Editor’s note: This article was first published in July 2012. It reflects that moment: Spain’s requests to Brussels, more than 5 million real unemployed (possibly 6), Niño Becerra’s forecast that the recession would last until 2016 or later, and the author’s estimate of at least three years to create 2 million jobs.
Predicting in minute detail what was going to happen, while society was living in that imaginary world where wealth was confused with credit or debt, really is an achievement. Many economists should stick their heads down the toilet and pull the chain, or at least keep their mouths shut. That, of course, does not apply to Santiago Niño Becerra.
The video below dates from March 2010, although it discusses the interview that the Spanish newspaper ABC did with Santiago Niño Becerra on 5 March 2006 (back in the days when we were all rich). In it, he said:
“Within four years we will live through an irreversible global economic crisis, in which the economic consequences will have a drastic social impact, with extremely high unemployment, falling consumption and severe deflation.”
In 2010, when our leaders were loudly proclaiming that we were close to the way out of the crisis, when Obama was announcing the end of the recession in the United States and China was lying to us about its debt, Niño Becerra reappeared, saying: “What we have lived through so far is only a pre-crisis. The crisis has not arrived yet, but it will.”
Clearly he was right again. Then again, what Niño Becerra was telling us could also be heard from older people in the street, who had no formal education but had something that most “official analysts and economists” lack: common sense.
It wasn’t hard to foresee what was going to happen once you had in hand the data Niño Becerra gathered on countries’ massive debt relative to their GDP.
Even so, Niño Becerra was called a doom-monger, a prophet of the apocalypse, and so on and so forth. The curious thing is that today Mr Becerra tells us that this recession will last a long time, probably until 2016 or beyond, and he is still called a pessimist for it, when the truth is that it is impossible to imagine it being solved before then.
The other day I asked myself a question: “Suppose Spain gets everything it has asked Brussels for, and suppose (and this would be a lot to suppose) that the Spanish government put away the scissors and started introducing measures for real growth. How long would it take to create just 2 million jobs?”
Unless some economic analyst can come up with a figure that contradicts me, the answer is that 2 million jobs could not be created in Spain in less than three years, and that is assuming the wind blows in our favour, which sadly is not the case. Now work out how long it would take to create 4 million jobs, always remembering that Spain has more than 5 million people who are really unemployed, a figure that could reach 6 million.
Other questions come to mind, which we will file under rhetorical questions. Niño Becerra knew what was going to happen by calculating countries’ debt levels and using a few mathematical equations, plus logic. Didn’t the rating agencies see it when they audited the banks’ accounts?
Let’s remember that these agencies that today are attacking the Spanish financial system (Moody’s, Fitch…) are the same ones that gave Lehman Brothers the highest guarantee of solvency a week before it went bust. Which leads to another question: why isn’t a single leader or banker in prison? Why has nobody opened a serious investigation into the interests of these agencies of dubious credibility? Not long ago Paul Krugman gave an interview in which he said that many people had warned about what was going to happen, but many officials silenced them. Of course, Krugman is just another “crank” of the same calibre as Becerra.
In the end, with so many cranks around, we listened to the “smart guys”, and as we can see, we are practically out of the crisis already.
Featured image: GRUPO FRANCISCO HERNANDO, CC BY-SA 2.0, via Wikimedia Commons.
