Why America gave up on economists |
Key takeaways
Economists used to have a sort of special status in US policymaking; they were the consummate technocratic experts. But over the past decade, both parties have increasingly been less enamored of economists — and economic thinking in general. The reasons for this include Trump and Biden’s personalities, the rise of populist MAGA and progressive factions, plus structural changes in the economy and the information environment. The consequences: more policies that economists dislike on the merits like tariffs and price controls — and also more badly designed policies that simply haven’t taken economic analysis into account. Economists will only regain influence if political elites think they can help solve major problems, but right now they’re somewhat at a loss regarding voters’ current top concern — high prices.The US’s two major parties can agree on one thing: They don’t have much use for economists anymore.
President Joe Biden ignored economists’ warnings about the risks of inflation. President Donald Trump dismissed economists’ arguments against his tariffs. And now, rising Democrats are backing price controls, even though mainstream economists aligned with both parties say they typically backfire.
Economists’ way of thinking has fallen out of favor among the political class more broadly. The right has embraced Trump’s zero-sum worldview and lost faith in expertise generally. Many progressives have rejected economists’ fundamental focus on trade-offs and the unintended consequences of policy interventions. Both sides are down on the free market.
All this marks a major change from many previous decades of US policymaking, in which economists were viewed as having a special sort of status among experts. Believed to epitomize intelligence and technocratic competence, their recommendations were viewed as more high-minded than those from ideologues or grubby interest groups.
Economists were the gurus of growth — and while, of course, they weren’t always listened to, it was widely believed that a president who wanted a strong economy should take their counsel seriously.
Not so much anymore. Economists, Ezra Klein has written, were “simply far less influential” in the Biden administration, which turned instead to elite lawyers, activists, and the nonprofit world for expertise. And Trump isn’t particularly interested in economists’ recommendations — he has his own vision of how the economy works, and trusts it more than theirs.
The reasons economists fell off their lofty perch are in part personal: Neither Trump nor Biden enjoys highfalutin academic debates (in contrast to Obama and Clinton, who did). They’re in part coalitional: The free market GOP establishment was roiled by Trump’s rise, while Democrats accommodated a rising progressive faction who blamed neoliberalism for the disappointments of the Clinton and Obama presidencies. And the reasons may also be partly structural, connected to bigger-picture changes in the economy, politics, or the information environment.
“I tie it to the rise of populism on both the left and the right,” Greg Mankiw, a Harvard economist who advised George W. Bush’s administration, told me. “Both have a degree of skepticism toward traditional economic viewpoints from both the center-right and center-left.”
“There are certain commonalities between Biden and Trump, in their rejection of a technocratic approach that thinks seriously about tradeoffs,” said Jason Furman, a Harvard economist who advised the Clinton and Obama administrations. “I often find myself in despair about the direction.”
It isn’t surprising that economists would bemoan their own loss of influence. But the question remains: Can a political system that sidelines economists deliver a prosperous, growing economy?
So far, the results have not been promising. The public’s economic confidence turned sharply negative under Biden, as inflation wrecked his presidency and sunk his party’s 2024 chances. It’s remained quite negative after Trump’s return, turning what was his greatest political strength into his greatest weakness.
There’s another problem. Even if you think mainstream economists have gotten a lot wrong in recent decades, their basic toolkit — modeling that assesses incentives and market behavior — is highly useful if you want to design policies that will actually work. Sidelining economic analysis, in practice, means we’ll get more badly designed policies pleasing ideologues and interest groups — policies that will do little to help the American people or deliver the growth the country needs.
The world of yesterday
Economists’ influence........