Diane Coyle is pro-economist and makes a decent case, but says both that, "By their actions, governments clearly find economists useful, more useful than other kinds of social scientist," and "reselling tickets for events or concerts makes sense to economists, because it means the people who most value the opportunity will be the ones who attend." In the former sentence, 'find' has to mean 'regard as' rather than 'discover to be.' In the second, the enormous assumption is made that how much someone is willing to pay for something measures how much they value it. It obviously does measure or track that somewhat, but how much they can afford also matters hugely. Coyle must know this, but she writes as if she doesn't.
Peter Blair Henry is also pro-economist, arguing that:
If economists had adequate influence, policymakers in the U.S. and Europe would already have followed the example of developing countries and implemented structural reforms of their own, such as simplifying the tax code and making it easier to hire and fire workers.Hmm. The US tax code is certainly very complicated, and I expect its complexity is harmful. But it sounds as though this is Henry's way of saying cut taxes and make it to easier to fire people. Which to the untutored ear sounds like: if only the Republicans ran everything we would all be better off. Which I think there is reason to doubt.
Marion Fourcade says nothing that I can summarize easily. And perhaps really nothing at all, beyond the claim that economists currently occupy a position that is "fragile."
Orlando Patterson and Ethan Fosse, sociologists, make the bizarre claim that it's "no wonder" that implementing ideas from economists has failed given that what economists say about the state of the economy is different from most people's felt experience. If what they said felt truer would we have good reason to expect better results? Perhaps by "no wonder" they mean that it would not strike most people as surprising rather than that a rational person would expect these bad results. They also claim that the key to development at the national level is state intervention in the economy, basically the opposite of what Peter Blair Henry recommends. Who to believe? And they complain that Economics has its own so-called Nobel Prize.
Philip N. Cohen, another sociologist, seems much more sensible:
In reality, many economists don't hew so firmly to these mainstream dogmas [i.e. the kind defended by Henry]. But economists’ influence is largely proportional to the degree with which their analysis comports with the interests of those who make the most influential decisions. The free market orientation, individualist logic and materialist values of some economists serve well the captains of industry (or, nowadays, of finance), who in turn reward their compliant consultants with privileged perches around the seats of power.Finally, Charles R. Plott claims that Economics is great, appealing mostly to the fact that economic theories are widely used. Perhaps they are indeed used because they work so well. Or perhaps Patterson and Fosse are right that they actually have worked very badly. Or perhaps Cohen is right that the ideas that get used are those that suit the people in power. Who knows.
(I've been waiting all week to find some time to comment on this. I'm looking forward to your blog evolving even more in this direction, as it's infinitely interesting to me personally.)
ReplyDeleteBut it sounds as though this is Henry's way of saying cut taxes and make it to easier to fire people. Which to the untutored ear sounds like: if only the Republicans ran everything we would all be better off. Which I think there is reason to doubt.
Yes, to the untutored ear. In other words, this is just the kind of interpretation which is almost invidiously easy to slip into, especially if you live among actual Republicans, and which I'm nevertheless instantly up in arms about.
How easy it is to fire people, for instance, is completely independent of what happens to people once they get fired. Many economists think that, if we want to make the most of an economy, the best kind of labour market is of a type whose textbook example is Denmark. There is next to no job security: you can basically be shown the door on a whim. But at the same time, the unemployment benefits are so generous compared to a country like the US that it's like winning the lottery. This way, employers are not afraid to hire people, because they won't be difficult to get rid of when they turn into a burden in a downturn. A lot of people will in fact be got rid of, but they still won't have to have their life wrecked in the process, while having ample time to find the next job.
In Denmark, those who have worked 52 weeks over the previous three years are eligible to receive no less than 90% of their average earnings for up to two years. In the US, it's typically 40% to 50% for only six months, and as low as 27% in some states. The problem with the Republicans is that they are cherry-picking. They want the ease of firing without conceding in return the generous benefits. They pretend that a Denmark-type system is a hammock for the idle, which it clearly isn't: the employment rate is almost exactly the same in Denmark as in the US (approximately 62% in both countries right now).
The typical untutored "anti-Republican" is probably liable to think of economists as wanting to cause hardship to people in the name of efficiency. But to many of the economists I know, it's the US system that's inefficient! It pushes the long-term unemployed so deep into the hole they're in that many will not emerge from it ever again. Their life is wasted, and waste is of course the exact opposite of efficiency. The larger the number of people who get a decent standard of living out of an economy of the same size, the more efficient the economy is – exactly like (say) a higher MPG in a car means better fuel efficiency.
