The Economists Sorry Journalism

Argentine Bashing

(Spanish version will follow in due course.)

Reading “The Economist” on ought to believe that its articles are of highest quality and objectivity. Unfortunately this is not the case when it comes to topics related to Argentina. For years “The Economist” has made it a habit of bashing Argentina. Every single article about Argentina is negative, lacks objectivity and distorts facts. 

Looking closer at “The Economists” true agenda, it becomes evident that it follows a political cause, influenced and dictated by powerful political entities that are unhappy with Argentine politics and subsequent economic success by defied international economic doctrines. This clearly upsets power-brokers, for it jeopardizes their geopolitical and economic agendas in the region. 

Due to its stagnating economy The United Kingdom is desperate to venture out into “new territories”, thus the ongoing Malvinas (Falkland) dispute with Argentina and the possibilities of large oil and gas findings around the disputed Islands as well as having a footstep in the door  to the Antarctica, once natural resources explorations is about to start. Thus the cause becomes obvious as to why corporate media such as the “The Economist” use manipulative journalism and flatly reject impartial news coverage.

“The Economist” is a mouthpiece of influential Anglo American entities, thus its articles are focused on free-market and business issues only within the larger context of Western military and economic powers. The need for state control in all matters, and especially regulation, is  fundamental of any Economist commentary. This is because certain powerful eco – political entities desire the growth of nation-states and regulatory democracy in order to provide the basis to achieve up-solute eco-political control.

The Economists latest article on Argentina is a perfect example on how bias the magazine is when it comes to Argentine related issues. (Comments on article are posted in yellow beneath each paragraph.)

On 17 December 2011 The Economist wrote:

Argentina’s president

Cristina prepares to defy gravity 

The president begins her second term facing an economic slowdown. She will meet it with a mixture of rhetoric, controls and austerity

The headline in itself is hypocrisy at its best. How can the Economist know how the Argentine Government will tackle alleged economic slowdown? 

Dec 17th 2011 | BUENOS AIRES | from the print edition

SHE owed her crushing victory in a presidential election in October to the economy’s vigorous growth and to public sympathy over the sudden death last year of her husband and predecessor, Néstor Kirchner.

Alleging that the president owed her victory to public sympathy over the death of her husband showcases how the article lacks objectivity and deliberately tries to manipulate opinions. Could it be that the overwhelming victory was because the government initiated a social welfare program that benefited the poor working class all over the country? Naturally such deeds are not noteworthy for the Economist, for it tampers with its eco – geopolitical doctrine!

Cristina Fernández inaugurated her second term as president on December 10th still dressed in widow’s black and glorifying her husband’s name almost as of a deity.

For an renowned news magazine, which the Economist claims to be,  focusing on what and why the president is wearing widows black seems pathetic and showcases only how prejudice the magazine is. Objective professional journalism does not need to focus on banalities, even if the magazine is not a supporter of the government or the country.

Her message was triumphalist. Contrasting Argentina with Europe and the United States, she crowed: “They govern with growth targets for the financial sector …and we govern with growth targets for work and employment.”

It must be a bitter pill to swallow for the Anglo American financial power elite, otherwise the Economist would not use disrespectful terminology such as “she crowed”. This shows that objective journalism is not a stronghold of magazine!! Obviously growth targets for work and employment are not in the interest of corporate media outlets of which the Economist obviously is part of! 

Those words may come back to haunt her. Ms Fernández is starting her second term in very different circumstances from the first, back in 2007. Argentina’s hectic growth was built on a weak currency (a legacy of default and devaluation in 2002), booming world demand for its agricultural commodities, strong growth in neighbouring Brazil, and a huge increase in government spending. Those tailwinds have now died down, or risk doing so. World commodity prices are no longer rising. Brazil’s economy has stalled. After years of high inflation at home the peso is no longer weak, and extravagant subsidies mean there is little or no scope for further fiscal stimulus.

About 4 years ago the Economist also predicted that the government would face difficulties due to declining demand in agricultural commodities. The paper also criticizes the government for not cutting subsidies, now that the government initiated subsidies cuts; the Economist held an online survey, questioning the Argentine Government, and its implementation of subsidy cuts, deeming that they are not appropriately administered !!!!! Needless to say that the Economist published an article on subjects matter prior to the survey!!! Manipulative journalism I would say! 

The government still denies that inflation is a problem. For years it has fiddled the numbers: officially, inflation is just under 10%, but independent economists put it closer to 25%, even though many energy and public-transport tariffs have long been frozen. Ms Fernández did admit that Argentina has a “competitiveness problem”. But the government’s solution looks to be a retreat into mercantilism, restrained by hints of realism.

The inflation topic of Argentina is arguably an issue that needs to be addressed but then the Economists should not forget to look at its own doorsteps, where inflation is quoted at 5.4%, according to The Office of National Statistics!!!!, so most likely one should add a few % to that figure as well. Argentine current Public Debt to GDP ratio equals 41.53% versus that of the UK of 83.70%. External Debt to GDP Ratio: ARG 36.75% versus that of the UK to 472.92%. Source: (http://www.usdebtclock.org/world-debt-clock.html#)

This year the UKs debt burden will grow by £167.9 billion.

In November officials announced timid steps to cut subsidies that now amount to 4.2% of GDP. Some large firms, along with richer households, must now pay closer to the true cost of energy.

Above assumption clearly not reflects the entire truth. Lower and Middle class households are not affected by subsidy cuts. Small businesses saw a minimal increase in their utility bills, hardly affecting their budget. 

