The Dark Art

by Don Boudreaux on March 27, 2008

in Politics

Today’s edition of the Wall Street Journal reports on Barack Obama’s economic "plan" and, on another page, summarizes remarks on the economy recently offered by Hillary Clinton.

Sen. Clinton said, as the WSJ reports, that "she
fears the U.S. is slipping into a Japanese-style economic malaise that
will overwhelm the Federal Reserve’s considerable powers"  Sounds scary.  To alleviate our fears, she and Obama each offer their own "solutions" for the economy.

But how
scared would you be if such fears were expressed instead by, say, your
veterinarian or your proctologist?  Because these specialists (and perhaps even geniuses) in their
respective fields have no expertise at diagnosing the economy, you’d be well-advised to take their economic concerns with a grain of salt. 
And you should do the same, but doubly so, with any pronouncements on the economy offered up by Sen. Clinton, Sen. Obama, and Sen. McCain.  Not only do these politicians have no expertise in economics — their specialty is winning political elections — but as Sen. Clinton’s recent sniper-fire whopper reveals, successful practitioners of the
dark art of politics possess an unusual
propensity to lie and dissemble.

Almost all that any politician says on any topic other than political strategy
should be treated with even less respect than would be accorded a
professional circus-clown’s speculations about string theory.

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Python March 27, 2008 at 12:57 pm

The WSJ – in the above link – has the following line, where Obama's words are the inner quote:

"Mr. McCain's economic policies amount to 'little more than watching this crisis happen.'"

Never thought Obama would convince me to vote for McCain in such a convincing fashion.

Python March 27, 2008 at 1:20 pm

BTW, Obama is going to be interviewed by Maria Bartiromo on CNBC at 4PM EST.

muirgeo March 27, 2008 at 1:27 pm

It's presumtive to assume these candidates are making recommendations with some lack of advice from experts.

In 1993 some 565 distinguished scholars hade endorsed Clintonomics as "our best hope for reviving the nation's economic growth." Seems they were right.

If only George Bush had listened similiarly to economic advisors insted of investors, oilmen, weapons makers and bankers for advice. It's now apparent the worse place to get advice on running the economy is from the guys working on Wall Street.

Barak Obama seems in every way a smart and pricipeled man. I have no doubt he will and is seeking the best of advice from the best of advisors.

shawn March 27, 2008 at 1:33 pm

you say words. lots of them.

Randy March 27, 2008 at 1:52 pm

What the political class wants from the economy is revenue. For this reason, I don't worry too much about what politicians "say" about the economy. Their words are only for political effect. While it bothers me that they collect every last penny that they possibly can, at least I know that their actions are limited by their interest in maintaining a productive economy.

Don Boudreaux March 27, 2008 at 1:57 pm

Randy,

You should read my colleague (and EconLog's) Bryan Caplan's superb book The Myth of the Rational Voter.

Don

Randy March 27, 2008 at 2:19 pm

Don,

I've thought about it, and your book as well, but to be honest, blogs are free :)

As for the comment above, I assume that your point is that as the voters do not behave rationally when electing their representatives my point that the political class is rational is suspect. My answer is that there is little connection between what the voters say they want and what the political class actually does. Take equality for example. A large section of the voters whine constantly about equality, and the politicians play to their whining without fail, but they don't actually do anything about it. They coddle and manipulate, but they do not respond, because to actually do anything about inequality is not in the rational best interest of the political class.

Paul Zrimsek March 27, 2008 at 2:24 pm

Your parallel is deeply unfair to the circus clown, who has much less incentive to talk nonsense about string theory than a politician does to talk nonsense about the economy.

muirgeo March 27, 2008 at 2:28 pm

Randy,

I disagree. Equality has consistently been improved under democratic regimes compared with republican regimes. Further, the overall economy has done as well or better and has been more stable under democratic regimes. The evidence suggest there is a difference. GDP, stocks and fesderal debts have consistently been better under democratic regimes. So it should be good for you to know there is at least a lesser of two evils at worst.

Randy March 27, 2008 at 2:44 pm

"Equality has consistently been improved…" : Muirgeo

Really? Then why are so many people still whining about it?

FreedomLover March 27, 2008 at 2:49 pm

Duck said:

In 1993 some 565 distinguished scholars hade endorsed Clintonomics as "our best hope for reviving the nation's economic growth." Seems they were right.