The irony and the tragedy is not that the typical academic economist approves of cherry-picking the nasty bits. On the contrary, the cherry-picking feels so alien to them that for that very reason they don't see why they should take any steps specifically to disassociate themselves from it. They cannot identify with those in their audience for whom the association exists – for whom, in other words, "economics" is already by default a kind of euphemism for Republican economic policy – even when breaking the association would be very much in the economists' own best interest. In this way, the authority of economics can be misappropriated y the Republicans for their own purposes, because the non-Republican economists are (so to say) so disgusted with the whole thing that they look the other way when they see the Republicans coming. (I wrote a piece of longform journalism not long ago, in Finnish, in which I made this same point.)
Thanks, Tommi! This is very helpful and interesting.
Deletethis is just the kind of interpretation which is almost invidiously easy to slip into, especially if you live among actual Republicans
Yes, and not necessarily a misinterpretation (although of course it might be) given that the articles are written for the New York Times. At least in Virginia it is very easy to fire people. Perhaps that's not true everywhere in the US, and perhaps that's a problem, but in this context (i.e. the one I live) calls to make it easier to fire people are hard to take at face value.
How easy it is to fire people, for instance, is completely independent of what happens to people once they get fired.
Good point.
The problem with the Republicans is that they are cherry-picking.
No doubt. But when economists give public advice should they bear in mind that this happens and be more careful not to sound more partisan than they mean to sound? I think that's a difficult question, but it seems naive, perhaps even irresponsible, not to head off likely political misinterpretations when talking about politically charged issues. If you speak as an expert and say a significant number of things that Republicans say (without also sounding like a Democrat a similar amount of the time) then you should either recognize that you are supporting them or add an explicit caveat. Or so it seems to me.
to many of the economists I know, it's the US system that's inefficient!
I would be much less suspicious of Henry's motives if he also said this. Or anything remotely like it.
the authority of economics can be misappropriated by the Republicans for their own purposes, because the non-Republican economists are (so to say) so disgusted with the whole thing that they look the other way when they see the Republicans coming
I can understand this (the looking the other way and being disgusted). It's neither being disgusted nor being Republican and yet allowing this kind of misappropriation in what to me seem fairly obvious ways that bothers me. And my (naive, untutored) sense is that this happens a lot.
Hmmm, this politicization seems rather off the mark to me. But since I'm in fact a Republican (probably hard to find in an academic milieu but not so hard in the larger society) perhaps I'm over reacting? Anyway, to the point of whether it should be hard to fire people or not, I can add something from personal experience which may be useful.
DeleteIn the 1990's I was a senior manager in a municipal agency. My staff were civil service, meaning they took tests to qualify for their titles and, when we had to hire anyone, we were obliged to take someone off the relevant civil service list. The rule was you had to go in accord with list seniority which reflected their test scores. You did have some flexibility though. You could interview up to three candidates (whoever were next in line on the list) but if you wanted to hire, you had to do it from among those three only. If you decided against hiring any of them you lost the opportunity to hire until everyone else after you had made their selection and then you could start again with those who were left.
I desperately needed a new analyst to keep our workload up to date but the three I saw that day were altogether unimpressive. Cognizant of the risk, I chose the one I deemed the best of the lot. Alas, he was a terrible choice.
He turned out to be a bad analyst and lazy to boot. Still I tried to bring him along. But about a year into his tenure with us I could see there was going to be little hope for him and I had begun simply relying on other team members. Still, the workload was heavy and I couldn't afford to let him do nothing at all. My team suffered tremendously though because the others had to carry him. One day I was feeling ill and expected I'd have to be out the next day so I gave one of the senior staffers some instructions for the rest of the team including a a short list of very precise written instructions for the guy who I'd foolishly hired at that hiring pool. When I came in two days later my senior staffer told me he'd got everything done except for what that guy was to do. He looked at me sheepishly and said the guy had taken the note with the tasks I'd left set it on fire in the trash bin, in front of the other staff. He told them that he'd be around long after I was gone.
He was right, too, because within the year we had a change of management at the top and I was invited by our new commissioner to submit my resignation. Being in management, I had no civil service protection and so moved on -- but that lazy, incompetent fellow I'd dutifully hired from the civil service list remained.
Nor is this an unusual story. I experienced it again and again during my years in government bureaucracy and could offer many more vignettes along these same lines. I'm no fan of bureaucracy, as you may imagine, but I'm even less a fan of a hiring system that insulates people from the consequences of their actions. It has an insidious effect on staff across the board, it creates excess costs (because you have to overhire to get enough people to actually do the work) and it destroys output quality. Maybe that's why I'm a Republican, eh?
Sometimes real world experience is valuable, too. Maybe more so than theoretical considerations.
