Ryan Cooper: Why are big-shot liberal economists hippie-punching Bernie Sanders?

Avatar

Will Truman

Will Truman is the Editor-in-Chief of Ordinary Times. He is also on Twitter.

Related Post Roulette

43 Responses

  1. Avatar greginak says:

    Dear Mr Cooper, this isn’t’ hippie punching although that is a nice try to redefine the criticism. From what i’ve seen the Freidman numbers predict growth, etc far exceeding historical averages and against trends like boomers retiring which makes them very unlikely. R’s have gone with the craptastic “we’ll get 5%..no 8% growth…Just Because!!!” even though that is mega improbable. It isn’t’ any better when Bernie does it.Report

    • Avatar North in reply to greginak says:

      Exactly, why in the name of agnostic Jeebus would we, seeing the shitstorm the GOP has gotten into doing it, encourage this kind of magical thinking in our own camp?Report

      • Avatar Chip Daniels in reply to North says:

        seeing the shitstorm the GOP has gotten into doing it

        Shitstorm? There was a shitstorm?

        Where and when did the GOP candidate ever suffer any ill effect from promising voodoo economics?

        They are still, 35 years on, running on the Laffer Curve. And winning.Report

        • Avatar Morat20 in reply to Chip Daniels says:

          Well, to be accurate, “considering these same economists have complained about the GOP doing this stuff” coupled with “and this often leads to these economists being called ‘liberals’ and ‘hacks’ and ‘partisans’.

          I suppose it IS really surprising, to some people, to see…consistency.Report

        • Avatar North in reply to Chip Daniels says:

          If you look at the state the GOP is in today and think “Yeah the left and the Dems need to go there and get in on that” all I can say is I’ll see ya on the barricades Chip.Report

    • Avatar Brandon Berg in reply to greginak says:

      The silly numbers aside, the mechanism makes no sense, either. Stimulus is good for a few percentage points of growth, tops, and it’s not something that can be repeated year after year. The best it can do is get you back to full employment, and at 4.9% unemployment, we’re pretty close as it is. Beyond that point, growth requires investment and technological advances (which require investment). Meanwhile, Sanders is campaigning on a tax plan that borders on a war on investment.

      Making our economic policy less like Singapore and more like Denmark is likely to make our economic performance less like Singapore and more like Denmark, not the other way around.Report

      • Avatar Morat20 in reply to Brandon Berg says:

        Part of the only defense I’ve seen of the work was the statement that he is right that the economy’s not at full capacity, and there is plenty of slack — and frankly with low interest rates and a backlog of actual important crap that needs doing — it’s not like we’ve missed the window to do so both cheaply (cheap loans) and in a fashion that will pay for itself long term (a lot of infrastructure — water pipes, bridges, electrical grids — are stuff that HAS to be fixed eventually, and enables commerce in rather important ways).

        Now how big an economic spike you’d get over the first year or two is debatable (it depends on how much slack there really is). The real problem is, of course, claiming that’ll work year after year. Which it won’t.

        As to the war on investment — eh, I think taxing gains as income (as long as you can still deduct losses and a few other simple things) is not a “war on investment”. Especially given the problems we have with income inequality AND the fact we’re starting to see the same idiot tricks again — the return of liar loans and “this time we swear they’re safe” CDO-esque mortgage bundles.

        It depends on the specifics of his plan (beyond taxing it as ordinary income, which is all I know. I assume you can deduct losses, etc), of course.

        Personally, while I’m quite in favor of much higher taxes on gains, I actually prefer a phased in version of Clinton’s plan (phased rates, going down the longer you hold an investment)— if we’re going to massively privilege investment income over labor income, we should at LEAST aim at subsidizing long-term investment.

        But frankly, right now, we do heavily privilege investment income over income from labor. Whether we should, either in general or right now given the high concentrations of wealth and rather recent examples of rampant speculation caused by far too much money chasing too few investments — is a conversation we should be having.Report

  2. Avatar Morat20 says:

    Yeah, it’s not hippie punching. The “big shot liberal economists” are critiquing Bernie for the exact same things they critiqued Paul Ryan for.

    Obviously, we can’t have consistent criticism — not in politics! Also, Krugman is shrill.

    And people have explained in detail — but honestly, for an analogy — if you’re trying to show, oh, the inputs to a system and end up creating something that sums up to 200% of the actual system, you don’t really have to say where they went off the rails. The ludicrous result is sufficient to know they screwed up somewhere.

