Sunday, August 4, 2013

How do you swagger? Truths, damned truths, and economists

[Note:  this is the first of a series on being a jerk in academe.  For the introduction to the series, click here.]

Economists and those academics whose training is steeped in the study of economics (by which usually is meant something like a combination of classical economics, plus marginalism, plus "Keynes and his critics"),  swagger by positioning themselves as the ultimate truth-tellers.

And in doing so, they challenge us to rethink our approaches to notions of "value" and to notions of choice.  They compel us to answer questions we don't always think of:  why do we choose what we choose?  what do we give up when we choose to do (or buy) something?  how do the policies we claim to want actually affect how people act?  Usually, the chief lessons that economists want us to take away from what they say is something like a paean to the aggregation of wealth, where wealth seems (to me as a non-economist) to be something relating to choices.  The more choices available, the more wealthy "we as a society" are.  The approximation of this wealth might be things and services produced or perhaps the money one earns through the process of producing these goods and services.

My framing here of what economics offers is, again, from my non-economist's point of view.  And other than having read (and probably not fully understanding) Wealth of Nations, having taken Economics 101 in college, and read a smattering of others' work, I don't even have an elementary education in economics.

Moreover, I am taking a deliberately narrow(er) view of the profession.  I am focusing on the libertarian-leaning economists whose comments I read on the blogs I frequent.  In other words, I'm not looking at the Paul Krugmans, or the "radical economists," like Barry Bluestone, Benjamin Harrison, David Gordon, Richard Edwards, or Michael Reich.  Those people undoubtedly swagger in their own way, and perhaps they even swagger like the libertarian-leaning ones.  But they're not my focus.

Sometimes economists style themselves as intrepid tellers of uncomfortable truths.  They are probably not alone in this regard (there's a certain former vice president who has so styled himself, for example).  And woe unto the person who doesn't quite see that truth.

The form of argument I sometimes see is the following:
X, which you thought was bad, is actually good.  As long as we accept my definition of X, and as long X isn't something I currently suffer from.
My source for this style of argumentation is Steven E. Landsburg's The Armchair Economist:  Economics & Everyday Life (New York:  The Free Pres, 1993).  This book, as far as I can tell, is meant as an introduction to economics for the benefit of non-economists.  In particular, Landsburg appears to want to demonstrate how economics is as much of an approach to understanding ourselves and our world (and our choices and others' choices) as it is a "dismal science."  I'll just state that although I have read the chapters I'm discussing in this post, I haven't read the whole book (it's so nice to be out of grad school and to be able to admit I've read only part of a book and not have to pretend I've read the whole thing).

"X" is usually some claim that is designed to evoke outrage in others, until we find out that the definition of X he uses is so narrowly tailored to his purposes that his conclusions follow almost inevitably from the definition he has assigned.

In some cases, this formulation offers pretty good food for thought.  Take his chapter, "The Power of Incentives:  How Seat Belts Kill."  His argument is an interesting and enlightening one.  Seat belts enable car drivers and passengers to better survive accidents.  But because drivers know they are now better able to survive, they tend therefore to drive more recklessly, putting themselves but also others, especially pedestrians, at greater risk.  He uses that argument as a springboard to a broader point about how we structure incentives can often have an effect that's not wanted or not obviously intended.  Sometimes his facts are a little too neat.  One study he cites cites (p. 4) finds that the number of auto-caused deaths in one period were, in Landsburg's paraphrase, exactly the same with seat belts as without, but with different victims.  I'm suspicious of claims that the tradeoff is exactly the same.  However, I haven't read the study in question (and if I had, I wouldn't have the expertise to assess it), so it might be right.  And at any rate, the principal point is made clearly that people respond to incentives.

So far so good.  But sometimes that formulation can get tiresome and leave unaddressed some very important considerations.  Take the chapter entitled "How Statistics Lie:  Unemployment Can Be Good for You."  I'll start with a confession.  I don't think I understand what his argument is here, and my lack of understanding might say more about my unwillingness to engage the chapter rather than give it a quick read.  His argument seems to be that we have to be very very careful about what conclusions we draw from statistics.  Fair enough, and he makes some good points (as in, informative points I hadn't thought of before).  For example, he explores ways in which the alleged increase in the income gap during the 1980s might have been illusory [132-134].  To be sure, he doesn't insist the increase in the income gap was illusory, only that it might have been.