Well, empirical data are certainly useful. I don't think that no one should ever be fired though. My point was rather that given how easy it already is to fire people (at least in the private sector) I find it odd that someone would say what we need is to make it even easier. Perhaps the answer is that in other states it's much harder. Perhaps the person who said this was talking about the public sector. Maybe both. I don't know. It just seems odd, and makes me suspicious. As I have said, I'm recording my initial feelings here. But I think they are the kind of feelings that should be expected from newspaper readers, and to the extent that the authors in question did not anticipate them they have done a bad job.
DeleteMore to the point, the Republican party, as you know, is associated with ideas such as smaller government, lower taxes, and less regulation. When economists argue for this kind of thing, other things being equal, they are very likely to come off as supporting the Republican party. It's one thing if that's what they mean to do. But if they don't mean to do it I think they are foolish not to say so.
One concern that I have about economics is that it can sometimes seem as though whatever your politics you can find plausible-sounding support for them from economics. Another concern is that economists who do not mean to support one party or another can unwittingly support, or allow themselves to be presented as supporting, one party rather than the other.
Understood. But neither Democrats nor Republicans have an entirely homogeneous ideology though it is much closer to that today than it used to be. The Republicans, especially, are a highly diverse group consisting of small government types, libertarians, socio-religious traditionalists, internationalists, business people and so forth. They don't all share the same views, as the fractiousness of that party shows. Democrats, consisting of union types, big government advocates, environmentalists, many minority groups, social liberals and so forth, have seen their interests more closely aligned in recent years. But neither party represents a single interest group or belief set. It's a function of our winner take all electoral system I think. Unlike parliamentary systems where different groups form parties to represent their interests and create coalitions after elections, in our system the coalitions are worked out within the parties before elections. I would say each type of system has its strengths and weaknesses.
DeleteEconomics doesn't strike me as much of a science although it certainly makes use of many systematic empirical tools. Still in the end its practitioners are more like philosophers in some ways though the work they do stands on data collected in the world. Philosophers generally don't do any collecting of their own but rely on the data gathered through other disciplines and what their practitioners may make of that. As a result, economists are more theorist, I think, than scientist and so they will certainly have their pet views, reflecting how they think about the data they collect. So it stands to reason there will be small and big government economists, laissez faire types and Keynesians. And that will surely put some in one camp and some in another. I think it'd be a mistake to think an economist has made a mistake if he or she happens to report findings or a theory that supports some Republican view. That would be like saying there's a knowable definitive economic truth, sort of like the theory of relativity in physics, which all true economists will know. But it's doubtful economics works like that.
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Deleteneither Democrats nor Republicans have an entirely homogeneous ideology
DeleteAgreed.
Economics doesn't strike me as much of a science although it certainly makes use of many systematic empirical tools. Still in the end its practitioners are more like philosophers in some ways
This is the kind of idea I'm interested in exploring. To what extent is economics a science., and to what extent should it aspire to be one? And to what extent is it like philosophy?
I think it'd be a mistake to think an economist has made a mistake if he or she happens to report findings or a theory that supports some Republican view.
Certainly. But given the importance of politics, if economic findings do support Republican views then economists should say so. This would help voters make an informed decision. And if economic findings support something that sounds like Republican policy but is actually different in important ways then economists should say this too, so that voters are not misled. (And I would say exactly the same thing with the name of any other party substituted for the Republicans here.)
Given the heterogeneity of the political parties in question, I'd say economists ought not to identify their findings (which, far more than in the hard sciences, refect judgment calls) with any party view. Perhaps it would be more reasonable to do so in a parliamentary system, where parties are ideological (or more clearly ideological than here) but since our political parties are more ideologically diffused, claiming that some finding is Republican or Democratic or Socialist, or that it contravenes a party's position, or that it only partly sustains or contravenes such a position, would be mixing advocacy with the discipline in question.
DeleteIt seems true that economics and other social sciences aren't in the business of formulating universal laws of causation but, in the sense that they ought to show respect for facts, both in gathering them and in making use of them, they are like the hard sciences. Science at this level is just about paying attention to the world as it is, not as we imagine it or would like it to be. And in this I think philosophy is no different (it cannot float free of the facts science has and continues to deliver anymore than any of the other things humans do) though its business is less about particular facts (determining their truth or falsity) than about the concepts which such facts motivate us to construct and apply. So if economics (and anthropology, psychology, etc.) are about collecting, organizing and interpreting various facts about human beings in different domains of human experience/behavior, philosophy must be about making sense of the conceptual structures (the mechanics) within which we deploy information we obtain through these other means.
