“Maybe it’s not that I am a regional thinker, but a regional feeler.”

Portugal has now had two lost decades. Adjusting for inflation, GDP per capita grew 7% between 2000 and 2008. I mean it grew 7% over that whole period, not on a yearly basis. Then it fell during the crisis and only last year did it get back to 2008 levels, so that between 2000 and 2017, total growth was 7%…

The population who lived in Portugal through the last 10 years now get extactic over 2.2% year-on-year growth. After so many years of nothing, mediocre growth feels amazing. Still, if you cross the border into Spain it no longer feels “this is what Portugal will be in 2021”, it feels like a much wealthier, qualititatively different, better economy. Portugal could have been that, but, at least in my lifetime, it probably won’t be. This is a lost opportunity and it brings me sadness.

Maybe it’s not that I am a regional thinker, but a regional feeler. I have a visceral feel for what it means to “grow to the level of Greece and then stop there” that comes from lived experience.

In summary, this is why I recommend you read Stubborn Attachments.

That is from Luis Pedro Coelho, there is more of interest at the link.


Your growth chart starts with Samuel Morse, by the way.

The chart simply defines the digital era, as the Morse code was the first robot syntax. Everything past that, look closer, is generally Moore's Law getting us more digits per word. Everything speeded up from Morse to Nyquist (got you broasdcast) , Shannon (high speed digital communications and processors) up to neural nets; that thread yielded the supply line management that made everything else speed up. If you look at the chart a hundred years from now, it will stop at unmeasurable, we will no longer be able to measure our own GDP.

Crazy preference structure to prefer, over Germany, somewhere that is poorer than Germany but growing more quickly (China). Surely that can't be ignored, or it it easier if we Europeans-Chinese don't really have any empathy for each other? Like, maybe if you are ideologically happier with gulags for millions of people, fine. But how can one ignore the reality of life in China for the average person? This is a sincere question. It goes beyond the UAE situation, where at least one knows most foreign workers are poor but not actually there against their will.

Was just thinking of a Melville impression-piece describing a visit to a cotton-factory: "virgins" bent over the white goo extruded from a metallic bug-demon.

Economic growth in Mordor, not the Shire.

I live in Shanghai. GDP per capita in PPP terms is just 19% lower than in Germany; this is wealthier than Eastern Germany and many EU countries. It is certainly wealthier than Portugal and the average person is materially better off here.

In addition, you as a Westerner in China will probably earn more than the median Chinese. In Germany, your earnings options as a Portuguese knowing no German and with no German work experience would presumably be below median.

I was working in Germany until June, at higher than median-wage (also, as I write in the text, I do have a German high-school education).

In Shanghai? Possibly. What if the avg and median Chinese? Go out into the thousands of small towns to see what it is really like. A very ignorant thing to say

@Millian: status seeking?

I live in Switzerland. Here the Portuguese diaspora is quite large. If you talk to them, the common feeling is not being treated "well enough" by the host society. Bricklayers or road workers feel like cogs in the machine and they may be right, for employers they're easy to replace. Even if Mr. Coelho has high qualifications, living in France or Germany means frequently meeting other Portuguese with the feeling of unrest. We're social animals and it's really difficult to not be influenced by the gloominess of your peers.

Enter China. No poor Portuguese on sight, your high qualifications are demanded, you feel appreciated, your peers are others high-income expats, life is good, this host society/economy must be better.........until you look under the hood. I was that kind of expat once.

This may be the story of lots of high skills individuals that may have a better life in a low income country, simply because their skills are scarce. But, ask the bricklayer where to go: China, Germany or Switzerland?

Low information article with high "feels" content.

There's a failure to put things in rational well thought terms of why he believes Portuguese economic growth should've been more significant, and what it would have done for the lives of average people and the sort of society they'd create if it had.

What is a "France / German lifestyle" for example, in concrete terms, and why would Portuguese one want to get it? What are the technologies in Portugal that he believes they ought to have and that they do not?

A declaration that "Germany is stagnant and once you see it, the gap between what could easily be and what actually is gets too large to be ignored" is certainly feels, not anything too concrete.

All very much on the level of a feeling, an impression, not a concrete argument of fact and rational thought that really is even possible to engage with well.

If you're addicted to seeing economic growth numbers go up, and in a somewhat correlated way, new buildings and infrastructures, then it can be understood as to why you'd have a preference to move to China. Or Cambodia, or Bangladesh, or Ethiopia. But if you seriously want to see the development of a society to new levels of freedom and prosperity as citizens, why move to China, where it's mostly catch up growth in GDP per capita and per capita consumption and they can do perhaps a few interesting things and maybe some cool science through having an autocratic state and very large population, and a lot of terrible, repressive things?

