No One Cares What Economists Say About Trump
This week, there have been not one, but two open letters by some of the most eminent economists in the U.S., urging the American public not to vote for Donald Trump. One letter, published in the Wall Street Journal, was signed by 370 economists, including eight Nobel prize winners. It slams Trump for questioning the accuracy of economic data, for attacking free trade and immigration, for getting facts wrong and for having misguided policy proposals on a variety of fronts. The second letter is by Nobel laureates only -- 19 of them. They write:
Donald Trump…offers an incoherent economic agenda. His reckless threats to start trade wars with several of our largest trading partners, his plan to deport millions of immigrants, his trillions of dollars of unfunded tax cuts, his casual suggestion that the United States could threaten default on its debt in order to renegotiate with our creditors as if Treasuries were a junk bond—each of these proposals could jeopardize the foundations of American prosperity and the global economy.
This is all true. However, I’m going to go out on a limb and make a bold prediction: Essentially no American voters will listen to these economists.
The reason? Despite spending much of their time thinking about public policy, economists don’t have much success when it comes to actually persuading the public of anything. The fictional president on the TV show "The West Wing" might have been a Nobel laureate, but in the real world, economists haven’t been successful at running for office.
Meanwhile, economist-sponsored policy initiatives, like Washington state’s carbon tax proposal, often founder when they meet the realities of politics. The proponents of the Washington tax decided to try to appeal to fiscal conservatives by making their proposal revenue-neutral -- adding tax cuts in some areas to balance out the new tax on carbon. That infuriated environmentalists, who are almost all progressives who want a more redistributive tax system. The economists, trying to be moderate, ended up appealing to no one.
Part of the problem is that economists don’t think about politics very much. After years of interacting with the general public, I’ve concluded that there’s another factor -- economists are adored by U.S. business and political elites, but held in contempt by much of the rest of the country.
Economists’ cachet among U.S. elites is hard to dispute. Every presidential administration has prominent academic economists as advisers. Books such as "Freakonomics" are huge best-sellers. Econ blogs are very popular. And obviously, columns in financial publications by academically trained economists command a lot of interest.
Economists’ pay is another sign of the special respect that they command among the American elite. A study found that in 2014-15, the average starting salary for an econ professor at a four-year school was $91,301. For rough comparison, another survey in 2012 found that a starting physics professor made an average of only $56,483. Economists, in other words, make more than many academics with greater average levels of mathematical skill. And that doesn’t count the lucrative fees that many econ professors make from side jobs in consulting -- yet another a sign of how highly their analyses and pronouncements are regarded among business elites.
But among the general public, it’s a different story. A 2014 paper by Christopher Johnston and Andrew Ballard looked at how people’s opinions on policy issues changed when they were told what economists think. They found that while the public generally trusts economists on highly technical issues, on politically sensitive issues such as trade and immigration, they basically have no faith in the academics. Anecdotally, I can report that among large swaths of the public, “economist” is a word that often evokes either distrust, derision or incomprehension.
Why is this? One favorite answer, especially among left-leaning writers, is that economists are politicized -- basically, that they’re in the pocket of the rich and shill for free-market policies that hurt the masses. That’s not actually true -- these days, economists look more favorably on government intervention in the economy than the public at large.
Another answer is that economists lost respect when they failed to foresee the financial crisis. This is true -- almost no popular academic models of recessions even admitted the possibility of something like 2008 happening. However, I seriously doubt that most non-economists know this. Who outside of an econ department knows what a real business cycle model or a new Keynesian model is? Precious few. So if people really do blame economists for not anticipating the crisis and the recession that followed, they probably do so for reasons having little to do with fact.
This leaves me with no solid explanation for why economists are the toast of the elite but shunned by the masses. But if economists want to have more influence over real policy, they should investigate this question in greater detail.
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