Must-Read: His Latest John Cochrane Smackdown: Free-Market Ideology and the Burden of Proof: "John writes: 'My surprise in reading Noah is that he provided no alternative numbers...:
...If you don't think Free Market Nirvana will have 4% growth, at least for a decade as we remove all the level inefficiencies, how much do you think it will produce, and how solid is that evidence?...
I don't really feel I need to produce an alternative to a number that was made up as a political talking point. Why 4 percent? Why not 5? Why not 8? Why not 782 percent? Where do we get the number for how good we can expect Free Market Nirvana to be? Is it from the sum of point estimates from a bunch of different meta-analyses of research on various free-market policies? No. It was something Jeb Bush tossed out in a conference call because it was "a nice round number", after James Glassman had suggested "3 or 3.5". You want me to give you an alternative number, using the same rigorous methodology? Sure, how about 3.1. Wait, no. 3.3. There we go. 3.3 sounds good. Rolls off the tongue.
I must say, Cochrane here reminds me of one of my most favorite quotes from communist economist Paul M. Sweezy:
The publication in 1952 of Stalin's Economic Problems of Socialism in the USSR would make possible today a more satisfactory reply to Mr. Kazahaya on the law of value under socialism.... Stalin's position is that... certain features of capitalism, particularly the operation of the price mechanism in the agricultural sector of the economy, have not yet been eliminated.... I should like to amend the statement which Mr. Kazahaya criticizes, by substituting "communist" for "socialist" and "communism" or "socialism." It would then read as follows:
In the economics of a communist society the theory of planning should hold the same basic position as the theory of value in the economics of a capitalist society. Value and planning are as much opposed, and for the same reasons, as capitalism and communism.
This conveys my meaning more accurately than the original wording and is, I think entirely in accord with Stalin's view...
The point at issue was whether in a proper "socialist" economy--like the post-WWII Soviet Union claimed to be--the peasants were still enslaved to necessity in the form of the market (the "law of value") or, instead, free people collectively deciding what to produce in order to fulfill a societally-rational plan. Sweezy had been claiming that the USSR was such--and that, in this dimension at least, was a better society than the USA.
Josef Stalin says: "Not so fast! Frog, hop!"
And Sweezy hops.
Now John Cochrane is not Paul M. Sneezy. J.E.B. Bush is not J.V. Djugashvili. But J.E.B. Bush decides to trump James "Dow 36000" Glassman in optimism, says in a conference call "why not 4%?" for the target economic growth rate, and then says: "Frog, hop!"
And John Cochrane hops, as high and as fast as he can.
This is not a dignified or an appropriate position for a university professor to place himself in. The point is to speak truth to power, not power to truth.