200611

November 30, 2006 4:07PM

It’s Official — Economists Think Stern’s Nuts

In this month’s issue of the Economists’ Voice, Robert Whaples, chair of the economics department at Wake Forest, reports on a survey he recently conducted in which he sent questionnaires to 210 Ph.D. economists randomly selected from the American Economic Association. His charge: to find out how much disagreement there is within the profession and a number of high profile public policy issues.


What did his respondents have to say about the impact that global warming will have on the economy? 

  • 19.6% agreed with the Stern Review on the Economics of Climate Change, that is, that U.S. GDP per capita would be reduced by 5% or more by the end of the 21st century if the world did nothing to address industrial greenhouse gas emissions;
  • 35.7% believed that warming would reduce U.S. GDP by less than 1% and may even increase it up to 1%!;
  • 21.4% agreed with Yale economist William Nordhaus in that U.S. GDP losses would be somewhere between 1–5%;
  • 16.1% believed that U.S. GDP would increase by 1–5% as a consequence of warming; and
  • 7.1% though U.S. GDP would increase by more than 5% because of warming!

In short, the number of economists who thought global warming would improve the U.S. economy outnumbered the number of economists who thought that global warming would harm the economy to the extent feared by the Stern Review.


Will those who demand that we bow down to the consensus of scientific opinion likewise demand the same regarding the consensus of economic opinion? Not bloody likely.

November 30, 2006 11:53AM

If George Did It

What if journalist Seymour Hersh, former CIA agent Valerie Plame Wilson, and former vice president Al Gore were poisoned within rapid succession of one another and strong circumstantial evidence suggested that President Bush was behind all three murders? Do you think the European political class would react a bit more intensely than they have been reacting to President Putin’s recent impersonation of Tony Soprano?

November 30, 2006 10:11AM

News Roundup

  • Local police killed Sal Culosi by accident. The police union is now howling over mild discipline.
  • Federal police pay restitution to Brandon Mayfield after telling the world he was a terrorist. Taxpayers foot the bill. No mention of agents disciplined. But unspecified “reforms” are now in place at the FBI “to avoid a similar mistake in the future.” Similar assurances followed the Richard Jewell case, but that was then.
  • On the intelligence side, federal agents are fighting the Al‐​Masri case. Al‐​Masri says the CIA mistook him for a terrorist and had him “rendered” to Afghanistan, where he was imprisoned for months, abused and mistreated. When Al‐​Masri filed a civil suit against federal officials, the government’s response was that if this lawsuit were to proceed, government secrets would be revealed. This case is “developing,” as they say …
November 30, 2006 9:30AM

The Swift‐​Boating of Andrew Biggs

Anyone who thinks that Democrats might be prepared to work in a bipartisan manner to reform Social Security should be quickly disabused by their disgraceful treatment of Andrew Biggs, President Bush’s nominee to be the next deputy administrator of the Social Security Administration. Biggs, who once worked for me, is a distinguished economist and expert on Social Security, who has earned the respect of people on all sides of the Social Security debate. During the time we worked together, he proved to be a rigorous analyst, who followed the numbers wherever they led, always choosing facts over ideology. No one ever criticized his character or the quality of his research.


However, Biggs is an advocate of personal accounts. As a result, some Democrats in Congress, the New York Times, and the National Committee to Preserve Social Security and Medicare have embarked on a campaign to smear him and scuttle his nomination. Democrats appear to be saying that holding any opinion with which they disagree makes one unfit for public office. If that’s the course they plan to pursue in the next Congress, more than just hope for Social Security reform will go down the drain.

November 30, 2006 8:52AM

We Have Work To Do

At EconLog, I point to a survey of economists by Robert Whaples. It seems as though there is a professional consensus on the libertarian side of the issues of free trade, school vouchers, and marijuana legalization. They also support raising the retirement age for Social Security, which is my favorite libertarian approach on that issue.


However, on health care, Whaples reports that a plurality–almost 50 percent–support universal health insurance.


This got me thinking about what the consensus belief among economists ought to be about health care. I think it ought to be that government should stop leading people to think that prepaid health plans are health insurance.


In any case, I think more members of the American Economic Association need to read Crisis of Abundance.

November 29, 2006 4:40PM

Sen. Richard Lugar: Public Menace

Representatives of NATO are in Latvia this week to talk about the alliance. But no international gathering is safe from the careful eye of Sen. Richard Lugar (R‑IN). On the eve of the NATO meeting, Lugar gave a speech at conference sponsored by the German Marshall Fund arguing that NATO must be capable of responding if producing states use energy “as a weapon” to cut supplies to NATO members.


Now, think about this for a minute. Lugar is implying that if A decides not to sell to B, then B has the right to shoot A in the head. If A decides to sell less to B than B might like, B is apparently also justified in shooting A in the head.


Sometimes, however, military retaliation might be a bit over the top — even for Sen. Lugar. In those cases, Sen. Lugar proposes that consumers diversify their sources of supply as a preventative measure. Apparently, this would never occur to market actors. This would only occur to United States Senators.


And now, let’s toast the new Democratic majority in the Senate .…