Democracy and the downturn

The Latinobarómetro poll


Nov 13th 2008
From The Economist print edition

Latin Americans are standing up for their rights

FIVE years of strong economic growth have prompted a slow but fairly steady rise in support for democracy and its institutions among Latin Americans, although many remain frustrated by the way their political systems work in practice. Most see themselves as politically moderate, but they retain a yearning for strong leaders and expect the state to solve their problems. These are some of the findings from the latest Latinobarómetro poll taken in 18 countries across the region and published exclusively by The Economist. Because the poll has been taken regularly since 1995, it tracks changes in attitudes in the region.

This year’s poll was taken in September and early October. It therefore reflects the sharp increase in inflation in the region in the first half of this year, but not the full effect of the financial turbulence and deteriorating economic outlook that hit some Latin American countries in recent weeks. Nevertheless, it carries some sobering lessons for the region’s politicians.

The poll underlines the fact that a small majority of respondents are convinced democrats (see table 1 and chart 2). In 12 countries, support for democracy has risen since 2001, when the region last suffered an economic recession. But only in five countries is it higher than it was in 1996. This year democracy has received a particular boost in Paraguay, a country where authoritarian attitudes previously predominated. The shift follows the victory in a presidential election in April of Fernando Lugo, a leftish former bishop who ended more than half a century of rule by the Colorado Party. That echoes similar hopes of change aroused by newly elected leaders in the region in recent years.

Conversely, in Venezuela, support for democracy may have been boosted this year among opponents of President Hugo Chávez, after their victory in a referendum on constitutional change last December. In Colombia, President Álvaro Uribe’s success against the FARC guerrillas may be the reason for a similar democratic lift.

Uruguayans are by far the most satisfied with how their democracy works (see chart 3). Peruvians are particularly disgruntled. That is paradoxical: Peru’s economy has grown faster than that of any other of the region’s bigger countries both this year and last. Their discontent seems to reflect deep flaws in the political system. But even if slightly less than two-fifths of respondents across the region are satisfied with their democracies, that is a significant improvement on the 2001 figure.

The relative dissatisfaction owes much to the deep-rooted socioeconomic inequalities in Latin America. Across the region 70% of respondents agreed that governments favour the interests of the privileged few; around half say they would not mind a non-democratic government if it solved economic problems; a similar proportion say democracy has not reduced inequalities; and only 30% think there is equality before the law. These attitudes help to explain the popularity of Mr Chávez, an oil-rich strongman—more than a third of Venezuelan respondents say inequalities have diminished.

But most respondents are convinced that democracy is the only road to development—and 71% say they are personally happy. So why the grumbles? As democracy has come to stay in the region, “people are more conscious of their rights and their expectations are higher”, says Marta Lagos, Latinobarómetro’s director. She adds that the yearning for a strongman is more a cultural trait than a political preference—and that the same goes for a fondness for a paternalist state.

The poll shows that a large majority believe that pensions should be in state hands (see chart 5). In Argentina that number is 90%, which perhaps helps explain why President Cristina Fernández last month nationalised the private pension system. But at the same time 56% of respondents see a market economy as the road to development (up from 47% last year). And 32% declare themselves satisfied with privatised public services, up from 15% in 2004. Some 44% say they trust their banks, up from 29% in 2003. The church remains the most trusted institution in the region—but less so than it was. Trust in government and legislatures continues to edge up (see chart 4).

In six countries, including Mexico and Venezuela, crime and public safety are seen as the most important problem. In ten countries, economic concerns (unemployment, poverty and inflation) are still seen as paramount. In Brazil 19% cited health care as the biggest problem.

Despite the swing to the left in the region in recent years, most respondents to the poll consider themselves in the political centre (42% this year, up from 29% in 2003). Only 17% say they are on the left and 22% are on the right (even in Mr Chávez’s Venezuela those on the left and right are tied at 26%).

Despite the swing to the left in the region in recent years, most respondents to the poll consider themselves in the political centre (42% this year, up from 29% in 2003). Only 17% say they are on the left and 22% are on the right (even in Mr Chávez’s Venezuela those on the left and right are tied at 26%).

That provides hope for centre-right politicians in a round of presidential elections in the larger countries in the region in 2010-12. Those elections are likely to be held against a much less rosy economic backdrop than has prevailed for the past few years. The task facing Latin America’s politicians is to ensure that economic difficulties do not spill over into a weakening of support for democracy.

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Latinobarómetro is a non-profit organisation based in Santiago, Chile, which has carried out regular surveys of opinions, attitudes and values in Latin America since 1995. The poll was taken by local opinion-research companies in 18 countries and involved 20,217 face-to-face interviews conducted between September 1st and October 11th 2008. The average margin of error is 3%. Further details from http://www.latinobarometro.org/

Hola, Luther

Nov 6th 2008
From The Economist print edition

A holiday that is a cultural milestone
ATIN AMERICAN countries have long celebrated a plethora of Roman Catholic public holidays, from Corpus Christi to St Peter and St Paul. But this year Chile set a regional precedent, declaring October 31st a public holiday in honour of “the evangelical and Protestant churches”. It marks the date in 1517 when Martin Luther pinned his 95 theses to the door of a church in Wittenberg, Germany, starting the Protestant Reformation. Only Slovenia and some German states take it as a holiday.

What makes the decision to celebrate the Reformation odder is that Chile is the only country in Latin America that still has a significant (Catholic) Christian Democrat party. Nevertheless, the new holiday was approved by a unanimous vote in Congress. The politicians seem to have spotted an opportunity.

In the latest census in 2002 in a once staunchly Catholic country, 15% of Chileans said they were “evangelicals” (a synonym in Latin America for Protestants). State schools now offer a choice of Catholic and evangelical religious teaching, and the armed forces have chaplains from both denominations.

Chile is not alone. More than 15% of Brazilians and over 20% of Guatemalans are now evangelicals. Most Latin American Protestants are Pentecostals, stressing direct experience of God. Pentecostal churches continue to multiply in poorer areas of Santiago, as they do across the region. A former Catholic bishop and liberation theologian was elected as Paraguay’s president this year. But the embrace of Protestantism by Latin America’s socially aspirational poor looks like an inexorable trend. Five centuries after the region’s forced conversion to Catholicism, Chile’s new holiday is a cultural milestone.

It comes at a price. Chile may have a reputation as boringly hard-working, but now has 16 public holidays a year (plus the “bridge” days that Chileans tack on when a holiday falls near a weekend). A workday’s production is worth some $735m in lost output. So the government wants quietly to drop two of three holidays dedicated to the Virgin Mary.

The writing on the wall

Oct 30th 2008 | SANTIAGO
From The Economist print edition

And it points to the right

MUCH as some of them tried to claim the result was a victory of sorts, the dejected faces of the leaders of Chile’s governing centre-left Concertación coalition on the night of October 26th told a different story. In that day’s municipal elections, Alliance, the centre-right opposition, won 41% of the vote for mayors, two percentage points more than the Concertación but enough to win eight of the 14 regional capitals. It was the first-ever defeat in a nationwide election for the Concertación, which has ruled Chile ever since the end of General Augusto Pinochet’s dictatorship in 1990. Jubilant Alliance leaders reckon that the result paves the way for them to win the presidency in an election in December next year—and to counter South America’s recent drift to the left.

The victory was not clear-cut. Confusingly, municipal councillors are elected separately. In that ballot the Concertación, which includes the Socialist and Christian Democrat parties, won 45% of the total vote to 36% for the Alliance. But more people (some 10% more) voted for mayors than for councillors. The overall result confirmed opinion polls that make Sebastián Piñera, a wealthy businessman and the Alliance’s putative candidate, the front-runner for the presidency.

A dress rehearsal for the presidency

Voters punished the Concertación because it is tired, increasingly ineffective and fractious. It has presided over the consolidation of Chile’s democracy, almost two decades of economic growth and stability, and much social progress. But under Michelle Bachelet, the president since 2006, it has run out of steam. It has failed to promote new, younger leaders. A spate of corruption scandals, though mostly minor, has left even some Concertación supporters wondering whether 20 years in office might not be enough. Chile’s economy may be stronger than that of many of its neighbours, but it no longer grows at Asian rates, and inflation has spiked this year. A botched attempt to modernise public transport in Santiago, the capital, smacked of incompetence.

But if voters are tiring of the Concertación, opinion polls suggest they are not thrilled by the Alliance. The voting system, bequeathed by General Pinochet, divides the country into two-member constituencies, thus cementing a two-coalition system and punishing third parties. This has produced political stability but is widely blamed for apathy. Nevertheless, in the municipal election a new force formed mainly by defectors from the Christian Democrats won 7.6% of the vote, while a far-left coalition got 9.1%.