    He even linked Drum’s piece, where Drum highlights several nonsense conclusions — Employment/population rate at 65%? It’s never EVER been 65% in history. It would be pretty freaking extraordinary to hit that, but doing so when the Boomers are retiring is flat idiocy to suggest.

    A clearly nonsensical conclusion is sufficient to show there’s something incredibly wrong with the paper.Report

    • Avatar James K in reply to Morat20 says:

      @morat20

      He even linked Drum’s piece, where Drum highlights several nonsense conclusions — Employment/population rate at 65%? It’s never EVER been 65% in history. It would be pretty freaking extraordinary to hit that, but doing so when the Boomers are retiring is flat idiocy to suggest.

      Perhaps Sanders plans to get congress to abolish old age.Report

      • Avatar Morat20 in reply to James K says:

        You know, it’s funny — I bet I can tell you exactly how this really went down.

        1) Sander’s has some ideas, his policy team has some ideas, and then put some work into them. But Sander’s team is probably not that experienced (they’ve made some a big mistake or two on their own analysis on his healthcare proposals costs, for instance).
        2) He doesn’t really have a think tank or a big group behind him, so his analysis of his ideas is pretty rough — lack of time, money, expertise. Everyone’s busy on the campaign. Clinton’s stuff is stuff she’s — and people who work for and with her — have been working on a lot longer.
        3) A third party comes out, does a lengthy analysis that looks awesome.
        4) Sanders PR guy sees it, embraces it — because it looks awesome.
        5) And now it’s Sander’s plan, with ridiculousness baked into the analysis, because he’s doesn’t really have his own white papers to put against it (and his PR guy was pushing it).

        What you’ve got here is pretty simple — Sanders has a lot of big ideas, and a rough plan, but not one fully worked out with the usual white papers and work behind it. Which is fine, I mean it’s not like that wouldn’t get done prior to actually getting proposed — and a lot of polishing, altering, and other stuff done quietly on the side. A PR guy saw a really rave review of his plan and pushed it.

        And a shit-ton of economists, who have spent the last decade or so getting more and more annoyed at BS plans with BS assumptions full of BS, slap it down really hard. Because, one, they’ve always been slapping down what they saw as BS numbers and two — at least for some of them — it’s probably pretty important they be even more critical of their own ‘side’ to ensure they’re not letting bias slip through. (Plus, in cases like Krugman — the man’s punditry career started with being annoyed at innumerate budget plans. The last thing he probably wants is BOTH sides abandoning reality. He’s already given up on the GOP).

        So to sum up: I’m pretty sure Sanders and his team feel that, with work and polish, his plan will lead to great economic things. He and his team probably don’t think it’s gonna be a decade of record-shattering growth, massive income games, and somehow increasing labor force rates higher than they’ve ever been even as the greatest retirement in American history is ongoing.

        But they’re certainly happy to point people towards economists saying “Great plan, Sanders!”.Report

  3. Avatar Christopher Carr says:

    Point 1 – Optimism sells, and politicians are salesmen.

    Point 2 – There was a discussion on another thread about why economists aren’t taken as seriously as “scientists” as, say, chemists. Case in point: replace the word “economics” with “chemistry” in any of the above articles, sit back, and enjoy the lolz.Report

  4. Avatar Autolukos says:

    The mind blowing passage to me:

    Friedman’s analysis is certainly far outside the mainstream, and from my informed amateur perspective, the amounts by which he predicts Sanders’ program will exceed the CBO baseline are mighty implausible. But the basic shape of his analysis — a sharp initial growth spike driven by massive fiscal stimulus, falling rapidly to a lower but still-strong rate — is not at all ridiculous.

    It’s an odd defense of the analysis and the Sanders campaign’s use of it that admits that the author doesn’t actually believe the analysis.Report

    • Avatar Morat20 in reply to Autolukos says:

      It’s like he’s saying the shape of the analysis is right, but wrong on all the details like “magnitude”.

      The end numbers are…rather difficult to believe, most of them under the heading “record-breaking” and “never before seen” which is generally a reason to be skeptical as hell.

      I mean I’d love to believe Bernie found the magic mix to sprinkle on the economy, but I’m…kinda doubting it. Especially since some of the numbers seem closer to “impossible” than “really insanely optimistic”.Report

    • Avatar Stillwater in reply to Autolukos says:

      Looked at the original analysis everyone’s critiquing and the difference between the CBO numbers and Friedman’s come down to different values of the multiplier effect in the short and long term projections. Friedman uses what he calls a “conservative” but much higher value than the CBO.

