By now, everyone bar George Osborne and Angela Merkel think that cutting government spending in slump is a bad idea. The threat that, the instant we begin doing something to alleviate the suffering of our poorest citizens, the handful of bond-traders who move the world’s pension schemes around will take all their precious money out of the UK to some safer haven, affecting our sacred “credit rating” and jacking up the interest we have to pay on our debt, is looking paler and paler.
(As an aside, it’s worth remembering that the “money markets” are just a group of people. And it’s interesting to think, with the credit ratings agencies and the bond traders combined, just how many people they might actually be. What factor of ten? Are we talking hundreds? thousands? However many they are, their collective influence over the actual lives (as opposed to just the pension pots) of millions of people is scary.)
No one believes that austerity works. When your fiscal policy is too brutal for the IMF, for heavens sake, you know you’re in dangerous territory.
So why did this article, calling for a more humane approach to debt reduction, leave me feeling moved to leap to my keyboard in righteous ire? Because it does what almost all Economics writing does: hides the almost laughable simplicity at the heart of Economics ideas behind needlessly difficult to understand prose, designed to make the reader despair at ever truly understanding what’s written and just going along with the general sentiment. An economist would probably use the word “obfuscation”, a kind of meta-word which is an example of that which it describes.
1: When everyone already has a job, government spending just moves people from the private sector to the public sector.
2: When not everyone has a job, government spending can give them a job which is good for them now, good for them in the future and good for society at large.
2.5: At the moment, not everyone has a job.
British magazine The Economist is not lacking in prestige or respectability, but they nevertheless insist on readability and on explaining things which might not be known to the reader. (See the magnificent “BP, a British oil firm” here. Indeed, just the introduction to The Economist‘s famous style guide is enough to make me weep with happiness.) But in the course of the exposition of their 2.5 simple (perhaps even intuitive) ideas, Miller and Skidelsky employ technical terms, which are either unexplained, or explained using further technical terms; quote “famous” Economists with no explanation of who the person is or what they were talking about; and write sentences which are impossible to parse on first reading.
Here is a choice selection of my absolute faves:
…DeLong and Summers must be wrong because a stimulus would imply a “free lunch”, and Milton Friedman said there is no such thing!
Don’t know what that means? Not sure who Milton Friedman was? Tough, there’s no further explanation, despite the jaunty exclamation mark which suggests the reader and the authors are slapping each other merrily on the back at the witticism.
The yields on index-linked borrowing in the UK are in fact less than zero
This sentence is so much simpler than it sounds, that it could be used verbatim in an Economics-tract parody piece. If you don’t know what index-linked borrowing is, or what a ‘yield’ in this context is, then this article just isn’t for you. Sorry.
Nothing in their analysis, however, would countermand a policy of additional fiscal consolidation if that were judged appropriate
No further explanation of any of this is offered. What would a policy of ‘additional fiscal consolidation’ look like exactly? By the way, despite all the impenetrable Economics in this article, it was actually the totally gratuitous use of the word ‘countermand’ that first had me gritting my teeth.
And finally, my personal favourite:
Not only would this generate positive benefits in terms of current output, it could also avoid negative “hysteresis” effects on future supply. The argument is that factors unused in the present ipso facto become less usable in the future
There are so many things wrong with this last example that I hardly know where to start. What I will say is that this kind of language has no place in a broad-readership magazine. We assume that the editors were simply too cowed by the muscular incomprehensibility of the article to shout “Cease, Miller!” and “Desist, Skidelsky!” as they should have been doing right from the opening sentence.
We economists are a hated breed, our science deemed dismal and the results of years of our policies being applied have been manifestly unpleasant. But the era of battering the reader into submission is surely over. The Economist exists! Jay Ulfelder‘s blog exists! Nobel prize-winning Economist Paul Krugman has been blogging in English now for ages!
The application of Economics, for better or worse, actually makes a difference to peoples lives. (see Greece, Ireland, Iceland, much of sub-Saharan Africa, starving Chinese under Mao or The Grapes of Wrath for more details.) This means that discussion of Economics and economic policy should be part of the everyday process of democracy, and we must be allowed to see and understand the effects of modelling assumptions which lead every day to real-world effects.
Shame on the massed ranks of obfuscating economists for holding up democratic involvement, and shame on the New Statesman for letting us get away with it.
Note: the article seems not yet to be online. I’ll quiz the NS about this, and put up a link when I find one.