Yes, that's exactly what the article is: a comment that while GDP numbers seem dry, I map them to feelings of disappointment that growth did not continue as we were promised growing up.

What kind of society would Portugal be if growth had continued? It would be much more like Spain.

Exactly! I knew the "this is only somebody's feelings" take would appear. Anybody can go post data from the world bank or IMF website, what is interesting is interpreting how that data affects people on the ground. So I very much enjoyed your post and hope to see more of them. Ignore the naysayers (although I think you probably already do).

On reflection, I don't have that much problem with the idea that he should present "just his feelings", but I find the notion a bit ridiculous that I should treat this with any more inherent seriousness than the "feels" of someone who "feels it's not my country any more" or "feels that capitalism is making us soulless and less than authentically human" or whatnot.

It's that level of argumentation, and about as worthy of respect. If you find people's "feels" on what wealth inequality changes mean, and regard as suspect as fundamentally people reading their own biases in the measure, I don't see how you can with intellectual honesty treat this in any different light.

'Germany is stagnant and once you see it, the gap between what could easily be and what actually is gets too large to be ignored'

Absolutely - why, just imagine if Germany was the home of the world's largest car company or the world's largest business software company.

Then imagine that Germany actually had the world's largest current account surplus, and not merely in PPP terms.

Then imagine that the German government has not used new debt to finance itself since 2013, and has been shrinking its public debt since then.

Just imagine how Germany would look if the all the above were actually true.

The answer, apparently, is stagnant.

Numbers, numbers, numbers... How about some observations? Examples of how those numbers are contributing to people's increased well being? What does the average german think?

I know a tech worker in the UK ready to depart for Germany due to a combination of Brexit and rising racism in the UK (which he feels is worse than in Germany, surprise),

Actually, since China is building a lot of new things and new organizations, there is a lot of opportunity to build something new and different in China right now. As opposed to more developed countries, where there is a lot of institutional inertia and a very crowded (or over regulated) marketplace where it can be very difficult or risky to try something different. Not that this means that China is really a better place to live or has a preferable form of government, but just to point out that it is different and does appear to be changing in all sorts of ways and changing more quickly than fully economically developed countries.

Ideas have consequences. Portugal's fascist- Feudalist regime can not step up this game to react to the new international realities. Portugal can not live for long apart from its mother country. The Federative Republic of Brazil is the legitimate successor of the United Stes of Brazil, which is the successor state of the Empire of Brazil, which is the successor state of the United Kingdom of Portugal, Brazil and Algarves, which was the sole successor of the Kingdom of Portugal.

Brazil is also the legitimate ruler of China.

(And of course the USA, as the successor state of Great Britain, which is the legitimate ruler of South Asia and SubSaharan Africa, is the legitimate ruler of South Asia and SubSaharan Africa.)

It is not that simple. The USA was a colony, denied representation (hence the motto "no taxation without representation"). Brazil itself was a kingdom, co-equal with Portugal.

"The United Kingdom of Portugal, Brazil and the Algarves was a pluricontinental monarchy formed by the elevation of the Portuguese colony named State of Brazil to the status of a kingdom and by the simultaneous union of that Kingdom of Brazil with the Kingdom of Portugal and the Kingdom of the Algarves, constituting a single state consisting of three kingdoms."

Brazilian representatives sat at the Parliament. It was the Portuguese oppressors' savage attempts at taking Brazil's autonomy away that ultimately led to Brazil's declaration of independence.

Those circumstances and Portuguese treachery are clearly mentioned in Brazil's Indepence Anthem:

"Brave Brazilian people!

Far begone, slavery's fear!

Either keep the Fatherland free,

Or die for Brazil.

Either keep the Fatherland free,

Or die for Brazil

The chains that forged for us

Treachery's astute slyness,

There was a most powerful Hand,

Brazil sneered at them.

There was a most powerful Hand,

There was a most powerful Hand,

Brazil sneered at them"

I think a fairly strong case can be made for it. Brazil surely is the legimate ruler of Macao, Formosa ("Republic of China"), Tibet and Guangdong. If, under the "One Country, Two Systems" doctrine, it can be constured as a claim over all China is a matter for the experts in Internationa Law, I think. Anyway, reunification would be to be managed very carefully. The transitional stage would take decades.