Ms Bachelet this week called on the Concertación to show “unity, unity and more unity”. She also called for an electoral pact with the far left—which would push Christian Democrat voters towards Mr Piñera. She has presided over unprecedented infighting among the Concertación’s four parties. Since presidents cannot serve consecutive terms, the coalition must now try to unite behind a successor to Ms Bachelet, decide how to choose one and agree a programme. There are three strong contenders: Ricardo Lagos, a former president, is Chile’s most popular politician; the stolid Eduardo Frei, another ex-president, might appeal to the centre; José Miguel Insulza, the secretary-general of the Organisation of American States, has said that he would stand only if the Concertación fields a single candidate.

Chileans have not elected a government of the right for half a century. Mr Piñera’s victory is not assured. But Alliance has taken the first step. As the economy slows along with the world’s, the government will start to spend some of the windfall copper revenues it has saved. But many of the mayors implementing job-creation schemes will now be from the opposition, and they will doubtless claim the credit for them. No wonder the Concertación looked so glum on election night.

A force for good, now

Chile
A force for good, now

Sep 25th 2008 | SANTIAGO
From The Economist print edition

A newly streamlined army polishes its democratic credentials

TEN years after General Augusto Pinochet stepped down as commander-in-chief, Chile’s army is at last emerging from the shadow of its murky past. For a quarter of a century it laboured under the baleful influence of the man who came to power in a military coup in 1973, its once proud reputation sullied by the blood of thousands of innocents tortured and murdered under his 17-year dictatorship. The army was unable to start reforming itself until he finally stepped down as its leader another eight years later.

Despite hundreds of court cases (though few convictions so far), many questions about the army’s role in the human-rights abuses remain unanswered. The remains of some 3,000 people killed or “disappeared” by the regime have never been found. Many Chileans still wonder how such a highly disciplined force could have resorted to such appalling violence. “There is a weight of history,” admits José Goñi, Chile’s defence minister. “But the new generation doesn’t have to be held responsible.” Only six of those in the army at the time of the 1973 coup remain in service.

The bad memories are fading

Despite hundreds of court cases (though few convictions so far), many questions about the army’s role in the human-rights abuses remain unanswered. The remains of some 3,000 people killed or “disappeared” by the regime have never been found. Many Chileans still wonder how such a highly disciplined force could have resorted to such appalling violence. “There is a weight of history,” admits José Goñi, Chile’s defence minister. “But the new generation doesn’t have to be held responsible.” Only six of those in the army at the time of the 1973 coup remain in service.

General Óscar Izurieta, the army’s commander, says that the army will not be accepted fully as part of democratic society until questions over its past can finally be laid to rest. The courts have to do their job, he agrees, and it is legitimate for people who suffered at the army’s hands to want to keep the issue open. “But I don’t know if it’s good for them or the country,” he says. “Every day, they put me face to face with a problem of the past.”

The army has tried hard to regain legitimacy over the past decade. It has seized on natural disasters, such as earthquakes, to play an active civil-defence role. It has used its field hospitals to take medical services to remote areas and help the national health service cut waiting lists. And it has sought to reduce its social isolation by such measures as sending cadets from the Santiago military academy to one of the city’s universities for some of their courses.

Some of the excess fat has been shed, too. Currently 40,000-strong, down from around 70,000 in the mid-1990s under Pinochet’s command, it is leaner and more professional. Unpaid military service has been scaled down and, unlike General Pinochet’s conscript-packed army, all national-service places are now filled by volunteers. And under a law passed by Congress this summer their number will drop even further as they are gradually replaced by professional soldiers.

Thanks to record prices for copper, Chile’s main export, and an odd arrangement (predating Mr Pinochet) under which Codelco, the state copper producer, transfers 10% of its export revenues (amounting to $1.4 billion last year) to the armed forces for capital expenditure, there has been money to spend. The finance ministry has the last word, but the army has been able to shop extensively, with acquisitions including German tanks and better electronics. Today, Chile’s is the most modern and best-equipped army in Latin America, says Armen Kouyoumdjian, an adviser to the Stockholm International Peace Research Institute.

But what exactly does the country need such an army for? In the 1970s Chile faced a real threat of war with Argentina and Peru, but relations with both have improved a lot since then. Indeed, Chile’s military ties with Argentina are so close that the two countries have created a joint standby unit for international operations. Although political instability in Bolivia is a worry, the main risk to Chile from that direction—an exodus of Bolivian refugees—is hardly a military problem. On the other hand, having a strong army may help to ensure that relations with Peru stay peaceful. Chile and Peru have had a long-standing dispute over maritime borders, and Ollanta Humala, the Peruvian populist who almost won his country’s most recent presidential election, found it convenient to stir up sentiment against Chile.

For its part, the army emphasises that it is available for international peacekeeping. It is already part of the United Nations force in Haiti—its first significant peacekeeping role. Some Chileans reckon that the army is still bigger than necessary for a peaceful country of only 16m people. But a rational plan for slimming should be based on the needs of the future, not the misdeeds of the past.

Keeping their fingers crossed

Latin America's economies

Keeping their fingers crossed

From The Economist print edition

In Latin America, the most trenchant opponents of globalised finance look most likely to suffer at its hands

IF ANALOGIES with the Great Depression are scary for Americans, they are hardly less so for Latin Americans. Within a few years of the 1929 stockmarket crash, 16 governments in the region fell to military coups or takeovers by strongmen. In recent years the talk has mostly been of Latin America’s economic independence from its big neighbour in the north (with the exception of Mexico). But on September 29th, the day the House of Representatives in Washington balked at the bail-out, came a reminder of just how close those ties still are. While the Dow Jones dropped by nearly 7% in a day, Brazil’s Bovespa, the region’s biggest stockmarket, tumbled by more than 9%.

Even so, the fact that this financial crisis does not have “made in Latin America” stamped on it is cause for modest celebration. In the crises of 1994, 1998 and 2001 Latin America went on a binge, using foreign finance to pay for a huge rise in imports. The mood then changed, foreign money fled and panic ensued. This time many countries have had trade surpluses in recent years, and soaring commodity prices have made government finances look more than respectable (see chart).

Latin American banks also look strong. This is partly because they did not hoover up American mortgage-backed securities, but also because they are not that dependent on foreign credit. Brazil’s banks are an exception: the publicly traded small and medium-sized banks that do depend on foreign funding have had their share prices pummelled over the past week. But even in Brazil, foreign capital accounts for only about 10-20% of bank-funding needs.

Equity markets in Latin America are shallow (apart from in Brazil), which reduces the chances of one path of infection. Credit is more of a concern, particularly for exporters, who are finding foreign lines of credit much harder to acquire. This may be only a temporary blip. But if it endures, companies will turn to domestic lenders instead, leaving less credit to go around. Edmar Bacha of the Banco Itaú, who has seen many crises come and go, says a credit squeeze is now his chief concern.

A bigger future fear, though, is that a global slowdown accompanied by a decline in commodity prices will put government finances under pressure. Chile, which pours money into a big fund (currently around $20 billion) when copper prices are high, and bases its budget on a copper price far below the current spot price, is the only big country in the region where the commodity boom has not been accompanied by a government spending spree. Commodity prices have already fallen back a bit. If they fall much further some countries will be in trouble.

Heading the list of those most vulnerable are countries whose markets have been viewed for some time as badly behaved: Venezuela, Argentina and Ecuador. Venezuela, which has given up producing things that its consumers want, importing them instead on the back of its oil revenues, looks particularly exposed. The same oil revenue has allowed the number of public-sector jobs to more than double since President Hugo Chávez came to power in 1999, and is also underwriting a big new arms deal with Russia. Cutting public spending is an option, but not one which he would wish to contemplate before critical regional elections at the end of November. Even then it may not be easy to switch into austerity mode. Despite a recent increase in the arrests of “foreign imperialist plotters”, Mr Chávez would find it hard to explain away large numbers of people descending onto the streets.

If lower commodity prices lead to lower costs of staple foods, this would provide Argentinians with some relief against their country’s rampaging inflation. But for President Cristina Fernández’s government it would be a different story. It gets 10% of its revenue from export taxes. A fall in commodity prices would squeeze farmers (who already pay a 35% tax on exports) even more and might reignite their recent protests. Ms Fernández might be tempted to make up the shortfall by raiding pension funds. There is also a currency concern. The peso, which has won back trust after its crash in 2001, is backed by high soyabean prices. If these fall, it could lead to a fresh flight to dollars for those able to get them, and misery for everyone else.

