The Word that Dare Not Speak its Name

Steve Schifferes' analysis for BBC NEWS of the first day of the proceedings of the World Economic Forum in Davos focused (as it should have done) on the view of the world economy from Chinese and Russian perspectives:

In his first appearance at Davos, the Chinese Premier Wen Jiabao hit back, placing the blame for the crisis squarely on the shoulders of the US authorities.

Among the causes of the crisis, he cited "inappropriate macro-economic policies of some economies and their unsustainable model of development" - a clear swipe at the low savings and high consumption rate of the US economy - and "the failure of financial supervision and regulation".

He also blamed the banks for their "blind pursuit of profit" and a "lack of self-discipline" which have landed the world economy "in the most difficult situation since the Great Depression".

Further criticism came from Russia's Prime Minister Vladimir Putin, who said that "poor quality regulation" led to "the collapses of the existing financial system".

Mr Putin also criticised the world's dependence on the dollar.

"Excessive dependence on what is basically the only reserve currency is dangerous for the world economy," he said.

He said that the result was "a serious malfunction in the very system of global economic growth" and that "whole regions of the world, including Europe, found themselves at the periphery of global economic processes" and "were outside the framework of the key economic and financial decisions".

And he argued that the benefits of the boom "were distributed very disproportionately" both within countries and between them.

I was particularly interested in Putin's remarks. One rarely encounters a phrase like "serious malfunction" among the Davos cheerleaders. Through that phrase Putin was attempting to steer the general discourse in the direction of a word that, in either its noun or verb form, is practically taboo in the American economic community among all but the most serious progressives. That word is "reform;" and, by even suggesting it, Putin was throwing down a gauntlet before "the usual suspects" of the rich and mighty in his audience, challenging them to give as much thought to curing the underlying disease as they had thus far been giving in trying to alleviate the symptoms. As Schifferes observed, the United States is far from receptive to this kind of language at the present time; but Putin may have been just the right person to confront them with this word that dare not speak its name. As I wrote back in August at the height of a "double fever" of a Presidential Election and military activity in Georgia:

Putin is less a blustering militarist and more a cold-blooded chief executive determined to set achievable goals that can be brought about through well-executed plans. Put another way, he knows how to frame what he wants in terms of what he has; and he does it well enough to run up a good record of getting what he wants.

However, there is another side to Putin that Schifferes did not include in his analysis, even though it was revealed in his response to a question after his speech. I found that part of the story in a report by Erica Ogg for CNET News. The "question in question" (so to speak) came from none other than Michael Dell. Ogg's report reveals the rest:

During the opening of the show, Putin gave a wide-ranging, 40-minute speech. When it came time for questions, Dell asked "How can we help" you with your country's IT infrastructure, according to a report in Fortune.

Putin immediately rebuffed the PC company's founder. "We don't need your help. We are not invalids. We don't have limited mental capacity," Putin responded. (I think the only appropriate response to that is, "Oh, snap!")

Now, I wasn't there, but it's highly unlikely this is anything close to what Dell was suggesting. Fortune writes that the "slapdown took many of the people in the audience by surprise." Um, rightfully so. But that wasn't the end of Putin's verbal judo attack on Dell and his company. Near the conclusion of his talk he reportedly talked up Russian scientists and how they are "respected not for their hardware, but for their software." Double snap.

Now from where I sit, Dell's question was presumptuous in a serious departure from the normative behavior of the rich and mighty; and, in the interest of maintaining a proper tone of discourse, he deserved to have his wrist slapped. Nevertheless, he did not deserve a humiliating full body slam; so the episode ended up telling us more about Putin's attitude toward that "proper tone of discourse" than it did about Dell's. When I wrote about Putin last August, it was to address his behavior in terms of how well he could play "the game of statecraft" according to rules set down by Dennis Ross in his book on that topic; but the "instruments" of that game are the instruments of conversation. Using those instruments to bully rarely advances a conversation (although it may explain why George W. Bush saw Putin's soul when he looked into the Russian leader's eyes). Putin is right about a conversation about reform being necessary; but stupid things usually get said in conversation, just by nature of the human condition. I really hope that he can refine his conversation technique a bit before any serious conversation about economic reform gets under way.