From Badajoz, on the Spanish side of the Spain-Portugal border. Regional envy seems to work in both directions. When our weariness with public life and institutions in Spain is reaching its limits, there's a phrase we use here - Siempre no quedará Portugal, we'll always have Portugal. Over the border, you have no far right party on the rise, no regional minorities unhappy with their treatment from the state, no reactionary knee-jerk nationalism, no former IMF chairperson serving a prison sentence along with dozens of other corrupt politicians, no pharaonic building projects tumbling down at the edges of cities. Today, the public holiday celebrating the 40th anniversary of the Spanish Constitution, I'll be having lunch in the beautiful Portuguese city of Evora, where the people are cultivated and polite, and the bookshops excellent and doing a busy trade.

So what happened to Portugal? A combination of the adoption of the Euro and the great recession, and the forced austerity that comes with reliance on assistance from third parties. So what's the significance of the year 2000, when economic growth stalled? That's when Portugal adopted the Euro. Look at "inflation" in Portugal at the peak of the recession: it spiked! Luis Pedro, "who grew up in Portugal, coming of age in the 1990s", only knows a post-Euro Portugal. Now he is nostalgic for the authoritarian, pre-democratic Portugal: "there was a lot of economic growth in the 1950s and 60s, and the true victims of the dictatorship were in the African colonies". Unfortunately, it's all to easy to learn the wrong lessons of history because we see what we want to see.

Euro, debt, low education and crony capitalism.

Great vacation destination though. The Portuguese people were kind, welcoming and mostly spoke English in the cities. The sights were amazing and fascinating to see how the place was once commanded an empire.

It's a hugely underrated place for a vacation. I enjoyed it more than Spain.

For those who don't get why Cowen linked to this short essay, the author titles it "Why I moved to China". Together with his nostalgia for Portugal's dictatorship, the author is expressing a preference for economic growth over political freedom: as between a choice of political freedom and slow economic growth in Portugal and lack of political freedom and rapid economic growth in China, he would pick the latter. Now, I cannot believe that would be Cowen's choice, but one has to wonder, especially given his newfound admiration for Trump. Where is this blog headed? Is attachment to democracy and freedom a stubborn attachment from which we must let go?

"The population ... now get extactic over 2.2% year-on-year growth."

Like the US media during the Obama presidency.

To be fair, Trump's 3.9% growth came with a 21% jump in government deficit spending and much higher inflation. Next year's budget will be at an unprecedented top of over $1 Trillion. Yes, with a 'T'.

As long as TC is concerned Portugal is doing just fine. Do a "Stubborn Attachment" growth but don't ever try to outpace the US like China is doing. Otherwise TC will go after you.
Free Ms. Meng’

The 2010-2014 financial crisis and bailout had a significant impact on Portugal's economy. That was a big hole to have to climb out and cannot be easily discounted but also is in Portugal's past.


With austerity, Portugal has dug its way out and will likely post only about a 1% of GDP deficit this year compared to say the 3.9% of GDP deficit the US federal government managed.

Portugal's future is much, much brighter, with stable growth forecast and a budget surplus achievable as soon as 2020.


Shh - disapproval of financing growth with debt is not the sort of thing that is considered appropriate here anymore.

Letus be blunt. the Portuguese regime has got to change in a fundamental way.

Portugal's future can't be bright with such a high debt/GDP ratio and high levels of emigration. There was this positive tourism shock, but that won't last forever right?

Well as bright as an EU member nation's future can be. Portugal's negative population growth is a concern. Here it appears to be victimized, as are all of the poorer EU member states, by out migration to richer EU states. Despite Portugal's negative population growth it still managed 2.7% gdp growth in 2017. Portugal is also benefitting from its "golden visa" program which has brought in several thousand Chinese, Brazilian, and South African property buyers bringing in over $50 million however this seems to be offset by Brazilian remittances in the $70 million per year range. If Bolsonaro's reforms succeed, or if the US manages to get its act together and make some meaningful reforms to achieve stronger US-Brazil ties then the Brazilian remittance drain might decline.

Portugal can benefit from Brazil's higher growth in the next few years.

It looks like Portugal did the normal thing center left governments do; deficit financing of basic services for decades could with low growth policies in the name of caring. Their core asset, the young with intelligence fostered by education leave because there is no opportunity. Eventually a debt wall gets hit, the strangling of economic potential gets worse, more young people leave. How can a bunch of retirees and government workers generate the economic growth necessary to pay there own upkeep?

Interesting to see the stagnation and tightening affecting the center in France. The EU won't collapse it will simply shrink in from the edges until it is all edges.

You have to see things in context: it would be quite difficult for Portugal to be competitive in Europe, education levels are extremely low which results in low productivity. Also portuguese elites, while well educated seem only interested in mantaining status quo, and stealing as much as they can...

By "now get extactic" the OP means "now get ecstatic."

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