This article appears in the April 2024 issue of The American Prospect magazine. Subscribe here.
Jon Stewart stoked controversy in his return to The Daily Show in February for having the audacity to point out that the president is old. A maelstrom of rage was directed at Stewart for letting the secret get out. Amid the uproar, the interview he paired with the opening monologue mostly escaped the public’s notice.
After the commercial break, out to the host’s desk strode Zanny Minton Beddoes, editor in chief of The Economist, the British weekly known for channeling the hopes and fears of the international business class. The rationale for her selection was pretty clear. The magazine carries significant sway across both sides of the Atlantic, and the cover of a recent issue chastised Biden for placing “vanity” above “duty” by not stepping aside. “In failing to look past Joe Biden, Democrats have shown cowardice and complacency,” it reads.
On cue, Beddoes suggested Biden was a doddering old man nearly the same age as her father, unequipped for another campaign run. But the conversation would soon move beyond mere theater criticism, proving to be far more revealing about the war of ideas between the corporate and populist factions of the Democratic Party.
Stewart referred to Beddoes’s publication as “the establishment,” which evidently touched a nerve. The Economist, she interjected, championed British liberalism, the more patrician classical sort, not the bastardized American kind. Free markets, limited government, and the free flow of international capital and peoples across borders were its guiding principles. That’s what The Economist had always stood for, she insisted, and for the past several decades those ideas were the prevailing consensus on both sides of the Atlantic, spanning the governments of Margaret Thatcher, Ronald Reagan, and Bill Clinton.
But times had changed. “We’re absolutely not the establishment anymore … industrial policy is in, big state is in, protectionism is in,” Beddoes remarked. She was describing the core pillars of what’s been dubbed “Bidenomics,” which is credited for introducing the post-neoliberal turn in U.S. policymaking by rejecting market fundamentalism.
Stewart appeared nonplussed that his guest had more of an ideological bone to pick with Biden. He quickly pivoted the conversation to more common ground: the global crack-up of the international order wrought by Russia’s invasion of Ukraine and rising right-wing movements.
But the moment stuck out. Beddoes’s pushback was actually a remarkably self-aware assessment that summed up the full-scale repositioning undertaken by The Economist during the Biden years.
Seemingly unbeknownst to Stewart, the venerable publication has become one of the leading attack dogs against the Biden administration’s domestic economic agenda, with as much gusto as The Wall Street Journal editorial pages. The short list of policies criticized most vehemently by The Economist could fill an entire State of the Union address: renewed antitrust enforcement, pro-union labor board rulings, public investments for domestic manufacturing and greenhouse gas reduction, more robust social spending. It also questioned the withdrawal from Afghanistan, featuring an op-ed from none other than Henry Kissinger as he was knocking on death’s door.
Only as of late has the Biden age question become a topic of concern, with the more neutral critique about competence serving as cover for the ideological revolt. Reading The Economist provides a glimpse into the pro-corporate forces assembling behind the scenes, eager to pin the collapse of the Biden campaign on the more populist measures adopted by his administration.
BEDDOES’S RECENT APPEARANCE ON THE DAILY SHOW begs the question: Why should an upper-crust British interlocutor, clearly disdainful of our country’s policy decisions, be considered a credible figure to tell Americans how to handle our next election? Wasn’t the whole point of the American Revolution to escape these sorts of people unduly meddling in our country’s affairs?
Well, The Economist is not just any international outlet. Its influence within the U.S., among both the business and political elite, has been unusually potent for decades. In the 1990s, George H.W. Bush was often seen striding across the White House lawn clutching the latest issue under his arm. On his way out the door in 2016, Barack Obama became the first American president to pen an editorial in its crisp pages, in a bid to cement his legacy.
The magazine’s clout trickled down among rank-and-file government staffers in Washington, who prominently displayed fresh copies in their offices as a kind of status symbol. These days, The Economist may have lost a step, perhaps because of its persistent attacks. Biden recently cited its rival, the Financial Times, as his preferred publication.
But it has retained its pull in the C-suites. Bill Gates has described it as essential reading, and its elite readership is summed up by a notorious tagline that the publication hired renowned adman David Abbott to craft in 1990: “It’s lonely at the top, but at least there’s something to read.”
The venerable publication has become one of the leading attack dogs against the Biden administration’s domestic economic agenda.