That's a good thing to keep in mind.  But he seems rather glib in some of his asides about unemployment.  Part of his point is that working fewer hours, which is how he seems to define underemployment ("We are all grossly underemployed compared with our ancestors of 100 years ago" [130]) or not having a job at all comes with leisure as a tradeoff.  (Another part of his point is that by getting the current unemployment rate, we don't have a clear view of people's lifetime earnings.)  He seems to almost completely discount the anxiety and fear that unemployment can bring.  He comes close--"[o]f course, unemployment can be accompanied by bad things, such as diminution of income...." [129, emphasis his]--but there is a cost to not having work, and the "leisure" might be hard to enjoy when a new job is not in the offing.

He also seems too eager, in my opinion, to neglect the consideration that certain "choices" regarding employment are constrained [130]:
When Peter chooses to work 80 hours a week an get rich while Paul chooses to work 3 hours a week and get comfortable in other ways, who is to say which choice is the wiser?  I can find nothing in economics, morality, or for that matter my personal instincts that says we should approve more of one than the other.
I don't, either, but judging others' choices is not the only question, is it?  Peter's "choice" to work 80 hours per week might be to a non-trivial degree informed by his needs and the wages he can command, and Paul's "choice" to work 3 hours might be to a non-trivial degree formed by the paucity of available work.  Landsburg goes on to say "Unemployment, or a low level of employment, can be a voluntary choice and a good one."  Yes, but it can be other things, or it can be some messy mixture of voluntary choice and circumstances that channel and limit the available choices.

Don't get me wrong.  I think Landsburg has some important points here.  We shouldn't assume even severe reverses to be unrelentingly, pathetically, bad things, with no upsides.  When I was laid off from my job as a loan processor in 2008, that quickly proved an opportunity to take an emergency adjuncting job that advanced my employment prospects (and a few months later, I met the woman who eventually agreed to marry me).  And although I have to remember that I had no dependents to support and as a student I had access to certain employment networks (hence, my adjuncting job) and other resources, I can say that losing that job was in many ways had corresponding benefits.  (There was also a sense of relief when it finally happened, because rumors of layoffs had been in the office air for at least a couple weeks.)

But there's a certain glibness to his statement of the truths here that turn off, at least me, and probably others who might need to hear what he says.

I'm reminded of a blogger whose site I read regularly and who although not an economist, has a lot of training in economics.  In one post, he wanted to demonstrate, in the context of discussion of sweatshops in developing countries, that sweatshops could mean more choices and therefore made better off those for whom the choice to work at a sweatshop.  In order to illustrate his point that more choices make people better off, he posited the following hypothetical (I paraphrase):
Suppose the only employment available to someone is low wages in a sweatshop.  Suppose also that another propositions that someone to provide sex for money.  That worker is now better off because she has more choices.
Now, I want to be clear about two things.  First, the person who advanced this hypothetical does not in any way think that situation is a good state of affairs.  He doesn't endorse exploiting people sexually, although he might support laws that enable people to do sex work on the (very reasonable) grounds that laws which forbid sex work tend to hurt the sex workers more than anyone (and I might support such laws, too).  Second, the conclusion he draws from his hypothetical is, in my opinion, correct.  The worker in that scenario is (slightly) better off than before because now she has a choice.

But a lot has to be assumed away and some costs have to be discounted for that hypothetical to permit that conclusion (and the blogger I refer to acknowledges that there is a lot of assuming away).  Here are some of the discounted costs that come to mind:
  • The worker in this case faces no opprobrium for agreeing to this "choice."  Rightly or wrongly, people judge others by their sexual choices.  And I'm not an expert the sociology of any developing country, but the stereotype, at least, is that most of these areas are supposedly traditional societies.  "Traditional" is a loaded term, but at least some of these societies might attach a certain opprobrium to sex work that can, again in some cases, lead to ostracization, or worse.
  • STD transmission is a real threat.  The "choice" in this hypothetical relies on a short time horizon.  The worker might be better off now, but if she contracts a fatal or debilitating disease, the cost will grow in the medium and long term horizon.
  • This is just speculation on my part, but I imagine the class of people who offer sex for money has a disproportionate number of people who would take it by force if they can't get it by payment.  I'm not saying all john's are like that, but I suspect that some of them might be like that.  And the person so propositioned might, with very good reason, not be fully confident that the "choice" is really a choice at all.
But let's assume away all those costs and anything else on heaven and earth we can dream of.  And let's acknowledge the worker is indeed better off.  I, for one, am not going to book a plane to that developing country and tell the person how much better off she is now.  She is indeed better off (again, granting the assumptions), but it's not quite my place to tell her that.