For well-behaved countries, such as Mexico, Brazil, Colombia and Peru, things look better. Their governments have balanced their budgets and built up trade surpluses along with dollar reserves. In some places growth is still strong: the latest year-on-year figures show an 8.3% rise in Peru for July, and 6.1% rise in Brazil for the second quarter. Not everyone is convinced by this rosy picture. “Economists who talk about structural shifts on the eve of a cyclical downturn should all be taken outside and shot,” says Gray Newman of Morgan Stanley, a bank.

Meanwhile, Mexico’s age-old linkage to the United States’ economy is already having an effect. In August remittances from Mexicans working north of the border suffered their biggest drop on record. Hopes that Americans will keep buying heroic quantities of Mexican manufactured goods are dimming. And Mexico’s trade balance, boosted by high oil prices, is at risk. Brazil, Latin America’s biggest economy, looks better placed. But commodities account for about half its exports, leaving it, too, vulnerable to a fall in prices.

The biggest difference this time around, it seems, is that those countries that have been most hostile to global capitalism look the most exposed to its changed mood. In the 1930s, the region’s democracies suffered from a crash and a depression made thousands of miles away. Today, it is the elected monarchies ruled by economic populists who have the most to fear.

The Economist: The end of Allende

See original here

Leader
The end of Allende
From The Economist print edition

Our leader on the death of Chile's President Allende, published in The Economist on September 15th 1973

The temporary death of democracy in Chile will be regrettable, but the blame lies clearly with Dr Allende and those of his followers who persistently overrode the constitution

President Allende did not become a martyr, even if it is true that he took his own life on Tuesday. The bombing and storming of his presidential palace and the seizure of power by the commanders of Chile’s armed forces put a bitter end to the first freely-elected marxist government in the west. And the fighting may have barely begun. With most of Chile’s links with the outside world still severed, it was difficult to take the full measure of the apparently continuing violence. But if a bloody civil war does ensue, or if the generals who have now seized power decide not to hold new elections, there must be no confusion about where the responsibility for Chile’s tragedy lies. It lies with Dr Allende and those in the marxist parties who pursued a strategy for the seizure of total power to the point at which the opposition despaired of being able to restrain them by constitutional means.

What happened in Santiago is not an everyday Latin American coup. The armed forces had tolerated Dr Allende for nearly three years. In that time, he managed to plunge the country into the worst social and economic crisis in its modern history. The confiscation of private farms and factories caused an alarming slump in production, and the losses in state-run industries were officially admitted to have exceeded $1 billion last year. Inflation rose to 350 per cent over the past twelve months. Small businessmen were bankrupted; civil servants and skilled workers saw their salaries whittled away by inflation; housewives had to queue endlessly for basic foods, when they were available at all. The mounting desperation caused the major strike movement that the truck-drivers started six weeks ago.

But the Allende government did more than wreck the economy. It violated both the letter and the spirit of the constitution. The way it rode roughshod over congress and the courts eroded faith in the country’s democratic institutions. A resolution passed by the opposition majority in congress last month declared that “the government is not merely responsible for isolated violations of the law and the constitution; it has made them into a permanent system of conduct”. The feeling that parliament had been made irrelevant was increased by violence in the streets (almost on a Belfast scale) and by the way the government tolerated the growth of armed groups on the far left that were openly preparing for civil war.

The armed forces moved only when it had long been clear that there was a popular mandate for military intervention. They had to move in the end because all constitutional means had failed to restrain a government that was behaving unconstitutionally. The trigger for the coup was provided by the efforts of left-wing extremists to promote subversion within the armed forces. Two leaders of Dr Allende’s Popular Unity coalition, Sr Carlos Altamirano, the former Socialist party secretary-general, and Sr Oscar Garretón of the Movement of United Popular Action, were named by the navy as the “intellectual authors” of plans for mutiny among the sailors at Valparaiso. The Valparaiso naval commanders were the first to move this week.

But the rapid success of the coup and the participation in it of all the armed services (including the paramilitary carabineros) suggest that the plans for it had been carefully laid. It remains to be seen whether the armed forces are now solid in their opposition to the ousted government. The disappearance of two commanders, Admiral Raul Montero and General Sepulveda, the carabineros’ chief, who were replaced by their anti-marxist subordinates on the day of the coup, shows that not all senior officers were in favour of it. The real danger of bloodshed will come if the armed forces split, or if there are serious mutinies among the lower ranks. That could produce a messy civil war. Strong resistance can be expected from the workers’ committees and paramilitary brigades that the Socialist party and the Movement of the Revolutionary Left are running in Santiago and from guerrilla groups in the south. But if they fail to get significant military backing, they can probably be contained.

No return to the old ways
Whatever government emerges from the coup cannot expect an easy time. There will also be a temptation now for those who have suffered from the Allende government to settle their accounts with the defeated side. Few people believe that Chile can now return to its old ways of doing things. The work of reconstruction will involve considerable sacrifice, just as it did in Brazil when Senhor Roberto Campos was responsible for economic planning in the years after the 1964 coup. This does not mean that Chile will become another Brazil; for one thing, it is probably a less violent place even now, and for another, its soldiers have a rather different conception of their role from the soldiers behind Senhor Campos. They accept that it is too late to reverse many of the changes brought about by Dr Allende; in trying to rebuild the private sector, for instance, they will lay more stress on coaxing back foreign investors and on creating new industries than on handing back what was taken away.

General Pinochet and his fellow officers are no one’s pawns. Their coup was home-grown, and attempts to make out that the Americans were involved are absurd to those who know how wary they have been in their recent dealings with Chile. The military-technocratic government that is apparently emerging will try to knit together the social fabric that the Allende government tore apart. It will mean the temporary death of democracy in Chile, and that is to be deplored. But it must not be forgotten who made it inevitable.

Pinochet, Milosevic...Henry Kissinger?

Christopher Hitchens vs David Rieff


Dear Christopher

28th June 2001

I hold no brief for Henry Kissinger, and had your recent attack on him been concerned-as you put it-with exposing his "depraved realpolitik," I would not have been disposed to quarrel with you. There is much to loathe about what Kissinger believes, and much to despise about what he did when he applied his brand of amoral realism to the conduct of US foreign policy. But you insist that your goal is different. You claim that the book you have written is "concerned only with the Kissingerian offences that might or should form the basis of a legal prosecution for war crimes, for crimes against humanity, and for offences against common or customary or international law, including conspiracy to commit murder, kidnap and torture."

You claim that in your bill of indictment you have included only those acts of Kissinger's which can be properly described as identifiable crimes rather than exercises of irresponsible power, or acts which, however repulsive they are to you, "might in outline have been followed under any US administration." These include the secret bombing of Indochina; collusion with the Pakistani government's campaign of slaughter in East Pakistan in 1971 and in the subsequent assassination of Bangladesh's first president, Sheikh Mujib; collusion in the assassination of Rene Schneider, the chief of the Chilean general staff under Allende; involvement in the plan to assassinate President Makarios of Cyprus; guilt for the Indonesian genocide in East Timor; and personal involvement in a plot to kidnap and murder Elias Demetracopoulos, an exiled Greek journalist then living in Washington.

There are a number of flaws in your argument which would be apparent even to someone who shared both your politics and your presuppositions. Among them is the fact that, as you yourself admit, you don't have a lot of direct evidence in a number of these cases. You blame Kissinger for withholding access to his papers and speculate, without evidence as far as I can see, that he has destroyed certain key documents. But the result, as you concede, is that you can often only bring what you call a prima facie case. In other words you want Kissinger in the dock, but you often don't have enough evidence to warrant an indictment under the legal standards you yourself invoke and depend on.

Let me give one example of many. You demonstrate that Kissinger lied when he said that he had no advance warning of the Turkish invasion of Cyprus. You go on to claim that Kissinger must have approved of it. If you were writing a political polemic, that would be acceptable. But you have imposed higher standards on yourself by claiming to have written a prosecutor's brief. By those standards, you fail. Reading that section of your book, the old Scottish verdict "Not Proven" came to mind.

But let's assume you're right. It still seems to me that the Cyprus case is better understood as emblematic of the irresponsible exercise of US power during this period than of the particular whims of Kissinger. The same, I believe, can be said of the US government's complicity in the Indonesian invasion of East Timor. No fact adduced by you suggests that Kissinger's views in these matters were at variance with that of the US policy establishment generally.