      I haven’t read an analysis yet of why Friedman’s choice is preposterous, or why the CBO’s is “realistic.”Report

      • Avatar Autolukos in reply to Stillwater says:

        If your estimate has the US (or any similarly wealthy economy) at 9% growth for a full year, your estimate is probably wrong. This is purely a heuristic (or, to be less charitable to myself, an argument from incredulity). I am, however, happy to bet on it.Report

        • Avatar Stillwater in reply to Autolukos says:

          I’m no economist, but it seems prima facie reasonable to think the first year spike is quite close to accurate IF all of Bernie’s policies were implemented on day one of his presidency, that the financial markets remained stable, the the Fed didn’t immediately raise interest rates, etc etc.

          Which is to say, the internal maths on the plan probably do work out just the way Friedman outlines (according to his values of stimulus effect coupled with multiplier coefficient), and it’s all the other variables that will either not work with the plan or will actively counter certain aspects of it that would likely retard the growth projections it contains.

          But none of that matter anyway since there’s zero chance of Bernie enacting the major policy changes he wants.Report

        • Avatar Stillwater in reply to Autolukos says:

          {My comment ended up in moderation so I’ll repost here}

          I’m no economist, but it seems prima facie reasonable to think the first year spike is quite close to accurate IF all of Bernie’s policies were implemented on day one of his presidency, that the financial markets remained stable, the the Fed didn’t immediately raise interest rates, etc etc.

          Which is to say, the internal maths on the plan probably do work out just the way Friedman outlines (according to his values of stimulus effect coupled with multiplier coefficient), and it’s all the other variables that will either not work with the plan or will actively counter certain aspects of it that would likely retard the growth projections it contains.

          But none of that matter anyway since there’s zero chance of Bernie enacting the major policy changes he wants.Report

        • Avatar Brandon Berg in reply to Autolukos says:

          Singapore’s wealthier than the US, and hit 9% three times between 2006 and 2010, including 15% in 2010. But it sure as hell didn’t do it by emulating Denmark. And I think its small size played a role, too, so I doubt the US could achieve those kinds of results.Report

      • Avatar Morat20 in reply to Stillwater says:

        Because, among other things, he concludes a 65% labor force participation. A number we’ve never, ever, ever hit. A number that, per this projection, we’ll somehow magically hit while we have the largest percentage of retired Americans in history.

        Pretty sure those guys count, you know? And they’re not going to be working unless Sanders has a magic plan to prevent retirement.

        But mostly because Bernie’s numbers are actually ROSIER than the number’s these same people have been mocking Jeb, Carson, Cruz, and Trump for. They’re being consistent here — this projection, like the ones of half the GOP field — require not just record-breaking growth, but sustained record-breaking growth. And by “record breaking” I mean “smashing records”.

        In a mature economy, with the largest retirement in American history starting to happen.

        So you can start with “The CBO isn’t predicting the US will shatter all it’s own personal bests, and also do that every year for 10 years. They are instead predicting America will muddle on in a very average way for America”.Report

        • Avatar Stillwater in reply to Morat20 says:

          Oh, I don’t believe the numbers will work out as Freidman claims for a whole bunch of reasons, some internal to the predictions, most existing outside of them (politics, policy, cultural inertia, etc). My only point up there was that the difference in the CBO numbers can be largely accounted for by different values for the multiplier (and I haven’t seen anything to suggest that their value is the right one…).

          But from my pov it doesn’t matter anyway since, as I said up thread, Bernie won’t be able to enact any of his major policy initiatives. So the issue, to me, is largely mute.

          Seems to me assuming he can enact his program simply by being Preznit is the primary form of magical thinking going on.Report

          • Avatar Morat20 in reply to Stillwater says:

            Well yeah, but to be blunt — if we’re going to point and laugh at Paul Ryan for assuming 5% growth (or Jeb Bush or Carson), we have to do the same for Bernie Sanders.

            Now, as a caveat, Sander’s isn’t claiming ridiculous growth. An economist parsing his plan did, and Sanders’ team was very clearly “Oh yeah, see how awesome we are! You should read him about our plan!” which is….close enough for jazz, really.

            I think there’s also some rumbling that Sanders’ economics team made some actual screwups with his healthcare cost stuff as well.

            All of which is to be expected. Of the two people running on the Democratic side, Clinton has the wonks. The people with white papers and analysis and such. Sanders has the rhetoric and passion and didn’t really come equipped with his own think tanks, you know?

