Friday, December 26, 2014

Is Economics a Deeply Corrupt Profession?

I have suspected for a long time that a big chunk of the economics professoriate has, in effect, sold out to the high bidders. Unlike physicists, biologists, and anthropologists, economists powerfully influence government policies which directly affect wealth. A vast array of "think tanks," policy institutes, and other devices exist to put money into the pockets of economists who sing the tune of the ultra rich funders of the same.

I read Paul Krugman's latest post as essentially confirming this diagnosis.

Robert Waldmann is shocked, shocked, to find conservative economists not doing their homework:

Even now, I am shocked that economists didn’t bother to look up the data on FRED before making nonsensical claims of fact.

I’m shocked that he’s shocked.

Waldmann’s issue is the relationship between government spending and growth in recent years, which everyone on the right knows has been negative, but is actually positive. Why, he asks, didn’t they look up the data — which takes only a few seconds on FRED — before making their claims?

But this is typical; it applies to issues across the board. The same people know that growth has been much faster since financial deregulation and the Reagan tax cuts, except that it hasn’t; they know that Reagan was the only president to oversee the creation of millions of jobs, because there never was a Clinton boom; they know that there has been unprecedented growth in government spending under Obama, when the reality is the opposite. At this point you shouldn’t be surprised.

Wherefore this willful disregard of easily available data? Laziness? Stupidity? Blind faith in ideas that are refuted by nasty facts?

Maybe, but I'm more inclined to suspect more venal motives. And Krugman hints as much.

...I’ve had conversations in which people belligerently assert “I’m not impressed by your charts — you’ll never convince me that government spending has fallen under Obama.” Don’t bother me with facts!

But why this attitude? Mainly, I suppose, it’s the epistemic closure that comes from serving the interests of big money. There’s a world of think tanks that don’t want too much thinking, partisan media that don’t do fact-checking, and for that matter professional journals that erect high barriers against anything even vaguely Keynesian while uncritically publishing new classical stuff.