If I am right, then despite your claims you have not taken sufficiently into account the institutional nature of the policy Kissinger implemented and instead have fetishised the role of one celebrated official at the expense of seeing his role in its appropriate political, historical and moral context. The oddity in this debate is that it is you, not I, who is the self-proclaimed leftist. It seems to me, though, that by fixating on Kissinger you let the US policy elite, of which Kissinger is only one rather florid and over-rated product, off the hook. In your account, he is a kind of lone gunman, spreading destruction across the globe out of a demented, pathological need to do harm. There is little attempt in your book to grapple with the issue of how much difference any individual made to the conduct of US foreign policy during the cold war, or, to return to the concrete world of personalities, no real recognition of the implications of the fact that Kissinger spent most of his time in government serving Richard Nixon-a president who was hardly a passive bystander in all these events. In these important ways, your book is astonishingly, defiantly, and perplexingly anti-political.

You are not alone. The belief that evil deeds committed by people in power are best understood as criminal acts, violations of international law best addressed by courts of law, is one of the reigning bien pensant pieties of the age. In a recent widely-praised book, the journalist Bill Berkeley, claimed that many African tyrants, from Mobutu to Foday Sankoh, are best understood as mafia chieftains-Don Corleone wannabes.

Would that it were so. The truth is that all political violence, whether committed by Alexander the Great or Foday Sankoh, Napoleon or Saddam Hussein, could be described in this anti-political, ahistorical way. By the same token, to describe the cruelties of statesman in the language of the criminal statute books is to offer a chimerical vision of a world into which, if we only can get enough courts and enough prosecutors and policemen, we will usher that human rights utopia that you seem to believe is heralded by the formation of the International Criminal Court and the Pinochet indictment.

Don't bet the ranch on it. In reality, this is a specious, self-congratulatory logic which mistakes setting new legal norms for the transformation of reality, and mistakes trivial steps forward for seismic shifts in the political landscape. You should know better. When you write that "we now enter upon the age when the defence of sovereign immunity has been held to be void," you sound, I'm sorry to say, almost as callow as Mary Robinson, the UN's human rights commissioner, whose windy optimism has made her a laughing stock from Beijing to Havana.

Even your usually inspiring prose suffers as a result of such flights of fancy. Who is this "we"? And which defence against sovereign immunity, by whom, and against what charges? A real judge would laugh your prosecutor's brief out of court. To me, you are in the process of falling into the same trap of human rights triumphalism, into which the mainstream human rights organisations slipped some time ago.

International justice, as it is grandiloquently called, is not the cure-all its advocates believe. To the contrary, in a world of gross oversimplifications, both benign and malign, it is among the grossest. Montesquieu writes somewhere that to every problem there is one, simple solution, and it is wrong. The idea that political wickedness can be usefully considered as a matter for the courts rather than political debate, resistance, or counter-violence is just the sort of wrongheaded prescription Montesquieu would have recognised and deplored.

Leave the practical difficulties of such human rights to one side. Leave aside the fact that, by your criteria, not only Kissinger but every French statesman since Colbert (including one of my heroes, General De Gaulle) and a plurality of British foreign secretaries could have been hauled before a tribunal. Assume, for the sake of argument that justice really should be humanity's collective categorical imperative at the expense of other, often conflicting imperatives like, well, peace. Even after you have done so, you are left with the problem that the judicialisation of the world that your book calls for, which constitutes its moral and intellectual underpinnings, effectively means a great shift toward the depoliticisation of our understanding of politics and history. In your account, the bad guys are just criminals, and you can simply hunt them down.

In an age when the general public is obsessed with personalities, your strategy, though doubtless undertaken for the best of reasons, only panders to the world as distilled by Tina Brown and Rupert Murdoch. The point was not, is not, Kissinger; it was, it is, the American empire. You know this. That is why your emphasis on one personality, and your attempt to transform Henry Kissinger into human rights public enemy number one is, whether you will forgive or not for saying so, beneath you.

David



Dear David

29th June 2001

On 28th May of this year Henry Kissinger was visited by the Paris police at the Ritz Hotel. The gendarmes bore a summons, still extant, from Judge Roger Le Loire. It asked that Kissinger attend the Palais de Justice on the following day, to answer questions about his knowledge of Operation Condor. Operation Condor, as you well know, was the international death squad which co-ordinated the secret police terror of Chile, Argentina, Paraguay, Bolivia, Uruguay, Brazil and Ecuador in the decades of dictatorship. This atrocious system enjoyed the collusion of the US government, most warmly in the Nixon-Kissinger years. Five Frenchmen are "missing" from that period, which gives Judge Le Loire his jurisdiction. Kissinger left town in a rush. On his return to New York, he found similar summonses from Judge Garzon in Spain and Judge Rodolfo Corral in Argentina.

Earlier, I published a short book predicting that this and other forms of legal redress would be pursued against a man whose continued immunity and impunity astonishes us both. I wrote the book in that form because, in the post-Pinochet (and indeed the imminent post-Milosevic) context, I thought we might realistically promote the term "criminal" from metaphor to job description. And, as it happens, I was right and everybody else was either wrong or not paying attention.

You don't flatter me all that much by saying that I could have written ten different books. Of course I could (though I wouldn't have been so wedded to anachronism as to call for the trial of Richard Nixon). But this is the most stringent test yet of the principle that no one is above the law, whether local or international. I can't think why so many people are in such a hurry to change such a fascinating subject. I'm naturally sorry to find you among them.

Christopher



Dear Christopher

1st July 2001

At the end of your book, you tell the story of an American network television producer who tried to avoid responding to your arguments by asking if there was anything "new" in the claim that Henry Kissinger was a war criminal. "The shallow demand for novelty," you write, "is... a favourite spin tactic of the powerful." But you are fair-minded enough to add that there is a way of "asking such a question in good faith." You go on: "The information is not 'new' to the people of East Timor and Cyprus and Bangladesh and Laos and Cambodia, whose societies were laid waste by a depraved statecraft."

I agree. But I would suggest that your apt phrase, "depraved statecraft," radically undermines the force of a polemic which singles out Kissinger for opprobrium in each of these episodes.

It seems to me that none of the episodes in which you describe US power being used to malign ends would have played out very differently if someone other than Kissinger had been US secretary of state. Kissinger himself wrote recently that US victory in the cold war was the result of bipartisan efforts over nine US administrations. The same can be said about cold war crimes.

If I am right, then for all its merits as reportage or polemic you have written a perversely anti-political book. I don't think that by saying this I am trying to change the subject; what I'm saying is that you've got the context wrong. The judicialisation of the world that you support implies the rejection of a political understanding grounded in history, and institutions in favour of the criminal code. Such a choice has been the catastrophic error of the contemporary human rights movement, and I am sorry to find you joining them.



Dear David

2nd July 2001

Of the four men who concocted the wicked plan set out in the first chapter of my book-the plan to subvert the Paris peace talks on Vietnam and undermine the 1968 presidential election-Richard Nixon, Spiro Agnew and John Mitchell were eventually brought within the ambit of the law. Mitchell went to jail; the first attorney-general to do so. The fourth man, Henry Kissinger, has escaped judgment even though his crimes extended well into Washington DC during the Watergate nightmare.

Of the international despots who were his favoured clients-Augusto Pinochet, Suharto, Brigadier Ioannides, the coup-mongers in Bangladesh-all are in jail or awaiting (or evading) trial. I fail to see the objection to making this due process more thorough and consistent.

Of course you are right to say that there were systemic deformities in the US apparat, some of them produced by cold war exigency. However, would you not agree that by the middle of 1968 a strategic majority of the establishment had decided that the Indochina war had lost any semblance of imperial rationality? This was even Kissinger's view until Nixon made him a secret job offer. The decision to prolong and extend that war, by covert means and with an eye to domestic political manipulation, created a presidency under which the US was in the real sense of the term a "rogue state." I take it that you do not believe that the ruling class, or whatever you wish to call it, wanted or needed the bugs, the bagmen and the "madman theory of war."

Kissinger was a crucial enabler of all this-he even urged Nixon to burn the tapes rather than submit to subpoena. Because of the Nixon regime's implosion, he became for some time the president, at least for foreign policy. He is the only surviving unpunished co-conspirator of that period. The truth and justice commissions of neighbouring nations, pursuing their inquiries into the same epoch, have reached a point where they have to apply by legal means to open some hidden archives in Washington, and for a deposition of Kissinger himself. I think they deserve support in this. Don't you? Or are such commissions just a part of the skein of inky parchment bonds which you see festooning the globe?

As you know, I have produced a history of the Cyprus question which examines the continuity of American foreign policy through several administrations. I take your point about power. Who could not. However, even the most hardened student of realpolitik has to whistle a bit when examining Kissinger's volatile, high-risk dependence on criminal elements, and on fascist-minded forces. And how did the precipitation of a war within Nato-between Greece and Turkey-aid the west in its contest with the Warsaw pact? Did the mass murder of the Timorese help demolish the Berlin wall? Did the asphyxiation of democracy by death-squads in South America cost Brezhnev any sleep?