            I’m not saying he’s wrong, it’s just I’m pretty sure his policy analysis team isn’t nearly as experienced.Report

            • Avatar Stillwater in reply to Morat20 says:

              As yet, I haven’t seen anyone knock down Friedman’s analysis, only his conclusions. That should be easy enough to do if he’s preposterously wrong, tho, yes? (I’m not saying it won’t happen; just saying there’s a lot of pointing and laughing without accompanying analysis.)

              On the other hand, I’ve seen analyses of various GOPer’s proposals knocked for being “preposterous”, and some of them – not all – identify internal inconsistencies within the plan itself, while some are viewed as “overly optmistic” or whatever.

              Overly optimistic sounds fine to me. Internally incoherent doesn’t.

              On the third hand, like Sanders, Clinton is not gonna get a single one of her policy initiates thru congress regardless of how “realistic” the assessment is from various wonks.*

              Which leads me to the gripping hand: the politics of this stuff cuts both ways for both parties, with establishment oriented realists using their preferred candidate’s pragmatic bona fides as a weapon against the idealists, while the aspirationally-oriented folks view criticism of their preferred candidate’s program as deriving from establishment-based status quo bias, which they reject.

              *Unless the GOP wants it.Report

              • Avatar Morat20 in reply to Stillwater says:

                You mean besides scads and scads of economists poking holes in it? Pointing out assumptions that are hugely optimistic, results that are not believable?

                I mean are you asking for a white paper on it? A thorough fisking? What exactly are you looking for?

                Because just at a glance, I’ve seen a dozen or so different economists rip different pieces of it to shreds. And hell, the best defense of it I’ve seen boils down to the fact that ONE of the critiques isn’t as strong as it sounds — that because of the front loaded nature of the growth, the actual trend wouldn’t be close to triple the projected US economic growth but more like double.

                In other words, the best defense I’ve seen is literally “Well, it’s not even more ridiculous than the magic GOP numbers, it’s just about only as ridiculous”.

                Seriously, with a bit of poking around you can find people dissecting the growth numbers and pointing out they’re ridiculously inflated, people hacking through the workforce rates, people digging into wage growth — it’s larded with assumptions that go beyond “optimistic” and the end result is, quite predictably, ends up with numbers that aren’t believable. (Which is what happens when you take multiple underlying factors, push them up past the most optimistic models and assessments, then add them all together).

                So no, I’m not aware of anyone who has fisked the full 53 page paper. I am aware of LOTS of people who have taken one or more thread of the analysis and found serious problems — and each and every one of them found the SAME problem — it’s ludicrously magical numbers under the hood.Report

              • Avatar Stillwater in reply to Morat20 says:

                Morat,

                Since there’s no hope of it happening in any event the whole premise is based on magical thinking.

                Seems to me that if the strongest criticism of a specific assumption contained in Freidman’s analysis is that it’s overly optimistic, then the final criticism of the plan in its entirety can be no worse than “overly optimistic”.

                Which is different than internally incoherent.

                And Sander’s plan may be internally incoherent. I don’t know. (I don’t actually care, tbh.)Report

              • Avatar Autolukos in reply to Stillwater says:

                “Internally consistent” is a weirdly low bar for projections that are supposed to be about what would actually happen were a set of policies implemented.Report

              • Avatar Stillwater in reply to Autolukos says:

                If a candidate is running on an aspirational campaign, then it seems to make perfect sense to present policies in the best light possible. Be very “optimistic”.

                The other issue is that it seems legitimate to criticize Bernie for advocating the polices he does, and it seems legitimate to criticize him on the impossibility of his policy agenda. But it seems sorta ridiculous to criticize him – or anyone else – for being “overly optimistic” regarding the implementation of policies that really would be revolutionary (in the US system anyway) and are therefore +/- unpredictable over the short term…

                Put another way, if he or his proxies lowered the projections by 30% would KThug and whoever suddenly be feelin the Bern?Report

              • Avatar Don Zeko in reply to Stillwater says:

                @stillwater My understanding is that the problem with the analysis is that it makes a whole bunch of optimistic assumptions stacked on top of each other. It may be one thing to assume that my favored basketball team will get the tip-off and the first rebound, but it becomes less so if I assume that they’ll get the tip-off AND the first rebound AND that 70% of their three-point attempts will succeed AND nobody will get in foul trouble etc etc etc.Report

              • Avatar Morat20 in reply to Don Zeko says:

                And wherein you come down with results that each quarter will see record-breaking scores by the home team, and where the final tally is that the home team made 95% of all shots, two thirds of them 3-pointers, and crushed the opposing team 320-10 (when the previous biggest league win over the last 100 years was less than 120 point spread, and the highest score was 160.