Better, on my view, to leave the citation of politically relevant economics findings to journalists and advocates so that the economists, themselves, whatever their personal inclinations, may go where the facts lead them -- to the extent human beings can do that (and, arguably, there may be some significant limitations on our capacity to do that completely or even adequately). A scientific attitude to facts, along with methodological interest in them, is what makes the social sciences science, I would say, while a differing methodological interest is what distinguishes them from philosophy.
A scientific attitude to facts, along with methodological interest in them, is what makes the social sciences science
DeleteYes, and in purely scholarly work it's probably advisable to keep politics out of such work as far as that's possible. But when you're writing for a newspaper I would think you ought to keep the political implications, or likely inferences, in mind. And the same goes for teaching. How far politics can ever be kept out of social science (and how far ethics can ever be kept out of philosophy) is an interesting question.
I see your point, Duncan. I guess I made my own rather badly. What I see as a problem is assuming that the Republican Party has a unified economics. There's general agreement among Republicans that the private sector is better than the government for getting things done and that government can be too big, too expensive, too intrusive, too domineering. But there's a wide range of opinion among Republicans re: 1) what counts as any of these things and 2) how much is too much in any particular case.
DeleteThere's less agreement on international stuff with a strong libertarian wing being isolationist in opposition to more muscular policy types. There's general agreement that government benefits programs can be too big and costly, but how much smaller and less costly they should be is not clear. It strikes me that economists shouldn't highlight their findings as being in accord, or out of accord, with some party's (or faction's) policy preferences since those preferences are not necessarily uniform or clear cut and are often in flux. If an economist has data he or she thinks supports lowering taxes or relaxing hiring and firing rules, or the opposite, that economist ought not to associate it with some particular party's policy prescriptions both because there is such a wide divergence of views plus they run the risk of undermining the credibility of their claims.
Another personal note: I was fairly left wing in my youth but at a certain point my father persuaded me, right after college, to register as a Democrat and since I generally sympathized with Democrats' interest in using government to make things better, I didn't find that too difficult. I bought the argument that Reagan wasn't smart enough and never voted for him.
But having lived through the seventies, and then his presidency in the eighties, I was surprised that the policies he implemented, and which were reviled by most of the media (not to mention Democratic politicians and most mainstream economists), actually seemed to work. Now I can't say it was his policies for sure that reversed the awful stagflation of the seventies. It could have been a normal reaction of an extremely beaten down economy or it could have other difficult to recognize factors. But he did implement sharp changes from prior administrations' policies and practices -- and that did coincide with to roughly 25 years of mostly strong economic growth thereafter, some of it quite spectacular.
Now can I prove that the generally conservative policies Reagan introduced and which Clinton didn't really overturn caused all those improvements? No, I can't and to this day many, including economists like the Times' Paul Krugman, still insist that the Reagan policies had nothing to do with the economy's gains -- or really made things worse. There's an element of how one wants to see the data in all this, I think. It's not like equations and observations in physics. But I lived through the period in question here in the U.S. and was even predisposed to dismiss the results when they first began to become evident.
There's a level of observational evidence which, when it's as dramatic as it was with Reagan, ought to make people at least do a double take and, perhaps, change some of their beliefs. Of course it generally doesn't because so much of what we believe seems to stand on something other than mere observation.
I think you did make your point clearly, but I disagree (or think I disagree) with this bit:
DeleteIt strikes me that economists shouldn't highlight their findings as being in accord, or out of accord, with some party's (or faction's) policy preferences since those preferences are not necessarily uniform or clear cut and are often in flux.
I agree that neither of the big parties in the US is monolithic in its views, but the general outline of the differences between the two is clear enough. Patterson and Fosse say that state intervention in the economy is the key to development. It surely wouldn't be unreasonable to guess that they are more likely to be Democrats than Republicans. And Henry says that what we need is a simpler tax code and fewer regulations limiting what businesses can do. I don't think it would be crazy to guess that he might favor the Republicans. In cases like these I would find the case presented more plausible if, say, Patterson and Fosse noted points on which they disagree with the Democratic party, or if Henry did the same with the Republicans. Otherwise it looks as though they are finding what they want to find.
It has been claimed that the more courses US students take in economics the more they tend to support the Republican Party. I think that people teaching economics ought to address this. That is, if what they are teaching does not in fact lend support to Republican policies then they ought to correct the apparent misunderstanding by their students. If, on the other hand, Republicans really do have better economic policies than Democrats (bearing in mind differences within the parties, etc.) then I think professors ought to address this in their courses. Maybe that's dangerous, but giving students a certain politically significant impression without being explicit about what the facts really are seems worse to me.
