[The following original piece was offered to NewAPPS by Joshua Broady Preiss.--ES]
Last June, George Mason economist Daniel Klein published an op-ed in the Wall Street Journal which the editors titled “Are you Smarter than a Fifth Grader.” This piece seemed designed so as to maximize self-congratulatory high-fives from WSJ readers who always knew that those silly liberals were ignorant about real world economics. Recently, Klein has published a retraction, of sorts, in The Atlantic. It turns out that, with a similarly worded survey, self-identified “libertarians” and “conservatives” would give equally unenlightened answers.Unfortunately, the tone of the Atlantic piece is simply too muted (compared to the original piece), and the original article simply too terrible, for this “retraction” to be sufficient.
In the original WSJ op-ed, Klein draws upon data from a survey designed and conducted Zeljka Buturovic at Zogby International. The results, and their analysis, are presented at greater length in Econ Journal Watch (which Klein edits). Their conclusions, with respect to economic enlightenment by self-identified ideology, are that conservatives and libertarians perform the best. Trailing far behind are moderates, followed by liberals, and finally progressives. They note that “many have said that people of the left often trail behind in incorporating basic economic insight into their aesthetics, morals, and politics,” and that their findings support “Hayek’s theory…that the social-democratic ethos is an atavistic reassertion of the ethos and mentality of the primordial paleolithic band, a mentality resistant to ideas of spontaneous order and disjointed knowledge” (p. 185).
In addition, Klein and Buturovic “demonstrate” that education level seemingly makes no difference for economic enlightenment. The data, as a result, raise serious questions about economic instruction on campuses. Therefore, they suggest mandatory economics instruction. More accurately, they push for real economics instruction. They write,
“We advise students and parents to beware of economics-principles courses that either stress blackboard models divorced from judging important policy positions, or that are hostile to classical liberal thinking and values. Students and parents should understand that while academic economists are, relative to other faculty, more attuned to economic enlightened, a substantial majority vote Democratic and maintain an ideological character in line with that of most of the humanities and social-science faculty. In selecting schools and courses, students and parents need to drill down to the individual professor, and investigate his or her webpage and course syllabi.”
As many have noted, their methodology is deeply flawed. Very briefly (avoiding jargon) consider statement eight:
- Minimum wage laws raise unemployment
With respect to each statement, respondents were asked to say whether they strongly agreed, somewhat agreed, somewhat disagreed, strongly disagreed, or were not sure. What is the enlightened response to this prompt? Well, the blackboard response is that they clearly do, but this leaves out a number of relevant variables. Some argue that they do not, given coordination problems. Perhaps the enlightened response is: “sometimes, to a greater or lesser extent, based on context and best available data.” For Klein and Buturovic, the charitable conclusion is only those who answer somewhat disagree or strongly disagree are unenlightened. Notice, however, that somewhat agree is a very different sort of answer than generally true or sometimes but not as much as blackboard models indicate or the majority of economists think so.
Given this disconnect, and the complete lack of accountability for respondents who never defend or explain their answers, it is not at all surprising people would respond to prompts in ways that would fail Klein’s economic enlightenment test (perhaps imagining an interlocutor that agrees all too vigorously). From these results Klein is only justified in claiming that he used the results of a survey that was not properly designed to get him information relevant to his claims.
Klein and Buturovic acknowledge that some may take exception to “their take on the eight questions.” Perhaps the strangest of their pronouncements of economic fact follows statement six:
- Third-world workers working for American companies overseas are being exploited.
People who respond agree or strongly agree, they conclude, are economically unenlightened. Klein never justifies this claim. Claims of exploitation are clearly normative claims. According to what standard is Klein assessing the truthfulness of such claims? Living wage? Local market standard? Wages and working conditions consistent with Article 23 of the Universal Declaration of Human Rights?” Klein provides no guidance.
My best guest is that Klein thinks that because workers volunteer for such jobs, which often pay as well or better than the available alternatives, they are not exploited. How can freely chosen work be called exploitative?
This argument may resonate with some who identified themselves as libertarians for the purposes of Klein’s survey. Nonetheless, it is a very odd argument for a libertarian or classical liberal, in particular a devotee of Smith and Hayek, to make.
Not every thing we choose to do given our circumstances counts as a freely chosen in the libertarian or classical liberal sense of the term. Handing my bag over to an armed robber, for example, does not count as a free exchange for mutual benefit, simply because I can describe the exchange in voluntary terms.
As Robert Nozick (1969) argues, when assessing whether someone is making a free exchange for mutual benefit (rather than responding to a threat) we must compare their situation in the status quo to the appropriate reference situation. For classical liberals or libertarians, the appropriate reference situation is a global market with the free movement of labor. Adam Smith (1776) argues that the free movement of labor is necessary for wages to reach their natural price. Unjust restriction of movement, for example by rules of apprenticeship, the exclusive privileges of corporations, or county and national boundaries, prevents wages from reaching the natural price. It also generates greater wealth inequalities, as protected workers benefit at the expense of unprotected workers. When F.A. Hayek (1960) discusses The Constitution of Liberty nearly 200 years after Smith, he distinguishes freedom from slavery. Borrowing from the insights of cities of ancient Greece, Hayek claims that among the central rights of a free person are “ to work at whatever he desires to do” and “movement according to his own choice” (Hayek 1960, p. 70).
The separation of the supply of labor from the demand of labor greatly increases the bargaining power of capital. Using the terms provided by Smith and Hayek, it does so in such a way that threatens the central rights of workers as free persons. If citizens of poor countries were free to move to wealthy countries, it would be far more difficult for American companies to get them to agree to work for so little. Many American companies are taking advantage of what, from the libertarian perspective, is an obvious injustice, and utilizing their unjustly superior bargaining position to gain a greater share of the benefits of production. What should libertarians call this if not exploitation? It seems, then, that Klein would include Hayek, Smith, and Nozick among the economically unenlightened respondents.
Joshua Broady Preiss Department of Philosophy Program in Philosophy, Politics, and Economics (PPE) Minnesota State University Mankato, MN, USA
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