Supply-Side Economics Today
The following is a non-Forbes post, here exclusively:
Last week on one of the better-read econ blogs, Scott Sumner's Money Illusion, a post bore this title: "Have conservatives always been this anti-intellectual?" That's a fifty-cent word, "anti-intellectual," and it's not bandied around these days very much, even within rarefied air.
Readers expecting analysis as urbane as brought Richard Hofstadter the Pulitzer in 1964 for Anti-Intellectualism in American Life were left disappointed. Turns out it was a malapropism. The author doesn't know what the term means.
Sumner's "anti-intellectual" fire was directed at John Tamny, of all people, my own point man at Forbes and one of the famously thoughtful and literate guys out there in financial and economic commentary. He got hit with this only because Sumner does not like the flow of his argument.
Sumner found fault with a column Tamny had written recently that called for a reduced mandate for the Fed so we could have something like the good old gold standard. This was enough to remind Sumner of the "anti-intellectual strain" in "populist conservatism," even if Sumner "used to think of conservatives as being relatively hard-headed." Hard-headed for soft money, I guess.
Traditionally, anti-intellectualism has meant one of two things: 1) Mistrust of intellectuals as a class; or 2) Concern that intellectual modes of comprehension are a bar to understanding. Neither of these things applies, of course, to Sumner's problem with Tamny's piece. He just doesn't find it compelling. Sumner should have said he found the column poorly argued, or wanting in evidence. If Sumner wanted to up the charge, he could have called it sophistic; but "anti-intellectual" is a category-mistake, clean as they come.
Nonetheless, believe it or not, there is gold in the hills of anti-intellectualism. Let's take a little time, with Sumner as pretext, to pan for it.
One of the things economics "“ macro in particular "“ has to answer for is why it generates 1000+ Ph.D.'s per year in the US alone, given that our macro record is worse than before there were any Ph.D.'s at all. Ph.D. programs started in earnest a little more than a century ago, about the time the American Economic Association was founded in 1885. It took a generation for the youngsters who got the doctorates to age and become a factor in the world of work. A convenient date for this transition was the year the first person with a professorial background (Woodrow Wilson) became president "“ 1913.
Well, our macroeconomic record since 1913 compares unfavorably to before. Before, growth averaged above 4%; after, a shade over 3%. Unemployment, inflation, and of course the severity and depth of recessions were all worse after. Big careers (such as Christina Romer's) have been made in academic economics arguing this point.
It's perfectly reasonable to maintain as a conjecture that there's a connection. Profession arises; object of profession tanks, necessitating more profession; profession wins. An object-lesson in self-perpetuation. This line of argument is "anti-intellectual" in the classical sense, and there is nothing wrong with it at all. In fact, go to an academic conference in something like the history of science (much less the sociology of knowledge), and arguments of this sort "“ in scholarly venues, mind you "“ are common as dirt.
Recently a book came out called Better Living Through Economics. It contended that evidence abounds that we're living better lives all around because of applications from the world of economic science over the last fifty some years. Richard Vedder reviewed the book (for eh.net) and said he wasn't so sure. He wondered if the volume wasn't some fancy way to justify all the money that's been thrown at economic research, particularly from the government. Anti-intellectual? Sure "“ and onto something.
As for the other grand tradition of anti-intellectualism, its achievements are epic. You really don't want Sigmund Freud and his "what science cannot give us we cannot expect to get elsewhere" calling the shots in your culture. That world is both menacing and somehow intellectually mediocre. You want the world his non-dogmatic superiors shaped, people like Einstein, Wittgenstein, Bergson, Popper, Maritain, and for an American touch the James brothers. Supply-sider David Goldman has much to say about Franz Rosenzweig on this score, at one of this nation's surpassing cultural adornments, the Spengler blog at First Things.
There is the foolish contention that those who don't lash themselves to intellectualism are "on the road to fascism" (a charge conservatives have to smile at daily). Thomas Mann presumed the opposite, actually; hence Doctor Faustus. What's usually the case is that if you follow the influences of someone like the "anti-intellectual," "vitalist" Bergson you end up at figures including Henri Matisse and supply-side hero Jacques Rueff "“ in other words, paragons of civilization.
Well, John Tamny has joined the legions of this tradition. He doesn't want an intellectualized policy board dominating currency creation and management; he'd rather that be left to the market, which is to say gold, a market indeed whose non-intellectual element predominates. Anti-intellectualism indeed.
To name just one companion of Tamny's in this point of view among an illustrious array from our, yes intellectual classes: Jörg Guido Hülsmann. Hülsmann (of France's University of Angers) is probably outright the best intellectual biographer in the world today; he certainly is with respect to the subset pertaining to economics. The Last Knight of Liberalism (on Mises) bleeds conviviality, philosophical seriousness, and scholarly standards like an open wound. Well, Hülsmann has been busy of late churning out works saying that the little people should be in charge of money creation. People who dig gold and set contracts and such. Is this fellow anti-intellectual? Yes again "“ and like Vedder onto something.
Scott Sumner didn't realize that it's not really a sneer when you use the term anti-intellectual these days; it's probably a compliment. When you muff your diction from the slopes of Mount Olympus, all heck breaks loose.
One more thing. Tamny was adjudged anti-intellectual also because he advocated gold without referencing the 1929-33 experience. Let me volunteer why he didn't: because supply-siders have been beating this specific nag with baseball bats for the past forty years and thought all that was left was pulverized dust. Instead of going to the horse's mouth (Robert Mundell's Nobel speech), here's me on the topic last year:
http://www.youtube.com/watch?v=JlJSJ10D-lM&feature=&p=3250CC137491061C&index=0&playnext=1
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