This is interesting. I'm teaching a course right now that has economic literacy as one of its main ingredients. My goal is not to make the students more Republican; it is rather to combat the misinformation that comes from A.M. talk radio. One of the issues here is what is meant by "teaching economics." I more fancy myself as teaching theory and development of capitalism. The difference is that economics isn't seen as its own science; but rather as a set of mercantile behaviors that come to dominate given periods of American history. What capitalism, industry or economics was to John D. Rockefeller in the late 1800s was not the same set of behaviors that come to dominate the post-Roosevelt era.
DeleteIf people simply come to see two things, the matter gets much more clear. 1. Who benefits? 2. Parties tend to have motives. If both of these PHENOMENA are seen, I think the matter of truth in economics becomes less consequential. I never take a position on the ultimate issues -- most Wittgensteinians don't, I assume. It's up to the students what they are going to ultimately believe. And I tell them that. Instead, all that I am concerned with is that they see or understand certain things about the DYNAMIC of the subject, before they can align. And so, if they know who is benefiting from certain policies and that parties tend to sell things, they can at least be more cautious consumers, taking claims in "yellow alert," as they should.
". . . if what they are teaching does not in fact lend support to Republican policies then they ought to correct the apparent misunderstanding by their students. If, on the other hand, Republicans really do have better economic policies than Democrats (bearing in mind differences within the parties, etc.) then I think professors ought to address this in their courses. Maybe that's dangerous, but giving students a certain politically significant impression without being explicit about what the facts really are seems worse to me."
DeleteBut how would doing as you recommend be anything other than politicizing a course which presumably aims to deal in facts, even if imperfectly known and subject to varying interpretations? Wouldn't connecting what's claimed about some facts by this or that economics theory, or this or that economist, with party positions just muddy the waters? Wouldn't it turn fact gathering, and the hoped for minimally biased interpretations aimed for by economists, into exercises in partisanship? Can that really further the cause of a disinterested social science, or teach students to set aside their own prejudices and biases when examining the facts available?
Perhaps one indispensable element in economics, or teaching it, is to point out the relations of the various theoretical approaches to particular political opinions as you say. But surely that shouldn't come into play when one is simply collecting and presenting data.
The data ought to drive the policy judgments, not the other way round, but it seems to me that doing as you suggest would tend to politicize the data out of the box producing arguments (the bread and butter of philosophy, perhaps) rather than assessments of the facts, such as they are, which ought to be the aim of any discipline claiming to be a science. At least that's how it seems to me. That is, I'd leave the political connections out of the mix and let the chips fall where they may.
That sounds like a very good course.
DeleteThe kind of point I'm making, I suppose, is that not taking a position on the ultimate issues is a tricky business (as I'm sure you're aware). Fox News used to use the slogan "We report, you decide," although of course they didn't simply report the facts without editorial bias. They, I am sure, are fully conscious of their bias, but not everyone is (there are limits to what anyone can do about this, of course) and, what is perhaps less obvious, students might take away a very different message from the one you (think you) are sending. (Here 'you' means one, not you personally.) I teach a course on poverty and last semester my students reported learning very different, even contradictory, things from that course (about, for instance, whether poor people are just lazy or not). I am pretty sure that anyone who thought they learned that poverty is a result of laziness was not paying attention, but I also think it's important that I pay attention to this as a potential problem and make extra efforts to ensure that fewer students come away with this idea in future. Similarly, if people teaching economics are unwittingly encouraging their students to be Republicans they should be aware of this and, I would think, address the matter directly in their courses. They might, for instance, explain that while the course might seem to imply that the Republicans are better than the Democrats, they really aren't for reasons x, y, and z. Or they might (hypothetically) explain that the Republicans really do have better economic policies and assure their students that this impression is not simply a result of the teacher's own political preferences. In short, clarity and honesty are good things. In your course, a possible danger might be that students come away thinking that every purportedly noble act is actually done for base motives. If that isn't what you want them to believe (and it probably isn't) then you might need to say so explicitly (as you probably do). Clarity involves being explicit sometimes about what you are not saying. Which is obvious, but seems to be overlooked at times.
But neither Democrats nor Republicans have an entirely homogeneous ideology though it is much closer to that today than it used to be.
DeleteWell, that's quite an understatement. As measured by roll call voting in Congress, party polarisation in the US has increased constantly since roughly the midterm election of 1978. And the increase shows not the slightest sign of reversing. For this reason, I take the view that the ideological heterogeneity of the Republican electorate is beside the point as long as this electorate votes for candidates who are ideologically homogenous. After all, it's the lawmakers who make the laws, not their voters. (See here, for instance, for some relevant figures and facts.)
