Scientism and the Great Power Nexus
Borders, Max, Freeman
President Obama wants to create jobs. His political life depends on it. So the President recently used the bully pulpit to propose a "jobs" bill that would include heavy spending on infrastructure. Journalists wanted to know what the bill would do. They turned to economists.
These experts, armed with the most sophisticated methods available, gave the journalists what they needed. In turn the journalists - armed with what they uncritically accepted as good information - returned with coffee to their keyboards and reported.
Mark Zandi, chief economist at Moody's Analytics, is frequently the go-to guy for both parties when it comes to analysis of various jobs proposals. So, what did he think of President Obama 's speech last night? Here's the report: "The plan would add 2 percentage points to GDP growth next year, add 1.9 million jobs, and cut the unemployment rate by a percentage point." [Brad Plummer, "Ezra Klein's Wonkblog," Washington Post, September 9.]
And who are the willing consumers of this information? People looking for reasons to be hopeful. People looking for certainty. Who can blame them? Times are tough.
But this sort of reporting is just scientism on display. I'm not alone in thinking this. Economist Russ Roberts, reacting to similar reporting in the Financial Times, wrote at Cafe Hayek (September 13): "Really? That's what they found? [The journalist] treats it like a discovery of fact. As in '[Alan] Blinder and Zandi weren't sure of the distance between the earth and the sun but when they measured it, they found it was about 93,000,000 miles.'" (tinyurl.com/5sq44ua)
Roberts knows economists aren't capable of auguring such things. Because when it comes to national-level prediction and forecast, economics has all the reliability of a Farmer's Almanac. And that's being charitable.
Certainty for Sale
Here's the problem: People like Mark Zandi belong to a great power nexus that relies on scientism for its very existence. To repeat: People crave certainty. Politicians crave power. So the latter have to provide the former with at least the illusion of certainty to stay in office. But they can't do it alone.
Economists - especially those who tend to get tapped by the media or by Washington elites - are the ones willing to strut around on the national stage showing their predictive plumage. Journalists, no experts themselves, report what they're told. (And few try to spot the turkey behind all that peacocking.)
But as readers of this publication know, a nexus of politicians, economists, journalists, special interests, and a desperate lay public can hardly be virtuous. This industry enables peddlers of scientism to hock their wares in a world full of uncertainty. Indeed, a pseudocertainty creates the circumstances under which great wishes can father great lies.
F. A. Hayek warned us about this, of course, when he said, "It seems to me that this failure of the economists to guide policy more successfully is closely connected with their propensity to imitate as closely as possible the procedures of the brilliantly successful physical sciences - an attempt which in our field may lead to outright error. It is an approach which has come to be described as the "scientistic" attitude. . . ."
Since Hayek, a growing movement of great minds, across disciplines, warns us to clip our wax wings.
In 1961 Edward Lorenz discovered the "butterfly effect." Ironically, when he figured out that tiny changes in initial conditions could mean seismic shifts in the rest of a system, he was studying weather and climate. I won't discuss the irony here. Suffice it to say Lorenz is the one who taught us that complex systems - whether the climate, an ecosystem, or an economy - can also be chaotic systems. "I realized," said Lorenz of his thenobscure finding, "that any physical system that behaved nonperiodically would be unpredictable. …