You realize it's a logical fallacy to appeal to credentials. If you can prove to me based on writings how Clintonomics "was the best hope for reviving economic growth" then have at it. But it doesn't jive with the fact that GDP was already growing again by 4th quarter 1992. oops.

FreedomLover March 27, 2008 at 2:52 pm

Duck said:

Equality has consistently been improved under democratic regimes compared with republican regimes.

Translation from duck speak to real speak:

Democratic regimes transferred the free-market won wealth of some people to other people, thus "increasing equality". Otherwise known as legalized theft.

Python March 27, 2008 at 2:57 pm

Muirgeo,

Even in my Vicodin-induced stupor I can detect your BS. What do you think caused the good times in the 90s:

1) Clintonomics
2) computer technology coming to business in the form of the Web, high-speed networks, robust OS, etc.
3) the long-term economic improvements beginning in 1983
4) Republican-led Congress in 1994
5) NAFTA
6) Other, please explain

If you believe the majority of good times was from #1, please clearly explain which aspects of Clinton's policies lead to economic growth.

Secondly, do you think that the bubble at the end of the 90s should be attributed to Clinton or to some other player?

muirgeo March 27, 2008 at 3:01 pm

Randy,

"…has consistently been improved under democratic regimes…"
democratic regimes…"
democratic regimes…"

How many times our we going to repeat this experiment? Laissez-faire policies leading to greater inequality, less stability and economic collapse followed by Keyensian policies returning trust, stability and improved equity. If you haven't noticed republicans have been in charge 20 of the last 28 years and we're seeing the results of return to laissez-faire as the economy collapses all around use.

Hardworking people are whining because the fruit of their labor has been stolen by the financial wizadry of wall street paper pushing assholes making pyramid schemes and calling them fancy names like derivatives. That's not free market economics it's common thievery and it's the end result of allowing unfettered greed run our markets and assuming beyond all reason that the invisible hand will slap these bad boys when they get out of line.

Faith based economy is a scary thing! Time to base it on something a little more substantial like good presidential economic advisors. They can make all the difference.

Randy March 27, 2008 at 3:02 pm

FreedomLover,

And most of the transfers (rent collection) goes straight into the pockets of the political class. The amounts actually paid to the "unequal" are just a token to keep the game running and the revenue pouring in.

Python March 27, 2008 at 3:05 pm

Muirgeo,

After you answer my post above, please once and for all, respond to my 3 other queries to you.

Namely, how are you defining which party is "in charge"? By president. By president and both houses? By both houses alone. By president and one house? It matters.

Please define it so I can show you the facts.

Randy March 27, 2008 at 3:08 pm

"How many times our we going to repeat this…?" : Muirgeo

That's up to you.

muirgeo March 27, 2008 at 3:17 pm

Python,

Mostly by president. But broadly speaking and considering all 3 branchs the pre-30's were ruled by the republicans, from the 30's to the 60-70's mostly democratic and mid 70's to present republican.

Python March 27, 2008 at 3:25 pm

Muirgeo,

I am not interested in "broadly speaking". Give me your basis for "in charge" and "ruled". I am not satisfied with lumping Eisenhower with Dems, or Clinton with Republicans until you define it clearly.

Choose one of the following:
A) President
B) President and one house
C) President and both houses
D) Both houses, regardless of President

Randy March 27, 2008 at 3:27 pm

"…mid 70's to present republican." : Muirgeo

Check it out, he's trying to dump the Carter recession. LOL.

muirgeo March 27, 2008 at 3:30 pm

What do you think caused the good times in the 90s:

1) Clintonomics
2) computer technology coming to business in the form of the Web, high-speed networks, robust OS, etc.
3) the long-term economic improvements beginning in 1983
4) Republican-led Congress in 1994
5) NAFTA
6) Other, please explain

Posted by: Python

I'd say likely a bit of each contributed.
It's obvious it's easy to oversimplify what causes the economy to do better or worse.

But the broad general theme of the debate here is over planning vs non-planning.

You would think that if the "non-planners" were right the data would more consistently favor results under the republican administrations but the data seems to suggest (however impefect) the opposite.

It would be a little like me continuing to claim man made warming is happening in spite of a long term trend that showed in fact there is cooling.

I mean I'd give up my "belief" in man made warming if the temperature graphs were flipped 180 degrees from what they are. I'm thinking at some point the Laissez-faireis might want to reconsider their positions based on what the data seems to be telling us.

