The WSJ’s Editorial Posing as “News” about Ecuador

By William K. Black

Greetings from Bogota where I’m participating in an economic conference and teaching two class sessions.

Under the banner “Latin America News” the Wall Street Journal has poured out its pain that the people of Ecuador might reelect President Rafael Correa.  The article is actually an editorial attacking Correa and the people of Ecuador for potentially voting to reelect Ecuador’s most successful President in the modern era.

The issue is term limits.  I have always opposed term limits as an obstruction to democracy and competence.  The U.S. had no presidential term limits for most of its history and the only president the population chose to elect to more than two terms was Franklin Delano Roosevelt – one of our greatest presidents.  I am deeply thankful that our Nation had the great good sense to reelect FDR to four terms in office.

Term limits are an issue on which reasonable people should be able to disagree without rancor.  Rupert Murdoch and his reporters do not fall within that category and they despise Correa Ecuador’s success and Correa’s popularity falsify their ideological claims that democratic government is the problem and plutocracy is the solution.  The WSJ is enraged that that Ecuador’s democratically-elected parliament might remove term limits for public officials.  The faux “news” story launches this fact-free smear: “Mr. Correa, whom opponents characterize as a semi-authoritarian leader who controls all levers of power.”  Wow, I’m sure I could find “opponents” of every elected leader in the world who would say far worse.  I’m also sure that the WSJ never ran a “news” story that read “Mr. Bush, whom opponents characterize as a semi-authoritarian leader who controls all levels of power.”  It turns out that the “opponents” that the WSJ tries to dredge up are political opponents who define winning democratic elections as “authoritarian.”

We can test the claim that Correa “controls all levels of power” against the facts.  He is the democratically elected president and a majority of the members of the democratically elected Parliament support him.  That’s the norm in all parliamentary systems that Murdoch loves when conservatives are elected the PMs in Australia, the UK, and Canada.  Correa’s party also lost democratic elections for mayor in Ecuador’s largest cities, so he plainly does not control all levels of power and does not act to prevent his political opponents from winning elections nor does he annul their victories.  In Ecuador, the President is not the leader of the party or coalition that controls the parliament and for many years Correa held office with a parliament controlled by the opposition.

The WSJ lets slip the “opposition’s” real concerns – the people of Ecuador strongly support Correa’s policies and oppose the return of the oligarchs to power.  The oligarchs are desperate to make it impossible for the people of Ecuador to reelect the leader they support.

“Still popular after seven years in office, Mr. Correa, who is 51 years old, would likely win a fourth presidential election in 2017 and remain in power far into the future, analysts and opposition figures believe.”

No one describes the oligarchs as “semi-authoritarian” because they, allied with the military, were openly authoritarian.  They were also incompetent, often personally corrupt, and betrayers of the people of Ecuador in favor of foreign corporations such as Texaco.  In particular, their oil royalty agreements gave only a pittance to Ecuador regardless of the price of oil.  One of Correa’s first acts as President was to renegotiate those agreements.  Together with his rejection of odious debt, another act of economic treason by the oligarchs, these financial steps made it possible for Correa to adopt the policies that produced Ecuador’s dual economic and social miracles.  Unemployment, poverty, and inequality have all fallen sharply under Correa.

A Nation that was the largest exporter (as a percentage of total population) of its citizens via emigration reversed that tragedy to a net inflow.  People voted with their feet under the oligarchs by leaving Ecuador.  They are now voting with their feet by returning.  The oligarchs are determined to prevent them from voting with their ballots in favor of the leader who brought exceptional competence and results to Ecuador.

The WSJ tries to turn these successes and Correa’s popularity into an indictment not only of Correa, but the people of Ecuador.

“Buoyed by high oil prices, Mr. Correa has funneled money into education and highways, giving him high approval ratings, while drawing sharp criticism from rights groups and press freedom advocates for trying to muzzle critics.”

The WSJ purports to love “the Washington Consensus” – which calls for increased public spending on education, health, and infrastructure.  Those are precisely Correa’s priorities and he has delivered major improvements in each category.  That is why Correa is so popular with the people of Ecuador and so hated by the oligarchs who once totally dominated all media and made “press freedom” an oxymoron.  Absent Correa’s actions on oil royalties and the odious debt “high oil prices” would not have made it possible to produce these tremendous gains in education, health, and infrastructure.  The oil proceeds would have simply gone to reward the holders of odious debt and the foreign oil companies.

Correa is an excellent economist and his policies are highly pragmatic.  His policies are rooted in Catholic social justice principles.  It is a grave mistake to lump the leaders and nations of Latin America together and treat them as clones.  It is long past time for President Obama to reach out a hand of friendship to President Correa and the people of Ecuador.  Correa and the people of Ecuador have made real Obama’s campaign slogan:  “Sí, se puede.”

4 responses to “The WSJ’s Editorial Posing as “News” about Ecuador

  1. Great post, Bill. Since the sale of the WSJ, we should just consider everything that appears on the editorial page as written by Rupert Murdoch himself.

    The difference between Obama’s “Yes,we can” and Correa’s “Sí, se puede” is that Correa carried through on it for the people as he said he would, while Obama sold out to the oligarchs to his supporters dismay.

  2. First, I love all your reporting on the banks and the detailed explanations of control fraud
    have helped me understand what has happened to the economy. Especially the recent Citibank posts. But, having read their editorial/news report, I would recommend it as a pretty straight forward reciting of facts. And all of the facts- 61% approval rating, turning around the economy from default, spending on roads, schools, health care to the delight of the people, business owners support of his policies, etc , can hardly be described as having slipped out. The editorial slant, only supported by quotes of political opponents, is extremely weak. Reading it left me more impressed with Correa.

  3. Dear Prof Black,

    I follow your updates from Ecuador with a lot of interest since the situation there gets very little play in the German MSM.

    However, as in the case of Venezuela, Bolivia, and arguably Argentina and Brazil, the attempt to improve the standard of living using revenues of resource extraction seems to be a risky one. The RNN had Lander talk about this in the case of Venezuela a while ago:
    and when I look at the plans of the Ecuadorian government and the way they handle local (partially indigenous) opposition, e.g. and, it seems to me that Correa’s image is showing some ugly cracks.

    Do you have an opinion on that?

    Keep up the good work!

  4. Good stuff, Bill.

    I’ve been seeking an MMT perspective on the so-called “Chilean Miracle” and was wondering if you have some good links/resources to recommend that break down the real economic story pre and post the Chicago Boys?