Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Delusions of Competence Business Leaders Don't Necessarily Understand the Economy

Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Delusions of Competence Business Leaders Don't Necessarily Understand the Economy

Article excerpt

Several recent polls showed Donald Trump favored over Hillary Clinton when it comes to managing the economy. This is remarkable given the incoherence and wild irresponsibility of Mr. Trump's policy pronouncements.

Voters apparently see Mr. Trump as a hugely successful businessman and believe that business success translates into economic expertise. They are probably wrong about the first and definitely are wrong about the second: Even brilliant businesspeople are often clueless about economic policy.

One of the many peculiar things about Mr. Trump's run for the White House is that it rests heavily on his claims of being a masterful businessman, yet it's far from clear how good he really is at the "art of the deal." Independent estimates suggest he's much less wealthy than he says and probably has much lower income than he claims, too. But since he has broken with all precedents by refusing to release his tax returns, it's impossible to resolve such disputes.

Remember, too, that Trump is a clear case of someone born on third base who imagines that he hit a triple: He inherited a fortune, and it's far from clear that he has expanded that fortune any more than he would have if he had simply parked the money in an index fund.

But leave questions about Mr. Trump's business acumen aside. Does business success carry with it the knowledge and instincts needed to make good economic policy? No.

True, the historical record isn't much of a guide, since only one modern president had a previous successful career in business. And maybe Herbert Hoover was an outlier.

But while we haven't had many business leaders in the White House, we do know what kind of advice prominent businessmen give on economic policy. And it's often startlingly bad, for two reasons. One is that wealthy, powerful people sometimes don't know what they don't know - and who's going to tell them? …

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