When Economic Advisors Stop Caring About Honesty, Accuracy, or Credibility
The current administration's economic advisors are truly fascinating, but in the worst possible way. Notably, however, they were for the most part highly educated at elite institutions (horrors!) and would seem at least superficially to have expertise in the subjects on which they are working. This makes them unlike many of the other political appointees in the executive branch, which has been filled with obviously unqualified charlatans and cranks -- think Health and Human Services, the FBI, Homeland Security, and so forth.
Very much like their laughably ill-equipped colleagues, however, the top economists are cringe-inducingly willing to say and do anything to please the big boss, including things that are not even necessary to defend his bad decisions. I will get into some details momentarily, but this makes the economists more like the Marco Rubio types in the administration -- not exactly the same, however, because Rubio has never demonstrated any true expertise or insights of any kind and lacks any serious credentials. He did, however, at least seem to have a point of view that was reasonably well formed and was based largely on what he had done during his decade-plus in the Senate. Yet he, too, gleefully joins in on atrocious behavior that shocks even people who had a low opinion of him.
In the abstract, of course, people who are part of a group have to do some amount of adjusting their own views to the marching orders coming from the top, which requires people to be reasonably flexible about adapting to decisions with which they might personally disagree. I recall talking to an economist who had served as a Deputy or Assistant something in the Treasury Department in the Clinton Administration, and he recounted having lost an internal argument about a policy that was essentially a giveaway (specifically a tax incentive that would shovel money to people who were already doing the thing that the incentive was supposed to induce). Even so, he said, it was obviously not his place to go on TV to air his disagreement or to talk trash to reporters. The policy mistake was not so serious that it would cause him to resign over principle, so he sucked it up and defended the decision as well as possible.
Not to pound the point home too many times, but I can add that my many years in academia I saw plenty of instances in which faculty members passionately disagreed about various decisions that had been made by their deans and colleagues but were expected to accept defeat and then fall in line. Hiring decisions can be very contentious, for example, but it was quite rightly considered unacceptable for a dissenter then to go to the potential hiree and try to get them to reject the offer. That was unfortunately not completely unheard of, but it is a sign of fairly good institutional health that it was very rare, and people generally did not go rogue whenever they disagreed with the group's decisions. Again, resigning over principle is always an option for those who truly believe that something has gone horribly wrong in their organizations.
Having said that, there is of course no reason why anyone needs to go outside their lane to say or do things that make no sense, especially in service to a mad king. The prime example of this extremism is Donald Trump's top trade economist, a man named Peter Navarro who holds a Ph.D. from MIT's top-2-ranked economics department. It is true that his dissertation work was not in international trade, but industrial organization is a closely-enough allied field to count as relevant expertise. Even so, Navarro's career saw him become a man on an island, one of the only people with such credentials who became an avid anti-trader (or whatever one would call his variant on mindless protectionism).
In that regard, Navarro is not a Rubio type (or a J.D. Vance type) who simply changed his views to get into a position of power for its own sake. Navarro seems sincerely to believe the crazy things he says, which has caused him to ruin everyone's day when the rest of the world had to agree with Elon Musk about something. The co-President recently called Navarro "truly a moron" and "dumber than a sack of bricks" when it comes to tariffs, which seemed just about right. (And some Dorf on Law readers might recall that I am probably the economist who would be the most likely to have some sympathy for unorthodox views on trade.)
It should go without saying that being "a good soldier" to a president does not require a person to commit a crime in order to keep him in office, yet apparently Navarro never received that memo. Navarro, moreover, did not limit himself to being in contempt of Congress (the criminal charge that resulted in his 4-month prison term). More significantly, he was the guy behind what he publicly called (in a book, mind you) "the Green Bay sweep," which was essentially a confession that he was behind Trump's coup attempt in 2020-21.
Again, that is not merely being a loyal public servant who keeps his own expert views to himself to allow the administration to stay on message. This had nothing to do with his expertise at all, and it amounted to blind loyalty to an individual that superseded all else. Navarro is extreme, but he is not alone.
Less extreme but still puzzling is the current director of the National Economic Council, Kevin Hassett. Like Navarro, Hassett brings the academic goods, having earned his Ph.D. in economics from a top-ish department, and he had a fairly orthodox career path early on in various economics departments and merit-based policy positions before going into the right-wing think tank world. Hassett's name has come up on Dorf on Law before, including my column about his red-baiting-with-a-smile attack on Thomas Piketty in 2014, his equating of Elizabeth Warren and Bernie Sanders to Joseph Stalin and Fidel Castro in 2018, and perhaps most notably his interventions during the pandemic, when he claimed to have come up with a much-derided "cubic model" that predicted that Covid deaths would go essentially to zero by May 15, 2020.
