Words of wisdom

by on March 31, 2009 at 2:39 pm in Political Science | Permalink

From Matt Yglesias:

The question here is what would Adam Posen have done if he had Tim
Geithner’s job? And based on Posen’s analysis, I think the only
conclusion you can reach is that he’d have done more-or-less the same
thing. Talking about a different issue last week, I heard Tyler Cowen
forcefully make the point that you have to think of the political
constraints as a real policy consideration. Suppose Geithner had asked Congress to appropriate $1 trillion to implement a program of bank
nationalization, asset writedowns, and loan guarantees–what would that
have accomplished? It certainly wouldn’t have gotten Congress to
appropriate $1 trillion to implement a program of bank nationalization,
asset writedowns, and loan guarantees. It might have derailed the
budget and thrown the political momentum on the Hill to proponents of a
neo-Hooverite spending freeze program. It might have caused panic. And
it certainly would have undermined the credibility of the inevitable
effort by Geithner to do the most he can with the authority he already
has.

One thing I like about Bryan Caplan's book is an interpretation which he will probably hate.  The truly decisive actors are people directly in the political process.  Maybe the "libertarians" who are or have been in politics are not just "sell outs."  Rather they are implementing the net-liberty-enhancing policies that a real libertarian would favor if he or she were truly a decisive agent.

Josh March 31, 2009 at 2:50 pm

Isn’t governing about leadership? Congress allocated close to $1 trillion for poorly run state governments, political priorities, and outright rewards to political supporters. Spending $1 trillion on something that would fix the problem instead would have been a much better idea.

anonymous March 31, 2009 at 3:13 pm

“The perfect is the enemy of the good.” — Voltaire

On a similar note, this is also why Krugman will never be a policymaker.

a March 31, 2009 at 3:33 pm

“To govern is to choose.”

-Nigel Lawson

“To govern is to always choose among disadvantages.”

-Charles de Gaulle

I think Yglesias and Prof. Cowen have this pretty much right.

Luis Enrique March 31, 2009 at 3:58 pm

yep – far too many econ bloggers give far too little thought to the constraints Geithner & co are acting under.

[Raivo Pommer is driving me nuts]

Patrick March 31, 2009 at 4:44 pm

Political constraints are not constant. As opinions change, so do the constraints on policy. And if you’re trying to influence opinion on policy, it seems silly to focus on political constraints.

If you’re evaluating the policymaker, yes, absolutely you should consider the political constraints they face. But if you’re evaluating the policy itself (as Posen seemed to be doing), aren’t they beside the point?

mk March 31, 2009 at 6:57 pm

Tyler, you should have titled this post “Politics compromises the progressive project.” (Or “doesn’t compromise” since that’s what you are actually saying).

babar March 31, 2009 at 8:42 pm

> Why doesn’t the government sell bailout bonds?

They are called ‘treasury bonds’.
There has been some talk about letting the Fed sell bonds as well, just so they can more easily clean up afterwards as they are printing money.

Myself, I am waiting. I want bailout equity, but not until after dilution has occurred.

C Vinson March 31, 2009 at 10:25 pm

Tyler, why do you say that Bryan Caplan would hate your interpretation? Also, it’s not quite clear to me what you’re saying: is it that libertarians who refuse to participate in government because of their principles are not as good libertarians as those who participate irregardless of their principles?

Mick April 1, 2009 at 1:41 am


Maybe the “libertarians” who are or have been in politics are not just “sell outs.” Rather they are implementing the net-liberty-enhancing policies that a real libertarian would favor if he or she were truly a decisive agent.

I wonder what a unionized state government employee like yourself knows about libertarians or liberty?

hikaye April 1, 2009 at 5:55 am

Yes thats is a good idea. Thanks a lot

Robert Capozzi April 1, 2009 at 7:05 am

TC: Rather they are implementing the net-liberty-enhancing policies that a real libertarian would favor if he or she were truly a decisive agent.

Me: Navel gazing IS an option, and might be more effective, at least for the gazer. And determining WHO the “decisive agent” is or is not is unknowable, before and sometimes after the fact. We can guess, of course. Just as we can guess about what is or is not net-liberty-enhancing.

The third option is to create constructs out of thin air, but that seems largely contra-indicated.

Since all MUST be motivated by utility maximization (even if we are often our own worst enemies), we can only conclude “it’s all good.”

P.F.C. April 1, 2009 at 6:22 pm

Not to be flip, but if Lincoln thought this way many of us would probably still be in chains.

To put it another way, while your version of realpolitik is probably the way governing must be done 99% of the time, there is a decisive 1% of the time that it’s not. There are moments in history when constraining the range of possibilities within which one is willing to compromise is a mistake, and when major shifts are possible. Now maybe we’re all apt to think we’re living in that 1% moment more often than we are, but that doesn’t mean it’s better to assume you’re never there and can only tweak the status quo.

hikaye June 16, 2009 at 2:45 pm

Duh! Working people have had to worry about not getting their pay which is
much less than a million dollars for decades. “

徵信 August 16, 2009 at 10:44 pm
dikmen bilgisayar teknik servis December 7, 2009 at 4:56 am

Yes thats is a good idea. Thanks a lot

takı July 21, 2010 at 5:56 am

Duh! Working people have had to worry about not getting their pay which is
much less than a million dollars for decades.

Str8er February 28, 2011 at 9:15 am

You have great article.I really enjoyed it.Wisdom is not something that you can get 100% out of books.I guess everybody has his qualities and those qualities may transform at some point in something that we can call wisdom.

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