Given the current rock-hard discipline in voting behaviour among the Republican caucus in Congress (the overlap between the parties shrinking from 240 Representatives out of 435 in 1973 to zero out of 435 in 2011), I don't think anyone should make any apologies for describing any piece of economic policy, or indeed any piece of policy in any other area of politics, as simply "Republican" or "non-Republican" without any clarifying riders. This would not have been at all true 50 years ago, but it is now; and if anything, the change to the new manner of speaking is overdue by now.
Now I can't say it was his policies for sure that reversed the awful stagflation of the seventies. It could have been a normal reaction of an extremely beaten down economy or it could have other difficult to recognize factors.
I'm reminded of a favourite quotation from the political scientist Larry Bartels, describing voting behaviour around the Western world in the wake of the Great Depression:
"In the United States, voters replaced Republicans with Democrats in 1932 and the economy improved. In Britain and Australia, voters replaced Labor governments with conservatives and the economy improved. In Sweden, voters replaced Conservatives with Liberals, then with Social Democrats, and the economy improved. In the Canadian agricultural province of Saskatchewan, voters replaced Conservatives with Socialists and the economy improved. In the adjacent agricultural province of Alberta, voters replaced a socialist party with a right-leaning party created from scratch by a charismatic radio preacher peddling a flighty share-thewealth scheme, and the economy improved. In Weimar Germany, where economic distress was deeper and longerlasting, voters rejected all of the mainstream parties, the Nazis seized power, and the economy improved. In every case, the party that happened to be in power when the Depression eased went on to dominate politics for a decade or more thereafter."
Much the same goes for the end of the 1970s stagflation. It ended at roughly the same time everywhere in the Western world, no matter what kind of change of government there was in any individual country.
But he did implement sharp changes from prior administrations' policies and practices
Many economists would deny this. To them, Reagan's policy looks much the same kind of Keynesian reflation as, say, FDR's or JFK's.
claiming that some finding is Republican or Democratic or Socialist [...] would be mixing advocacy with the discipline in question.
DeleteI don't think so. This brought to mind the conclusion of von Wright's paper "Wittgenstein on Certainty":
"[Unlike in natural science], there is a bourgeois and marxist economics or sociology in their own rights, I would say. To say that they differ in valuations would not be quite correct. Valuations do not belong within the body of a social science, whether 'bourgeois' or 'marxist'. This is the truth contained in Max Weber's famous postulate of Wertfreiheit. But types of social science may differ in paradigmatic conceptions as to what constitutes the social reality and conditions social change."
Some findings in social science, including economics, are "X-ist" or "Y-ist" already as findings, because the "paradigmatic conceptions as to what constitutes the social reality" in terms of which the findings are put are simply not found in the competing "isms".
An example that has repeatedly caused me practical problems in my job as a professional translator is the way in which the noun phrase "the government" is used in English, especially American English. Dictionaries will claim that this translates into Finnish as hallitus, into German as Regierung, etc. But if you ask native speakers of these languages what they think of "the government controlling the economy" or whether they "trust the government", they will think that you mean the party political government currently in power – known in English by such words as "administration" or "cabinet" – or at most this plus the machinery of enforcement at its command (in US vernacular, "the Feds").
Conversely, if I have to translate "the government" into Finnish, I usually in fact translate it as valtio ('the state') or valtiovalta ('state power', 'police power'). Whenever I see "the government" used in this sense, I feel like saying: "You mean the state."
And the difference is in paradigms. In a tradition of political culture influenced by Locke and by social contract theory, such as that of the US, the state is viewed as so precarious ontologically (so "temporary") that the word "government", meaning the latest in a series of transitory governments, is used to refer to the state itself, the thing the affairs of which the government governs for the time being. In a tradition of political culture influenced by Hegel and by Lutheran two kingdoms doctrine, the state is not viewed as something that can either exist or not exist: it exists by definition, so to say. In this tradition, speaking of the state as coextensive with "the government", i.e. something ontologically temporary, does not seem wrong so much as... arch. ("As if one were to distinguish between a murder with one shot and one with three." - Zettel §384.)
The context of von Wright's remarks is a suggestion that this is a difference in "world-pictures", such as Wittgenstein speaks of in On Certainty. I agree.
If you spoke to a true believer in Hegel and Luther, they would say that reality itself is already political: God made it so when He created it. To them, to speak of "politicisation" would be a kind of blasphemy; while to a true believer in Locke, claiming it to be blasphemy would probably itself constitute blasphemy. "Where two principles really do meet which cannot be reconciled with one another, then each man declares the other a fool and a heretic" (OC §611).