Kyle March 27, 2008 at 4:09 pm

Don,

With Obama likely to be president, how worried should I, a college student about to enter the job market, be about the economy?

I mean, this is looking really bad.

Sam Grove March 27, 2008 at 4:10 pm

I wish to again recommend 'Treason' by Orsen Scott Card, for his illustration of the nature of the political class.

I ran for congress three times and followed no less than Nancy Pelosi around as we spoke to different groups and I can testify to the successfull politician's ability to adapt to the expectations of various groups.

Hey, it works.

Marcus March 27, 2008 at 4:16 pm

I love the comment by Obama that financial regulations need to be 'modernized'.

What was it von Mises said? "Progress is precisely that which the rules and regulations did not foresee."

I did not know Obama read von Mises! ;)

FreedomLover March 27, 2008 at 5:06 pm

My god, the ducky is so stupid it's not even worth responding to. I bet he'd say that the cause of the Great Depression was too much capitalism.

Python March 27, 2008 at 5:18 pm

Muirgeo,

Let me know your answers for my 2 questions.

A-D for "ruled by" in the post 7 above this one
1-6 for Clinton's good years in the post about 11 above this one.

I need specifics so I can show you data. This wishy-washy stuffy you answer with is hard to quantify.

Eric March 27, 2008 at 5:24 pm

muirego —

You keep implying that Republicans are "non-planners". That's absurd. They're just as interventionist as Democrats. Democrats like to intervene on behalf of "workers" and Republicans like to intervene on behalf of "business". Reagan's car quotas and Bush's steel tariffs definitely exist and they're no "better" than higher taxes or higher minimum wages.

Republicans and Democrats are just bad in different ways.

Mcwop March 27, 2008 at 5:45 pm

Python #2, #2! Then the budget stalemate between repubs and Clinton that kept government spending down.

dcpi March 27, 2008 at 6:09 pm

Python:

I vote for 6… End of Cold War. Downsizing the military and Pentagon contractor class freed minds and talent to move onto other things, including private sector tech from public pork tech. For example, one college friend — one of the best and brightest — moved from designing Abrams tanks to working on computer chips. He was one of many of undergrads I schooled with who started their engineering paths with military-related jobs in mind only to end up working at Sun, Microsoft or some startup.

I think we all the better off for it. Oh yes, a few of those people ended up with $10s of millions after started and selling businesses, so I guess they increased inequality from what it would have been had they earned a paycheck at Gen Dynamics.

Mesa Econoguy March 27, 2008 at 6:14 pm

Duck keeps insinuating numerous falsehoods, such as Republican non-planning, Democratic “superiority” (moral & otherwise), and Anthropogenic Global Warming (had to get that in there).

Mesa Econoguy March 27, 2008 at 6:27 pm

Here’s yet another deficit invented by the economically illiterate press (and enjoyed by muirgeo’s cognitive peers), and sure to be addressed by politicians:

"– FXNEWS-Canadian international travel deficit hits record –
Canada's international travel deficit surpassed the
C$10-billion mark in 2007, in the wake of substantial gains in
travel spending by Canadians abroad, Statistics Canada said.
The deficit (the difference between spending by Canadians
abroad and spending by foreigners in Canada) hit a record high
of C$10.3 billion in 2007, up from the previous record high of
C$6.7 billion in 2006. Higher travel spending abroad fuelled
the burgeoning deficit. Canadians spent a record C$26.9 billion
outside the country in 2007, a 15.5 percent increase from 2006.
At the same time, foreign spending in Canada edged up 0.3
percent to C$16.6 billion. Lower spending by U.S. residents in
Canada offset most of the increase in spending by travellers
from overseas countries."

Ooooohhh, eh? What should we do abooot that? Sell more touques?

Mesa Econoguy March 27, 2008 at 6:30 pm

And how do we know that Hitlary isn’t similarly lying about her economic “plan” as she was with her “sniper fire” recollection/plan?

muirgeo March 27, 2008 at 6:37 pm

Python,

Let's go with A. The President And mostly 1. Clintonomics the reason for our prosperity under his administration.

