If you're not convinced that a junkyard of discarded
economic ideas looks worse than a junkyard of wrecked autos, read Michael
Singh's “The Real Middle East Crisis Is Economic,” an article that was
published in – what else? – The New York Times edition of August 20, 2014.
The poor thing believed he was on to something when he
thought he discovered that President Obama was on to something when he said:
“Iraqi Sunnis [are] detached from the global economy” which Singh interpreted
to mean that there is something fundamentally wrong with the Iraqi economy. He
then went further and generalized the false discovery to encompass all Middle
Eastern economies; a euphemism that means Arab economies.
And so, he piles one piece of junk on top of the other till
the yard starts to look so horrible, you want to get away from it, and rest
your eyes on something more pleasant. Here in brief is what he does:
Piece of junk number 1 – “The region accounts for just 4
percent of global imports.” Well, guess what Michael, if you know how to use a
calculator, divide 300 million (which is the Arab population) by 7.2 billion
(which is the world's population) and the result comes to guess what! 4
percent. It means that in this sense, the Arabs are average. But this is
neither here nor there because if you can show convincingly that nations
prosper by importing from abroad, I'll be the first to say you're an economic
genius.
Piece of junk number 2 – Singh pretends to compare the
region's economies with what he says are Asia's economies, but then picks two
special cases from the region, which are Egypt and Iran, and compares them with
two special cases from Asia, which are China and South Korea. Why not compare
Arab Kuwait, or Dubai with Asia's Burma ? Or India for that
matter? Or the Philippines ?
Or Cambodia ?
Or Afghanistan ?
The fact is that the West has conducted non-stop economic warfare against the
countries it did not like in the Arab and Muslim worlds at a time when it
propped up South Korea as well as Taiwan and Hong Kong which then transferred
the Western largess to China. And the West did all that to show the communist
world that capitalism worked better.
Piece of junk number 3 – He compares the per capita incomes
of nations as translated in dollars without factoring into the mix the
purchasing power parity. Worse, he makes comparisons not only with current
values but also with those going back half a century. For example, he compares
the per capita GDPs of Egypt and China
in 1965 when the population of Egypt
was a quarter what it is today, and the country had huge surpluses of
agricultural products to export. This gave the Egyptian Pound a value almost
equal to the British Pound, itself worth nearly 3 American dollars at the time.
And that was the case when China
was experiencing both famine and a Cultural Revolution, and its currency was
worth exactly nothing. By contrast, china is today accumulating reserves like
there is no tomorrow, at a time when Egypt lost much of its reserves due
to the Revolution. And this brought the value of its pound down to 14 cents.
That does not mean rich Egypt
became poor while poor China
became rich. It means that making this kind of comparison is better left for
the birds.
Piece of junk number 4 – He says that the economies of the
Middle East are stagnating because they are detached from one another in the
sense that the countries trade very little among themselves. Well, trade for
the sake of trade is never a good idea. You buy the goods and services you need
from the best sources no matter who they are; and you sell what you have in
surplus to the highest bidders no matter who they are. This is the policy that Canada is
pursuing, which is why we are a prosperous nation despite the fact that we
trade with foreigners more than we do internally among the provinces.
And so, beginning with all that discarded junk, Michael
Singh commits something that is worse than the classic mistake of cherry
picking bits and pieces from the internal debates they continually have in
those countries, to build a case he can submit for publication. Normally, a
classic mistake would be committed when someone who is versed in economic
matters but intellectually lazy, repeats in English what the opposition out
there is saying in Arabic. And he gets paid for that because there is one born
every minute willing to pay him.
However, unable to do even this much, Michael Singh has
willy-nilly snatched a handful from the cherry picking of the lazies. He mixed
it with political talk of his own, resulting in a piece that is the
quintessential ramble – the kind that will put us all to sleep.