"Given the current rock-hard discipline in voting behaviour among the Republican caucus in Congress"
DeleteIt's no less so with Democrats although Americans are more polarized today than they used to be. Still, there's more divisive infighting among Republicans now than among Democrats. Just look at the parties in terms of the jockeying for the 2016 presidential nomination!
"I don't think anyone should make any apologies for describing any piece of economic policy, or indeed any piece of policy in any other area of politics, as simply 'Republican' or 'non-Republican' without any clarifying riders."
One could say the same about Democrats who, almost to a man (or woman!), favor bigger government, more and higher taxes and increased spending. Certainly by any of these three both parties are at opposite ends of the pole though Republicans are more conflicted than their Democratic counterparts. Republicans have less agreement about where to actually cut and how much to actually spend than Democrats have about what not to cut and how much more to spend.
There is a social bias in the States today toward larger, more assertive government and while there remains an almost atavistic longing for personal liberty, put at hazard the larger government grows, Americans have come to expect and even demand government involvement in their lives. It's this conflict, between that defines the current political dynamic in the U.S.
"In the United States, voters replaced Republicans with Democrats in 1932 and the economy improved."
Except that that improvement from the Crash that initiated the Great Depression took an historically long time (hence "Great"). There are numerous economists and analysts who actually ascribe the length of that Depression to Democratic policies. Some argue it actually took the second World War to yank the U.S. out of its economic funk.
One of the things about the social sciences is you're always observing and trying to explain and predict in an imperfect environment. But if anyone wants to make the argument that FDR's New Deal policies pulled America out of a roughly decade long Great Depression they would also have to acknowledge that Reagan's policies pulled us out of the Great Stagflation of the 1970's. In fact, Roosevelt's policies, implemented after 1932s, roughly coincided with the Great Depression whereas Reagan's policies, implemented in the early 1980's, followed the Great Stagflation (which Keynsian economic theory suggests was impossible because you don't get economic stagnation and inflation at the same time). Reagan's policies coincided with a significant recovery from the time of implementation while Roosevelt's saw the problem drag on and on. So on that measure, Reagan's policies were more successful than Roosevelt's.
"Much the same goes for the end of the 1970s stagflation. It ended at roughly the same time everywhere in the Western world, no matter what kind of change of government there was in any individual country."
Countries around the world picked up and began implementing conservative economic policies a la Reagan, e.g., Ireland and certainly Thatcher's UK. But this probably only helps show how discussions like this are driven by our belief systems rather than observation since I doubt I could convince anyone here that certain conservative approaches to economic activity could ever be better than liberal ones insofar as they are already enrolled in the liberal viewpoint. Nor am I immune to that, I suppose, though in my favor I did once hold liberal views until changing my mind in acknowledgement of the positive changes I lived through from the seventies to the nineties. But even observation-based ideas have a remarkable sticking power so I expect it would take a lot at this point to shake me of my current notion that certain conservative economic policies are better than certain liberal ones.
"If you spoke to a true believer in Hegel and Luther, they would say that reality itself is already political: God made it so when He created it. To them, to speak of "politicisation" would be a kind of blasphemy; while to a true believer in Locke, claiming it to be blasphemy would probably itself constitute blasphemy. 'Where two principles really do meet which cannot be reconciled with one another, then each man declares the other a fool and a heretic' (OC §611)."
DeleteSo they do, in a great many cases. But perhaps the point in treating economics as a science, even if only a "social science," is to avoid that level of discourse? Physicists, chemists and biologists, after all, don't come to blows or execrations over string theory vs. brane theory, or the question of water's constitution or the reproductive behaviors of the newt.
the enormous assumption is made that how much someone is willing to pay for something measures how much they value it. It obviously does measure or track that somewhat, but how much they can afford also matters hugely. Coyle must know this, but she writes as if she doesn't.
ReplyDeleteOr it's taken to go without saying, even while the audience being addressed does not so take it. Sadly, economists are guilty of this all the time, but so are other academics, and to some extent just about everyone.
They also claim that the key to development at the national level is state intervention in the economy, basically the opposite of what Peter Blair Henry recommends.
There is a strong case for saying that the key to development at the national level is initially state intervention in the economy, until the stage of development is reached where this then ceases to be true. See Chang's Thing 7 ("Free-market policies rarely make poor countries rich") and Thing 12 ("Governments can pick winners"). Chang's native South Korea is a textbook case, as is Finland, incidentally.
And they complain that Economics has its own so-called Nobel Prize.
I feel the same way about the Library of Living Philosophers. Towards the end of his life, Paul Arthur Schilpp said that if he had known how meagre its contribution to genuinely furthering philosophical understanding would be, he would not have founded it at all.
