Jonathan Gruber is mad as hell, and he’s not going to take it anymore. The eminent health care economist and health reform architect is annoyed at Casey Mulligan’s latest, which misrepresents Gruber’s views; mine too.
Gruber is right to be mad: that was a disgraceful, deceptive column. But I think you also want to put it into a larger picture: the enduring myth of the stupid progressive economist.
So about Mulligan: As Gruber documents, he pulls multiple fast ones, asserting things that he says are conclusions of the CBO report when they aren’t — they’re his own views, pulled out of, um, thin air, or maybe someplace else, which he is projecting onto the budget office to make them seem authoritative.
Beyond that, Mulligan tells his readers that both Gruber and I are too dumb or craven to admit that the disincentives to work created by some aspects of the Affordable Care Act impose economic costs. One suspects that Mulligan didn’t actually read either of the pieces he links to. If he had, he would have found this from Gruber:
But the likelihood of voluntary reductions in work is not the only issue. The CBO also projects work reduction by individuals who cut back on hours or avoid moving up the job ladder because they don’t want to lose Medicaid eligibility, or because they don’t want to make so much in wages that they would lose tax credits to help pay insurance premiums. Unlike voluntary job leaving, this second kind of work reduction would entail real economic distortions and be a cost, not a benefit.
And this from me:
Just to be clear, the predicted long-run fall in working hours isn’t entirely a good thing. Workers who choose to spend more time with their families will gain, but they’ll also impose some burden on the rest of society, for example, by paying less in payroll and income taxes. So there is some cost to Obamacare over and above the insurance subsidies. Any attempt to do the math, however, suggests that we’re talking about fairly minor costs, not the “devastating effects” Mr. Cantor asserted in his next post on Twitter.
So both of us acknowledge that there are incentive effects and that they have a cost; but both of us argue on quantitative grounds that the cost isn’t large. Hardly the doctrinaire liberalism Mulligan thinks he sees.
Oh, and bonus misrepresentation: Mulligan:
Paul Krugman goes even further and calls it “misrepresentations” to interpret the marginal tax rate provisions of the Affordable Care Act as destructive.
No, I didn’t — I called talk about “2 million jobs destroyed” a misrepresentation, because it is. Who says so? The CBO itself.
On to the broader point. What one sees in this particular Mulligan piece is something I encounter all the time, in many contexts: the myth of the stupid progressive economist.
It works like this: Conservatives in general, and conservative economists in particular, often have a very narrow vision of what economics is all about — namely supply, demand, and incentives. Anything that interferes with the sacred functioning of markets or reduces the incentive to produce must be a bad thing; any time a progressive economist supports policies that don’t fit neatly into this orthodoxy, it must be because he doesn’t understand Econ 101. And conservative economists are so sure of this that they can’t be bothered to actually read what the progressives write — at the first hint of deviation from laissez-faire, they stop paying attention and begin debating with the stupid progressive in their mind, not the real economist out there.
As a result, many conservatives seem utterly unable to take on board the notion that people like Jon Gruber or yours truly might understand Econ 101, but also believe with good reason that you need to go beyond that point.
On the health care issue: yes, there are incentive effects — as there are with all insurance, by the way. But there’s also good reason to believe that there’s a major market imperfection in the form of job lock, and that even aside from this, there are important benefits to expanding health insurance that must be weighed against any costs. All of that is, in brief, in both of the pieces Mulligan denounces, and there at much greater length in our other writings; but as so often happens, conservatives develop problems of reading comprehension whenever such issues come up.
I’ve encountered similar responses on many other issues. You say that deficit spending is helpful in a depressed economy? You must be saying that deficits and bigger government are always good, which is stupid hahaha. You say that increasing unemployment benefits in a demand-constrained economy can create jobs? But you also said once upon a time that unemployment insurance can raise the natural rate of unemployment, so you’re stupid hahaha.
Well, somebody’s being stupid, anyway.
I can’t resist going back to the 2009 debate over stimulus, when one after another, prominent conservative economists dismissed calls for a temporary increase in spending as being clearly stupid and/or corrupt, because accounting identities, or maybe the effect of expected future taxes, clearly showed that stimulus made no sense. Along the way these notables reinvented classic conceptual errors from 80 years ago and added a few new howlers too; yet their faith in the proposition that progressive economists must be idiots never wavered.
But then John Stuart Mill knew all about this.
via:http://krugman.blogs.nytimes.com/2014/02/14/stupidity-in-economic-discourse/
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