In Freakonomics we poke fun at “experts” — folks who go around speaking with great authority about topics they don’t actually know that much about.
I can be criticized for a lot of things since Freakonomics came out, but one thing that I have been pretty good at is not masquerading as an expert on topics I know little about. For instance, although I have views on the financial crisis, I’ve more or less kept them to myself, instead using the Freakonomics blog as a vehicle for publicizing the views of people who know more than I do about the issues, even if I don’t necessarily agree with everything they are saying.
Every once in a while, though, I let someone get me going on topics I have no business talking about.
A recent interview with Steve Paulson on NPR is a good example. Somehow he got me talking about the housing bubble and the stimulus package. I wouldn’t actually encourage you to listen to it, but if you want to be a witness to my descent into expertdom, it is available online. My segment starts about 30 minutes into the show. Other guests on the show include Paul Krugman, who has a very different view of stimulus than I have.
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I’m sure your thoughts are better than Krugman’s. The way Keynesian economics, which contrary to popular belief the US government has been doing since the 80s, has caused this but market economics are being blamed reminds me of the Reichstag fire.
Oh come on, everybody’s got a theory, and to anyone who’s read your work knows that you will at least attempt to look at the data and give it some thoughtful analysis, unlike the vast majority of talking heads who, like Bush and “Colbert” think from the gut.
Off topic, but I’m not sure where else to address it:
Is there enough money out there for Americans to buy back our debt? What I think I mean is this: during past crises, Americans have been encouraged to buy bonds issued by the US govt. to provide it the cash it needed to, say, fund WWII.
It may be simple minded, but it seems to me that deficit spending hands the problem off to our kids. At least if we bought the bonds ourselves we would have a greater sense of participation in fixing the problem. Why isn’t it a priority of all patriotic persons to own a piece of the US debt. So what if the interest payment is tiny, at least it gets payed back in the US, hopefully making its way back into the US economy eventually.
Obviously there are probably not Trillions lying around American households, but surely there are billions being “invested” in other places. If we could own the debt, would we be any better off?
Thanks,
Pete Merriam
I have this vision of Krugman sitting around on the day that Lehman fell, then standing up from his recliner and shouting “Yes! Face time for Krugman!” Then maybe he and his ego split a bottle of champagne and some cigars.
I realize it’s not your area of expertise (note how I’m tying back to the original topic here), but do you have any economic models that would predict what would have happen if we allowed all the bad banks to fail and injected all $700 billion into only healthy banks? I don’t claim that it would have been the best solution, it just sounds like an interesting idea to test.
“Other guests on the show include Paul Krugman, who has a very different view of stimulus than I have.”
This certainly gives your “expertise” a lot of credence in my eyes.
I won’t go and listen to your interview but it seems to me that precisely what the current situation needs is more of the Freakonomics approach would advocate:
Put aside your presumptions and look at the data with a clear eye and a cold heart and see what you can learn.
Krugman appears to believe we can stimulate and get back to the height of an artificial and unsustainable bubble and stay there – seems unlikely to me.
You are very aware then of the “expert problem.” I love it when people are humble. I listen closely to those folks, because they question themselves. This is a true value added attribute to what comes out of their mouths. If only there were more people like that and less “experts.”
Thanks
Krugman, Obama, Pelosi, Reid et al. want to get the economy “back on track” with deficit spending. Even if it is possible to get the economy back on the old track we were on, that track was headed for a cliff anyway. The economy needs a fundamental restructuring that can only be achieved with a complete collapse of the festering tumor that is the financial system.
It’s easy to be an expert on this topic. Simply determine where Paul Krugman stands, and take a position diametrically opposed to him.
It can’t fail.