This is partly a battle to open the archives; the weapons of subpoena are already being aptly employed against Kissinger in DC as a consequence of the Letelier trial, and I predict there will be further legal initiatives.

You have to begin somewhere: the British Special Branch was not ordered to go round to a clinic and democratise Chile; it was told to pick up a wanted war-criminal. At the time of that arrest, you were among those who thought it would retard the opening of Chile's politics; it has, of course, greatly assisted that process. The open trial of Milosevic has every chance of beginning the rehabilitation of Serbia. But you and I would be the first, I hope, to say that laws and precedents and principles of this kind should not be used only to discipline small fry.

The summons served on Kissinger in Paris on 28th May is the highest the finger of justice has ever reached; it touches a senior offender who is a citizen of an undefeated nation. I said this would and should happen, and I designed my book as part of the new argument needed for the new context of international law. Progress here is (like my book) uneven and inconsistent, but it is measurable. Universal jurisdiction is in; "sovereign immunity" is out. As Pinochet's prison-visitor once said: "Rejoice! Rejoice!"



Dear Christopher

3rd July 2001

As you know perfectly well, Nixon, Agnew, and Mitchell were not punished for their complicity in the secret bombing of Cambodia or any other part of the Vietnamese catastrophe, but for violations of domestic US law connected to Watergate, or personal corruption. What has this got to do with the question of whether Henry Kissinger is or is not guilty of war crimes? Surely, such conflating of historical and legal issues is no advance on the past and no further step toward what you describe-far too credulously in my view-as the "new context" of international law.

More important, I think your claim that Kissinger was acting in defiance of an American elite consensus by continuing to prosecute the war in Vietnam, even if it is true (and I am not convinced that it is), does not answer the question of why you hold him particularly responsible for US actions at key times in Cyprus, Bangladesh, East Timor, and Chile-policies that, at least in the case of Cyprus, you yourself concede had considerable continuity across US administrations.

You ask, as if this demonstrated anything about Kissinger's guilt or innocence, whether such policies were necessary for the US to win the cold war-something I don't believe any more than you do. But the salient question is whether most of the American elite believed such acts to be necessary, however regrettable some may have found them. I believe that, demonstrably, they did. The whole sorry record of cold war excess, from the overthrow of Arbenz and Mossadeq in the 1950s, through Vietnam and the slaughter in Indonesia in the 1960s, to the support for the Turkish repression of the Kurds that persists to this day-more than ten years after the defeat and disappearance of the Soviet Union-supports such a view.

But my deepest anxiety is about the position you now espouse, and, more generally, about the current direction of the human rights movement. It is that by fetishising the guilt of a few individuals, you give considerable support to the consoling fiction that the cruelty with which powerful states and those who administer them apply to the destinies and dreams of weaker states and vulnerable peoples, are the exceptional acts of a few criminals.

There is little in the argument you advance in your book, and still less in the declarations of groups such as Human Rights Watch, which could rebut a person who said, "oh, Bangladesh (or Laos, or East Timor, or some fresh horror still in store for us), that's not the fault of the system-it's that wicked war criminal Kissinger (or Pinochet, or Suharto, or, yes, Milosevic)." As the writer, Nuruddin Farah, likes to say: "a thief cannot live among honest people."

So "Rejoice! Rejoice!" eh? Painful as it may be to disagree with the Iron Lady, I should have thought a more appropriate response would have been: be careful what you wish for.

David



Dear David

5th July 2001

You are verging upon error in your memory of the Nixon gang. Not only was Mitchell convicted for illegally using the CIA as a domestic politicised police force, but the first article drawn up by the House in the impeachment of the president explicitly cited the unlawful blitzing of Cambodia. It's a great shame that these grave issues were never put to proof. I suppose if Nixon had been brought to book-and he would hardly have stood in the dock alone on the Cambodia arraignment-you would be grumbling that this left Abraham Lincoln unpunished for his suspension of habeas corpus.

I realise that I simply don't know, and can't tell, from your arguments, whether or not you approve the detention and trial of men like Pinochet and Milosevic. You seem to prefer saying that such things don't go far enough, or that mere trials are surrogates for deep societal reforms. I dare say you might be right about that. But you are not entitled to the corollary, which is your assertion that supporters of universal jurisdiction propose it as a universal panacea. And it's simple casuistry on your part to suggest that we blame everything on malign or deviant individuals.

It does sometimes happen, however, that such persons come to power. Blame "the system" all you like; the fact remains that Kissinger twice provoked-over Bangladesh and Cambodia-mass protests and mass resignations from his own state department. And the disclosures about him in the Pike Committee report had to be extracted by congressional subpoena. My point is disarmingly simple-do you think that men like this should be above the verdict of law? In saying that they should not, I don't thereby discard or disdain other verdicts, such as those of history or political theory.

My closing point is more intuitive than forensic. If you consult the current issue of Foreign Affairs, you will find an article by Henry Kissinger on the grave dangers of universal jurisdiction. (It is an extract from his latest dreadful book.) There is no doubt that he is extremely rattled by the advances made in this direction. So are the ex-caudillos of many unhappy countries. We cannot prove that the future caudillos have been depressed as well, but that is Kissinger's explicitly-stated fear. I don't mean to cite Kissinger as an authority on anything, but his express misgivings surely make nonsense of your insinuation that justice for war criminals is a feelgood trip for the bien pensant.

Cristina in the land of make-believe

Argentina
Cristina in the land of make-believe

May 1st 2008 | BUENOS AIRES
From The Economist print edition

Dashing hopes of change, Argentina's new president is leading her country into economic peril and social conflict

SHE romped to an easy victory in last year's presidential election by promising to maintain Argentina's impressive economic performance while easing its social tensions and rebuilding its foreign relations. Yet just five months after Cristina Fernández succeeded her husband, Néstor Kirchner, in the Casa Rosada, Argentina is worse off on all three counts. Already, her government looks in disarray. It has provoked a tax revolt by farmers. On April 24th, it lost its most important new face when Martín Lousteau resigned as economy minister over a policy disagreement. The price of Argentina's bonds has plunged as investors show little confidence in the government.

With the economy having grown at over 8% a year since 2003, when it began a vigorous recovery from an earlier financial collapse, Mr Kirchner basked in popularity. He was helped by record prices for Argentina's farm exports but pumped up the economy further, with dollops of public spending and an undervalued currency. He brushed off worries about inflation, strong-arming businesses into freezing prices and ordering an underling to doctor the consumer-price index.

During her campaign, Ms Fernández led some analysts to believe that she would be more moderate than her combative husband. But any such hopes have been quickly dashed. She has kept most of his ministers, his policies and his rhetoric. According to unofficial calculations, inflation has reached 25% (officially, it is 9%).

Ms Fernández shows little sign of curtailing the dash for growth at any price. Mr Lousteau's mistake seems to have been his intention to act on her campaign promise to restore credibility to official statistics. His replacement, Carlos Fernández, is a non-entity. In practice, Mr Kirchner himself seems still to be in charge of economic policy. “We don't want a cooling of the economy because that always brought us unemployment, poverty, exclusion and economic concentration,” he told a recent rally of the ruling Peronist movement.

But overheating and inflation are already bringing Argentines some of these woes—and if unchecked will in time bring all of them. The statistics agency has stopped releasing poverty figures. Using an independent estimate of inflation, the poverty rate has risen from 27% in 2006 to 30%, with 1.3m Argentines descending into poverty last year, according to calculations by Ernesto Kritz, a labour economist in Buenos Aires.

To tame inflation and stabilise the economy, the government needs to allow the peso to appreciate, curb spending growth and energy subsidies, and raise interest rates. The longer such measures are postponed, the more painful and unpopular they will be.

Ms Fernández is already in a weaker position than her husband was. Several recent opinion polls give her an approval rating of only 35%. Mr Kirchner used lavish fiscal transfers to buy the support of provincial governors and mayors. But it is getting harder for his wife to match that.

To compensate for Mr Kirchner's pre-election spending binge, in March she raised taxes on agricultural exports. Buoyed by record world commodity prices and a favourable exchange rate, farmers had hitherto grudgingly accepted the levies. But the tax increase, together with rising inflation, cut the profit margin on soyabeans to just 6%, for example. The farmers launched an unprecedented campaign of strikes, roadblocks and pot-banging protests in city centres.

