I've Been Chaited, Been Mistreated, When Will I...

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I recently wrote a piece arguing that, while both supporters and detractors have many other arguments to rely on, two of the most ubiquitous arguments in favor of Obamacare are not compelling.

In response Jonathan Chait wrote a counter that makes, perhaps, one fair point, and drowns it in a sea of invective, poor logic, evasiveness, and a series of tricks that have become rather standard in the world of internet "take-down" hit pieces (hint, by hyperlinking to an article accusing Jonathan of these things I just put one into practice). I'm writing this because, let's face it, irked responses are a big part of my repertoire, but also to illustrate the low quality of so many dashed off superpartisan barely-fact-checked hyperlink-heavy playing-to-your-own-cheap-seats "expert"-citing web based imitations of journalism that today are hurdles on the path to fair-minded people reaching reasonable consensus, at least on facts.

In my original editorial I argued that it was obvious that Obamacare would raise the number of people with health insurance coverage. When you mandate some people buy something, and give it away to other people, it's not a tough leap that there will be more of it, regardless of what "it" is. That doesn't make doing this a good or bad idea itself, just not an aspect of the issue under great dispute and therefore not one we learn a lot from observing. In contrast the rise in coverage is heralded by a myriad of Obamacare supporters as one of two major pieces of proof the law is working. But, how can something we knew before the fact be proof of anything?

Chait challenges how obvious this was to conservatives and libertarians beforehand. He provides three examples. They aren't the strongest examples (one used the word "may," another predicted a push) but I'll give him this, I should've mentioned that some Obamacare opponents didn't agree with me that increased coverage was ex ante obvious.

But he misses the larger point. If everyone says you're going to fail your drivers license test, and one guy, or even a bunch of guys, adds, "and you'll probably kill yourself and the examiner trying," you don't get to claim you passed the test just because you and the instructor survived it. Increased coverage is evidence that Obamacare was not as bad as its worst enemies predicted, but not even close to evidence that Obamacare is working.

In fact, I said this in my essay:

"In fairness, both sides of the debate made some bold claims five years ago, and Obamacare's supporters have things to point to other than these two ubiquitous tricks. There is no evidence of the upward cost spiral some detractors predicted. Similarly, there is scant data that the ACA caused employers to shift full-time workers to part-time positions. Health-care quality and availability have not precipitously declined, and the botched rollout did not cripple the program forever, as some contended."

The kind of honesty in that paragraph must have sent Chait into an emotional tailspin as he forgot to mention it. Be that as it may, I'll agree that I should've had an additional line in that paragraph, something like "And there were even some ACA critics who thought the program might fail to increase coverage." Chait thinks that omission was significant because he thinks this is just about keeping scorecards (who got what right?) and he likes to score himself against the ex post least accurate people on the other side. However, the important point for policy decisions - that Obamacare can't be judged on something you think was obvious even if you can find three people who disagreed - still stands. In other words, Chait would agree with me that articles trumpeting increasing coverage might be fun in a "look some Republicans got something wrong" kind of way, but aren't new information relevant to whether the ACA is a success or not. He hides his agreement well.

Next, Chait literally ignores half my essay. Separately from the coverage issue, I noted that nobody has established a strong link between ACA and the global slowdown in healthcare spending, but that ACA supporters love to mention both the cost slowdown and ACA in the vicinity of each other hoping readers take away a link. Maybe someday they will be able to show such a connection but right now they are not close. So, Chait's entire piece is a small critique of one of my two points, coverage, which leaves its essential logic untouched, and a complete "I can't hear you, I can't hear you" about my other main point, costs. Come on there were only two! He probably had a great takedown for that one too but decided to be kind to me as he's not the kind of guy to spike the football. Right...

As an aside, for pretty straightforward dog-whistle attack reasons he throws in a line calling me a global warming denier, the ultimate nastiest worstest of the worstest insult you can make these days, linking to an article on my views on one narrow aspect of this issue. He did not link to my actual co-authored article. I defy him or anybody to read the original and compare his statement that I "deny that the massive release of heat-trapping gasses into the atmosphere will trap more heat" with the actual article I co-authored. You won't find a hint of what Chait said but you will find excerpts like "Finally, the data do say a lot of things (we leave any quarrels about the data itself to others). They say the world has indeed warmed for more than a century. They say there has not been a recent hiatus as some critics contend. While not statistically distinct they indeed say the most recent measurements are at a record high. They even suggest that warming has accelerated over time." What fierce red state bible thumping denial! Clearly, reading the original sources is not Jonathan's strong suit. Snarky misleading links to dubious articles on articles seems more his wheel house.

Finally he titled his piece "Confused Hedge-Fund Manager Cliff Asness Struggles to Express Continued Rage at Obamacare." I don't think I was very confused, but that's certainly possible, I often am. My firm manages some hedge-fund like products but it's not our main line of business. I guess "hedge-fund" sounds more evil to Jonathan and his target audience than "investment manager." I don't think I was struggling at anything, and while I'll keep how enraged I may be at any given time to myself, I defy him or others to detect it in my sober article. So, aside from that, how was the title Mrs. Lincoln? Of course his first line following the title called me an "occasional right-wing crank." I prefer libertarian to right-wing for many reasons, but you get the level of journalism you expect from Jonathan here. In truth, my major problem with this particular insult is just about the writing. Jon, am I occasionally right-wing, occasionally a crank, or just occasionally an author while always being those first two things? He probably means the last of these but you'd think a professional writer would nail this kind of "eats, shoots, and leaves" type stuff, no?

At the end Jonathan offers similarly thoughtful and fair-minded investment advice. Stay classy Jonny.


Cliff Asness is Founding and Managing Principal of AQR Capital Management, LLC. 

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