Methinks March 27, 2008 at 6:41 pm

whining because the fruit of their labor has been stolen by the financial wizadry of wall street paper pushing assholes making pyramid schemes and calling them fancy names like derivatives. That's not free market economics it's common thievery and it's the end result of allowing unfettered greed run our markets and assuming beyond all reason that the invisible hand will slap these bad boys when they get out of line.

Seriously, How the &^#@ did you get into college?

Mesa Econoguy March 27, 2008 at 6:43 pm

And, of course, Clintonomics encompassing lower taxes from the Republican Congress. That’s what you meant to say.

[After the largest tax increase in history.]

Right.

Python March 27, 2008 at 7:56 pm

Muirgeo,

Now that you said President as the ruling order I would like to set up some more ground rules for my statistical analysis.

Can we agree that when we look at stats we shouldn't include the entire year that the Presidents were inaugurated in because it takes some time for their leadership to get into place?

They get elected in November, inaugurated the following January, and they settle in.

So for example, the recession that Clinton inherited shouldn't be counted against his stats until he got into office enough to straighten it out. Do you agree with that?

I'll leave it up to you. Do you want go mid-year, so say Clinton's stats should start in say July 1993, or do you want to start them at January 1994?

The economic criteria that I would like to choose for my judging is going to be: Dow Jones industrial index, real GDP per capita, and unemployment.

Just to start on friendly terms, I'll let you add one criteria to the list for my analysis.

And lastly, what year would you like to begin the analysis? Obviously 1928 or 1933 would be too cherry picked, but if we go back too far, the data isn't as reliable or available. Shall we say 1920? It's up to you, just make it reasonable.

So, I'm waiting to hear from you regarding the start of the true presidential stats, which stat you would like added to the mix, and what calendar year you would like to start the analysis with. Fair enough?

Kook March 27, 2008 at 8:06 pm

Economic Geniuses who constantly share their expertise on the economy like the one's on this blog couldn't see this one coming. They have about as much credibility on the matter as O'Clinton or McPain. Like Rothbard would say, banks are inherently bankrupt, a crisis just reveals it.

Sam Grove March 27, 2008 at 8:58 pm

It's presumtive to assume these candidates are making recommendations with some lack of advice from experts.

I say that would depend on the experts. You can find all kinds of 'experts'.

Mesa Econoguy March 27, 2008 at 9:24 pm

Python, you have set up the economic Kobyashi Maru for duck.

While intriguing, asking duck to go here

http://bea.gov/

here:

http://www.nber.org/

here:

http://www.economagic.com/

here:

http://epp.eurostat.ec.europa.eu/portal/page?_pageid=1090,30070682,1090_33076576&_dad=portal&_schema=PORTAL

here:

http://www.econlib.org/index.html

and here:

http://www.bls.gov/

to confirm his mistaken beliefs is like asking Bill & Hillary to tell the truth.

{hint duck: these are all economic resources for you to utilize}

Ain't gonna happen.

Python March 27, 2008 at 9:29 pm

Mesa,

I've been sitting at home all day, souped on meds, with nothing better to do then have some fun with the quacker. To his credit, he has tried to communicate with his Forbes magazine link regarding a similar analysis. Of course, their analysis is flawed and shallow, and I intend to add a few twists here and there.

Mesa Econoguy March 27, 2008 at 9:34 pm

Apparently, duck has done much the same, minus the meds.

Or not….

Mesa Econoguy March 27, 2008 at 9:37 pm
Mesa Econoguy March 27, 2008 at 9:39 pm
Mesa Econoguy March 28, 2008 at 12:59 am

My apologies for frontrunning, Python.

I do hope you get better, Python, and vicodin is a very good avenue thereto.

Scotch also works.

:)

vidyohs March 28, 2008 at 9:25 am

Lest we forget who we deal with in muirduck.
We are up to 12 now. Remember, you need nothing but his words to understand how dysfunctional he is.

