THE PROFESSORIATE FAILS US AGAIN: What made Reinhart and Rogoff tick?

THURSDAY, MAY 2, 2013

Part 3— Three unflattering portraits: Why didn’t other ranking professors check Reinhart and Rogoff’s work?

Beats us! In early 2010, the Harvard professors unveiled a study which “instantly became famous.” According to Paul Krugman, “it was, and is, surely the most influential economic analysis of recent years.”

Gack! Reinhart and Rogoff’s famous paper was widely used to promote economic austerity policies. Meanwhile, some people had doubts, right from the start, about the professors’ findings.

But doggone it! No one asked the professors to share their data until three graduate students came forward! Three years after the study appeared, it was left to three youngsters to show the world where the famous professors had erred.

Why didn’t other professors check their colleagues’ work? We have no idea. Meanwhile, we were intrigued by the ways three major pundits described Reinhart and Rogoff after the graduate students finally showed us the score.

What makes Reinhart and Rogoff tick? Let’s review three major reactions to their bungled work.

On Monday, we cited a punishing profile penned by Slate’s Matt Yglesias. In the passage which follows, Yglesias offered unlovely insinuations about Professor Rogoff:

YGLESIAS (4/26/13): [T]his isn't just some sad case of conservative politicians running around mischaracterizing a sober-minded study and then liberals overreacting in response. Ken Rogoff was writing op-eds drawing strong policy conclusions from this paper. He was delivering congressional testimony drawing strong policy conclusions from this paper. And it's not as if he's some political naif who stumbled down from the ivory tower into a partisan controversy he could never have predicted. He was research director at the International Monetary Fund and he knows how the game is played. He's signed up as a paid speaker for the Washington Speakers Bureau. His "fees vary based on event location" but they promise that in exchange for your money "Kenneth Rogoff reaches beyond the theoretical and delivers quantitative proof from his frequently cited research and best-selling book to explain why our financial history continues to repeat itself—and just where the US and global economies are heading."

But of course there is no quantitative proof. In a sense there never was, but the University of Massachusetts counter-paper helped expose how little quantitative proof was there. Now under attack Reinhart & Rogoff are retreating to much softer, much milder, much more defensible claims.

Oof! Yglesias drew an unflattering portrait, reminding us of the large rewards which can come a professor’s way if he’s willing to play along.

Presumably, Reinhart and Rogoff didn’t realize that they had made gruesome mistakes in the way they handled their data. To their credit, they released their data to those graduate students when they were finally asked.

But according to Yglesias, Rogoff was issuing public pronouncements which warmed the cockles of austerian hearts—and he stood to benefit from his advocacy. As we have long told you, the rewards are great for those who toe appropriate lines in this day and age. In Yglesias’ portrait, Rogoff jets off to fancy resorts to speak congenially for cash.

This is a very unflattering portrait—but rewards are great in the modern world for professors (and journalists) who know how to pursue them. Let's take a wild guess: This helps explain why so many journalists have failed you so badly down through so many bad years.

(Chris Matthews' salary went from $1 million to $5 million per year as he conducted his wars against both Clintons, then Gore, in service to GE's Jack Welch. We're just saying.)

Yglesias was unusually suggestive in the passage we’ve posted. Oddly, so was Ezra Klein, in a piece in which he generally tried to tamp down the criticism of the bungling professors. In an April 26 Wonkblog post, Klein attempted to make peace between various warring parties. But along the way, he offered some insinuations which resembled those made by Yglesias.

“It’s true that Reinhart and Rogoff’s initial paper was technically flawed,” Klein wrote. “And it’s also true that Reinhart and Rogoff were happy to be feted as tribunes of austerity even as their paper made more careful claims.”

In that latter characterization, Klein doesn’t allude to financial gain which may have come the professors’ way. But yikes! He does suggest that people who toe certain lines may be “feted” by powerful interests, thus becoming famous celebrities.

As is sometimes the case, Klein almost seemed to be toeing a bit of a line himself. In his full post, he tried to redirect criticism away from the famous professors and toward the Republican Party instead, noting how moderate Professor Reinhart had been in interviews with himself, Klein.

Klein seemed to play a familiar game, in which he speaks in defense of his sources. Even so, Klein seemed to suggest that the famous professors had failed to act in good faith in some very basic ways.

According to Klein, the professors’ research had been used in support of “inane” proposals. But wouldn’t you know it? The famous professors had abdent-mindedly failed to speak up about this:

KLEIN (4/26/13): The debate between most of the academic “austerians” and the “keynesians” is, in many ways, a fake debate: There’s no serious economic model in which $400 billion in stimulus spending—plus some principal reduction—over the next two years would destabilize the bond markets if it was coupled with $4 trillion in deficit reduction over the next 12 years.