Taken aback, Ms Fernández's response was tellingly authoritarian and unstatesmanlike. She accused the farmers of greed and, improbably, of seeking a military coup. Government rent-a-mobs of piqueteros (unemployed protesters receiving state welfare payments) were unleashed against the farmers and their supporters. That backfired. “Cristina managed to do in three weeks what Argentina's farmers couldn't over 50 years: unite them,” says Gustavo Martínez of Salvador University in Buenos Aires. The farmers suspended their protests to allow talks to take place. The government seems to be seeking a way to back down.

Even in foreign policy, in which Mr Kirchner showed no interest, Ms Fernández has had little success. Her expressed desire to improve relations with the United States foundered on a complicated campaign-finance imbroglio. Last year customs officers at a Buenos Aires airport impounded $800,000 in cash being brought in by Guido Antonini Wilson, a Venezuelan-American who had arrived on a private plane rented by the Argentine government. Two days after Ms Fernández's inauguration, American prosecutors charged five men who they said threatened Mr Antonini, who lives in Miami, and claimed to have evidence that the money was for her presidential campaign.

The president seemed to blame the United States government, rather than its courts, for what she called “a garbage operation” against her. A planned visit to Europe last month was curtailed because of the farmers' protests. While foreign investment pours into neighbouring Brazil, Ms Fernández has done nothing to assure investors that they will enjoy predictable policies while she is in power. The government signed a contract this week for a $3.7 billion high-speed train from Buenos Aires to Córdoba, the first of its kind in Latin America, but it will be paid for with debt.

Ms Fernández still has plenty of time to correct her mistakes. She is blessed with a weak and divided opposition. Her husband has installed himself as president of the Peronist party, still Argentina's most formidable political machine. But the first couple's support is narrowing to not much more than the urban underclass organised by that machine.

After her bumpy start, Ms Fernández is being compared to Michelle Bachelet, the similarly hapless president of neighbouring Chile, with whom she is friendly. But at least Ms Bachelet is making her own mistakes. The suspicion in Buenos Aires is that Cristina is paying the price for her husband's pigheadedness, even if that is something she shares. “The Kirchners' golden age is over,” says Sergio Berensztein, a political consultant. “Now they'll have to get used to it.”

MIGRATION: You don't have to be rich

Developing countries attract migrants too

THE complaints sound familiar. Foreigners steal our jobs. Aliens cause a rise in crime. The corrupt interior ministry cannot cope. The border is ineffective and deporting illegal migrants does not work: removed by train, they return on foot. Outsiders put a strain on housing, especially for the poor, and on hospitals and schools. But employers do not care: farmers want cheap labour, and rich families need skilful foreign gardeners and housekeepers.

ReutersTurfed out of Little London

Residents of Soweto, or other urban areas in South Africa, are likely to grumble about foreigners in the same way as in rich countries. The makwerekwere, as African foreigners are insultingly known, are attracted by South Africa's relative wealth. Some Tanzanians talk longingly of Johannesburg as “Little London”. One in four Little Londoners may now be a foreigner. Zimbabwean teachers, forced out by hunger and repression, work as security guards and shop assistants. Congolese lawyers toil as waiters and chefs.

In 2005 two World Bank researchers, Mr Ratha and William Shaw, estimated that two in five migrants—about 78m people—were outside rich countries. But who in the poor world is counting? South Africa's government does not know how many foreigners it has (2m? 5m? more?). Mexico, India or Turkey cannot be sure either. Total numbers are skewed by those displaced by the collapse of the Soviet Union or who became de facto migrants when borders moved.

Ms Newland of the Migration Policy Institute in Washington, DC, says the flows between poor and mid-income countries are huge but “desperately understudied”. One reason why outsiders pay little attention is that most poor migrants do not move far. Roughly half of all South-East Asian migrants are thought to have remained in the neighbourhood, and nearly two-thirds of migrants from eastern Europe and Central Asia have stayed in their own region. Nearly 70% of migrants from sub-Saharan Africa remain on their continent. West African countries do not limit immigration from their neighbours, so lots of people cross borders, for example from Ghana to oil-rich Nigeria.

Some middle-income countries, such as Morocco, Mexico, Turkey and Libya, are well-trodden transit routes with migrant populations of their own. A senior civil servant in Morocco laments that his country is “between the hammer and the anvil” of Africa and Europe. Others, like India, Russia, South Africa and Argentina, are destinations in their own right. With all this come the same opportunities and threats as in the rich world. Chile imports doctors and maids from Peru, raising worries about a brain drain. Zambians fret about an invasion by Chinese, whose numbers in Africa are said to be between 80,000 to 400,000, many in oil-rich countries such as Sudan, Nigeria and Angola.

Remittances from one low-income country to another probably help to cut poverty. A 2006 study of 4,700 households by the Southern African Migration Project found that 40% of Zimbabwean households received some money from this source. How much is hard to measure, but a World Bank estimate for 2006 gives a range for remittances among poor countries of $17 billion-55 billion.

Some middle-income countries are extraordinarily welcoming. Venezuela, awash with oil revenues, even allows Colombians to use its social-welfare system. Argentina has lifted most restrictions on immigration from South America, again guaranteeing access to public health and education, even for illegal migrants. But many other countries show signs of xenophobia. On one occasion a newspaper in Morocco gave warning that “black locusts”—African migrants—were invading. Russian authorities, especially in Moscow, regularly throw out traders from Georgia and elsewhere in the Caucasus. Libya occasionally expels African migrants.

Many poor people are drawn to somewhat less poor countries in the hope of finding work, just as they are to rich countries. But with war, repression and economic collapse, push factors are much stronger in the poor world. The invasion of Iraq in 2003, and the violence since, has uprooted more than 4m Iraqis. Some 95% of them have remained in the Middle East, including 2m in hard-pressed Jordan and Syria. Sweden, with an admirable history of taking in refugees, has welcomed 23,600 Iraqis, but few other rich countries have followed suit. Some of the displaced are beginning to return home. Since the Taliban were booted from power in 2001, Afghanistan has seen the voluntary return of at least 3.2m people from Pakistan, Iran and elsewhere.

Climate of fear

Could a changing climate cause similarly big ebbs and flows? Scientists agree that average temperatures are likely to rise significantly by the end of this century. Rainfall patterns are already shifting. Those in marginal areas, for example on the edges of deserts, will suffer most, along with those in countries with the least resources to adapt. The sea is also rising, which might mean floods on vulnerable coasts. Some 12% of Africa's urban population, and 18% of Asia's, live in low-lying coastal zones and may be exposed to extreme weather or floods. The Intergovernmental Panel on Climate Change suggested in 2007 that millions may face water shortages, hunger and flooding as a result of climate shifts. Some would migrate, although probably over a period of time.

Environmental change has already set off some migration. Because the Sahel region gets much less rain than it did a century ago, farmers in Mali are moving to the cities. According to the UN Environment Programme, over the past four decades the desert in Sudan has crept south by about 100km and forests have disappeared. Rainfall in north Darfur, in Sudan, has dropped by a third over the past 80 years.

All this has displaced people and, some believe, encouraged war. Morocco's government is anxious about it. “There is a direct impact on migration. You see people leaving sub-Saharan Africa in search of more habitable land,” says Mr Ameur, the minister for Moroccans abroad. Abdelhay Moudden, a migration expert in Rabat, suggests that the first to leave may be struggling farmers: “If the urban economy cannot absorb them, then it may also push international migration.”

A 2005 report by the Institute for Environment and Human Security in Bonn suggested that rising seas and extreme weather, among other things, could uproot 150m people by 2050. Ms Newland of the Migration Policy Institute cautions against talking up the figures, but thinks that if drought and rising temperatures cause crop yields to fall in, say, the Sahel, they will probably encourage migration. If climate change were to cause wars or spread disease, that could compound the effects. Another reason, then, to switch to low-energy light bulbs.

MIGRATION: Of bedsheets and bison grass vodka

Rich economies gain from high levels of migration, but the benefits are unevenly spread

FOR the past two decades or so, high rates of immigration into OECD countries have coincided with prolonged economic growth in much of the Western world. Consider Cobh, a bustling tourist town in southern Ireland which used to be famous for exporting people. Some 2.5m Irishmen and women embarked for America from its quayside, and its great and gloomy neo-gothic cathedral was paid for by remittances.

ReutersThey need her

Now, like the rest of Ireland, Cobh heaves with foreign workers. There are Poles on building sites, Latvians who own a shop selling dumplings, sauerkraut and other continental delicacies, a South African in the tourist office and another driving a taxi, Chinese in restaurants, a Bangladeshi managing a fishing business, and so on. A hotel owner says that he could not do without the migrants: when he recently advertised for a receptionist, none of the 200 applicants was Irish.

