Beware the derp peddlers who keep saying the same wrong thing

Inflation derp has become more or less a required position among Republicans

It’s an article of faith on the right that any attempt by the government to fight unemployment must lead to disaster, so the faithful must keep predicting disaster no matter how often it fails to materialise

It’s an article of faith on the right that any attempt by the government to fight unemployment must lead to disaster, so the faithful must keep predicting disaster no matter how often it fails to materialise

 

When it comes to economics – and other subjects, but I’ll focus on what I know best – we live in an age of “derp” and cheap cynicism. And there are powerful forces behind both tendencies. But those forces can be fought, and the place to start fighting is within yourself.

What am I talking about here? “Derp” is a term borrowed from the cartoon South Park that has achieved wide currency among people I talk to, because it is useful shorthand for an all-too-obvious feature of the modern intellectual landscape – people who keep saying the same thing no matter how much evidence accumulates that it’s completely wrong.

The quintessential example is fear-mongering over inflation. It was, perhaps, forgivable for economists, pundits and politicians to warn about runaway inflation some years ago, when the Federal Reserve was just beginning its efforts to help a depressed economy. After all, everyone makes bad predictions now and then.

But making the same wrong prediction year after year, never acknowledging past errors or considering the possibility that you have the wrong model of how the economy works – well, that’s derp.

And there’s a lot of derp out there. Inflation derp, in particular, has become more or less a required position among Republicans. Even economists with solid reputations, whose professional work should have made them sceptical of inflation hysteria, have spent years echoing the paranoia of the goldbugs. And that tells you why derp abides: it’s basically political.

It’s an article of faith on the right that any attempt by the government to fight unemployment must lead to disaster, so the faithful must keep predicting disaster no matter how often it fails to materialise.

Cheap cynicism

True, the peddlers of politically inspired derp are quick to accuse others of the same sin. For example, right at the beginning of the Obama administration, Robert Lucas, a Nobel laureate at the University of Chicago, accused Christina Romer, the administration’s chief economist, of intellectual fraud. Her analysis of fiscal policy, he declared, was just “a very naked rationalisation for policies that were already, you know, decided on for other reasons”.

In general, anyone practising some kind of Keynesian economics – an approach that, among other things, correctly predicted quiescent inflation and interest rates – is constantly accused of just looking for reasons to expand government.

But derp isn’t universal. There’s also plenty of genuine, honest analysis out there, and you don’t have to be a technical expert to tell the difference.

I’ve already mentioned one telltale sign of derp: predictions that just keep being repeated no matter how wrong they’ve been in the past. Another sign is the never-changing policy prescription, like the assertion that slashing tax rates on the wealthy, which you advocate all the time, just so happens to also be the perfect response to a financial crisis nobody expected.

Yet another is a call for long-term responses to short-term events – for example, a permanent downsizing of government in response to a recession.

And here’s the thing: if you look at what Romer and many other Keynesians had to say, none of those telltale signs were present. They advocated deficit spending as a response to a severe downturn, not a universal elixir, and the measures they called for, such as infrastructure spending and budget aid to state governments, were designed to be temporary rather than a permanent expansion (and the 2009 stimulus did, in fact, fade away on schedule.)

Derpitude

Thus, if you’re a conservative opposed to a stronger safety net, you should be extra sceptical about claims that health reform is about to crash and burn, especially coming from people who made the same prediction last year and the year before (Obamacare derp runs almost as deep as inflation derp).

But if you’re a liberal who believes that we should reduce inequality, you should similarly be cautious about studies purporting to show that inequality is responsible for many of our economic ills, from slow growth to financial instability. Those studies might be correct – the fact is that there’s less derp on America’s left than there is on the right – but you nonetheless need to fight the temptation to let political convenience dictate your beliefs.

Fighting the derp can be hard, not least because it can upset friends who want to be reassured in their beliefs. But you should do it anyway: it’s your civic duty. – Copyright New York Times 2015

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
GO BACK
Error Image
The account details entered are not currently associated with an Irish Times subscription. Please subscribe to sign in to comment.
Comment Sign In

Forgot password?
The Irish Times Logo
Thank you
You should receive instructions for resetting your password. When you have reset your password, you can Sign In.
The Irish Times Logo
Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.
Screen Name Selection

Hello

Please choose a screen name. This name will appear beside any comments you post. Your screen name should follow the standards set out in our community standards.

The Irish Times Logo
Commenting on The Irish Times has changed. To comment you must now be an Irish Times subscriber.
SUBSCRIBE
Forgot Password
Please enter your email address so we can send you a link to reset your password.

Sign In

Your Comments
We reserve the right to remove any content at any time from this Community, including without limitation if it violates the Community Standards. We ask that you report content that you in good faith believe violates the above rules by clicking the Flag link next to the offending comment or by filling out this form. New comments are only accepted for 3 days from the date of publication.