Reinhart and Rogoff could have been doing much more to call out the inanity of this position, which has blocked both more short-term support for the economy and more long-term deficit reduction. That, for them, should be a lesson of this debacle: They got in bed with politicians whose policy agenda had little to do with their actual research, and so now they’re being blamed for that policy agenda.

The professors’ research was used to support “inanity,” Klein said—but the professors failed to speak up! They “could have been doing much more to call out the inanity of this position,” Klein allowed.

Klein didn’t allow himself to say that they should have done more. And as you can see, he instantly seemed to assume the basic good faith of Reinhart and Rogoff, suggesting that they will learn a good solid lesson from this unfortunate episode.

But even as he softened his blow, even Klein used unflattering language about the professors. They “got in bed with politicians whose policy agenda had little to do with their actual research,” he indelicately said.

Why did Reinhart and Rogoff do that? Klein didn’t try to say.

Yglesias floated an insinuation concerning financial gain. While attempting to make peace in the land, Klein said the bungling Bostonians “were happy to be feted” by powerful interests.

On balance, Klein suggested the bungling pair had behaved in good faith. But in an instant angry response, Paul Krugman pushed back against Klein, thus providing our third portrait of the famous professors.

“The reality is that as an economist, you’re either trying to calm deficit hysteria or you’re helping to ratchet it up,” Krugman wrote. “And [Reinhart and Rogoff] were clearly helping to ratchet up the fear.”

Oof! That wasn't flattering. As he went on, Krugman painted a highly unflattering picture of the professors’ conduct. For fuller context, you will have to read his full post. But Krugman pounded the famous professors as he pushed back at Klein’s attempt to calm the waters:

KRUGMAN (4/26/13): [Reinhart and Rogoff] were clearly helping to ratchet up the fear. If that’s not what they meant to do, well, it would have been easy for them to say, clearly, that despite the negative correlation between debt and growth they were opposed to spending cuts right now. They never did that.

This is, I’d say, part of a broader point: the responsibility of public intellectuals in general goes beyond talking about the ideal. I don’t mean that you have to draft legislation that can pass Congress, or whatever; I do mean that you need to make it clear where you stand on the actual decisions being made, as opposed to merely stating what we should do but won’t. And this is especially true when you know full well that many people are invoking your work to push for policies that look nothing like your ideal.

So yes, Ezra is right that my worldview is a lot closer to Reinhart and Rogoff’s than it is to Paul Ryan’s or Olli Rehn’s. So? [Reinhart and Rogoff] effectively lent aid and comfort to the Ryans and the Rehns, and knew that they were doing so. They need to own up to that fact.

Klein wanted all the fighting to stop. Rejecting that approach, Krugman said the professors had clearly helped to ratchet up fear; had failed to speak up as their research was misused; and had given “aid and comfort” to Paul Ryan.

Ouch! He said they gave that aid and comfort in a knowing way.

Why would major professors do that? For several years, Krugman has suggested that economics experts around the world are in the hip pocket of powerful interests, that they are discarding the basic things they know in service to preferred narratives. Did some such thing happen in this case? If so, could it be because of those speaking fees? Could it be because of the ways the two professors were “feted?”

For ourselves, we don’t know a blooming thing about Reinhart and Rogoff. We have no views about their motives. We don’t know if they even had any “motives” in this particular case.

That said, we thought these three reactions to Reinhart and Rogoff were unusually pungent. That said, the three reactions we have excerpted have been conducted on-line. In the brightest light of day, no one is going to ask these professors why they behaved as they did.

No one is going to ask if our professors, “experts” and journalists do the things they do for the money. No one will ask if they toe certain lines in pursuit of fame—because they enjoy being feted.

Beyond that, no one is going to ask why it fell to three graduate students to find the groaning errors in the famous professors’ work. If it weren’t for those graduate students, we still wouldn’t know about the ways these latest experts failed.

We’ll date our own experience with experts and journalists to 1972. In our experience, our “experts” are constantly wrong, under-informed and/or uncomprehending. If we lived in a rational world, we’d always be checking their work.

But we don’t live in that rational world. We live in a world of guilds, where made men and women are granted respect. We also live a world which offers extremely large rewards to people who agree to color within the lines preferred by powerful interests.

For years, we’ve been asking if this explains the endless pattern in which our “experts” fail us. How often do you see anyone else asking this obvious question?

Tomorrow: Professors rule! The Times rolls over and dies.