What is the legacy of economics, so far?

Steve Landsburg asks us to step back and gain a little perspective in his defence of economics and of economists’ failures to predict or address the 2008-and-beyond crisis. He points out that we don’t, after all, consider the failure to predict the current Ebola outbreak a failure of medicine.

His argument is summarised by the following:

If you care about human well-being, recession-fighting is small potatoes. It’s that long-term upward trend that matters. And economists, fortunately, understand a lot about what it takes to nourish that trend — things like well-enforced property rights, the rule of law, free trade, sound money, limited regulation and low marginal tax rates. Even more fortunately, economists have managed, however imperfectly and with fits and starts, to impress that understanding on the minds of policymakers. As a result (and going back, at least, to the repeal of the Corn Laws), we’ve had better policies and greater prosperity.

I don’t find this a compelling defence. He’s absolutely right that the long term trend far outweighs any short-term fluctuations (although let’s not pretend that GDP equals wellbeing: it doesn’t seem controversial that an employed person in 1980 would be happier than an unemployed person in 2008, notwithstanding the latter’s better life expectancy, iPhone, etc.).

The problem for me is that he doesn’t make the case that the particular insights or arguments of economists have really made much difference to the trend. The industrial revolution was already well on its way when the Wealth of Nations was published. It’s even less clear that 20th century economics has had much impact on the long term growth rate. The productive frontier is determined by technological innovation: perhaps we’d actually have been better off if all of the 20th century’s economists had trained as engineers? Meanwhile, economics has tried, since 1945, to push lagging countries towards the frontier. The results have been disappointing at best.

I could, perhaps, be convinced that without Smith and Ricardo we’d have less specialisation and trade; that without Keynes we’d still be locked in the currency crises of the late 1800s; and that without Schumpeter there would be no iPhone 6. But I’m skeptical. The advance of effective economic policy seems to have been at least as much a result trial-and-error, of cultural and political evolution, of empire and conquest (both military and commercial) and of the empirical reality of growth and stagnation, as it has been the result of wise economists offering counsel to receptive rulers.

This doesn’t mean I think economics is a waste of time. We still do meteorology, astronomy, cosmology – even history – although those disciplines focus largely on observation and ex-post explanation. Nobody expects a weather forecaster to intervene in a hurricane. Economists, though, have created and traded on the belief that we can successfully shepherd economies, over the short and long run. Economics has become the dominant language of policy debate, even as it is more often used as a fig leaf for pre-existing ideology. We have sewn the seeds of our own inevitable failure.

So unlike Landsburg, I do think this crisis matters. I think economics should take from it a good measure of humility. In the medical analogy, we are still somewhere in the era of the barber-surgeon.

Why I found the Newsnight piece on ‘Year of Code’ problematic

Last night BBC’s Newsnight ran a segment on the UK government’s ‘Year of Code’ initiative to encourage kids to learn programming.

Jeremy Paxman surrounded by 'gobbledygook'.

Jeremy Paxman surrounded by ‘gobbledygook’.

Much has been made of the studio interview with Lottie Dexter, the government-appointed ambassador for the scheme, who admitted to Jeremy Paxman that she herself can’t code. That doesn’t both me so much, if she does as she said she would and makes an effort to learn in the coming year. I can easily enough imagine an overweight person fronting an anti-obesity initiative in the same way.

What most annoyed me was Newsnight’s tone. In the first minute we were told that code is ‘baffling’ and ‘gobbledegook’. They’re pretty pejorative descriptions, and seem to reflect an anti-intellectualism that it all too common in reporting on maths and sciences. They’re terms that otherwise get used to describe UKBA visa rules or EU arcana. It’s unlikely Newsnight would use them to describe Ulysses, a work of legal scholarship, or something else in the media’s comfort zone of the arts and humanities. They might, however, apply them to an equation in physics or a new theorem in maths.

Gobbledygook means ‘language that is meaningless or is made unintelligible by excessive use of technical terms’. Most programming languages are anything but that. Computer scientists have thought harder about clear and elegant language design than any other group of people.  The ratio of bullshit-to-meaning is lower in science and engineering than other fields, precisely because engineers and scientists have to distinguish between millions of different concepts with absolute clarity – not, it must be said, a strict requirement of other fields (journalism included).

Yes, becoming a skilled coder takes years, but getting past ‘baffling’ takes only a modicum of effort. The Newsnight reporter chose not to bother, preferring a resort to cliché.

Either way, lazy reporting like this is part of the problem.

On the census consultations

In 1882, novelist Leo Tolstoy, himself an enumerator in Moscow, described a census as “a mirror into which, willy nilly, the whole community, and each one of us, gaze”.

I have a piece published in the Conversation (UK) on the history, tradition and symbolism of the census. It is more of a background article than an actual position on the coming potential changes to the UK census.

I do have more specific views on how it should evolve – and in time I’ll probably blog about that – but as far as this piece goes, my overwhelming sentiment is that change should be gradual and well-tested.