The Economist’s staff comes almost exclusively from the British upper echelons; one of the magazine’s four trustees, who choose the editor in chief, is named Baroness Bottomley of Nettlestone. Its signature style is the lack of individual author attribution to its articles, delivering a monolithic editorial voice across its pages. For that reason, one high-up editor once remarked that he didn’t believe the publication would necessarily be served well by more “diversity” of background, or viewpoint for that matter.
But the magazine opened up its ranks in 2014 and welcomed the first female editor in its 150-year history: Beddoes, who’d been the economics editor for well over a decade. Her previous work is even more illuminating about the publication’s current disposition toward the splintering of the liberal international order.
Since its inception, The Economist has held that spreading markets abroad, whether at gunpoint (during British colonialism) or through free-trade agreements, would liberate the world economy and dissuade global conflicts. Beddoes was on the front lines of putting this worldview into practice.
Fresh out of Harvard in the early 1990s, she was recruited by the economist Jeffrey Sachs, one of the chief architects of the market reform experiment in Russia after the fall of the Soviet Union, known as “shock therapy.” This entailed forced liberalization of the economy by selling off state assets to the highest bidders, creating a new class of oligarchs and engendering widespread corruption. Beddoes learned these tools of the trade and took them to the International Monetary Fund, where she replicated those policies across post-Soviet satellite states.
The failure of that liberalization regime, with its corruption, sky-high inflation, and scarcity of goods is widely understood as one of the driving factors behind the rise of anti-liberal authoritarians in Eastern Europe like Russia’s Vladimir Putin, Viktor Orban in Hungary, and Andrzej Duda in Poland.
The Economist and Beddoes remain undeterred in the myths they’ve spun about globalization. They continue to push the same policies even as the rise of China and Russia’s invasion of Ukraine reveal that a more interconnected global economy can arguably be even more effectively weaponized by bad actors. As the pandemic showed, concentration in production overseas created brittle supply chains that fail to deliver even basic goods in times of upheaval.
Zanny Minton Beddoes, The Economist’s editor in chief, was the opening-night guest on Jon Stewart’s return to “The Daily Show.”
When the election of Donald Trump in 2016 marked the first signs of this crack-up in the global order, the magazine wrestled with the rise of populist politics and the crisis of liberal democracy with a bit of soul-searching. And it came to some rather unexpected conclusions. In order to restore trust in liberal institutions and the political center, The Economist conceded that the technocrats would have to better distribute the gains of economic growth across the citizenry.
In particular, the publication identified monopoly power as a corrosive feature fueling public anger across the West. Its 2018 special report on competition opened with a startling acknowledgment: “America’s economy has become a capitalist dystopia; a system of extraction by entrenched giants.” Some of those sweeping statements were qualified with counterarguments later on. But after ticking off consolidated markets in aviation and telecom and credit card banking, the basic thesis was this: “The view that competition might be in peril … feeds into the public’s sense that the economy is rigged.”
The special report was inspired in large part by the attendance of several editors at the University of Chicago antitrust conference, which was becoming a bastion at that time for the growing neo-Brandeisian movement.
The report by no means embraced the more radical edge of antitrust proponents. But it was seen as a validation of the underlying premise that concentration was constraining innovation. “It was like, even The Economist gets that this is a real problem,” said Hal Singer, an economics professor at the University of Utah who moonlights as the pre-eminent watchdog of The Economist’s most wrong takes.
In many ways, that 2018 report mirrors the rationale that numerous Biden administration officials have employed to crack down on corporate power. Yet just a few years later, The Economist has done a complete about-face on the issue.
The Wall Street Journal may be the leading critic of Federal Trade Commission chair Lina Khan, averaging one editorial screed against her every 11 days, according to the American Economic Liberties Project. But The Economist is very close behind, routinely lambasting Khan for “treating all big firms as criminals” and “most mergers [as] offenses.”
In a recent editorial, the publication went so far as to write that “the single biggest reason why Bidenomics has got a bad rap has been his competition agenda, led by Lina Khan.”
The recent history of The Economist offers a warning: Beware of ideological attacks using Biden’s age as cover.
This onslaught has been relentless. Mainly, they claim the merger guidelines she and the Justice Department finalized at the end of last year are too restrictive and that her legal cases have lost in courts.
Another piece on “why trustbusters have fallen short of their ambitions” cites Khan’s failure to block the Microsoft-Activision merger and others as evidence of her failed approach. It parrots the ad hominem attacks about staff treatment at the FTC spread by a New York magazine piece in December, “Lina Khan’s Rough Year.”
