Tuesday, August 20, 2024

Greg Mankiw's Two Hypotheses

In the first part of his post he rightly skewers the awful Harris "price gouging" plan and then offers two hypotheses.

One is that the Harris campaign believes that the remaining persuadable swing voters are economically ignorant, so the campaign is offering them economically ignorant economic policies. Bryan Caplan's wonderful book The Myth of the Rational Voter documents a lot of mistaken beliefs among the general public, including an anti-market bias. Ms. Harris's political advisers may be steering her to pander to these mistaken beliefs,

A second hypothesis involves campaign personnel. The people I see mentioned as Harris economic advisers are Brian Deese, Gene Sperling, Mike Pyle, Deanne Millison, and Brian Nelson. All smart people, no doubt. But as far as I know, none of these people is trained as a PhD economist. They all seem to be lawyers. Maybe lawyers are more inclined to see a problem and think, "I know what new law will fix that." True economists are more respectful of the invisible hand and more worried about the unintended consequences of heavy-handed regulation.


Allow me to offer a third hypothesis:  Harris is herself, economically ignorant.  She either never took a basic econ course or took a course and didn't understand it or dismissed it as BS.  In her mind, the law of supply and demand might as well not exist.  
Surely she has some people who have a rudimentary grasp of economics, that they can't get through to her says either a lot about who she surrounds herself with or about her ability to be open to new (to her) ideas.  Neither of these options are acceptable in an executive of any kind, let alone the US President.

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