Economics

Obama Hearts Economists and Vice Versa

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The Obama campaign is rife with academic economists, according to the latest issue of The New Republic, including some unlikely University of Chicago-types:

The Obamanauts are decidedly non-ideological. They occasionally reach out to progressive think tanks like the Economic Policy Institute, but they also come from a world– academic economics–whose inhabitants generally lean right. (And economists at the University of Chicago lean righter than most.) As a result, they tend to be just as comfortable with ideological diversity as the candidate they advise. Just before the Iowa caucus, I saw [Obama adviser] Goolsbee approach New York Times columnist David Brooks in Des Moines and gush when the quirky conservative agreed to pose for a picture.

Meanwhile, according to a new L.A. Times/Bloomberg poll, people think McCain will do a better job handling the economy than Obama, 42 per cent to 34 per cent. This despite his now-famous line: "I'm going to honest. I know a lot less about economics than I do about military and foreign policy issues. I still need to be educated." (see clip above)

It could be true, of course, that a McCain presidency would be better for the economy, even if the man himself isn't a particularly subtle economic thinker, because of better underlying ideology or disposition. I think it probably would be. But I would rather have seen a story about all the super-smart econ nerds flocking to the McCain campaign and the candidate welcoming them with open arms.

The again, maybe I never would have seen that story, or at least not in The New Republic, since it wouldn't be news. Most people (certainly the people who answered the latest L.A. Times poll) already think Republicans are the more economically literate party.

UPDATE: I should have said "when it comes to the presidency, people already think Republicans are the more economically literate party." Polls do find that in recent months people prefer Dems to Republicans on the economy, but that captures overall party sentiments, including feelings about Congress.

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  1. I wonder how many times have Austan Goolsbee and pals said “Don’t listen to him! Listen to us!”

  2. Most people (certainly the people who answered the latest L.A. Times poll) already think Republicans are the more economically literate party. No, most peole who answered the latest L.A. Times poll think that John McCain is the better candidate on the economy. John McCain, the guy who voted against the Bush tax cuts and keeps getting slammed by the right for wandering off the reservation.

    If you want polling data on PARTY, you should look at a poll that asks about the parties. Like this one, from ABC News/Washington Post.

    “Which political party — the Democrats or the Republicans — do you trust to do a better job handling [see below]?” Parties rotated

    .

    Democrats Republicans Both (vol.) Neither (vol.) Unsure
    % % % % %
    The economy

    1/30 – 2/1/08
    52 33 2 10 3
    12/6-9/07
    51 33 2 9 5
    10/29 – 11/1/07
    50 35 3 9 4
    9/27-30/07
    51 33 2 11 3
    .

    The federal budget deficit Half sample

    1/30 – 2/1/08
    52 31 2 10 6
    9/27-30/07
    52 29 2 12 5
    .

    Taxes Half sample

    1/30 – 2/1/08
    48 40 1 8 4
    10/29 – 11/1/07
    46 40 2 8 4

  3. The Giants won the superbowl. The economy is safe.

  4. Joe-

    Look at the same poll numbers when they say “McCain” and “Obama” instead of Republican and Democrat.

  5. Who cares? When the chips are down, every person arrogant enough to want to be POTUS is going to pick whatever policy increases their popularity. The overwhelming majority of the populace wants socialism and they ought to get it good and hard.

  6. Uh, not so sure I can agree about the Republicans being good on the economy after the last 8 years.

  7. Wow, that poll KMW links to also finds that McCain would beat Obama in a general election, and that the public prefers his policies on Iraq.

    Both of which are, to put it mildly, outliers.

  8. Meanwhile, according to a new L.A. Times/Bloomberg poll, people think McCain will do a better job handling the economy than Obama, 42 per cent to 34 per cent.

    Talk about a useless fucking poll. Number 1: People are stupid, and don’t know how to balance their checkbooks, why would they know anything about macroeconomic policy? Number 2: About the only thing the president can do to the economy is fuck it up. That’s why we call it a free market.

  9. Yes, Cesar, that’s my point: the results of McCain-Obama polls are not a stand-in for party, and KMW contends.

    NBC/WSJ Poll

    “When it comes to [see below], which party do you think would do a better job: the Democratic Party, the Republican Party, or both about the same? If you think that neither would do a good job, please just say so.”

    .

    Democratic
    Party Republican
    Party About the
    Same Neither Unsure
    % % % % %
    “Dealing with the economy”

    1/20-22/08
    43 25 21 8 3
    7/9-11/07
    41 26 17 12 4
    .

    “Reducing the federal deficit” Half sample, MoE ? 4.4 (Form A)

    1/20-22/08
    42 20 17 15 6
    7/9-11/07
    43 18 14 21 4
    .

    “Getting the country out of a recession” Half sample, MoE ? 4.4 (Form B)

    1/20-22/08
    41 25 22 8 4
    .

