John Sutherland “splutters indignantly”:http://www.guardian.co.uk/g2/story/0,3604,1484604,00.html in _The Guardian_ that Steve Levitt’s Freakonomics, hides “hard-core Reagonism [sic] and Thatcherism” under a mask of playfulness. His evidence for this? First, that Levitt is an economist:
bq. Fun as it is to read, Levitt’s vision of the human condition is cold. The solution to every problem, whether political, moral, social or spiritual, is economics. The human animal is a rational-choice machine, driven by incentives and self-interest.
Second, that Reagan’s tax-cuts were “highly freakonomical” because they were counter-intuitive.
bq. Cut the taxes for the rich, and the poor will benefit. How? Because of trickle-down. And the government will pull in more revenue. Why? Compliance: people don’t mind paying taxes, they mind paying excessive taxes. History has proved Freaky Ron wrong on the first count and perhaps right on the second.
Now fulminating opinion-pieces should perhaps be held to a lower standard of truth than serious journalism. But even so, this is still an exceptionally silly article. First, even if Levitt’s view of the human condition is cold and based on economics, this is by no means evidence that he’s a right-wing jihadist. If Sutherland really wants to see the argument that “the solution to every problem, whether political, moral, social or spiritual, is economics” developed at length, he only needs to go back and read Marx’s _Capital_. Second, Reaganite economics didn’t have much of anything to do with the kinds of arguments that Levitt is putting forward. Indeed, in an important way, they’re antithetical to the kind of social science that Levitt is trying to do. _Contra_ Sutherland, the intellectual justification for Reagan’s tax cuts was, insofar as it was anything, the Laffer curve. To state it politely, the idea behind this curve was not driven by data. Levitt’s work, in contrast, isn’t scrawled down “on the back of a restaurant napkin”:http://www.wanniski.com/showarticle.asp?articleid=2965 ; it’s driven by what the data show. This, I suspect, is why Levitt has some harsh words for John Lott in the book – cooking your numbers is a mortal sin.
I’ve read _Freakonomics_ pretty carefully (you’ll be seeing more on this topic before the end of the week). My guess is that Levitt is somewhere to the right of the political center, but it’s only a guess. His broad political orientation is impossible to discern from his writing on economics. Sutherland’s article is completely off the mark, and is, in a certain way, anti-intellectual. He identifies a particular style of thought that he doesn’t like, and then damns it on the basis of its purported link to a right wing political agenda. And in so doing, he seems to argue that the examination of incentives and what they tell us about how to make policy is fundamentally morally problematic. That’s a far reaching claim, and, I believe, one that is deeply misconceived. Sutherland is usually a good book reviewer, but he’s gotten this one very badly wrong indeed.
(Thanks to Chris for the link).