For a prominent prognosticator, no easy answers in the year ahead


Reading The Economist’s redoubtable annual turn as Nostradamus, we will be forgiven if we emerge shocked, appalled and fundamentally confused.

After all, this is what the western world’s leading print pundit of fair-market capitalism does best: perplex.

“The World in 2015” imparts much the same wisdom as the various “Worlds” the magazine has published since big-picture, 30,000-foot views became both the sage and financially responsible way to board-up the bottom lines of publications heading into the otherwise preoccupied end-of-year times, just around the Christian holidays.

In the early 1980s, at the Globe and Mail’s Report on Business, these annual numbers were considered essential reading for cub reporters – just as important, for example, as the Canadian Securities Institute’s textbooks for aspiring investment, dealers, brokers and floor traders.

And as metro and national beat scribblers might have tucked into Charles Dickens, while the snow fell gently on the gritty curbs of downtown Toronto, we trenchers at the ROB studiously perused the writings of Walter Bagehot, The Economist’s preeminent editor (between 1860 and 1877) for clarity about the how the world’s financial systems worked then, and perhaps now, to sadly little avail.

Complexity is, of course, the essential nature of modernity. And accepting intricacy – nay, embracing it – in the affairs of men and women of good conscience is, arguably, what The Economist does best (hence, the name of the publication). In this regard, the 2015 outlook edition does not disappoint.

In his piece, the magazine’s editor-in-chief, John Micklethwait, writes, “Of all the predictions to be made in 2015, none seems safer than the idea that across the great democracies people will feel deeply let down by those who lead them. In Britain, Spain and Canada, elections will give voters a chance to unleash some of those frustrations.”

Are you listening Messrs. Harper, Mulcair and Trudeau? How about you, Barack Obama, one-time savior of the disavowed?

“The levels of unpopularity and disengagement in the West have now risen to staggering levels,” Micklethwait continues. “Since 2004 a clear majority of Americans have told Gallup that they are dissatisfied with the way they are governed, with the numbers of those fed-up several times climbing above 80 per cent (higher than during Watergate. Britain’s Conservative Party, one of the West’s most successful political machines had three million members in the 1950s; it will fight the (general) election in May with fewer than 200,000.”

So, then, we may reasonably assume, democracy is on the run.

But, wait, here’s what The Economist’s foreign editor, Edward Carr, writes in the same issue:

“Look on the bright side. . .Armed with more realistic expectations, optimists can point to three reasons for hoping for something better in 2015. The first is that democracies take time to respond to new threats and dangers, but when they do they tend to be committed to their new policies. . .The second reason to temper pessimism is adaptation. . .In 2015, China and Japan will begin to put aside their differences. Not because either is willing to give ground on their in their long-running territorial dispute over some rocky outcrops in the East China Sea, but because both need the economic boost from sustained trade and investment between them. . .The third reason concerns America. . .(Some have said) that (Barack Obama) is weak and distracted, and others (have said) that the United States is falling into decline. The charges distort Mr. Obama’s thinking and vastly overstate America’s loss of power.”

In fact, it’s hard to argue with a five-year recovery that has returned five million jobs to the biggest economy on the planet, reduced unemployment to below 5.6 per cent, and goosed annual GDP growth (in that country) to between three and 3.5 per cent over the next 15 months.

Perplexing, indeed.

Are we going to hell in a hand basket; or are we at the cusp of a new age of fair-market capitalism, powered by democracy movements that fully appreciate the role that healthy public institutions play in realizing their peaceful, common goals?

Let us dust off our crystal balls, for all the good they will do us.

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