    “Dealing with taxes” Half sample, MoE ? 4.4 (Form A)

    1/20-22/08
    36 31 17 12 4
    7/9-11/07
    36 27 14 18 5

  10. Why did conservative tees start using a 14 year old to model their shirts?

  11. reminds me of john derbyshire saying females’ attractiveness peaks at age 15. (16?) weird dude.

  12. But I would rather have seen a story about all the super-smart econ nerds flocking to the McCain campaign and the candidate welcoming them with open arms.

    One of Paul’s economic advisers, Don Luskin, defected to the McCain campaign. Paul’s supporters were not happy, but I was relieved. Who better to advise McCain on economics than one of Paul’s own?

  13. Cesar,

    Stupid PollingReport dot com doesn’t seem to have any polls that ask for candidate preference by issue.

    Seen any?

  14. No joe, but these things tend to change when given specific candidates. Especially after the GOP has finished their Dukakisization of Obama.

  15. Number 1: People are stupid, and don’t know how to balance their checkbooks, why would they know anything about macroeconomic policy?

    My brother-in-law actually thinks that the “tax rebate” that we’re getting from the stimulus package is coming because we had a surplus.

  16. One thing that might make people believe that the Democrats are better for the economy is because of how good the economy was during the Clinton administation. But if Clinton had had a Democratic Congress during all of those 8 years, would the economy have been that great? The Republican controlled Congress acted more responsibly in those years than it has during the last 7.

  17. One of the things that I like most about Obama, especially compared with McCain, is that Obama is smart enough to understand what people are talking about when they talk to him about economics. It’s unforgivable that McCain has been in congress for something like 40 years and still hasn’t bothered looking into economic issues; either he doesn’t care or he’s a potted plant. Or both.

  18. Well this is certainly better than a story about a large number of Fabian socialists flocking to Obama and being a major part of his brain trust.

    Hard to get all excited when Clinton and Obama are falling all over each other to discredit NAFTA but relatively exciting nevertheless.

  19. UPDATE: I should have said “when it comes to the presidency, people already think Republicans are the more economically literate party.”

    That link is to a poll of economists, and reports that only half responded.

  20. Cesar,

    In 1988, the Republicans had a sizeable lead over the Democrats in polls about who handled the economy better. Today, the Democrats hold a sizeable lead over the Democrats.

    If a McCain-Obama matchup bucks this trend – and I’m skeptical, given that the LA Times poll contradicts everyone else’s polls on the issue of Iraq – I would be more likely to attribute it to McCain’s apparent apostasy from the Republicans.

  21. I have to question any assumption that McCain would be better, economically speaking – as Reason has pointed out, the modern Republican Party is most definitely not a bastion of free-market thought, and in this at least, McCain is a perfect representative for his party. There’s really not much left in the GOP for a proponent of the Chicago School, although there may not be much on the other side of the aisle either.

    (And besides, Obama is part of the tribe – after the mess our polisci people have made in government, let’s hope the law school can do better.)

  22. OTOH, Obama could actually listen to his super-smart econ nerds, but hasn’t lately.

  23. Today, the Democrats hold a sizeable lead over the Democrats.

    At first I thought that was a typo, but in hindsight I’d have to agree that nobody’s better at beating the Democrats than the Democrats (see, e.g. Kerry, John).

  24. Oh, yeah. This is the Democrats’ race to lose!

    Aw, F*ck!

  25. I am missing something here. Who is better, Republican’s or Democrat’s on the Economy? The only way that either party can affect the economy is thru taxation or tariffs (another word for taxes). I have yet to see the President or Congress going to the COO of a fortune 500 company and telling him how to run their company.

  26. Chicago Boys advising Obama? OMG! He must be a Disaster Capitalist! Someone alert Naomi Klein!

  27. The only way that either party can affect the economy is thru taxation or tariffs (another word for taxes).

    What color is the sky on your planet?

  28. Find out which economists are telling Obama to raise taxes and sew their lips shut!

    Anyone else see this thread about how Obama’s economic plan will add about 20K to the tax bill of people making 280K?

    http://www.abovethelaw.com/2008/02/obama_biglaw_and_taxesor_obama_1.php

    Man, it’s fun to see lawyers cry.

  29. I’d care a lot more about all the free marketeers “advising” Obama if he would give any indication whatsoever that he listened to them.

    Is there any reason I shouldn’t think they’re just window dressing?

  30. @Marcvs

    Talk about a useless fucking poll. Number 1: People are stupid, and don’t know how to balance their checkbooks, why would they know anything about macroeconomic policy?

    Well, I was one of the people was polled for that poll, and they managed to call me when I was suffering from a prodigious hangover and trying to get the hell out of the door to get to work. The pollster who called had an accent so thick I’m not really sure what I was being asked, but given I was in a hurry to get out of the goddamn door, I just told him whatever popped into my head so I could hurry up and get the hell off of the phone….

  31. You can’t be pro-war and pro-empire and be for small government.

    McCain is for HUGE increases in government via military spending and never-ending war.

