Adam Davidson wrote an article last Thursday that tries to find common ground between economists Larry Summers and Glenn Hubbard. For those of you who don’t know it, Summers is a Democrat who was Treasury Secretary under Bill Clinton. Hubbard is a Republican who was the Chairman of the Council of Economic Advisers under Bush Jr. Davidson was very unhappy to find that the two men didn’t share any common ground.
This morning, Jonathan Chait wrote about this article. He argued that the problem was that conservative economists, while wishing to make the world a better place, were also interested in reducing the size of government as an end in itself. Liberals may want a bigger government for practical reasons but they don’t want a bigger government because they think it is necessarily better to have one. Chait is right about this, but I think he is being far to easy on the likes of Glenn Hubbard.
My experience with economic conservatives is that they think that a smaller government will be better for everyone, but even if it isn’t, they still think it is best. Chait would have us believe that the good of everyone trumps (or is at least equal to) the philosophical commitment to small government. But he’s wrong. And it is very clear from this line in the Davidson article, “Hubbard told me that a favorite book in high school was Friedrich Hayek’s Road to Serfdom, a 1944 treatise against big government that remains a sacred text among conservatives, including Paul Ryan.”
There are several problems here. First, The Road to Serfdom is not really a economic book and Hayek is not really an economist. It is very much like the conservatives’ Communist Manifesto. The economics in it have been repudiated, but conservatives hang on to it because it tells them what they want to hear. That’s understandable for a true believer like Paul Ryan. But how is it that a very smart and erudite economist like Glenn Hubbard still holds on to it? The answer I fear is that at this point, Hubbard only does economics as a form of conservative apologia.
On the other side of this divide, we have Larry Summers. According to Davidson, he’s an economic liberal. But that just isn’t true. For example, he’s a big believer is a “strong dollar” policy, which is just a way to hurt workers and prop up the wealth of the rich. But even apart from that, if the conservative position is the Hayekian filled thought of Hubbard, then the liberal side should be the Marxist filled thought of Paul Sweezy. Summers really is in the middle. His position is the data-driven compromise—at least as he see it. Hubbard’s is the ideology-driven extremist position.
And this is why there is no common ground. In other words, Davidson is trading in more false equivalence. And this is one of the primary problems with our media system: it treats extremists on one side as though they were just as reasonable as moderates on the other. And then it asks the question, “Why can’t they just get along?” Yeah, I wonder.
Here is a good example of who Glenn Hubbard has become (I don’t doubt he was a good scientist early on in his career). This is from Inside Job: