How to Keep the Debate on Translation Pricing From Going Full Retard

Kirk Lazarus: Everybody knows you nevergo full retard. Tugg Speedman: What do you mean? Kirk Lazarus: Check it out. DustinHoffman, 'Rain Man,' look retarded, act retarded, not retarded. Countedtoothpicks, cheated cards. Autistic, sho'. Not retarded. You know Tom Hanks,'Forrest Gump.' Slow, yes. Retarded, maybe. Braces on his legs. But he charmedthe pants off Nixon and won a ping-pong competition. That ain't retarded. PeterSellers, "Being There." Infantile, yes. Retarded, no. You went fullretard, man. Never go full retard. You don't buy that? Ask Sean Penn, 2001,"I Am Sam." Remember? Went full retard, went home empty handed...—Tropic Thunder(2008)
It seems as though the Common SenseAdvisory has launched a rate survey in order to imbue the idiot-boy shoutingmatch about falling translation prices with some empirical content. The surveyhas come in for a lot of criticism just because of its formulation. Iam not a statistician, but I do know that the creation of an unbiased set of questionsis not a simple thing. Kevin Lossner, one of the voices who doubt that pricesare declining, regularly summarizes translation surveys by sector organizationsthat do not point towards the Götterdämmerungcelebrated by many self-appointed gurus. His conclusion is as follows:

Ratesurveys without a particular ideological or commercial agenda from the ITI andIoL in the United Kingdom and the German BDÜ have larger samples of serviceproviders in many languages, and they mostly tell a story of stable or slightlyincreasing rates for language service providers.

This to me sounds far more likely than anyother sort of scenario (that is, if you are seriously interested in commonsense). Of course, there is also the probable fact that translation pricing (mostlyfor the B2B sector) took a cliff dive in 2008 and 2009, but that issurely due more to the Great Recession than to any factor endogenous to thetranslation industry (recessions tend to put pressure on prices of all sorts ofthings because demand craters).
Now, in a vain attempt to keep the debatefrom going full retard, I have a couple of observations. First of all, evenbefore the current crisis, we lived in a period that some analysts described asthe Great Moderation. What does this mean? For reasons that are not altogether clear, the past30-odd years have been marked by a dramatic cooling off of inflation worldwide.Whereas the seventies were dominated by a precipitous plunge of the US dollaragainst the ounce of gold, several oil price shocks and runaway inflation, thenext three decades were marked by ever lower inflation. Former Fed chief AlanGreenspan recounts in his memoirs how he used to get up every morning and lookat himself in amazement in the mirror: productivity and economic growth wereskyrocketing, but there wasn’t even a hint of inflation. Many hypotheses wereproposed by our dismal scientists (i.e., economists) to explain this remarkablestate of affairs. The two most popular explanations were: China (cheap labor)and technology (greater productivity with equal inputs). The latter explanationblossomed further into the idea of the New Economy in the 90s. Basically, itstated that the Internet and better communications technology were allowing theworld economy to achieve runaway growth without inflationary pressures. Oh, onecorollary of this brave, new theory was that recessions were a thing of thepast. Was the “New Economy” theory correct? Well, three little incidents happenedalong the road to recession-free Tech Utopia: the 2000 bursting of the 90s Internet bubble; the2001 recession; and the worldwide doo-doo storm known as the 2008 financialcrisis (and the ensuing Great Recession). That is why I find it hilarious tosee the translation gurus peddling the same outdated ideas about a tech-drivendeflationary spiral a full decade after the theory was totally discredited by alittle thing called reality.
Even now, four years after the crisis began,the thing that keeps central bankers awake at night is deflation. The financialindustry has an in-built bias against low interest rates: holders of financialassets hate them. But central bankers in both the First World and the ThirdWorld are still fretting about the opposite phenomenon: their nightmare isabout the entire world going down a deflationary drain. If you think lower andlower prices are neat-o, e-mail your closest Japanese acquaintance and ask him howdeflation has been working out for the Land of the Rising Sun. If you suggestedto any of those central bankers that technology has anything to do with ourcurrent problems, he would laugh in your face, because obviously the factorputting pressure on prices currently is fear. Good old fashioned fear. Rightnow, if you buy a German short-term bund, it gives you a negative interest. Yes, you get lessmoney back when you invest in some German and British tenors. Investors arebasically paying safe-haven countriesto hold their money. There is so much fear around that the smart money prefersto forgo interests and simply pay a small fee to have a creditor country safeguardtheir money.
Okay, now for the second observation. In acontext of low inflation or even deflation, prices that remain stable or increaseslightly are actually posting huge increases in value as everything else dropsin monetary value. So, any discussion of higher or lower translation prices ispointless outside the macro context of where prices are going worldwide. Fornow, world prices are stagnant and threatening to shrink. In that context,stable to slightly higher prices mean that you are winning the rat race. Ifthat is your case, pat yourself on the back. If not, try to find some way toget on the winning wagon.
Remember: fear and unfounded paranoia areonly certain recipes for going full retard. And, as Sean Penn discovered, thatnever pays off. As Robert Downey Jr. reminds us: "Never go full retard."

Miguel Llorens is a freelance financial translator based in Madrid who works from Spanish into English. He is specialized in equity research, economics, accounting, and investment strategy. He has worked as a translator for Goldman Sachs, the US Government's Open Source Center, and H.B.O. International, as well as many small-and-medium-sized brokerages and asset management companies operating in Spain. To contact him, visit his website and write to the address listed there. Feel free to join his LinkedIn network or to follow him on Twitter.