Monday, January 22, 2007
Not a fair fight.
Brad DeLong has chronicled the problems with Reynolds's work: if you can stomach it, look here, here, here, here, here and here.
If there is one trend in American life that most irks economic conservatives, it is probably rising inequality. It's not the inequality itself that bothers them, as most will happily admit. It is the perception of inequality and, worse, the constant discussion of inequality that is so irritating. It offends their view of capitalism, helps justify all sorts of nefarious government interventions, and makes the conservative economic agenda (most of which tends to increase inequality) appear unfair. They would very much like for it not to be true. Failing that, they would like for the public not to believe that it's true--or, at the very least, not to be sure whether it is true or not. This is where Alan Reynolds comes in.
A manager at J.C. Penney who attended graduate school at night, Reynolds was plucked from obscurity by William F. Buckley in the 1960s after writing a few pieces for The National Review. (He's still "a couple of classes" short of his masters degree in economics.) . . . Reynolds offers up conventional supply-side economic views; but his specialty is denying that income inequality has grown. He has been at this task for almost two decades, and, as the economic consensus that inequality is increasing has grown stronger and stronger, so, too, has his importance to the right.
Reynolds's crucial role within the conservative movement was on full display at a packed-house Cato forum last week in which he defended a paper--titled "Has U.S. Income Inequality Really Increased?"--he published earlier this month and summarized in a much-discussed Wall Street Journal op-ed. Reynolds was introduced by Chris Edwards, the director of tax policy studies at Cato, who began by noting that it is a matter of opinion whether income inequality matters at all. (In his opinion, it doesn't.) Nonetheless, he suggested, "Economists and reporters need to be extremely careful in looking at trends in income statistics over time. All sources of income data have various quirks and shortcomings." In other words, conservatives aren't sure whether inequality is rising, and they don't really care if it is. Their primary concern is that newspapers treat the question as a matter of dispute rather than a settled fact.If this sounds like the conservative stance on global warming or evolution, it shouldn't come as a surprise. Like those two issues, the existence of rising inequality is beyond dispute among academics who study it. This applies even to conservative economists with strong Republican pedigrees. (Harvard economist and former Reagan adviser Martin Feldstein: "There has no doubt been a relatively greater increase in higher incomes in recent years in the United States." Columbia's R. Glenn Hubbard, a Bush alum: "We have an issue with emerging inequality in the country.") And so the ambition of the conservative counterestablishment in these areas is not to overturn the scholarly consensus but simply to make the topic appear so complicated that laypeople and the press don't know what to believe.
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Reynolds's role is merely to point out that the data is imperfect. The skeptic challenging the expert consensus must be fluent enough in the language of the experts to nibble away at their data. (The evolution skeptic can find holes in the fossil record; the global-warming skeptic can find periods of global cooling.) But he need not--indeed, he must not--be fluent enough to assimilate all the data himself into a coherent alternative explanation. His point is that the truth is unknowable.
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