MUIR(STU)PIDITY OF THE (muir) DUCK

1. “The rising income discrepancy is what prevents people from obtaining affordable housing.”
Posted by: muirgeo Nov 2007
or
2. “If you are advocating a free market system say for schools you need to show one that works.”
Posted by: muirgeo | Mar 10, 2008 7:24:41 PM
or:
3. "Suffice it to say individualism where ever it surfaces is ultimately self-destructive.”
Posted by: muirgeo | Mar 15, 2008 11:29:41 AM"
or
4. “Planning and tinkering will definitely have a place in creating a strong competitive market. The invisible hand……YOU'RE FIRED!!!… well or at least demoted.”
Posted by: muirgeo | Mar 17, 2008 9:13:45 AM
or
5. “Natural cycles will often effect(sic) conditions on a short term basis but will not effect the larger man made trends.”
Posted by: muirgeo | Mar 18, 2008 10:15:41 AM

6. “I honestly believe the principles I support would increase our liberty not decrease it.”
Posted by: muirgeo | Mar 18, 2008 6:57:16 PM
or
7. “5,000 year old vegetation has been found in multiple areas around the world in the paths of recently receding glaciers.”
Posted by: muirgeo | Mar 18, 2008 7:00:43 PM
or
8. “First , the idea of climates "natural course" is invalid. There's no magic here climate responds to things we understand pretty well.”
Posted by: muirgeo | Mar 20, 2008 9:02:34 AM
or
9. "When some one says the climate is warming because it is following its natural course they need to be more specific. That's all I'm saying. Is it warming from the Sun, El Nino…. what? And provide evidence."
Vidyohs… your ego so controls you. You should learn how to tame it. You'll be a happier person.
Posted by: muirgeo | Mar 20, 2008 10:28:10 AM"
or
10.”I compete with other doctors for my patients and market forces are somewhat in effect. A government single payor(sic) system could actually increase consumer choice and market competition.”
Posted by: muirgeo | Mar 21, 2008 9:10:06 PM
or
11. “ If I was(SIC) to summarize my position it would be that I believe we need more democracy not less ( ie. a government represents the needs of its people more then(SIC) of its economic institutions).
I believe in competitive markets but understand they work best with good regulation.
Posted by: muirgeo | Mar 26, 2008 12:56:01 PM
or
12. “Seriously, the only historical reference I can think of was back in the days of the feudal system. Then the markets were completely unencumbered. Property rights were strictly observed and all property was held by a minority of wealthy people with everyone else an indentured servant.”
Posted by: muirgeo | Mar 26, 2008 2:48:31 PM

muirgeo March 28, 2008 at 1:30 pm

#1

Poorly worded but a true statement none the less

#2

Yes you proved that one wrong with your reference to the Kansas school system of 1850… of course now they want to teach creationism there.

#3

Egoism should be substituted for individualism

#4

I make me laugh…

#5
You make me laugh….

Is an absolute fact (in context) but you putting it on your list makes me laugh.

#6

Do you honestly NOT believe the same thing about your beliefs?

#7

Factual evidentiary statement…
” rel=”nofollow”>I even have a picture to help you understand what you can't with words.

#8

Poorly worded. Maybe qualifies for a murpidity but it's a fact that there is no "natural state" of climate. Indeed it's always changing.

#9

Actually explains #8. And you really should learn to recognize your ego. Doing so puts you at a higher level of self-awareness and could break you out of the 5th grader mentality rut you are stuck in.

#10 & 11

Consistent with the better stated proclamations of the worlds greatest scholars and philosophers. I stand by them and my poor English.

#12

Are you trying to claim the Kings who owned all the land did not earn their wealth and land? Are you claiming the Kings should be denied their right to property? On what basis? Do you really think left unimpeded the trend of multinational corporate ownership and rule would be any different then that of Kings…. I stand by this as well.

You cataloging murpidities without really ever offering your own well founded rebuttal is less then impressive. But what can one expect from a 5th grader.

muirgeo March 28, 2008 at 1:32 pm

One more try with the exposed 5,000 year old vegetation.

Methinks March 28, 2008 at 1:42 pm

…own well founded rebuttal is less then impressive. But what can one expect from a 5th grader. – Muirdiot

The complete inability to EVER punctuate sentences correctly. The inability distinguish between "then and "than". The inability to distinguish between possessive and plural. Of course the complete absence of logic is also a a factor – but not of fifth graders. This is true of complete morons and muirdiots.

Randy March 28, 2008 at 2:08 pm

So, Muirgeo, we're not even allowed to have an ego anymore? Dude, you are beyond fascist. You're a hardcore totalitarian fascist.

vidyohs March 28, 2008 at 2:25 pm

Thank you for number 13.

13. “Poorly worded. Maybe qualifies for a murpidity but it's a fact that there is no "natural state" of climate. Indeed it's always changing.”
Posted by: muirgeo | Mar 28, 2008 1:30:17 PM

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