by the woman who has somehow managed to be both the West's most impressive politician and its greatest ditherer, Angela Merkel. But to what end? The near-permanent euro crisis has proved a classic exercise in shambolic decision-making, consisting mostly of agreeing to kick the can down the road.

If liberal politics are rightly attacked, the blows that have rained down on liberal economics have perhaps been even more painful. It is now a commonplace to blame the dominant event of this editorship, the 2007-08 financial crisis, on unfettered capitalism.

… This helps explain why a feeling of unfairness lingers across the West—visible in the streets of Athens, but also in the pages of Thomas Piketty. People blame liberalism for much of what they fear: whether large-scale immigration, technological change, or just what the French call mondialisation.

Such a reaction is not unreasonable. Globalisation has indeed brought problems in its wake. But it has also done an incredible job in reducing want.

We've quoted at length here because the letter makes controversial points in a kind of offhand way. We seem to learn that tyranny has ascended in the East, that US voters resent Washington's gridlock (presumably voters want a larger regulatory state), that China is rabidly authoritarian and that "capitalism" is being blamed for the 2007-2008 financial crisis.

Later in the letter we learn that capitalism – subject to so much contempt – has "hauled" nearly 1 billion out of "extreme poverty."

Finally, the letter points out that there are two great debates in formation. "The first is to do with inequality. A more open society, where global markets increase the rewards for the talented, is fast becoming a less equal one."

The second debate has to do with the government's role. "Some of the remedies for inequality involve the state doing more, not less," the letter states. But the real answer may be to "scale down government … direct it more narrowly and intensely. In Europe, America and Japan the state still tries to do too much, and therefore does it badly."

The battle for the future of the state is an area where modern liberalism should plant its standard and fight, just as the founders of the creed did. Because, in the end, free markets and free minds will win. Liberalism has economic logic and technology on its side—as well as this wonderful newspaper, which I now hand over into excellent hands. And that is my last, best reason for optimism.

This last paragraph encapsulates – sums up – the cognitive dissonance that informs the rest of this letter. The "paper" that Micklethwait writes for has done a good deal to promote a certain kind of market, but free it is not.

Additionally, other points that Micklethwait makes, as portrayed above, are certainly subject to question. Russia and Turkey are said to be authoritarian but Britain, France and the US are not? Chances are there are more surveillance cameras in London than Moscow. And the US – not Russia or China – leads the world by a large margin in penal incarcerations.

The letter is a kind of work of art in terms of its factual lacunae, elegantly covered up by modest rhetoric. Insisting that the West's free markets and free minds will win is encouraging but one has to wonder at the definitions, let alone the proclamations.

It is Western central banking, after all, that has created inequality not "capitalism." It is Western money printing that has destabilized the West and created opportunities for further regulation and further globalization. Central banking money printing has "hauled" Chinese out of poverty but when the next bust occurs it may place many of them back in it.

What Micklethwait calls liberalism is actually a kind of refined mercantilism that depends on monopoly privilege extended to certain banks and to industry via judicial decisions supporting corporate personhood. The system he is advocating is in large part warlike and exploitative, and its underpinnings are not the market but the military-industrial complex.

After Thoughts

Micklethwait is going to Bloomberg now – and thus these two media facilities, The Economist and Bloomberg, should grow even more alike in terms of vision, vocabulary and coverage. One can learn many things from the mainstream media but objective truth may not be among them.

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