Even so, to balance its books, the government will have to turn to the money markets during 2012, thinks Miguel Kiguel of Econviews, a consultancy. One sign that it is preparing the way is Ms Fernández’s appointment of Hernán Lorenzino, who is respected in financial markets, as economy minister.But these steps have been overshadowed by a tightening of controls aimed at curbing capital flight. In October the government ordered mining and energy firms to repatriate all their export dollars and citizens to justify every purchase of foreign currency. Tax inspectors were put in foreign-exchange bureaus.

Guillermo Moreno, the thuggish secretary for internal trade who has persecuted independent economists for their inflation estimates, has been put in overall charge of foreign trade too. Some importers have already been required to become exporters as well if they want to get hold of dollars.

The subject of capital flight is not an entire Argentine phenomenon, and occurs in many parts of the world, as is Protectionism. Objective journalism would try to use neutral wordings and not “thuggish” when commenting on a public figure, no matter how much one disagrees with the deeds of the person. 

Lower growth can probably be sold to Argentines provided that other countries are doing worse. The opposition is weak, divided or co-opted. But austerity, if it comes, will require Ms Fernández to adjust her political alliances. The trade unions have been warned that demands for big pay rises will be met by curbs on the right to strike. Ms Fernández reminded private businesses that they have done very well in recent years, and warned them not to “spit at heaven”. Having regained a congressional majority in the election, the government is now pushing through a measure to regulate newsprint, which arouses fears in newspapers that have been critical of the Kirchners.

The Economist, it seems, is also the mouthpiece of the Argentine political opposition as well as certain Media outlets, for it lashes out in all possible directions. If the article would have been written in an impartial and objective way, the journalist would have report the true reason behind the regulatory measures concerning Media bill. They neglects to mention that the Clarin Group together with La Nacion, hold a vast majority over “Newsprint”. In addition the “Clarin Group” owns a powerful TV and Internet empire which gives the group a quasi media monopoly in the country. 

In 2008 when Argentina’s output briefly shrank, the government balanced its books by nationalising private pensions. What might it take next? The potential targets are neither so easy, nor so rich. The risk now is that inflation and a rising current-account deficit will trigger a rush to buy dollars and a downward spiral of devaluation and price rises like the one that scarred the country in the 1970s and ‘80s. Ms Fernández’s government will hope that its controls can stave that off, at least until new finds of shale oil and gas can be developed. But one way or another, things look likely to get rougher in Argentina.

Conclusion:

In a nutshell one would call the Economists views desperate “PROJECTIONISM” and wishful (bad) thinking. Agricultural commodity demand will most probably be somewhat lower than in recent past, but then again one has to bear in mind that the world needs to be fed, thus the need for agricultural commodities will not cease, thus making Argentina, a valuable assets for global food supplies and this is exactly why the Economist and global eco- political power entities are eager to portray Argentina as a bad economic sample, for Argentina has defied the international monetary system and still succeeded to “eco-financially” prevail amidst the current eco – financial turmoil, thus corporate media such as the Economist will not lose a chance to portray Argentina in negative ways. In its last paragraph, the Economist revealed its true cause, namely what I have claimed many times; UK’S interest in the Southern Cones natural resources!

Argentina, the land of Agriculture commodities, vast areas of fertile land, fresh water resources (the commodity of the future) and possible oil and gas findings in the South are the reason why the UK and other entities (IMF, World Bank, etc.) are desperate to gain eco political influence in the region in order to enforce upon Argentina their eco political doctrines and subsequently obtain the countries natural resources.

Here are some reader’s comments regarding above article:

If indeed there are elements of this article that point to legitimate macroeconomic concerns Argentina faces, it is worth looking back at the coverage of The Economist over the last 8 yrs. This publication has been predicting doomsday in the country more or less since 2004. Why? The country did not follow the prescriptions for austerity and financialization that The Economist has been recommending for years, the results of which are plain to see in Europe and the US today. Frankly, the entire worldview of this magazine has been so deeply discredited that it shocks me that anyone should take it seriously, particularly those with global investments.

Agreed, people who pay for this magazine don't seem to be too smart. The target customer base of the economist are IQ100+ wannabes.

If we equate Argentina's total growth over the last 8 years versus the economist expected growth, then this magazine ought to answer for about a 70% difference.

People at The Economist, If you are wrong once it's OK,
twice... maybe,
three times.. wait a minute
4 times.. maybe you should revise your methodology
5 times... you lie to us and you know it
6 times... you know you are lying and you do it because you have an agenda
7 times... you have an agenda and you are being paid to do lie despite all the embarrassment.
8 times... all of the above plus you don't have a lot of respect for your readers.

The Economist hasn't got an explanation for the success of Argentina, so The Economist denied Argentinian success.

Maybe people who work for this magazine should watch things like this

http://www.usdebtclock.org/world-debt-clock.html#

Or better yet, watch this one: http://www.debtbombshell.com/

Al of what you say is absolutely true. However, companies, people and countries do not default on debt as a whim. or as policy. It is the result of trying every possible way to avoid it until there is no other way out. Another method of default or controlled default is to devalue your country's currency on a massive scale, such as what the UK did in the late 1940's and early 1950s when it owed Argentina at least $2 Billion USD. Granted they did not do this to "screw Argentina", but the fact remains that they must have tried every possible way to avoid bankruptcy, and unfortunately in the world of economics, few are the countries that have avoided debt default or bankruptcy proceedings but at such a great cost that it may have been cheaper to do so - like American Airlines this past week. 

The UK economy is alive in name only due to the banking industry that attracts depositors from all over the world. Almost every good sold there is Made In China, and its current account deficit is covered only by massive borrowing, that will one day have to be repaid. It is only a matter of time before the UK and the USA will have to admit that with massive unemployment, diminished industry, and profits from non-productive speculative trade will not be enough to sustain their economies in the long run. I give the UK 5 years at most before the next crisis hits them such as the current one in the US.