David Brooks: Math is Hard, Just Give Money to Rich People
David Brooks complains that liberals used rigorous economic models.
"The economic approach embraced by the most prominent liberals over the past few years is mostly mechanical. The economy is treated like a big machine; the people in it like rational, utility maximizing cogs. The performance of the economic machine can be predicted with quantitative macroeconomic models.
These models can be used to make highly specific projections. If the government borrows $1 and then spends it, it will produce $1.50 worth of economic activity. If the government spends $800 billion on a stimulus package, that will produce 3.5 million in new jobs.
Everything is rigorous. Everything is science."
Brooks contrasts this approach with the moralizing and whining of conservatives:
"Conservatives, who are usually stereotyped as narrow-eyed business-school types, have gone all Oprah-esque in trying to argue against these liberals. If the government borrows trillions of dollars, this will increase public anxiety and uncertainty, the conservatives worry."
He then concludes that because the economy is still weak, we should listen to the conservatives and cut spending and taxes.
Actually, the liberal models have performed quite well if Brooks actually bothered to look. The stimulus was projected to create 3.7 million jobs in its original form. The bill actually approved by Congress contained roughly one-third less stimulus, so we should have expected it to create roughly 2.5 million jobs. No one who looked at the models that Brooks is condemning would have thought that this would have been sufficient to restore the economy to normal levels of output and employment in an economy that had lost over 6 million jobs by the time the stimulus kicked in.
Brooks also misrepresents the attitude of liberal economists to the moralistic conservatives who just want to give all our money to rich people. All of their whining has specific implications. For example, when Brooks or some other conservative complains that businesses aren't hiring because of all the uncertainty about taxes and regulation, then the implication is that businesses are finding ways to meet their demand for labor in ways that don't involve permanent hires.
The obvious mechanisms would be to increase average hours per worker or increase the hiring of temps. Liberal and progressive economists insist on examining the evidence to see whether it supports the whining of the conservatives. In this case (and all others) it doesn't. The increase in hours per worker since the trough last fall has been very modest and average hours are still well below their pre-recession level. Temp employment has rebounded very weakly and is also far below its pre-recession level.
In short, Brooks is not just complaining about the economic models of liberals. He is also complaining that liberals try to examine the logical implications of their whining and look for evidence of these whinings being accurate. Brooks' view is apparently that we just give in to conservatives since this is the only way to get them to stop whining.