Since that piece ran, the FTC has put together a string of victories, scuttling merger deals between Figma and Adobe, Illumina and Grail, and IQVIA and DeepIntent, while banning Rite Aid from using facial recognition software to harass customers, forcing GlaxoSmithKline to withdraw unlawful patents, and persuading Boehringer Ingelheim to drop the price of inhalers by hundreds of dollars.
The Economist has yet to cover any of these developments.
When not trashing Lina Khan, The Economist has gone on the attack against industrial-policy initiatives like the Inflation Reduction Act and the CHIPS and Science Act, which it argues will lead to disastrous “protectionism” and potential inflationary spirals. A recent special issue focused on discrediting the “homeland economics” model being developed in the U.S., critiquing reshoring efforts for failing to admire the efficiency and low prices that free trade delivers.
The report brushes aside the supply chain shortages during the pandemic—which shifted the conversation about industrial-policy reforms in the U.S.—as a once-in-a-lifetime event. Policy changes this drastic, it argues, shouldn’t be predicated on anomalies.
This fails to contend with other motivating factors for supply chain resiliency. Earthquakes in Taiwan in the 1990s or the hurricane in Puerto Rico threatened to knock out access to key medical and technology supplies. Extreme weather was even a factor in the pandemic supply crunch, and is equally cited by administration officials as reason to revitalize the industrial base.
The Economist blames Biden’s spending packages for the inflationary pressures of the past several years, ignoring that the U.S. has one of the lowest inflation rates among industrialized nations. It also holds special contempt for the “greedflation” theory that excess corporate markups could possibly be contributing to rising prices, which has recently been taken up by President Biden. In short, it offers full-throated support for a corporate-friendly agenda.
WHY WOULD A PUBLICATION ALL OF A SUDDEN ARGUE against its own policy recommendations from a few years ago, just as they gain traction? “I’ve never seen such an obvious top-down change in editorial line. It’s frankly corrupt and gross,” said Matt Stoller, director of research of the American Economic Liberties Project.
It’s hard to shake the sense that such an abrupt change emanated from outside influence. On the business side, audience capture is a very real phenomenon. After proving to be one of the most successful publications to make the digital transition in the 2000s, The Economist’s revenue numbers started to sink like many other outlets’. It couldn’t really afford to shed its remaining white-collar subscribers and advertisers.
The makeup of its board of trustees, chock-full of financiers with holdings across industries, also should be noted. In 2013, Google’s executive chairman Eric Schmidt joined the board for a brief stint.
The publication claims to adhere to a strict professional firewall between the editorial and business sides, but that firewall only goes so far. On several occasions, the coziness between its writers and board members has been abundantly apparent.
Sebastian Mallaby, former editor at The Economist and husband of Minton Beddoes, wrote a book in 2022 about the history of venture capital called The Power Law. As reviewers noted, it took an all-too-uncritical view of VC as an indomitable engine of growth. One of the subjects whom Mallaby managed to secure a rare extensive interview with was Eric Schmidt, for a chapter portraying the heroic risks VC took to foster a tech superstar like Google, run by an impressive founder like Schmidt.
Ideological capture often precedes any overt directives from corporate powers. What’s clear is that The Economist was shaken by the more populist direction it saw in the Biden administration.
As with much of the Democratic Party’s donor class, it thought a Biden presidency would merely represent a “return to normalcy,” and the enduring stability of the political center. In the run-up to the 2020 election, The Economist tempered “fears of a leftward lurch under Biden” by reassuring business leaders that “the charge is wide of the mark. Mr Biden has rejected the Utopian ideas of the left.” Their hopes were shattered by the appointments of Lina Khan and other aggressive reformers, and the more interventionist economic policy approach.
What The Economist proposed from 2017 to 2019 were tweaks to the system to shore up its legitimacy. The Biden brain trust believed that a much broader transformation was needed to effectively move beyond neoliberalism. “I don’t think the publication was fully prepared for the declaration of ‘a new Washington consensus’ [by national security adviser Jake Sullivan] or giving someone like Lina Khan free rein,” said Singer.
There are plenty of reasons to be worried about Biden’s fitness for a grueling campaign and to criticize his administration, in particular for its handling of the war in Gaza. Many have called for him to step aside for those reasons.
But the recent history of The Economist offers a warning: Beware of ideological attacks using Biden’s age as cover. The progressive wing of the party has more skin in the game with the Biden presidency than any previous administration of recent decades. The political center will inevitably use a Biden loss in November to try and discredit its populist leanings. The Economist is laying the groundwork for that already.
