Opinion

David Rohde

Dismiss the middle class at your peril

David Rohde
Oct 27, 2011 19:39 UTC

For two hundred years, the middle class has enjoyed legendary status in Western economic thought. First the British and then the American middle classes, Weber, Marx and many others said, served as vaunted engines of economic growth and political stability throughout the 19th and 20th centuries.

When large segments of the population moved beyond subsistence living, they invested their excess capital in savings, education and the purchase of increasingly high-quality consumer goods. A focus on thrift, education and hard work produced entrepreneurial small companies that drove economic growth.

For a remarkable forty-year stretch after World War II, that model proved largely accurate in many parts of the world. The American, European and Japanese economies drove global growth. And a middle class the likes of which the world had never seen emerged in the United States. American incomes, educational opportunity and home size seemed destined to grow inexorably generation after generation.

In an astonishingly short period, that economic model has disintegrated. In practice – just ask the American worker whose real wages have declined for decades – and even in theory.

Last month, the British economist Charles Kenny declared the middle class’ importance and purportedly magical role in economic growth a “myth.” A 2010 paper by the Brookings Institution’s Homi Kharas argued that the best hope for the world economy was the emergence of western-like, consumer middle classes in China and India. And my colleague Chrystia Freeland wrote a recent column describing how companies are increasingly trying to sell to the rich at home and the emerging middle class abroad instead of the cash-strapped American middle class.

Trust Tunisia

David Rohde
Oct 24, 2011 21:35 UTC

As the first elections of the post-Arab spring unfold over the next several weeks, you will be hearing the term “moderate Islamist” over and over again. Early results from elections in Tunisia suggest that the moderate Islamist Ennahda party is going to win the largest number of seats in a new assembly that will rewrite the constitution, choose a new interim government and set dates for parliamentary and presidential elections. Members of Egypt’s Muslim Brotherhood who have also been described as moderate Islamists are expected to fare well in similar elections there in November. And Islamists play a growing role in Libya’s transitional council as well.

The Islamist parties insist that they have renounced violence, fully embrace democracy and will abide by the electoral process. Secular Tunisians, Egyptians and Libyans, as well as some western pundits, warn that the Islamist parties are a Trojan Horse. Once Islamists take power, they will refuse to relinquish it and forcibly implement conservative Islam in all three countries.

What is striking is the silence emanating from Washington and other western capitals.

Save lives in Turkey

David Rohde
Oct 23, 2011 16:08 UTC

A major earthquake in eastern Turkey Sunday morning killed up to 1,000 people and produced images of sweeping destruction and panicked pleas for help. Immediately dispatching search-and-rescue teams and humanitarian assistance is the right course of action for the United States and Europe.

There is a core humanitarian and moral duty to act now. Quick responses by American search-and-rescue teams saved earthquake victims in the past. Forty-three foreign teams – including six from the United States – pulled 123 Haitians from the rubble alive after last year’s devastating earthquake in Port-au-Prince. Cynics about foreign aid should remember that providing humanitarian assistance in response to national disasters is a central tool in maintaining goodwill toward the United States.

Unfortunately, there is a widespread perception in predominantly Muslim countries that Americans and Europeans care less about the death of Muslims than those of members of other faiths. Americans gave less aid to victims of Pakistan’s 2010 floods than they did to victims of Haiti’s 2010 earthquake. Haiti’s relative proximity to the United States could be one explanation, but suspicions that Pakistan’s military intelligence service, the ISI, sheltered Afghan Taliban fighters may be another.

Where Islam and democracy meet, uneasily

David Rohde
Oct 21, 2011 15:40 UTC

ISTANBUL — Last month, Davut Dogan, an amiable, 51-year-old businessman from Turkey’s Anatolian heartland, accompanied Turkish Prime Minister Recep Tayyip Erdogan on a historic trip to post-Mubarak Egypt. In a single day, Dogan and 259 other Turkish business leaders flush with cash announced $853 million in new contracts.

“We will go to Egypt next month to finalize the deal,” said Dogan, who is opening a $10 million furniture manufacturing plant there. “The factory will employ two hundred people.”

From the rapturous welcome Erdogan received to the economic power the Turkish businessmen displayed, the trip demonstrated Turkey’s potential to serve as a model for the Post-Arab spring Middle East. The violent death of Muammar Gaddafi Thursday in Libya and elections in Tunisia this weekend show the desperate need for an alternative to the region’s two failed models of government: American-backed dictatorships and authoritarian Islam.

Wall Street’s long occupation of the middle class

David Rohde
Oct 13, 2011 22:31 UTC
Last Friday morning, a 24-year-old New Jersey woman told me why she joined Occupy Wall Street. Around her, balding activists in their 50s tried to rekindle 1960s-era protests. Young Marxists flew red Che Guevara flags. The young woman, though, was different. 

She commuted to the protests, she said, while holding down two part-time jobs. She lived at home and helped her schoolteacher mother, who also worked two jobs, support her jobless, 60-year-old father. She asked to be identified only by her middle name – Susan – because she feared her bosses would fire her for attending protests. She didn’t talk of revolution. She talked of correction.

“Like any great nation and country, there are also hitches in the plan,” she told me. “And things that need to be changed.”

Looking to Afghanistan’s future

David Rohde
Oct 7, 2011 21:54 UTC

As the 10th anniversary of the start of the Afghan war is marked around the world, looking forward is more important than looking back. As I noted in an earlier post, staggering mistakes have been made over the last decade. While individual Americans and Afghans have performed heroically, the Afghan and American governments – particularly their civilian arms – have performed anemically. And Pakistan’s intelligence service – the ISI – is the single largest impediment to stability in the region.

Looking forward, the advocacy group Global Witness is on the right track. In a statement, it said that Afghanistan’s management of an estimated $3 trillion in copper, Iron, gold, oil, chromite, uranium and rare earths is the key to the country’s future stability.

“The stakes could not be higher,” said Juman Kubba, a Global Witness official. “Get it right and minerals could be the catalyst for peace and prosperity; get it wrong and there’s a massive risk they will be lost to corruption, or form a new axis of instability and conflict.”

Can Confucius save America’s middle class?

David Rohde
Oct 6, 2011 14:45 UTC

Update: Sorry, in the first version of this column I confused two different companies. The corrected version is below.

BOWLING GREEN, KENTUCKY–For decades, this bucolic corner of southwestern Kentucky depended on Corvette sales from the local GM plant for its economic life. Now, it’s trying something different.

Last year, the state university opened a “Confucius Institute” that offers nighttime Chinese language classes to local business people. An American auto parts company chose to create 280 new manufacturing jobs here instead of Mexico. And government officials brag about the 19 companies from India, Japan, Finland, Germany, Israel and other foreign countries that have invested locally.

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