[Disclaimer: If you follow the news, a lot of this recap will feel old hat. If you don't need or want a blow-by-blow review, feel free to skip ahead to "Personally, I'm not sure that GDP is...", or for those following by email, below the jump.]
Mitt Romney waded into some trouble last week while on vacation in Israel:
Mitt Romney offended Palestinian leaders on Monday by suggesting that cultural differences explain why the Israelis are so much more economically successful than Palestinians, thrusting himself again into a volatile issue while on his high-profile overseas trip. – Romney Trip Raises Sparks at a 2nd Stop
Once he realized drumming up an international diplomatic incident while in an unofficial capacity was not his best idea, Mitt wasted no time rescinding his statement:
Mitt Romney insisted Tuesday he was not specifically talking about Palestinian culture at a fundraiser in Israel on Monday when he was quoted suggesting culture was the reason for the economic disparity between Israel and the Palestinian territories. – Romney denies criticizing Palestinian culture
Romney later reversed his position a second time, in a statement I’m quite frankly too lazy to dig up and quote.
Momentarily leaving aside the diplomatic implications of Romney’s impolitic remarks, I will note in Willard’s defense that he has more of a point than he is given credit for. Here is his original statement:
“As you come here and you see the GDP per capita, for instance, in Israel which is about $21,000 dollars, and compare that with the GDP per capita just across the areas managed by the Palestinian Authority, which is more like $10,000 per capita, you notice such a dramatically stark difference in economic vitality.”
As has been widely noted, the economic disparity between Israel and its Palestinian neighbors is wider than the figures cited by Romney. I seem to be quoting every other line of this post, so why not this one? The accurate numbers are these:
Israel had a per capita gross domestic product of about $31,000 in 2011, while the West Bank and Gaza had a per capita GDP of just over $1,500, according to the World Bank.
The comments seem to have been controversial primarily because Romney failed to mention the effect of Israeli occupation and trade restrictions. Saeb Erekat, a senior aide to President Mahmoud Abbas of the Palestinian Authority:
It is a racist statement and this man doesn’t realize that the Palestinian economy cannot reach its potential because there is an Israeli occupation. It seems to me this man lacks information, knowledge, vision and understanding of this region and its people.
Personally, I’m not sure that GDP is a reliable indicator of anything, nor do I think that Romney’s failure to account for Israeli occupation is really at the heart of what’s wrong with his statement. In other words, as usual, the truth probably lies somewhere in between.
I’m not going to take up the case on behalf of Mr. Romney, as it is one that has been made in a number of books – including his own – online and in print, and probably elsewhere. But in his defense, it is also worth noting that, in the absence of the occupation, it is unlikely that Palestinian GDP would approach the level achieved by Israel’s economy. Here are the 2011 GDPs of the countries with which Israel shares a border, but with which Palestinians do not share an occupation [as measured by the IMF, as related in this Wikipedia article]:
Saudi Arabia: 24,237
According to the IMF, Israel’s GDP per capita is 30,975, or – as stated in the article – “about $31,000.” As you can see, the only nearby country that comes even close to matching Israel’s economic output is Saudi Arabia, and I don’t think the source of that country’s relative wealth is any great mystery.
Of course, no two countries are exactly alike, and each country listed has its own serious issues, but I think it’s safe to conclude that even had the West Bank and Gaza constituted an independent Palestinian state for the past 64 years, its GDP would be unlikely to match that of Israel. There’s simply no reason to believe it would be anything other than just another country in that part of the world. Using a broad definition of ‘culture’, Romney is in many respects correct.
But all of this discussion is silly and hypothetical. The primary takeaway – if you’ve stuck with me this far – should be that Romney has outed himself as someone to whom economic indicators, like GDP, matter a great deal – indeed, the Wealth and Poverty of a nation’s culture depend on them.
And to me, that sounds downright un-American.
As it happens, the United States is not the world’s most productive country on a per capita basis. According to the CIA Factbook, the IMF, and the World Bank [all cited in the aforequoted Wikipedia article], the US ranked 9th, 7th, and 6th, respectively in 2011. The logical end-point of Romney’s thinking is that our culture is inferior to those ranked higher in per-capita GDP.
But to be fair to Romney, none of the higher-ranked countries are located in the Western hemisphere, and he was quite clearly speaking about countries that are close neighbors:
“And that is also between other countries that are near or next to each other. Chile and Ecuador, Mexico and the United States.”
But where Mitt looked to the land of his father’s birth for a convenient disparity to assure the United States would out on top, according to his formula – in which wealth translates to cultural superiority across short distances – our culture is currently inferior to a bunch of beaverskin-wearing hosers freezing to the north. You see, according to the World Bank, Canada’s GDP per capita exceeds that same metric in the United States:
United States: 48,442
And it’s not just a fluke of GDP. According to a report released just last month:
For the first time in recent history, the average Canadian is richer than the average American.
And not just by a little. Currently, the average Canadian household is more than $40,000 richer than the average American household. The net worth of the average Canadian household in 2011 was $363,202, compared to around $320,000 for Americans. – For the First Time, Canadians Now Richer Than Americans
So between his praise for Israeli socialized medicine and now, his claims of Canadian cultural superiority, I think it’s time to ask the obvious: of which country does Mitt Romney hope to be President, anyway?
You probably think I’m going to say ‘Canada’, but my money’s on the Cayman Islands – right next to Mitt Romney’s.