                It deserves pointing and laughing. And the fact that the Sanders campaign was actually saying “Oh yeah, you should read this guy” was…amateur hour.Report

              • Just because Christians invading a Muslim country had never before been greeted as liberators …Report

              • Avatar Autolukos in reply to Stillwater says:

                I don’t really see why we should waive realistic analysis for “aspirational” campaigns, however those are defined (other than “campaigns we really, really want to see succeed”). Campaigns are going to be criticized; that many Sanders supporters dislike him getting the same treatment as other candidates is rather amusing to me personally but not a problem with the critics.

                Yes, I expect that many of the critics would find an analysis with less facially implausible conclusions less worthy of derision.Report

              • If a candidate is running on an aspirational campaign,

                He’s the opposite of Jeb!, whose campaign is suffocating.Report

              • Avatar Morat20 in reply to Stillwater says:

                Um, no. Look, there’s a difference between saying “This is what I plan to do” and knowing that, really, your political opponents will likely kill it.

                It’s still what you want to do — failure can happen. People can block you. It might be a “in a perfect world” wishlist, but it’s at least pretty honest. The most deceptive you get is listing things you know will get killed, because being brutally honest is a pretty big buzz-kill and also not exactly how campaigns work. People actually want your “perfect world” plans.

                However, what this Sanders plan is built on is magic numbers. It may never be a plan that will get passed, but it’s also a plan that makes no sense anyways. It doesn’t match reality in any form.

                It’s not wishful thinking about the politics, it’s wishful thinking about how reality works.

                It’s the difference between wishing you could be an astronaut and building a spaceship with the assumption that Earth gravity is 5 m/s/s.

                So yeah, he should be slammed with this. Just like Paul Ryan’s plan was slammed for it.Report

              • Avatar Stillwater in reply to Morat20 says:

                Morat, Auto,

                Then don’t vote for him. I’m not sure what the criticism is: that he’s lying? that he’s administratively incompetent? that he doesn’t understand economics?

                If it’s any one of those things then make that argument: People shouldn’t vote for Bernie because he’s a lying economically illiterate incompetent. Or am I missing what’s at issue here?Report

              • Avatar Kolohe in reply to North says:

                Just the opposite: liberating the Democratic Party from the constraints of technocracy may be a primary goal of his political revolution.

                Which would sow the seeds of the Dems destruction just as they’re rising to their greatest heights in a half a century. Or maybe not, it depends if one sees the conservative reactionary politics of the late 20th century born in the aftermath of the Great Society as a failure of the technocracy, or a failure to embrace the technocracy.

                It is interesting though, that the typical anti-technocractic factions in the Democratic party, e.g. unions, poor/minority urban neighborhoods, who lead the charge against technocratic neoliberalism at the municipal level, are pretty much all going for Clinton at the national level.Report

              • Avatar North in reply to Kolohe says:

                Well I certainly agree. I am quite opposed to severing the Dems from the technocracy but then turkeys are opposed to Thanksgiving for obvious reasons; I am a technocrat by nature.

                I wouldn’t completely agree with your last paragraph, NIMBY’s for instance, the scourge of technocrats at the local level, are overwhelmingly more wealthy and white.Report

              • Avatar Kolohe in reply to North says:

                But how much are they part of the ruling Democratic coalitions of the urban machines? Though they don’t tend to be registered Republicans, they are usually are the ‘independents’ that get a guy like Bloomberg and Vihstadt elected when the machine has a hiccup.Report

              • Avatar North in reply to Kolohe says:

                Who NIMBY’s? Alas, they are bipartisan. They are slightly more noticeable because they perfect storm so well with arch-liberals inclination to know-nothingism on housing policy but they’re plentiful in conservative climes as well.Report

              • Avatar Will Truman in reply to North says:

                It also gets attached to liberals because the arguments are usually couched in liberal terms. So even conservatives will talk about “environmental impact” because that sounds better than not wanting to live near poor people.Report

  5. Is the question really “Why are economists going with their actual opinions rather than supporting a colleague with whom they share an ideology?”Report

  6. Avatar Jaybird says:

    It’s weird how the populists vs. the technocrats are getting into it in both parties at the same time. (Though, granted, Clinton has a much, much better ground game and so the technocrats will win for the Dems).Report

Leave a Reply

Your email address will not be published. Required fields are marked *