Paul Krugman Betrays Pursuit of Truth in Economics
5 Comments Published by Billy Joe Mills on Wednesday, March 5 at 4:03 PM.
Dear Professor Krugman,
I respect economists because I see their field as the most humanitarian study possible, given their power to increase the over all wealth of the world, but especially of its poorest parts. That's why I am dismayed by your increasing disinterest in staying above the muddy and dirty fray of common politics and statistical misguidance.
You recently wrote a post in which you touted the employment-population ratio as the best "guide" to how the employment market is doing. I feel that the picture you have painted is rather biased for an economist. Don't you think that other variables are at play here that make that ratio an incomplete picture? Retired persons, because of the onset of the baby boomers, as a share of the population are increasing, which means that we can naturally expect that ratio to decline in the years ahead but that it won't necessarily be a reflection on the health of the economy. Note that the BLS does not define the Employment-Population Ratio in terms of 16-65 year olds, instead it says: "The proportion of the civilian noninstitutional population aged 16 years and over that is employed."
You linked to a post that you wrote a couple of months ago in which you show a biased time sample selection. I presume you wished to influence your readers into thinking that the current ratio is at a historic low. Luckily for you, I love playing with BLS charts, below is the full chart dating back to 1948 (earliest possible year).
No single economic indicator can give an observer the full picture. So while you claim that "The official unemployment rate has been a deceptive indicator," you regrettably chose to present data that is equally deceptive when viewed in isolation of other datasets.
For those interested, below is the historical data on the unemployment rate. Note that it is currently very low in historical terms and also note, as you do Professor, that this indicator does not paint the full picture.
Professor, you know probably 100 times more than I do about economics. It's very possible that this entire post is full of errors, if so, I would encourage you or someone else to point them out. I am only a playground economist.
Regrettably,
Billy Joe Mills
I respect economists because I see their field as the most humanitarian study possible, given their power to increase the over all wealth of the world, but especially of its poorest parts. That's why I am dismayed by your increasing disinterest in staying above the muddy and dirty fray of common politics and statistical misguidance.
You recently wrote a post in which you touted the employment-population ratio as the best "guide" to how the employment market is doing. I feel that the picture you have painted is rather biased for an economist. Don't you think that other variables are at play here that make that ratio an incomplete picture? Retired persons, because of the onset of the baby boomers, as a share of the population are increasing, which means that we can naturally expect that ratio to decline in the years ahead but that it won't necessarily be a reflection on the health of the economy. Note that the BLS does not define the Employment-Population Ratio in terms of 16-65 year olds, instead it says: "The proportion of the civilian noninstitutional population aged 16 years and over that is employed."
You linked to a post that you wrote a couple of months ago in which you show a biased time sample selection. I presume you wished to influence your readers into thinking that the current ratio is at a historic low. Luckily for you, I love playing with BLS charts, below is the full chart dating back to 1948 (earliest possible year).
No single economic indicator can give an observer the full picture. So while you claim that "The official unemployment rate has been a deceptive indicator," you regrettably chose to present data that is equally deceptive when viewed in isolation of other datasets.For those interested, below is the historical data on the unemployment rate. Note that it is currently very low in historical terms and also note, as you do Professor, that this indicator does not paint the full picture.
Professor, you know probably 100 times more than I do about economics. It's very possible that this entire post is full of errors, if so, I would encourage you or someone else to point them out. I am only a playground economist.Regrettably,
Billy Joe Mills
Labels: Billy Joe Mills, economics, New York Times
Obviously I can't speak for Paul Krugman, but I'd say a couple of things:
(1) What Krugman said regarding the employment-population ratio was, "The official unemployment rate has been a deceptive indicator; the employment-population ratio has been a much better guide to how the economy feels." And he said this in a post that was exactly two sentences long. In any event, it doesn't seem to me that Krugman is arguing that either figure paints a complete picture, nor does it seem that Krugman is saying this is the figure that we should always and forever look to. Instead, it seems like he's saying that relative to the unemployment rate, the employment-population ratio has been a better guide in recent years.
Now, not being an economist, I have no idea whether that's true or not. It seems like it easily could be, and it certainly seems like the fundamental point that the unemployment rate gets a lot more attention than it deserves is a solid point to be making. But in any case he doesn't seem to be expressing the kind of outright misleading, disingenuous argument that you are imputing to him.
(2) You seem to be making the same mistake when you talk about his post showing the employment-population ratio. You attribute to him the motive of getting his readers to "think that the current ratio is at a historic low." That doesn't seem to have been his goal at all. In fact, he states pretty explicitly what his goal is in the very post: "What it shows is that the 'Bush Boom' was really fairly pitiful compared with the boom under Clinton, both in magnitude and in duration." He is fairly explicitly not taking a broad historical view but rather comparing the Bush years to the Clinton years. Again, I'm not economist, so the point he's making may be fair or not, but it's pretty clear he's just not making the argument you say he's making.
(3) Your insistence on looking at longer term trends seems fairly misleading. I have no trouble believing that the American economy, in the long view, has been consistently improving. But it seems like more conservative economists have a habit of making that point in order to obfuscate the more specific point that President Bush's management of the economy has not been very good. I would think that assessing Bush's performance would require looking at more recent economic history rather than looking at how things are now as compared to 1945.
Now, I think your preference for taking a more long-term view of economic history might be a good argument against people who want to say that the sky is falling down in economic terms, and I would grant that liberals in the Bush years have been eager to make that unfair argument. But that doesn't mean that a fair argument can't be made that Bush isn't doing as good a job as he could be doing in economic terms, and that a lot of liberal policy proposals would help the economy to do better than it is currently doing.
And just to emphasize my second point, the TITLE of his post was "Employment: A Tale of Two Administrations." Not a tale of how the employment-population ratio is at a historic low, but a tale of two administrations.
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While Prof. Krugman is undoubtedly a fantastic scholar, it seems that he sometimes compromises scholarly thoroughness and restraint in order to lend support to liberal arguments. In other words, he's a bit of a hack.
I don't know if Billy is right, but kudos to Billy for investigating something he found not quite right. As a public intellectual, Krugman is not above criticism, even from those outside the field.
I'm also not sure if Krugman is misrepresenting information and statistics, but I've noticed this type of thing about a lot of economists who write opinion pieces. For example, I've often seen Thomas Sowell beat the "Tax cuts were responsible for increased government revenues" drum. Haha, and obviously this type of obfuscation isn't unique to economists.
I strongly second Billy's earlier recommendation to read Mankiw's blog. He's always intellectually honest and his posts are usually fairly accessible to those both with and without an economics background. He also occasionally provides fun and useful thought exercises.