President Dilma Rousseff of Brazil has figured out that dissing Uncle Sam is a low-risk political tactic. She cancelled a US state visit and made a critical speech at the United Nations. Yet, even pariah Iran has shown long-term growth at a par with some US allies like the Philippines and Egypt. Bashing Washington doesn't seem too costly. Wall Street is another matter.
With Brazil suffering from a weak currency and sluggish economy, it would make sense for Rousseff to sweet-talk the country's largest foreign investor and business partner. Instead, her anger at fugitive whistleblower Edward Snowden's revelations about National Security Agency surveillance in her own backyard has chilled relations with the United States.
Economically, that may not matter much. Iran, for instance, has operated since 1979 under strict US sanctions that bar American companies from doing business there. Yet, it has managed a 2.5 per cent average annual growth rate in GDP per capita, based on purchasing power parity, from 1992 to 2009, according to the latest World Bank figures.
That's generally comparable to the performance of several US allies with similar economies. Nigeria grew at a 2.2 per cent average annual rate from 1992 to 2012, Egypt at 2.8 per cent and the Philippines at only 1.9 per cent. What's more, all those countries place higher than Iran's dismal ranking of 145th on the World Bank's Ease of Doing Business Index.
Argentina, on the other hand, had a negative growth rate in GDP per capita from 1992 to 2002, when it was on friendly terms with the United States. Since the relationship soured in 2003, annual growth has averaged about seven per cent. The evidence, of course, is only anecdotal. But if Rousseff can take shots at Washington with economic impunity, she stands to reap a public relations windfall from her many anti-American constituents.
There may be lines that she won't cross, though. The president and several of her cabinet members were scheduled on Wednesday for a three-hour meeting with Goldman Sachs bankers about investment possibilities, according to Politico. Not even heads of state can afford to insult Wall Street.