(Note: In the Dorf on Law column linked under the word "interventions" in the previous sentence, I note that I have had professional interactions over the years with Hassett, starting when we overlapped on the parliamentary debate circuit and continuing into the 2000's. I note that here simply as a disclaimer, not to say that I have any unique insights into his thinking beyond what we can all observe in public.)
One might have imagined that Hassett would follow the example of so many of his right-wing economist friends, who either refused to serve in the first Trump administration or have distanced themselves since then. For example, the "charlatans and cranks" line that I quoted above is from Harvard's Greg Mankiw, who was an economic advisor in George W. Bush's administration and then Mitt Romney's 2012 campaign but who declared himself "no longer a Republican" in 2019 because of Trump. There is no expectation that these guys will be willing to work for this White House.
But Hassett is back, and even more than in 2020, he is swerving into oncoming traffic to demonstrate his fealty to Trump. Consider this from a recent Washington Post news article: "Trump economic adviser Kevin Hassett has told colleagues that the president thinks about the U.S. economy like 'one of his own children that he’s immensely protective and proud of.'"
What? Even if one of the running jokes about Trump were not about his terrible parenting, this would be weird. After I recited that quote to a friend the other day, they responded: "Why would anyone say that we can trust Trump on the economy because he has a special emotional connection that gives him pride? Presidents are supposed to care about the economy because that is the job, not because he happens to liken it to an (in this case nonexistent) personal emotion." At least Hassett is not jumping back into epidemiology and is nominally talking about the economy, but assurances based on Hassett's surely speculative claims about Trump's personal psychology are not Hassett's job nor part of his expertise.
Even when he does stay on topic, however, the hits keep coming. Hassett recently decided to defend Trump by confidently asserting that uncertainty is good for the economy, which is not only absurd on its face but was backed up by nothing. Well, not nothing. Navarro's citation years ago of an "expert" named Ron Vara (an anagram of Navarro) was rightly mocked, but Hassett is adept at the nearly equivalent version of "doing his own research." (That is what the "cubic model" of Covid deaths was, for example.)
In an embarrassing softball interview on CNBC recently, Hassett cited himself and a co-author of a non-peer-reviewed paper to defend Trump. Oddly, however, he cited the paper for the idea that businesses do not like uncertainty ("basically what happens is when there's a lot of uncertainty, people who have big projects, like you gotta nail down a new factory or something, tend to wait for the uncertainty to be resolved") but then said this: "But what I'm seeing in the jobs number, for example, is that the uncertainty is actually creating jobs in the U.S. Right now, we just saw 10,000 manufacturing jobs created in the U.S., 9,000 auto jobs."
Note that he did not say that (a very small number of) new manufacturing jobs has been created in spite of the uncertainty, nor did he even say that new jobs and uncertainty have recently (and very briefly) been correlated. No, "the uncertainty is actually creating jobs." My research assistant found the Hassett-Jensen paper (from 2010) and found no hits with a ctrl-f for "uncertainty," while another paper with a different coauthor deals only with an arcane (and for present purposes irrelevant) type of uncertainty in betting markets.
Importantly, Hassett's confident assertion of cause and effect is much more extreme even than the Trump team's general talking point about "taking medicine" or "long-term gain for short-term pain." Without bothering even to sketch out a new version of his "cubic model" or inventing some other seat-of-the-pants statistical illusion, the argument is that the medicine is already working. Why? Because the economy still managed to create some jobs. More jobs are good, but this is seriously hackish stuff.
I mentioned above that I have met Hassett, and I can honestly say that he has been pleasant to talk with on the one or two occasions that I recall doing so. His appearances as a Trump spokesmen show him to be a genial guy, and interviewers surely appreciate that demeanor in contrast to Trump's (and Press Secretary Karoline Leavitt's) nonstop contempt. But although short of Navarro's level of commitment, this is not the usual "good teammate" stuff of government officials. It is saying anything, anything at all to support whatever the President does. This will provide job security, at least, in a city where so many people can no longer count on being employed from from day to the next. But is the cringe worth it?
--Neil H. Buchanan