Sen. Menendez: Thank God We Don’t Have Economists Making Public Policy

May 6, 2008

Huffington Post has posted a video clip of Sen. Menendez being interviewed on MSNBC, in which he says: “You know, thank God that we don’t have economists making necessarily public policy, because they don’t really feel the pains of average Americans.”

What if economists did make public policy? You wouldn’t see policy proposals like Sen. Clinton’s gas tax holiday that may be well-intentioned but won’t work to benefit consumers. And you wouldn’t see stupid tax proposals like those that have come from Sen. Menendez’s office over the past few years.

Menendez illustrates the fundamental reason that economics is the dismal science: Economists will tell you both the good and the bad when you only want to hear the good. It’s also funny to hear, Menendez, a man who was appointed senator by the New Jersey political machine, and who’s been on Capitol Hill for the last sixteen years, claim that economists don’t care about average Americans. Such a statement shows his complete ignorance of the profession.

Even if you took the liberal position and equated care for working class people with support for government polices that are designed to care for them, you’d find economists lining up on the liberal side far more than the general public.

If you asked a random poll of economists whether they support greater spending on anti-poverty programs, you’d likely see greater support amongst (heartless) economists for such a policy than the general public. But they would also tell you which anti-poverty program would be more efficient than the other.

If you asked a random poll of economists whether they support a progressive tax structure, they’d tell you yes. But they’d also tell you how to achieve it in a way that would have minimal adverse economic harm (broad base, lower rates).

If you asked a random poll of economists whether they support higher taxes to combat global warming, they’d overwhelmingly say yes. But they’d also tell you that a carbon tax is better than just arbitrary pollution restrictions.

Mark Thoma of the always thought-provoking Economist’s View blog has more as he compares the gas tax holiday rhetoric with the “tax cuts pay for themselves” view that he argues comes largely from “economists” in Washington think tanks, although I hope he’s not painting us all with a broad brush.

(Also, check out this blog post on Thoma’s website discussing the role that the favorable tax treatment of housing played in the housing bubble. But it was written by an economist who according to Sen. Menendez obviously doesn’t care about average Americans pursuing the American dream of home ownership.)

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