Philip N. Cohen, another sociologist, seems much more sensible: [...]
His viewpoint forms a large part of the one I've been trying to get across, which you probably guessed already by yourself.
Marion Fourcade says nothing that I can summarize easily. And perhaps really nothing at all, beyond the claim that economists currently occupy a position that is "fragile."
Be that as it may, what she says I personally feel closest to of all these pieces, jointly with Cohen's. Might be worth a re-read?
I'm not sure what to say about this: "reselling tickets for events or concerts [...] means the people who most value the opportunity will be the ones who attend."
DeleteTaken at face value it just seems false to me. There could easily be rich people who get tickets in these circumstances who don't care very much whether they attend or not, and ardent fans who simply cannot afford to buy tickets. Am I being too literal? Perhaps she means only that reselling tickets increases the overlap between the set of people who most value the opportunity and the set of people who get tickets for it. But I would prefer that kind of accuracy in language. It reminds me of an old economics textbook that talked about employment as if those who work long hours value pay highly while those who never work value leisure more. There actually is something to this idea, as a recent New York Times article has made clear, but presented just this way it is extremely insulting to the involuntarily unemployed (and to people who work multiple jobs because each one they have pays so badly). It also encourages the right-wing myth that unemployed people are lazy. So it's sloppy, insensitive, and dangerous.
what she says I personally feel closest to of all these pieces, jointly with Cohen's. Might be worth a re-read?
I was probably unfair. Her point is no doubt right.
Perhaps she means only that reselling tickets increases the overlap between the set of people who most value the opportunity and the set of people who get tickets for it.
DeleteMy own view is that there is indeed a premiss left unsaid, but a different one: that no tickets will ever be so expensive that anyone wanting them would not be able to get them by forgoing something else.
To explain further would involve the concept of opportunity cost, which I already tried to explain to you once years ago. I still remember well how I recoiled from the strength of your moral disapproval of this concept (seemingly originating in something that was completely alien and opaque to me personally, even after you tried to articulate it to me, patently in good faith). For that reason I don't want to try again at this time.
But I would prefer that kind of accuracy in language. [...] So it's sloppy, insensitive, and dangerous.
Well, that's journalism for you. From experience, I can tell you that it's not even obvious that the sloppy use of language is due to the writer, instead of a copy editor on the paper.
I've been drawn to journalism increasingly myself since I started to write books, although solely through commissions. But I completely see the point in using "journalist" and "journalism" as semi-indiscriminate swear words, as Wittgenstein used them.
Well, that's journalism for you.
DeleteYes, there is that.
I think I understand and agree with the idea of opportunity costs now. Perhaps I'm fooling myself. It still doesn't sound right that literally "no tickets will ever be so expensive that anyone wanting them would not be able to get them by forgoing something else." If Super Bowl tickets cost $8000 then not everyone will be able to afford them by forgoing something else. Perhaps most people could, but not literally everyone could.
Good blog post, Richter. I am writing on the philosophy of economics these days, I especially liked your quip about Diane Coyle's remarks. Tommy also makes solid Wittgensteinian - as usual.
ReplyDeleteHowever: The Denmark example is pure fiction. Sure, firing is easier in Denmark than in France, but not that simple (luckily, I would add). The benefits mentioned are also pure fiction. Tommy must be thinking of the so-called "A-kasse"-system - that system, however, while state supported is actually a private form of insurance not usually opted for by people in poverty. And the rates mentioned are all off to. The absolute maximum amount one can receive is 630 US dollars per week, which is not bad but by no standard 90% of your previous salary. The starting salary for a fresh master student would usually be around the double. The 90% works the exact other way around, so that if a person had a very poor salary to begin with, say, 500 US dollars, he would no only get 450 a week (a rule designed to create minimum incentive to work even for very poorly paid labour). That the employment rate of Denmark is 62% is also pure fiction.
All the facts of economics are boring, but, I suppose, important.
Thanks! Those facts about Denmark are quite interesting, actually. And important.
DeleteI'm glad you think so. Some days, I rather do the mind-body problem or write something about Wittgenstein on personal pronouns, but given that my PhD is in Economics and Philosophy, I try to take economic facts as serious as it is, so to speak, philosophically possible.
ReplyDelete[Also (and this is a big admission) given the prospect of few months of unemployment before I start my post.doc., I know the rules of the Danish system!]
It sounds healthy that you have other philosophical interests too, but I think Economics and Philosophy is (and are) important.
DeleteIt sounds healthy that you have other philosophical interests too, but I think Economics and Philosophy is (and are) important.
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