I was disappointed to see Miguel Angel Santos, normally so lucid, join the unhinged chorus of voices passionately arguing against a straw-man made to stand in for Francisco Rodríguez’s position on macro-economic adjustment. I can understand why a guy like Luis García Mora, who plainly doesn’t understand what adjustment is, could find comfort in arguing against an aggressively dumbed down versions of F.Rod’s argument – but when guys like Santos are following him down the rabbit hole, things have reached a state.
On one level, it’s slightly mystifying that F.Rod’s position draws the level of ire and misrepresentation that it does. Here we have a guy saying that Maduro’s administration is pursuing the same ruinous cycle of pre-election over-valuation, post-election devaluation we’ve seen again and again since the Lusinchi era, a miserable cycle of politically-engineered and motivated boomlets followed by miserable contractions that destroy longer-term prospects for growth and development, and that’s somehow read as a defense of the government’s line! Some very strange forces are at play here.
To be clear, F.Rod is not arguing that “¡Ya! Los problemas económicos se van a resolver,” and much less that “Ramírez y Merentes son una suerte de Tim Geithner y Larry Summers.” (#FFS, Miguel Angel.)
He’s arguing that precisely because our economic policy-maker remain every bit as venal and dim-witted as they’ve always been, and because their basic objective remains the same it always has (to accumulate influence, build their patronage networks and steal), they’re likely to try to do what they can to hang on to power.
And when you’re a big-time oil exporter with a cash-flow problem, the very obvious elephant in the middle of the room remains the same as it always was: a big-time devaluation that has the same effect as a major tax hike, a one time shift of purchasing power from people at large to the government that abates the main macro (NOT micro) imbalances out there, leaving the country every bit as screwed up in the medium to long-term, but the government relatively better off.
If you’re the government, or someone the government owes money to, that’s good news. For virtually anyone else, it’s bad news. It just so happens that F.Rod’s job description is heavy on cluing in people the government owes money to.
The bigger question, to me, is why F. Rod’s in some ways perfectly conventional analysis draws the ire and the fevered conspiracy theorizing it does. The best way I can explain it to myself is the Briceño León Effect. You’ll remember Briceño León as the hack sociologist who made up the 24,763-murders-in-2013 figure that has been quoted totemically by just about everybody in the opposition despite containing exactly zero information about 2013.
For fair minded opponents to the chavista regime, the Briceño León episode should’ve been cause for alarm: a clear demonstration that powerful group-think processes are at play in the opposition public sphere, cognitive biases that immediately predispose us to accept any information confirming the view that the government=catastrophe (without inquiring too closely into its provenance), and to just as uncritically reject any information that challenges that position as self-evidently biased/bought/wrong.
This is what I refer to as the Opposition Bullshit Machine: a powerful, deeply entrenched set of cognitive biases that together form an impregnable echo chamber that mirrors the government’s own (though of course without the access to mass media the government’s own echo chamber enjoys).
To me, it’s impossible to see the debate surrounding F.Rod’s adjustment hypothesis and not see the Opposition Bullshit Machine fully mobilized, wounded, and on the defensive. The guy’s real sin is breaking the catastrophist consensus among bits of a commentariat heavily invested in a collapse-is-just-around-the-corner narrative. It’s a sin too many in the opposition won’t forgive.
But if you insist on pillorying anyone who tells you something you may not want to hear, can you really be surprised later on to find out you don’t understand what the fuck is going on?
* Ojo: None of this is meant to say that F.Rod’s hypothesis is definitely right. For all I know, he could have it dead wrong. The government could choose to tank and default amid hyperinflation rather than to devalue and paying its debts. If it does, his failure will be as public as failures can be, his career effectively over, and the F.Rod haters are welcome to do a victory lap or two. How, exactly, F.Rod is meant to be doing himself (or BoA) any favors by purposefully misleading their clients into thinking Venezuela won’t default when they secretly know it will is just another of those little mysteries the Oppo Bullshit Machine would prefer not to tug at lest they see the ludicrous whole conspiracy theory unravel.