Migration can be both a consequence and a cause of economic well-being, but many people in host countries with lots of migrants have yet to be convinced of the economic benefits. A poll in November 2007, for France 24, found that 55% of Spaniards consider migrants a boon for their economy, and so do 50% of Italians, but only 42% of Britons and Germans and a mere 30% of French respondents.

Some of the hostility towards immigration seems linked to worries about the economy. If recession looms, locals are more afraid that outsiders will take their jobs or scrounge on their welfare systems. The last time that immigration in America was as high as it is now, just under a century ago, xenophobia rose as recession took hold. Today, amid concerns that a housing slide could lead to a general economic slump, American anxiety about migration is rising again. But the poor worry about immigration even when the economy is thriving.

Legal migrants usually have better job prospects than illegal ones, and the more educated outdo the rest. Not all of them stay. Nearly a third of those who crossed the Atlantic to America between 1890 and 1914—and as many as half the Spaniards and Italians—re-emigrated. Similarly, surveys today show that a majority of Poles in Britain plan to go home within a few years.

Some migrants do better not only than those left behind but also than those in their destination countries. The Institute for Public Policy Research, a British think-tank, found in 2007 that the foreign-born of many ethnic groups are both more likely to have a job and to be better paid than the average Briton. In America, over the past century, studies have shown migrants' wages catching up with, and then often surpassing, those of average Americans. Migrants' children do well too. This is not surprising. Migrants need health, skills, determination, a willingness to take risks and some entrepreneurial nous to take the plunge, which marks them out as special people.

Assuming that migrants are in work, they are bound to benefit the economy of the host country as a whole. Most simply, an expanding workforce permits faster growth. More people can do more work, and many migrants are young adults who are particularly productive. Moreover, migrants increasingly alleviate specific labour shortages in rich economies. Some economies could not function without foreign workers. In the United Arab Emirates, for instance, they make up an astonishing 85% of the population.

For the moment few other countries rely so heavily on outsiders (see chart 2), but in a number of rich countries, including Britain and America, foreigners typically make up 10-15% of the labour force and their share is rising. Around half of the new jobs created in Britain today are filled by migrants, often because they have skills that locals lack (from plumbing to banking) or because natives scorn the work (from picking fruit to caring for the elderly).

Low jobless rates in Ireland, Sweden, Britain, America and other countries with high migration suggest that, so far, foreigners are not squeezing out natives. Migrants also help to create jobs, because a good supply of labour encourages those with capital to invest more. For example, the hotel owner in Cobh, knowing he can find affordable staff, has added an extension with extra rooms. In contrast, countries where migrants have been kept at arm's length, such as Germany, complain about a chronic shortage of skilled workers such as engineers, scientists or programmers.

Just say the word

Foreign workers are often more flexible than native ones, too. Having already moved from Mexico to California, say, they are probably willing to take a job in Chicago. Migrant labour helps to keep economies on an even keel. At times of strong growth, an influx of workers reduces the risk of wage pressures and rising inflation. If growth weakens, migrants can go home or move to another country, or choose not to come in the first place. For example, the flow of Mexicans to America is probably slowing as the housing slump worsens and construction jobs disappear.

Migrants can also release skilled natives to do a job (for example by providing child care that allows a parent to go back to work). And they are consumers, too, renting accommodation and buying goods and services. The owner of the off-licence in Cobh is delighted by his Polish customers, who are fond of bison grass vodka and east European lager. Cobh's supermarket, fast-food restaurants and other shops are flourishing too.

Quantifying the impact of all this is tricky. A 2007 report by PricewaterhouseCoopers concluded that a surge in migration has helped to lift Britain's growth rate above its long-term trend. Alexandros Zavos, of the Hellenic Migration Policy Institute in Athens, reckons that immigration into Greece has recently added as much as 1.5-2.0% to its GDP every year. For countries that have long had high rates of immigration, such as America, sustained economic growth partly reflects an ever-growing workforce.

Sceptics say that migration may boost the economy as a whole, but on a per-head basis the benefits for the natives are less impressive. Migrationwatch, an anti-migration group in Britain, reckons that for the average Briton the inflow of foreigners provides just a few extra pence a week. Roy Beck, an anti-immigrant activist in America, suggests that countries with ageing workforces should try to make their economies less labour-dependent. His country is “addicted to foreign labour”, he says, and more capital investment and more training for locals would reduce the need for foreign workers. But some jobs (such as cleaning or nursing) cannot be sent abroad or mechanised. And even if more natives can be trained to do highly skilled work, shrinking native workforces in many countries could mean economic contraction.

Some of the sceptics' arguments touch raw political nerves, particularly when it comes to the least well-off natives in the host country. In America the share of national income that is going to the poorest has been shrinking in recent decades. Inequality has increased and the real wages of the least skilled have fallen. Circumstantial evidence suggests that foreigners, who typically work in less skilled jobs, might be partly to blame. According to one estimate, they make up around 28% of legal construction workers in America and over a third of maids and housekeepers. If the illegal workers could be counted, the figures would probably be much higher still.

Cheap and cheerful

Do migrants make life worse for poor natives? Studies comparing wages in American cities with and without lots of foreigners suggest that they make little difference to the income of the poorest. George Borjas of Harvard University, who compared wages for different kinds of jobs where migrants most obviously compete with natives, estimated that immigration in America in the two decades to 2000 may have kept wages 3% lower than they would otherwise have been. For the least skilled the difference may have been as much as 8%. But Mr Borjas also calculated how a rise in the number of migrants might have encouraged the creation of jobs, which reduced the impact on wages.

This tallies with the outcome of natural experiments in recent history, such as the influx of 610,000 Russian Jews into Israel in the early 1990s, the return of 900,000 Frenchmen from Algeria in 1962 or the homecoming of 600,000 Portuguese after the collapse of their empire in Africa in 1974-76. Each time the influx of workers expanded the workforce and wages dropped slightly, but subsequently recovered. Given prolonged immigration, argues Steven Camorata of the Centre for Immigration Studies, the impact is sustained. He thinks that “it's the poorest 10% [of Americans] who seem to lose out, cutting their wages by perhaps 5%.”

Worse, say the sceptics, migration may limit poor natives' chances of moving up to better-paid jobs. With changing economies that reward skills, it is anyway getting harder to move up the ladder from low-wage jobs to better-paid ones. Now migrants, especially those with skills and drive, are making life even harder for the weakest natives.

A second worry is that migrants will put a strain on public services and the tax system. It is in schools, public housing and doctors' surgeries that natives come face to face with migrants and it is often at the local and state level, where responsibility for such services usually lies, that hostility to migrants seems strongest. Local councils in Britain complain that clinics and schools are overloaded and central government is slow to dish out help, and local police in areas with many immigrants blame foreigners for a rise in crime.

In Greece, as new illegal immigrants arrive at remote spots on the border, officials complain that they lack funds for policing and social services. The prefect of Samos laments that “we are given a short bedsheet to cover our body.” In America hostility to migrants is greatest where they have recently been arriving in large numbers, not where their absolute numbers are highest (near the borders or in big cities, such as New York). Several states have passed tough new laws banning illegal migrants from using their public services.

But crowding, although likely to cause resentment, results from the unexpected arrival of those migrants, with bureaucracies taking time to allocate resources to the right places. In itself, it does not prove that migrants are a drag on public services as a whole. Indeed, migrants often make a large contribution to the public purse. When a foreign worker first arrives, usually as a young adult, fully educated and in good health, he makes few demands on schools or clinics. A legal immigrant will pay taxes just like any native; even an illegal one will contribute something (if only through the tax on those bottles of bison grass vodka). If the immigrant stays on (and quite a few do not), the benefits will diminish as he ages, but at least he has given his host country a breathing space.

To complicate matters, highly skilled migrants contribute much more to tax and social-security systems than do less skilled ones. A study in America by the National Research Council suggests that migrants with an education beyond high school contribute an average of $105,000 to the tax coffers over their lifetime. By contrast, the least educated migrants are reckoned to leave the taxman with a $89,000 hole. But migrants as a whole, in the long term and counting the contribution of their children when they grow up and get jobs,are not a drain on public services. For rich countries with ageing workforces in particular, gains from importing the young, the energetic and those willing to take risks comfortably outweigh the costs.

