When I was helping to edit FOREIGN POLICY magazine in the mid-1980s, my own rule of thumb was that I’d favor publishing anything from a sitting or former president. For the record, we never had the opportunity. But my reasoning was that they had vantage points that were so utterly unique and valuable that the benefits overwhelmed the downside: These authors would prove nearly impossible to edit for substance.
So I support the decision of The Economist magazine to devote lots of space to President Obama’s take on the economic challenges he has dealt with in office, and those he believes still confront the nation and world. I’d recommend that everyone interested in these subjects invest the time to read it all the way through.
But I’ll bet that The Economist staff ran into the same editing problem that I had anticipated. For any less prominent author would surely have been challenged in at least the following three important ways.
First, the president touted America’s recovery from the last financial crisis and Great Recession without once mentioning the Federal Reserve Board. Of course, there’s a heated debate going on over whether the Fed’s rock-bottom interest rate policy and massive unconventional stimulus measures have done the economy more harm than good over the medium and longer term (by actively enabling its addiction to artificially cheap credit rather than letting it go at least somewhat cold turkey in order to recreate truly healthy growth). But there’s little debate that it was these Fed actions, and not the president’s stimulus bill and auto industry rescue, that prevented the downturn from becoming a full blown depression. But The Economist‘s editors evidently decided to let the matter pass.
Second, the unprecedented scale of the Fed stimulus seems inconsistent with Mr. Obama’s assertion that the economy is on “more durable” ground than during the bubble years that preceded his presidency. So does the Fed’s reluctance to raise interest rates further even modestly, and its repeated reminder that “only gradual” increases are likely “for some time” whenever they resume. Indeed, it would have been a genuine public service to ask the president to comment on mounting claims that the American and world economies are stuck in a situation of “secular stagnation” – meaning that adequate growth is possible only by inflating dangerous credit and asset bubbles, as in the 2000s. But that opportunity has come and gone.
Third, there are crucial questions raised by Mr. Obama’s effort to set the political stage for the article – and in the process, comment on the rise of populism in the United States and Europe.
Mr. Obama acknowledges that “Globalisation and automation have weakened the position of workers and their ability to secure a decent wage” and especially that “the financial crisis of 2008 only seemed to increase the isolation of corporations and elites, who often seem to live by a different set of rules to ordinary citizens.” And he concludes that “it’s no wonder that so many are receptive to the argument that the game is rigged.”
It’s hard to imagine that none of The Economist‘s staff thought to ask the president whether the game is actually rigged or not; if it is, to what extent; and if it is, whether it’s played a significant role in those globalization (and, one could add, immigration) policies that have “weakened the position of workers.” But it seems they were simply too intimidated.
I strongly suspect that President Obama will become one of those former chief executives who speaks out more rather than less on public issues once in retirement. If he does enter the fray, let’s hope that he’s treated by the media with a little more moxie.