Philip Bowring has a somber article on what the decline of the U.S. dollar means for the global economy in Asia Sentinel, a Web-only journal on Asian affairs that launched in August. The article is interesting for two unrelated reasons.
First, the dollar's accelerating slump has moved to the top of the list of global economic concerns. Bowring believes the chickens are finally coming home to roost. For years, economists have been warning that the U.S. can't keep running huge trade and budget deficits without eventually paying the price. If the time of reckoning isn't quite here, it's close at hand:
Doomsday for the dollar may in fact not have arrived. But arrive it will as time runs out on the pact that the U.S. made with the devil -- enjoy yourself as much as you can, have your every wish granted for, the punishment will be in the future. As 16th century playwright Marlowe put it:
FAUSTUS. Ah, Faustus,
Now hast thou but one bare hour to live,
And then thou must be damn'd perpetually!
Stand still, you ever-moving spheres of heaven,
That time may cease, and midnight never come;
Midnight is at hand for the $800 billion a year U.S. current account deficit which has been financing not just the U.S. consumption binge and the Iraq war but the global asset price bubble which is affecting, to varying degrees, assets around the world and of every variety.
A declining dollar will make U.S. exports more competitive, but will also jack up the cost of imports, which could fuel inflation, which could lead the Fed to tighten interest rates, which could help precipitate a recession that would hurt not just the U.S. but the rest of the world. So it's something to watch.
But my eye was caught not just by the dollar, but by Philip Bowring's byline. Bowring is a former editor-in-chief of the Far Eastern Economic Review, which was once the world's finest newsmagazine covering Asia, before it was gutted by Dow Jones and turned into a pathetic bimonthly showcase for thumbsucking portentousness. (DISCLAIMER: I spent the summer of 1990 as an intern at the Review, reporting out of Hong Kong and Taiwan, during Bowring's tenure.)
Bowring writes regularly for the International Herald Tribune, but Asia Sentinel is a startup he and a few other longtime Asia journalists founded that aims to fill the gap left by the decline of the Review, the closing of its competitor Asiaweek, and the end of the print version of the Asia Times. It is yet another example of established journalists migrating to the Web, seeking a new business model for their old profession.
The recent defection of two prominent Washington Post reporters to a politics Web site startup has been exciting the usual round of angst among those who see more threat than opportunity in the changed economics of the news business. Asia Sentinel fits neatly into that same conversation, though one shouldn't be overly quick to blame the dearth of long-form quality print journalism in Asia on the Net. The Asian financial crisis of the late '90s played a role, as did the bungling of management. And there's always been the intractable problem of figuring out how to cover such a huge diverse region with a product that interests everyone.
But much as I lament the passing of the Review, which I subscribed to for more than 15 years, and which was my primary conduit of information about what was really going on in Singapore and Sri Lanka and South Korea while I was living in the United States, a magazine of its kind hardly seems necessary now. There are so many sources of information available online -- World Bank and NGO reports, daily newspaper articles, eyewitness accounts of coups and tsunamis and village riots -- that the main problem is limiting one's intake so as to be able to make sense of it all. Sure, it's a mixed batch of stuff, and it's often hard to know who to trust.
But that's why God created bloggers.