    Obama, if his actions match his rhetoric, might actually be the small(er) government candidate here… sadly.

  32. Well, I was one of the people was polled for that poll, and they managed to call me when I was suffering from a prodigious hangover and trying to get the hell out of the door to get to work. The pollster who called had an accent so thick I’m not really sure what I was being asked, but given I was in a hurry to get out of the goddamn door, I just told him whatever popped into my head so I could hurry up and get the hell off of the phone….

    So in other words, it IS a good measure of the ordinary voter.

  33. Is there any reason I shouldn’t think they’re just window dressing?

    There is not. Just… just look at it. It makes baby economists weep.

  34. Austan Goolsbee isn’t a free-marketeer, exactly. I don’t think he wants a government that leaves the economy alone so much as he wants a government that interferes efficiently . He and Obama’s other advisers place a lot of faith in behavioral economics, which means they favor simplifying government procedures with an eye to how people will actually use them. Obama does follow this advice; his tax plans and stimulus package are much less convoluted than Clinton’s, who wants a lot of very specific credits and penalties. (A rebate on steam heat?) The Goolsbee camp tends to question whether government incentives will work out as planned — which is consistent with Obama’s idea that health care mandates will cause noncompliance. They also seem fond of “libertarian paternalist” investment schemes (where participation is the default, but you’re free to opt out).
    These aren’t laissez-faire policies, but they are policies made with more attention to economic research than we usually see from Democrats.

  35. “Abdul | February 28, 2008, 6:00pm | #

    Find out which economists are telling Obama to raise taxes and sew their lips shut!”

    Well, he seems to be taking Warren Buffett’s lead on this point.

  36. But I would rather have seen a story about all the super-smart econ nerds flocking to the McCain campaign and the candidate welcoming them with open arms.

    I would just as soon that economist stay far, far away from policy making in general. Economics is not a predictive science and yet for some reason we treat it like engineering. Economist have time and time again formed consensus views on problems that turned out to be completely wrong. Remember wage and price controls in the 70’s or the very firm conviction that stagflation was impossible?

    The ugly truth is we don’t have the necessary tools to measure the economy in realtime such that we can actually predict the effects of any particular policy. We can only make broad guesses. Having a bunch of economist clustered around the President is a recipe for disaster.

  37. One thing for sure: McCain knows more about economy that Obama and Clinton.

  38. I’d like to discuss the “forever war” complaint about Republicans.

    For all of human history long wars have been the norm. Our war with the Soviet Union is an exemplar.

    Another one is Islam’s 1400 year war against the West.

    It may just be that McCain is (sadly) the most realistic of the candidates.

  39. The lack of attention to McCain’s economic advisors in the media is puzzling. I know that Goolsbee’s colleague at the GSB, Steve Davis, is involved with the McCain effort at some level, but have not heard any other names. Does anyone else know?

    Jeff

  40. Jeff: I believe

  41. Sorry, typo.

    I believe Doug Holtz-Eakin , a former Bush official, is also working for McCain.

    I’m not sure why there’s been less media attention to McCain’s economic people, but maybe it’s because Romney made more of a point of attracting top economists (like Greg Mankiw.)

  42. Agree with Shannon Love here. By most accounts Milton Friedman was a brilliant economist, but he was a nincompoop when he was a government adviser.

    The only useful economic advisor to a presidential candidate is a parrot that says nothing but “Bad idea! Bad idea!” every time the candidate says anything about an economic plan.

  43. Another one is Islam’s 1400 year war against the West.

    Muslim Arabs and Persians didn’t give a fuck about the West for the entire 1400 years. You make it out like some kind of ongoing battle. The majority of the time they’re too busy fighting each other and saving Greek book-learnin’ to spend more than a few centuries trying to oppress the West. Besides 1400 years a little long to give the West much credit for freedom; I’m not sure if I’d rather be under the Church or the caliphate, pre-1600s.

  44. The idea that “economists lean right” has suffered some severe challenges in the academic literature in the last few years. This webpage has some links:

    http://www.insidehighered.com/news/2007/10/03/heterodox

  45. I’d like to discuss the “forever war”

    I think is one of the best depiction of interstellar war ever written (far superior to Starship Troopers). I find Halderman’s sense of humor spot on and his depictions of social change are great. It should be required reading in high schools.

    http://en.wikipedia.org/wiki/The_Forever_War

  46. Remember wage and price controls in the 70’s or the very firm conviction that stagflation was impossible?

    Hm, no, I can’t think of any Austrian economists who supported either of those.

  47. I don’t think there’s any question the McCain campaign is more economically literate. Speaking generally, economists favor:

    Free trade
    Tax simplification
    Entitlement reform
    Ending farm subsidies

    McCain stands for all of these; Obama is opposed. The one issue both McCain and Obama are ignorant on is their desire for cap and trade, rather than just imposing a carbon tax. For this we can thank Grover Norquist. Probably this outfit here too.

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