To be clear, there is indeed room for discussing the better-off-ness of others, and valid points aren't invalidated just because the point-maker is not likely to be in the position to be "better off" in just that way.  But there's a certain stridency in such invocations that, well, makes the truth harder to swallow or even acknowledge, especially when it's addressed to someone who doesn't already agree with the argument and who needs to be convinced.

Now back to Landsburg.  In his last chapter, we see what in my opinion is a pretty fresh represntation of the type of swagger I'm talking about here.  Entitled, "Why I Am Not an Environmentalist:  The Science of Economics Versus the Religion of Ecology," this chapter takes aim the preachiness of the environmental movement.  As someone who resists the sorts of obligations that are claimed upon me in the name of "protecting the environment," I have a lot of sympathy for his basic point here.

He recounts going to some sort of assembly put on by his daughter's pre-school that, he says, reflects a "naive environmentalism...a force-fed potpourri of myth, superstition, and ritual that has much in comon with the least reputable varieties of religious fundamentalism." [223-4].  In particular, the assembly, a graduation ceremony for the pre-schoolers, required the pre-schoolers to repeat phrases like "'With privilege comes responsibility,'" which, he suggests, functions principally as a way to inculcate the passive acceptance of a certain value, one possible outcome of which is to permit restrictions on our liberty simply by invoking the notion "it's good for the environment, and we do have a responsibility."

As I said, I have a lot of sympathy for Landsburg's point.  And perhaps it's a pity that he witnessed this example of the school's values on what was probably his daughter's last day at pre-school.  If he had learned of it earlier, he might haven't been denied the opportunity to conclude that another dollar spent for another day at her school wasn't worth the additional education, thus permitting him to pull her out of class.

My only real objection to his actual point is that any educational setting seeks to inculcate some values.  And given that he had just written a book expressing how his values are either superior to those of non-economists, or at least deserve a hearing from non-economists, one might think he'd be more reflective on that score.  (I'm also thinking of Robert H. Nelson's book counterposing the "religion" of environmentalism with the "religion" of economics.)

But I have another objection to Mr. Landsburg's "swagger" here.  In this chapter, he not only complains about the inane recourse to cliches as a way to justify all sorts of coercive action.  He also reprints a letter he wrote to his daughter's pre-school teacher.  He had already told the teacher he was dissatisfied with the assembly.  When she asked why, he, by his account, said (I'm quoting from the letter), "I reject your right to ask that question.  The entire program of environmentalism is as foreign to us as the doctrine of Christianity."  [231] Landsburg in a prior paragraph of the same letter noted that he and his family are Jewish and that on other occasions, when he had objected to a Christian-centric assembly at another school, the school's response was to respect the difference in religion.  He then proceeds in the letter to speak as if the teacher ought to have realized that her environmentalist language of obligation was, of course, a "religious" view and that she shouldn't have had even to wonder what anyone might possibly object to.  Here are some of his points [231]:
  • "I do not sense on your [the teacher's] part any acknowledgment that there may be people in the world who do not share your views."
  • "I am frankly a lot more worried about my daughter's becoming an environmentalist than about her becoming a Christian."
  • "[W]e face no current threat of having Christianity imposed on us by petty tyrants; the same cannot be said of environmentalism.  My county government never tried to send me a New Testament, but it did send me a recycling bin."
How dare the teacher not know this!  She displayed no acknowledgment that others might not share her views.  Well, she asked him his views, but other than that, she displayed no such acknowledgment.  "Everybody" knows and in fact starts from the assumption that environmentalism is a religion in exactly the same way that Christianity and Judaism are religions.  How dare she not realize that!  The enlightenment era struggles which resulted in America's secular institutions were waged against the clergy and state established churches.  And presumably environmentalism (but I don't recall learning that).  Even his own county is against him, although it's unclear from the letter whether he's required to recycle or is merely given the opportunity (in Chicago, for example, we have recycling bins in at least some neighborhoods, but (so far at least) the actual decision to recycle is voluntary, with due caveats being granted that we all pay taxes and that taxes fund the recycling service.)

I imagine the teacher, upon reading that letter, is to don a sackcloth and do penance, perhaps by reciting "[t]he government solution to a problem is usually as bad as a the problem," with every 10th recitation interrupted by "and in the long run, we're all dead," or writing 1,000 times on a chalkboard the statement, "a good or service should be consumed at a quantity at which the marginal utility is equal to the marginal cost."

Again, I'm not trying to bait economics by the argumentation style of two people, Landsburg and the blogger I mention.  They all have valuable points. But I'm at a lost to understand how the tone is designed to make it easier to listen to what they have to say.

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