RC#52: Fawlty Forbes

published in Eastern Economist #438, June 25, 2002
A famous American came to town June 19 to tell Ukraine how it can attract investment. Steve Forbes also urged Ukrainians to speed up integration into Europe.

            Mr. Forbes is a publishing magnate who ran unsuccessfully for President of the US. For some reason, President Kuchma invited him to Ukraine to discuss Ukraine’s economic situation and its investment climate. Forbes also delivered a lecture to students at the Institute of International Relations.

            This is the man who openly stated, during his presidential election campaign, “My father once spent $5 million on a birthday party for himself in Tangiers. Why can’t I spend a few more running for President?”

            Lest anyone doubt Mr. Forbes’ seriousness, he also said, “In their late 40s, Forbes men’s hormones seem to change. Pop started riding motorcycles. I would say running for president qualifies.”

            To crown the gentleman’s visit to Kyiv, Foreign Minister Anatoliy Zlenko named Mr. Forbes a “Ukrainian business ambassador” for his “significant contribution to the development of Ukrainian-American business contacts.”

            Just how has Steve Forbes contributed?

            His father’s flagship publication, Forbes Magazine, is known for never publishing bad press about any major advertiser*. A cozy relationship that puts the independence of many media in the US in question. And not unlike the relationship between many journalists and their publishers in Ukraine.

            Perhaps Ukraine should have thought to pay Forbes for some advertising in his magazine back in 1993. But it was struggling with thousand-fold inflation and had other things on its mind.

            In the event, Forbes has published at least two headline grabbing articles about the country.

            The first piece was a June 1993 interview with the founder of IntelNews, a Ukrainian-American from Baltimore. The headline read along the lines, “If you thought business was rough, try working in Ukraine, where business rivals can kidnap you at gunpoint.”

            “That was no business rival, it was her alcoholic boyfriend,” explained an American who worked for the company at the time. Ukrainian staff at the agency corroborated his statement. Not understanding the clout of a magazine like Forbes, they just thought the whole thing was funny.

            With a little professional checking, the Forbes interviewer would have found out that the story was bogus. Instead, Forbes left its tens of thousands of business readers with the impression that Ukraine was a cross between 1920s Chicago and the Belgian Congo in the 1960s.

            In September 1996, Forbes published an article by Paul Klebnikov called “Tinderbox.”

            The impression was that it was written sometime in 1991, when the rest of the world thought the August putsch in Moscow would herald dozens of ethnic wars as the Soviet Union broke up. Everyone thought soviet citizens would be starving by winter.

            Given that the region was not very accessible to foreigners in 1991, some misperceptions of this kind might have been forgivable in the early 1990s. But by 1996, dozens of world media groups had correspondents and stringers working in Kyiv. Visiting Ukraine was as straightforward as visiting Italy.

            Mr. Klebnikov’s article portrayed Ukraine as a country where ethnic tensions were at the explosive stage. “Russia is now a democracy,” Mr. Klebnikov wrote, “and the Russian president cannot ignore the pleas of the Russian-speakers in Ukraine if they ask for his help.” The suggestion seemed to be that Russian troops ought to cross the border into Ukraine just as they had done in Chechnya.

            Forbes seemed to be promoting a fairly bizarre definition of “democracy.”

            Mr. Klebnikov went on to compare Ukraine to war-torn Yugoslavia. It was a cheap shot, given that Ukrainian soldiers were risking their lives in Bosnia, serving with international peacekeeping forces.

            The article caused outrage in the Ukrainian communities of the US and Canada. But their many letters to the editor were dismissed. Because these were not subscribers, the Forbes editor said, the publication felt no need to concern itself.

            When word got out, the American Chamber of Commerce in Kyiv prepared a letter to the editor.

            “The board of American Chamber of Commerce in Ukraine has decided that it behooves us, as the main private-sector representatives of American business interests in Ukraine, to go on the record as strongly disapproving of the kind of biased journalism that this article represents, particularly since it concerns the region of the world where we are all engaged in doing business,” read a memo that went out to members on Oct. 18, 1996.

            “We are concerned that your correspondent, Mr. Klebnikov, has done America’s business leaders – your readership – a great disservice. We are concerned, as Americans doing business in Ukraine since 1991, that Mr. Klebnikov appears to have his own agenda and produced a pretty well-executed hatchet job, rather than writing in the best interests of serious American investors who read your publication to find information on which they can base their business and investment decisions.”

            Given Mr. Forbes’ legendary arrogance and aggressiveness, he may be operating on a simple rule. If readers don’t know any better, editors can put whatever spin on things they pretty well want. As long as it sells copy.

            At best, Forbes’ magazine has questionable checks and balances on its journalists. At worst, it has its own hostile agenda towards Ukraine and Ukrainians.

            My question is, What is this country doing giving Steve Forbes an award as “Ukraine’s business ambassador”? •

–from the notebooks of Pan O.

* For those who are interested in a business analysis of Steve Forbes, an article entitled “A Failed Manager With No Real World Experience” is available at www.realchange.org.