Rob Atkinson and Dean Baker squared off this morning on the topic of “Progressive Economics and the Great Recession.” Atkinson had previously criticized progressive economists; Baker had written a rejoinder; Atkinson had invited Baker to debate the issues in person. Hence this morning’s event.
Both are bright economists with important insights to share. Rob Atkinson heads ITIF, the Information Technology and Innovation Foundation. Dean Baker is co-director of CEPR, the Center for Economic and Policy Research. ITIF focuses on the national issue of competitiveness and its importance in long-run job creation. CEPR analyzes Washington policy debates and the tendency of poorly chosen policies to harm the interests of working Americans.
By my lights, Atkinson is right to emphasize competitiveness, right to argue that too many jobs have been lost because America hasn’t defended its technologies, its leading industries, and its markets as it should have.
Baker plays an important role as a critic of doctrinal conservatism. He raised the alarm about the housing bubble quite a long time ago. He’s realistic enough to see trends that others ignore.
But this dialogue, like so many thousands of others among economists, also put on display the general flaws of economics as a school of thought in contemporary America.
Economists, as a group, have no self-discipline. They have all been trained to discuss normative, diagnostic, and prescriptive issues simultaneously. And we have been trained to listen without objection.
Does anyone recall the TV show in which figures at the front of a movie theatre make scoffing remarks about the science fiction movie unfolding in black and white before them? That’s about what my mind does when I earnestly sit down to listen to economists. Little figures in the front of my brain start heckling. “He’s pretending the normative question has been settled.” “They haven’t separated the diagnostic issue from the prescriptive issue.” “Are they healers or are they ideologues?” And so on. There wasn’t anything unusual in the well-informed discussion that Atkinson and Baker carried on this morning – my hidden hecklers would have given any such panel a similar treatment.
I think my inner hecklers are right. When we haven’t the self-discipline to distinguish normative issues, diagnostic issues, and prescriptive issues, we ought to be heckled.
So let’s imagine a dialogue that might quiet my inner hecklers.
Let’s imagine a discussion among economists focused on the central normative issues. “What IS the purpose of the American economy?” “What, if anything, is the right role for the American government?” “Who gets to decide?”
This would be an excellent starting point. Settle it well and we might actually give ourselves cleanly-defined panel discussions. Or pretend that it doesn’t exist and suffer as it smuggles itself into everything else we want to take on.
In a clean, normative discussion, we might begin here:
Option One. “The normative ideal for the American economy is that it should be allowed to operate without government interference. Whatever result it produces is the result we should accept, because any result produced under the guidance of government regulation is by the standards of our normative belief system worse than any result it could possibly produce without government regulation.”
Option Two: “The normative ideal for the American economy is that it enriches the nation’s financial and industrial elites at the fastest possible rate.”
Then we’d offer a distinct alternative, Option Three: “The normative ideal for the American economy is that it should serve the following five purposes: Produce goods and services effectively for its customers; Reward good business leaders; Create full employment and shared prosperity for working Americans; Protect the environment; and Strengthen America as a nation.”
Three important options. No, they don’t exhaust the possibilities. But they’d be just the right place to start.
In addition, let’s also visualize the companion dialogue: Who gets to decide?
Is it up to the nation’s wealthiest to decide the normative standard? Or, more broadly, is it up to the nation’s business owners? What about the nation’s leading Republicans? Or the leading Democrats? Or both? Should our top politicians decide the normative standard for the American economy? What about the nation’s economists? Maybe they should decide.
And what about the American people? Should it be the American public that grapples with the normative standard by which the American economy ought to operate?
What's the normative standard? Who gets to decide?
These two questions already draw our attention, but for now they do so in the shadows, leaking in other ways – in our emotions, in our preferences for one belief system over another, in sibling rivalries among Americans of different persuasions. “Adam Smith loves me the best.” “John Maynard Keynes loves me the best.” “Friedrich Hayek loves me the best.”
My hecklers are dead on. An America that can’t get its sibling quarrels out in the open is an America that will never show the twenty-first century maturity it requires.
Let’s stop the pretense. Let’s bring the discussion out into the open; let’s debate it honestly and honorably.
My inner hecklers had fun today. But for once I’d like to attend a debate that shuts them up.
Steven Howard Johnson 2012-02-01
