The color of the cat

Some economists say the last great stagflation episode occurred in 1973, after the war of the Arab countries against Israel, which led all those countries to stop selling oil to the United States for a few months. The effect was shortages plus rising prices. It is a situation quite similar to that of these days. Stagnant growth, high inflation and, on top of that, high unemployment. It is something happening in many regions of the world, almost entirely outside the economic and political models. And it can be worse than 1973, because there is a diffuse factor that seems to be behind it: the perception that the world changed forever, that it will no longer be as it was, now populated by pandemics, extreme climates, billionaires, mass murders, social networks, off-center leaders, drone wars, and that inveterate habit of humanity of walking along the ledge. A perception, to say it in one word, pessimistic. It is not the first in history, nor is it the first time that many people feel trapped between the lack of distant horizons and the empire of emergency. That is why it is worth asking whether, before clearing up this question, anyone can commit to next year being "extraordinary," as President Kast has done. It is a risky statement. And also delicate, since that same expectation has been disappointed time and again. Even the pessimistic outlooks, like the one Minister Quiroz had in March, fell short: oil prices hang from two wars, Ukraine and Iran, which lack a visible exit. In March it seemed that at least one, Iran's, would last only a few weeks. What has changed? Well: that world of abundance that opened from the late 1980s, with the end of the Cold War and the great push of free trade and multilateralism, is over. It is finished. Now a world looms where the most prized goods are no longer traditional or non-traditional, but strange ones: energy, metals and minerals, rare earths, water, surfaces, many (but not all) of the things that AI devours with an insatiable appetite and a hazy promise. Starting with Donald Trump, many believe that AI will be the engine of growth in the coming years. And if this is true for those who own the technology, it should also be true for those who possess the resources that enable it, among which must now be counted, as one more resource and an immense competitive advantage, the speed with which permits themselves are processed. (The other engines, the experts say, will be the arms industry and electrical grids, quite a trio.) Like Europe or the United States, the growth prospects of the Americas and Chile for the years to come move between 0% and 3.9% annually (Consensus Forecast). This means that Chileans would have to wait between 10 and 15 years to eliminate the current level of poverty; and if the pace is closer to 2%, as it has been since Bachelet II, much more than double that time. So no government, neither the current one nor any other, could aspire to reasonably reduce the main of the social emergencies if it does not completely change the approach, looking at the globe from a new perspective. In ten more days, the United States parliamentary elections will resolve whether Donald Trump is stronger or weaker in the second half of his term. Of the numerous disruptions his government has produced, some are enduring and reflect deep impulses of the main capitalist economy in the world. For example, the definition of a great adversarial competitor, China. For example, the end of multilateralism in the UN style. For example, the dominance of commercial neomercantilism. And the same in more political matters. Like the instability in the Middle East. Or the polarization of Latin America. Or the end of open borders. This is a world where some things that used to be "easy" have ended, like visas, tax havens, and multilateral or big-bank money to go to the rescue of countries that used to make budgets only to comply with the procedure, like Argentina. In Europe, student movements have erupted demanding more benefits from states that already spend more than their GDP, like France (119%) and Italy (139%). They are not the ones who save, but the ones who spend. The big economic groups know these things and have long been looking for more predictable spaces to place their investments. It would not be strange if the Chilean Southern Macrozone, with its incessant conflict, has killed its golden goose, if one observes both the fall of forestry and agricultural production and the movement of the big lumber companies toward other South American countries. The same can be said of other sectors. Just dig a little. This is a problem of great scale, not of the next elections with repeated faces. In the 90s there were the right people to interpret the world at those dimensions (Frei, Lagos, Bitar, Foxley, Boeninger, Correa), fleeing, sometimes with difficulty, from parochialism; does anything similar exist now? After having drastically changed the color of the cat, can it be asked to hunt other mice? NEWSLETTEROpinionSaturday, AMTense ideas, opposing views and a clear analysis: elements to reveal the issues that divide opinions and will set the agenda. By subscribing you are accepting the Terms and Conditions and Privacy Policies of La Tercera.