MIGRATION: Open Up

Despite a growing backlash, the boom in migration has been mostly good for both sending and recipient countries, says Adam Roberts (interviewed here)

ENOCH POWELL had a point. The Conservative British politician gave warning, nearly four decades ago, that immigrants were causing such strife that “like the Roman, I seem to see the River Tiber foaming with much blood.” That proved to be nonsense, as did his advice that migrants should be encouraged to leave. Had they done so, Britain and other rich countries that depend heavily on foreign labour would be in a dreadful state. But one prediction he made was spot on: that by about now, one in ten people in Britain would be migrants. And indeed, at the last count in 2005, the foreign-born made up 9.7% of the British population.

By historical standards, that is high. It is a lot more than a decade ago, and the trend is resolutely upwards. Yet it is not dissimilar to that in many other rich countries, which have mostly seen equally rapid increases. And it is still lower than in America, where the proportion is now about 13%, not far off the 15% peak reached just before the first world war, in the previous great era of migration. What is particularly striking in Europe is that many countries which until recently had known only emigration, such as Ireland or Greece, are now seeing the sort of influx more typical of countries such as Australia and America.

This special report will argue that both emigration and immigration countries, as well as the migrants themselves, have been coping remarkably well with this new force that is reshaping our world. Yet there are now signs of a serious backlash against immigration on both sides of the Atlantic. In 2007 activists in America smashed a bill to make immigration easier that had the backing of the president and the leaders of both big parties in Congress. In France, Nicolas Sarkozy won the presidential elections partly thanks to his anti-migrant rhetoric. But this is still a far cry from Mr Powell's doom-mongering.

Politicians in rich countries may tinker with migration policies. They will certainly, under public pressure, put extra resources and energy into building more fences and walls to keep people out. And by making a connection between immigration and terrorism, they may cause their societies to become more heavily policed. But the basic forces driving migration are unlikely to ebb.

Counting the ways

People who cross international borders are often categorised by their motives, and some of these categories are seen as less desirable than others. Most migrants move for economic reasons, many in search of jobs, some to be united with relatives. Most appear to be doing so legally. America in 2002-06 allowed in an average of just over 1m legal immigrants a year who planned to settle permanently, more than half of them sponsored by relatives. Another 320,000 a year entered temporarily.

The number of illegal migrants is by definition hard to ascertain, but likely to be smaller than the legal sort. The illegals also go for economic reasons, and they probably make up the bulk of people seen floating on rafts in the Mediterranean or scrabbling over the fence from Mexico to America. Many illegal migrants do not risk the high seas or physical borders but instead enter under some other guise, perhaps as tourists, and then stay on. In that same period of 2002-06, America's population is thought to have seen a net gain of 500,000 illegal migrants every year. Within the European Union it has become impossible to keep a tally because people can move legally among most of the member countries without asking anyone. Britain, as an island, should find it easier than most to know how many foreigners it has allowed in, but its statistics on migrants have recently turned out to be way off the mark.

Lastly, there are refugees and asylum-seekers, strictly defined as those escaping persecution but often including anybody forced to flee, for example from a war. According to the UN's refugee agency, at the close of 2006 some 10m people fell into this category. Many go through legal channels, applying for refugee status and then asylum. But others join illegal migrants in trying to reach host countries by raft or by jumping over a fence. Genuine refugees may have no alternative.

The 200m question

The number of migrants in the world today, both legal and illegal, is thought to total perhaps 200m (though many of the figures, even those used by governments, are at best educated guesses). That sounds a lot, but it adds up to only 3% of the world's population, so there is great potential for growth. Migration has turned out to be a successful strategy for the world's poor to make their lives a little better. Nor is it the very poorest who travel. You need money to move to another part of the world. Thus as Africa, China and other emerging countries become less poor, many more people can aspire to travel in search of a better life.

In the 100 years to 1920, such prospects encouraged some 60m Europeans to uproot themselves and move to the New World. A European who crossed the Atlantic could expect to double his income. Today the incentives are even more enticing. Those who move from a poor country to a rich one can expect to see their income rise fivefold or more. As long as such differentials persist, the draw will continue.

These days, too, demography is playing a big part in migration. Not every migrant is aiming for America or Europe: perhaps two in every five move to another poor or middle-income country. But those who go to the richest parts of the world do their inhabitants a favour. Without migrants, the greying and increasingly choosy populations in much of the rich world would already be on the decline today. That matters for their fast-changing economies, which increasingly demand either highly skilled workers or people willing to do unpleasant and tiring jobs.

One reason why much of the world has enjoyed a sustained economic boom with low inflation in the past decade is that the effective global workforce is expanding so fast. The IMF says it has quadrupled since 1980 as China and India have plugged their huge young populations into the world economy. It is likely to keep on growing, though at a slower pace, with a 40% increase in the world's working-age population forecast by 2050. According to the UN,the global stock of migrants has more than doubled in the past four decades. Not enough young natives have the right skills or motivation, so the rich must hope that outsiders will keep coming.

And they will. Luckily for Europe and America, there are huge pools of eager workers ready to jump on the next plane, train or leaking raft to work abroad. This can be beneficial for their home countries as well, at least as long as the population is growing fast. The IMF says that emigration from Belize, El Salvador, Guyana and Jamaica, for example, may have led to higher wages and less poverty. Some Chinese from the heavily populated east coast are moving out, despite a fast-growing economy. Researchers in Africa report a recent rapid inflow of Chinese workers.

If exporting brawn generally makes sense for a poor country, sending its better brains away may not. Most, perhaps all, poor and middle-income countries face chronic shortages of skilled workers. In South Africa, although universities churn out graduates at a fast clip, many well-qualified people promptly depart for Britain or Australia, leaving tens of thousands of jobs unfilled at home. In Morocco those with science and engineering degrees, computer skills and languages go to France, the Netherlands and Canada, whereas the students of literature and public administration stay at home. Professor Mohamed Khachami, of AMERM, a migration think-tank in Rabat, laments that his country lacks people to build better internet connections, yet Paris now has an association for Moroccan IT engineers. Hospitals and clinics in southern Africa struggle to cope with huge public-health problems as doctors and nurses pack their bags for jobs in the Gulf, Europe and elsewhere. It is a similar story for schools.

Those in demand abroad are the hardest people to keep at home. Some European countries tried, and failed, to stop artisans emigrating to America in the early 19th century. In fact it is almost impossible to block the exit for the highly skilled if the lure is strong enough. Small countries such as Jamaica, Trinidad and Senegal have seen half to three-quarters of all their graduates move abroad.

Rich countries have taken in more highly skilled migrants than ever before. The World Bank looked at a sample drawn from 52m migrants in 20 rich countries in 2000 and found that 36% of them had a college education, a sharp rise on a decade earlier. Yet emigration of skilled workers may be a consequence rather than a cause of problems in the sending country. For example, nurses may be quitting Malawi because their salaries are not being paid or because hospitals are crumbling; entrepreneurs may be moving abroad because the business climate back home is wretched. Stopping emigration, even if you could, would not solve the problems. The nurses might still leave their jobs, the would-be entrepreneur might sit on his hands.

Indeed, some argue that emigration can help to add to the stock of brainpower. Migrants who go abroad may spend more time studying, pick up more skills and experience and then bring them all home again. Remittances are often used to fund schooling. And the prospect of emigration and prosperity abroad may be an inducement for many more to get an education. All this suggests that the consequences of skilled emigration are difficult to calculate, even if they are not negligible.

Governments of sending countries would do well to tackle whatever factors are pushing their skilled people out in the first place. Malawi, which exports a lot of nurses, should of course worry that it lacks medical staff. It is said that there are more Malawian nurses in Manchester than back home. But, perhaps with donors' help, more investment in public health could be combined with a strategy of training many more nurses than are needed, allowing for future emigration and the other benefits that brings. If migrants can be tempted back home, even for short spells, all the better. Ghana, for example, has raised wages for some medical staff and offered incentives to the highest-skilled to come back. Money is not the only concern: staff are also allowed parts of the year to work abroad, giving a boost to their careers.

There is no guarantee that migration will carry on at record rates. It is possible to seal borders tightly enough to keep more people out if those inside are ready to pay the price. An earlier period of great migration came to an end, for example, when America some 90 years ago shut its doors to immigrants for a while.

But easier movement of capital and goods has helped to make the world a much richer place in the past decade or two, and more human mobility has both created wealth and helped to share it out more equally. The billions sent around the world in remittances each year is testimony to that. The price of keeping people out would be high.

And unexpected things keep happening. Wars can suddenly displace millions of people who may start off as refugees but end up as migrants. Some people think that climate change might force tens of millions of people to get moving within just a few decades. Misguided policies, a backlash over terrorism or a failure to integrate migrants could all cause serious problems. All the same, it seems clear, 40 years on, that Mr Powell got everything but his sums completely wrong.