[lbo-talk] neocon economists

Max B. Sawicky sawicky at bellatlantic.net
Sun Apr 20 13:21:37 PDT 2003


In my experience the neo- paleo- and other-con distinctions are foreign to most economists' thinking. You don't get points in econ departments for following the New Republic.

The first point to reckon with is that the dominant American keynesians of the 1950s had departed significantly from what Keynes actually wrote. The real heirs in that sense are the post-keynesians typified by Paul Davidson. Whether they are right or not is separate from whether they are more consistent with Keynes himself. I like what I've seen of them but I can't say I've taken the time to go into it very deeply.

Market skepticism typified by Samuelson and the American Keynesians in the 1950s and 60s seems to have been shaken first by Friedman's recognition of the floating Phillips curve in the 1970s, and second my macro mismanagement in the 70s. So as far as fiscal policy goes, the profession was shifting in an anti-activist direction.

On the micro side, recognition of market failure came to be matched by recognition of government failure. Of course, you still have your choice of failures and choosing market failure is not a neutral decision. Again, the main implication is anti-activist. You end up with most economists acquiescing to the current size of civilian government, which is well below that of all other advanced industrial countries.

In this context, public choice is a bit of a chicken-egg issue. In principle, there is nothing wrong with analyzing the material basis for decisions by government bureaucrats, politicians, and voters. Marxists do that too. Obviously it's all in the way you do it. Some public choicers are not right-wing, including Mancur Olson and Dennis Mueller (both professors of mine), though the right-wing (really libertarian) dominance is real enough.

The more typical approach prior to public choice was to model government decisions as if they aimed to achieve some kind of efficient or welfare optimum. It's fine to derive that as some kind of policy ideal, but not smart to use it as a basis for analyzing actual behavior.

I'd say the dominant mood among economists is skepticism about activism. By contrast, we might note, the political neo-cons have a boundless optimism about the powers of a government striving for national greatness.

Among economists, the dominant trend is hostility to deficits, spending increases, and tax cuts. The minority deficit-symp view, in great part an artifact of one's interest in employment with the Bush Administration, happens to overlap with the neo-cons political opportunism. But this is a minority view.

So the neo-con label generally doesn't fit the way any economists do economics.

I can't think of any paleo-con economists, except maybe Paul Craig Roberts. He seems to be a free-trader, and is paleo-con by virtue of his adherence to nutty racial ideas (see VDARE.COM).

mbs



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