Noah Smith:
Noahpinion: Public perceptions of freshwater macro: CATO scholar and Forbes writer Timothy B. Lee is hardly what you'd call a liberal. Nevertheless, he's written a scathing column on conservatives' "Reality Problem". He mentions Nate Silver denialism, climate change denialism, and evolution denialism, but this part especially caught my eye:
On macroeconomics, a broad spectrum of economists, ranging from John Maynard Keynes to Milton Friedman, supports the basic premise that recessions are caused by shortfalls in aggregate demand. Economists across the political spectrum agree that the government ought to take action…. But rather than engaging this debate, a growing number of conservatives have rejected the mainstream economic framework altogether, arguing--against the views of libertarian economists like Friedman and F.A. Hayek--that neither Congress nor the Fed has a responsibility to counteract sharp falls in nominal incomes….
This is a point of view I hear expressed more and more frequently, not just in liberal circles, but in libertarian ones as well. It is an accusation that I myself have been unwilling to make, though I don't rule it out either. If this is becoming the conventional wisdom, it represents serious trouble for freshwater macro…. [F]reshwater macroeconomists have not gone out of their way to eschew political motivations. Casey Mulligan, a well-known labor economist who claims that government benefits caused the slump, entitled his book "The Redistribution Recession" - an obvious jab at liberals. Conservatives who cite "policy uncertainty" as the root of our woes routinely fail to identify the Debt Ceiling Standoff of 2011 as the high point of uncertainty (as serious scholarly analysis suggests), instead focusing on supposed anticipation of socialist redistribution…. And freshwater economists confronted with the question of "Why did the financial crisis of 2008 occur?" routinely state--in the absence of evidence--that the root cause was government policy encouraging lending to poor people. All of this does not look good...
