Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control
6/29/09 11:51 AM
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Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control There are very good health economists at Harvard--Newhouse, Cutler. He doen'ty have to manufacture his opinions on health care out of faxed Republican talking points. Paul Krugman: http://delong.typepad.com/sdj/2009/06/paul-krugman-urges-greg-mankiw-to-pay-more-attention-to-quality-control.html
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Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control
6/29/09 11:51 AM
Live long and prosper: Via Andrew Gelman, Greg Mankiw describes the use of international comparisons of life expectancy as part of the argument for reform as “schlocky.” Grrr. Not many serious advocates of reform use the life expectancy differences to argue that health care is clearly better in other advanced countries than it is in the United States; when it comes to care, the general assessment seems to be that it’s comparable, with no advanced country having a clear advantage. The reform argument actually goes like this: 1. Every other advanced country has universal coverage, protecting its citizens from the financial risks of uninsurance as well as ensuring that everyone gets basic care. 2. They do this while spending far less on health care than we do. 3. Yet they don’t seem to do worse in overall health results. So Greg suggests that maybe it’s all because we have an unhealthier lifestyle — what Ezra Klein calls the well-we-eatmore-cheeseburgers argument.... [W]e’re spending 6 or 7 percent of GDP more on health care than other countries — call it a trillion dollars a year — without any clear advantage. That’s not the sort of thing you wave away with a casual suggestion that maybe we have bad habits.... [Second,] people have thought about this — and tried hard to measure it... the huge McKinsey Research Institute... tried to quantify the costs of lifestyle-related issues — and found that it didn’t explain much. Third, read Atul Gawande! Bottom line: this is the most important domestic policy issue we face. It deserves more than casual just-so stories about how the kids American health care might, despite all appearances, be alright. To me, the thing to note about the economists--the Mankiws, the Lucases, the Beckers, the Barros, and all the rest--who have pledged allegiance to the Republican Party this year is how much they hagve stopped thinking like economists. When an economist thinks about American health care, he or she begins with what we give up and what we get: we give up $1 trillion dollars in real resources a year relative to other countries, and we get... what?... not much. But this is not how Mankiw or Becker approach it. When an economist thinks about nominal demand, he or she thinks about (a) the money stock and (b) the determinants of velocity--the incentives people have to spend their money quickly or to tend to hoard it. But that is not how Lucas or Barro think when they claim that fiscal policy cannot affect nominal demand. I still remember being convinced by Rick Ericson when I had just turned 18 that thinking like an economist required that one always pay attention to three key principles: market equilibrium, individuals responding to incentives, cost-benefit tradeoffs. And I remember him convincing me that if you kept those three principles in mind always you could do a much better job in understanding the world. I thought that Chicago-School economists believed in these principles too. But someone--was it Mark Lemley?--told me more recently that intellectual principles almost always weigh much less in the balance than political allegiances. RECOMMENDED (4.91) by 6 people like you [How? ] You might like:
Health care is not a bowl of cherries (@Paul Krugman) In Praise of Good Government by Barack Hussein Obama (@this site) 2 more recommended posts » Brad DeLong on June 21, 2009 at 01:12 PM in Economics, Economics: Economists, Economics: Health, Moral Responsibility, Philosophy: Moral | Permalink TrackBack TrackBack URL for this entry: http://www.typepad.com/services/trackback/6a00e551f080038834011570466bb6970c
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Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control
6/29/09 11:51 AM
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Comments So there must be an equilibrium position of marginal value of wingnut welfare vs the marginal value of reputation. Posted by: jhe | June 21, 2009 at 01:52 PM I assume you support the democrats' health-care plans. How do you analyze the overall themes of these plans with the abovementioned framework? Given the strengthening of employer-provided health care, in addition to increased insurance subsidization, would consumers not be less incentivized to conduct cost/benefit analysis when purchasing health-care goods/services? Without the consumer doing so, what incentive is there for suppliers to do the same? Posted by: B. D. | June 21, 2009 at 02:27 PM It's astonishing. Mankiw has said almost nothing defensible in the last 5 years. How is it that he's still taken seriously by anyone? I'm a Harvard alum and I'm stunned they consider him useful to keep around. Yet another reason to abolish the tenure system. Posted by: RN | June 21, 2009 at 03:03 PM What needs to be done is price control and quality control. Posted by: AMcCain... Keynesian In Exile | June 21, 2009 at 03:15 PM Once again - how can anyone take Mankiw's blog seriously when he doesn't allow comments? He obviously doesn't want anyone to question or criticize his opinions - why take him seriously? