My apologies Tom-I still love you. However, I just think here we have what Krugman calls a teachable moment. I argued the other day that I think that when someone like Sumner knocks Prescott, it's kind of like concern trolling as it suggests that there is a lot more political daylight between the two than there is.
http://diaryofarepublicanhater.blogspot.com/2014/01/sumner-mocks-ed-prescott.html
Yet I think if you were to question both Prescott and Sumner-perhaps under oath as Chris Christie may soon be?-what you'd find is that these two gentlemen agree on almost everything at least fiscally speaking.
I'd like to see if Tom or any other Centrist defenders of Sumner would want to disagree with this claim. Again, not on monetary policy where I know there's real differences but on fiscal issues-taxes, the budget, spending, etc. Ok maybe calling Tom a defender of Sumner is a little strong but on this question at least he seems to believe Scott and not me-who believes that there is no real way to be a 'liberal Market Monetarist.'
I see that Tom's been at it again-LOL. He and Mark had their usual-onesided- mutual admiration society!
"Mark A. Sadowski, re: Prescott & Kydland & RBC: The following have to be my favorite quotes from you that you left on Nick Rowe’s blog on this subject:
“I’ve wagered my whole economic life on the defeat of RBC.”
and
“Kydland and Prescott’s work is a tough sell to me. You don’t seem to get it. As far as I’m concerned they are the dark side. I’ll combat with every ounce of energy I have into the darkest corners of hell.”
http://diaryofarepublicanhater.blogspot.com/2014/01/sumner-mocks-ed-prescott.html
Yet I think if you were to question both Prescott and Sumner-perhaps under oath as Chris Christie may soon be?-what you'd find is that these two gentlemen agree on almost everything at least fiscally speaking.
I'd like to see if Tom or any other Centrist defenders of Sumner would want to disagree with this claim. Again, not on monetary policy where I know there's real differences but on fiscal issues-taxes, the budget, spending, etc. Ok maybe calling Tom a defender of Sumner is a little strong but on this question at least he seems to believe Scott and not me-who believes that there is no real way to be a 'liberal Market Monetarist.'
I see that Tom's been at it again-LOL. He and Mark had their usual-onesided- mutual admiration society!
"Mark A. Sadowski, re: Prescott & Kydland & RBC: The following have to be my favorite quotes from you that you left on Nick Rowe’s blog on this subject:
“I’ve wagered my whole economic life on the defeat of RBC.”
and
“Kydland and Prescott’s work is a tough sell to me. You don’t seem to get it. As far as I’m concerned they are the dark side. I’ll combat with every ounce of energy I have into the darkest corners of hell.”
http://www.themoneyillusion.com/?p=26043
My trouble here is that we seem to be assuming here that there is some deep difference between RBC and Market Monetarism. I say there really isn't-they share the common aim of crushing the infamous thing, that thing being Keynesianism. Yes, I know what Mark says here. It's not so much that I'm accusing him of lying-I think he means what he wrote there. My trouble is Sumner: does he agree with Mark here? After all Sumner is the Father of MM. Sadowski is just a very feverish disciple. A founder of a school is one thing- a la Sumner. Passionate disciples are something else. If you don't get this you should read Plato's The Republic sometime.
Here's what Sumner says about RBC.
http://www.themoneyillusion.com/?p=14433
So maybe Mark has wagered his whole economic life on the defeat of RBC but Sumner has wagered his whole economic life on the victory of RBC. Again, hope you know I'm not picking on you Tom. However, this is a key issue. It's the basis of my whole argument with Sumner. If there are-really-such a thing as liberal MMers then I'm wrong. I say, there aren't appearances perhaps to the contrary.
Mike: "...but Sumner has wagered his whole economic life on the victory of RBC."
ReplyDeleteRubbish.
Short Sumner: "Business cycles are caused by fluctuations in AD caused by bad monetary policy."
Short RBC: "Business cycles are not caused by fluctuations in AD caused by bad monetary policy."
It's like saying "someone who believes that disease is caused by bad plumbing, and who has spent his whole life trying to make the plumbing good, so that it no longer causes disease, is on the same side as those who believe that disease has nothing to do with bad plumbing."
ReplyDeleteMike: you really are suffering from Sumner Derangement Syndrome.
LOL. Nick that's a good one. I would say that he had Mike Derangement Syndrome first.
DeleteDid you see the piece I linked to though? He said victory is when RBC is all that's left in the field.
I'm happy to see you still drop by though Nick
Seems to me that much of the disagreement between RBCers and Sumner is the definition of AD. They both agree that bad monetary policy is the culprit but Austrians view the CB as evil and their actions as currency manipulation which only hurts savers. Sumner views CB actions as stimulatory and the only thing that can work. They both want higher interest rates and they both want NO fiscal actions whatsoever.
ReplyDeleteThere is very little distance between them in the end. The RBCers just call Mr Norris the "Evil Chuckie" while MMers call him "Uncle Milty".
I think that they differ on monetary policy. However, monetary policy is the means.
DeleteThe end is reducing the size of govt. They agree on this. They also both see Keynes as the real enemy. Sumner has a much bigger problem with Keynes-or Krugman-than Ed Prescott or John Cochrane
Mike, I'm going to have to keep on my toes and check in with you more regularly.... I never know when I'm going to end up being your subject material. :D
ReplyDeleteI have to agree with Nick here.
Furthermore I believe that Sumner is primarily interested in seeing good monetary policy implemented. He wrote that. Maybe he was lying, but I don't have a reason to believe that. IMO his politics and fiscal concerns are secondary. They are important to him for sure, and he often inserts those concerns in his posts (in ways that makes it unclear where his monetary beliefs end and his political beliefs begin), but I really don't see a problem separating those ideas (monetary policy and politics) for any of the MM proponents in general. For example, I have no idea what many of the other MMists feel about politics. We know Sadowski votes straight Democrat (but has libertarian sympathies). Sumner was actually pretty centrist on that quiz (he shared the results) but is most likely to the right of Sadowski. How about David Glasner? David Beckworth? Nick Rowe? You have any idea how those guys might vote? I think you could even claim JP Koning has MMist sympathies: but again, I have no idea of his politics. I'd guess broadly centrist for all of them. And they all have a writing style (dog whistle free) that gives me a warm fuzzy above anything I've see from someone who goes on regular rants against "central planners," "statists," "collectivists," and "progressives" (i.e. political hacks posing as economic commentators).
Bill Woolsey and Lars Christensen I imagine are conservatives (although perhaps Lars only in a relative sense: a Danish conservative). Marcus Nunes is hard to read, but I'd guess conservative too.
Re: RBCers, when I asked Sumner just a few days ago he flat out said that Prescott was a decent economist, but a bad monetary economist. BTW, I asked him how he felt about Woodford (to get another data point), and he said (w/o qualification) that Woodford is both an excellent economist and monetary economist. Isn't he the quintessential NKer? That doesn't tell me anything about how he feels about Woodford's politics (assuming any of us know).
Regarding that last link you provided: (Sumner on Keynesians and RBC), I get a very different message that you do I guess. I don't see Sumner as taking the RBC side on things there necessarily. I think it's a more subtle message. Can you explain in detail what your interpretation of that article is?
BTW, Sadowski was slightly embarrassed about his over the top quotes about Prescott and RBC from two years ago, but only just slightly: he went on to write:
Delete"You would think after having the biggest demand side meltdown the economy’s seen in 80 years such people wouldn’t dare to trot out such crap in public anymore for fear of ridicule, but it’s like everybody’s afraid to point out that the emperor has no clothes. And this especially applies to Edward Prescott, whose whole life’s work (in my opinion) is just a long series of glorified horse manure piles (pick any paper at random).
And you can quote me on that."
He was a bit kinder to Kydland.
Mike, you may find this interesting: Vincent Cate posted a link to an article he likes on Forbes by Louis Woodhill arguing that "Keynesians" are wrong to try to justify inflation using the Philip's curve. I read the thing and found some points of contention not having to do with the Philip's curve. Woodhill is obviously a goldbug, and he uses annoying dog whistle phrases like "central planners" over and over. He also bizarrely states that NGDPLT as proposed by Sumner would be better than what we've got now, but of course not as good as the gold standard. He pans inflation targeting. I thought the article smelled funny in general... but since he mentioned Sumner by name I asked him and Sadowski about it.
ReplyDeleteThis led to a long back and forth between myself and Sadowski... and even Louis Woodhill chimed in. Sumner too. And a general comment about the gold standard by Bill Woolsey.
Sadowski pointed out that he'd had run ins with Woodhill in the past and was tired of it. Apparently he's an advocate of ABCT too.
I was happy to see that Sadowski and I were pretty much on the same page here (basically a gut check for me, since I'm not skilled at pulling up real stats... Sadowski went back to year 1200 when discussing the gold standard and some of Woodhills claims, Lol). OK, so here it is:
http://www.themoneyillusion.com/?p=26098#comment-317171
That's my original question, but the answers continue on to the bottom of the page.
Now Cullen has made Sadowski's response in to a post:
Deletehttp://pragcap.com/debunking-the-myth-that-a-gold-based-monetary-system-coincides-with-higher-growth
Actually Vincent Cate actually dropped by here at Diary recently.
Deletehttp://diaryofarepublicanhater.blogspot.com/2014/01/ludwing-von-mises-and-cause-of.html
An interesting question is why Cate finds NGDPLT better than what we have now? After all, he clearly wants a more austere monetary and fiscal politcy
"Furthermore I believe that Sumner is primarily interested in seeing good monetary policy implemented. He wrote that. Maybe he was lying, but I don't have a reason to believe that. IMO his politics and fiscal concerns are secondary. They are important to him for sure, and he often inserts those concerns in his posts (in ways that makes it unclear where his monetary beliefs end and his political beliefs begin), but I really don't see a problem separating those ideas (monetary policy and politics) for any of the MM proponents in general. For example, I have no idea what many of the other MMists feel about politics. We know Sadowski votes straight Democrat (but has libertarian sympathies). Sumner was actually pretty centrist on that quiz (he shared the results) but is most likely to the right of Sadowski. How about David Glasner? David Beckworth? Nick Rowe? You have any idea how those guys might vote?"
ReplyDeleteIn my opinion that's just it-he packages his fiscal and politics as secondary. They're nor really secondary. This has always been the hook in Monetarism going back to Friedman.
I don't think the specific politics of each person who says they're a MMer matters. I don't think the matter is settled by how each person votes-or whether they vote at all. I also think that Sumner's own politics matters more than say Sadowski as Sumner's the Alpha Market Monetarist-that is to say he's the active founder of MM whereas the other MMs have more followed him on this.
In any school it's the founder who really has the agenda not the later followers who know less about the way it really works. Think of Plato's The Republic. the Philosopher King knows all but the guardians just know what they need to know. I think that's where we disagree I don't think politics are incidiental-I think that's the lie of monetary policy, as if it isn't implicitly political by definition.
What makes monetary nonpolitical. The whole pont of Sumner is that you can't judge fiscal policy without factoring the response of monetary policy. Yet, the very idea of independent monetary policy is political. During the Eccles Mariner era the Fed wasn't 'independent' indeed it was less independent until Volcker.
However, the Fed was created by Congress, the President appoints the Fed Chairman-among other high ranking Fed positions-and the senate votes on it.
So monetary policy is totally political. Calling it independent shileds it from the democratic accountabllity it rightly should have.
The way that Sumner talks about monetary policy is totally political but I deny that monetary policy ever could be unpolitical.
' And they all have a writing style (dog whistle free) that gives me a warm fuzzy above anything I've see from someone who goes on regular rants against "central planners," "statists," "collectivists," and "progressives" (i.e. political hacks posing as economic commentators)."
ReplyDeleteThis is why Sumner is very smart as I've always said. He's not so stupid as to use such an obvious dog whistle. He doesn't say stupid things like 'all tax is thefit' but he gets to the same place the more stupid libertarians don't get us.
Again, my point can't be judged on what Nick Rowe's specific voting patterns are. The brilliance of Sumner's method is that this doesn't matter. What it comes down to is what I've always said. Sumner is very good at conning people as he doesn't make such silly comments on a superficial level.
To really judge you have to dig deeper. Sumner unlike say Ed Prescott isn't going to say something really obviously wild. This doesn't prove he isn't just as conservative. Now when I say conservative here I mean something very specific. His fiscal policy. I maintain that he probably agrees with Prescott in way over 96% on fiscal policy. He's just got much better packaging. He says some things that centrists find warm and fuzzy. He's very shrewd.
Put it this way, just because he doesn't say things that are obviously way out there doesn't mean his political and fiscal views don't matter.
I also don't buy that there is any realm of pure economics or monetary policy totally innocent of politics.
"Re: RBCers, when I asked Sumner just a few days ago he flat out said that Prescott was a decent economist, but a bad monetary economist. BTW, I asked him how he felt about Woodford (to get another data point), and he said (w/o qualification) that Woodford is both an excellent economist and monetary economist. Isn't he the quintessential NKer? That doesn't tell me anything about how he feels about Woodford's politics (assuming any of us know)."
ReplyDeleteRight-a decent economist but a terrible monetary economist. I saw that. How does that disprove my point? I said that RBCers and Monetarists-including Market Monetarists-agree on the ends-so they agree on econoimcs-but they disagree on the means-ie, monetary policy.
Monetary policy isn't the end here is what I've argued again and again, It's the means. Monetaristm just might use better means. Yet, ultimatley taking the long view I see these views as complementary on the political level.
For instance I guess you probably think they're a very wide diference between Monetarism and Austrianism right? Yet Milton Freidman and Friedridh Hayek were both very welcome and frequent guests to both Reagan and Thatcher.
http://diaryofarepublicanhater.blogspot.com/2014/01/sumner-mocks-ed-prescott.html
As I've suggested before what matters is 'who you eat lunch with' -Freidman and Hayek 'ate lunch together' neither of them did so with Keynesians. I can guarantee no Keynesian hung out with Thatcher.
Just like Prescott will eat lunch with Sumner but would never do so with Krugman. I know that Sumner praises Woodford. I've seen him do so before. I don't see this has proving anything. For one think Woodford is a 'New Keynesian' and I find many ideas of NK quite problematic.
It's the problematic part of NK-that sold out way too much to the RBCers that Sumner likes. NK until this recession agreed with Monetarists that the fiscal multiplier is zero and that there's 100% monetary offset.
Again, I just think you're looking at things on the superficial level Sumner is no doubt grateful that you and many others do. Just because he prasies someone called a 'New Keynesian' and Mark Sadowski votes Democrat this is supposed to prove that politics don't matter?
The brilliance of Sumner's theory is that none of this does matter. Sumner is playing the long game. He knows the Republican party might be in trouble. He wants his influence to extend beyond Republican Administrations. LIke in the 90s, Clinton continued Right wing policies like fiscal austerity, etc, thought that monetary policy was what mattered and that the Fed must be 'independent', etc.
Sumner wants MM to win regardless of which party is in power. What's the use of having a Democrat if we have fiscal austerity? And that's the goal of Sumner-fiscal austerity packaged in its shiny MM gloss.
"Regarding that last link you provided: (Sumner on Keynesians and RBC), I get a very different message that you do I guess. I don't see Sumner as taking the RBC side on things there necessarily. I think it's a more subtle message. Can you explain in detail what your interpretation of that article is?"
ReplyDeleteI guess I'm not as subtle as Sumner then. He must be right when he calls me a moron all the time. I guess I'll stop wriritng my blog and let geniuses like him call the shots on what our policies should be. It's not like this is a democracy.
I'd be curious to know what you thin this subtle point is. I actually did find it kind of subtle and maybe you and few others did pick it up-again, Sumner is smart, I know that.
What he's saying is that Market Monetarism will solve the business cycle so that once this happens the RBCers will be right and we can do their policies-supply side stuff: tax cuts for the rich, cutting government spending for the poor, deregulation, etc.
It's like back in 2003 when Beranke and others were declaring the business cycle over. Now Sumner is really going to end the business cycle we're supposed to believe.
ReplyDeleteMike, wow! thanks for going through all that. I want to fit this recent Sumner quote in somehow, but I haven't figured out exactly how yet, so let me just do it before I forget:
Delete"To me the only interesting question is how much more volatile is RGDP as compared to an economy where the Fed has adopted the optimal policy. That’s a pragmatic way to define the real effects of monetary policy. It’s a definition with policy implications. It tells us how much we can hope to improve things."
http://www.themoneyillusion.com/?p=26098
Doesn't that speak to your last point here? That sure doesn't sound like solving the business cycle to me, it sounds like removing what he sees as an unnecessary component of that cycle: and he says that unnecessary component isn't caused by fiscal policy, it's caused by bad monetary policy.
Also, if it puts your mind at ease any, I don't think I'm falling prey to Sumner's evil genius (but that's the genius of it, isn't it! I don't even KNOW I'm falling prey!): E.g. I don't completely buy into how he plans to implement NGDPLT. The best you could say is that I think that NGDPLT sounds promising (but it sounds plausible to me that it might require some fiscal, even if just fiscal through the Fed): and if you take him at his word, that means I'm half-way to being invited into the MM cult, ...er, I mean club! [they warned me I should always call it a club! NOT a cult... right before they issued me my purple trainer robe stained with goat's blood] :D
I'll have more later.
I left a Sumner quote that I'm sure you're familiar with at the bottom of the next post. It's really my best argument. As you point out everything else is circumstantial evidence... circumstantial evidence that Sumner is NOT an evil cult leader. :D
ReplyDelete(and if he WERE an evil cult leader, then the evidence on the next page falls apart too, obviously)
... because of course evil cult leaders think nothing of lying and misrepresenting themselves! In fact they thrive on that kind of thing!
DeleteNot necessarily thrive-maybe out of necessity. What are you getting at Tom-does know one lie and misrepresent themselves?
DeleteAgain, you've never done telemarketing for a living.
Sorry, I laid it on a bit thick w/ the cult leader stuff: obviously he's not a cult leader: nobody is in 100% agreement w/ Sumner: I've seen him have fairly sharp disagreements w/ even his closest MM buds. ... but when I read through your detailed response, I had this image of him as this highly intelligent duplicitous schemer, purposely using charm and guile to cleverly misrepresent himself for the purpose of gradually sucking naive saps, such as myself, into his right-wing ideological clutches. :D ... a "Dr. Evil" type.
ReplyDeleteI think it's pretty clear that he wants to influence policy-in a Right wing direction. I'm speaking of fiscal policy. So he does hope to change public opinion. Is this shocking? Well Tom you might lead a sheltered life. LOL
DeleteBTW, speaking of evil cult leaders, have you ever read Murray Rothbard's story of / criticism of Ayn Rand's "cult?" It's a chilling tale!... very 1984-esque: and it comes from the likes of Rothbard no less. You can find it online somewhere (I wonder if he was PO'd because he got kicked out! Lol).
ReplyDelete"when I read through your detailed response, I had this image of him as this highly intelligent duplicitous schemer, purposely using charm and guile to cleverly misrepresent himself for the purpose of gradually sucking naive saps, such as myself, into his right-wing ideological clutches. :D ... a "Dr. Evil" type."
ReplyDeleteThe trouble is Tom I do telemarketing for a living. If you saw me on the phone you'd understand why it's not so crazy to imagine that there are people who are very good at manipulating with words.
That last response was somewhat tongue in cheek. Basically, though I do think that conspiracies happen and happen everyday as well for that matter.
ReplyDeleteTelemarketing also shows that not everyone is a rational optimizer-thank God as otherwise I wouldn't get a single sale.
Anyway and Tom I hope you dont mind me using you. I mean you're a nice guy think you've made a pretty articulate point here. I just disagree and think it's a major point of contention. You're not the issue but I don think a lot of people think Sumner is a lot more benign than he is.
ReplyDeleteI mean 'using you in my posts.
ReplyDeleteMIke, no problem. I just have to check in more regularly I guess! :D
ReplyDelete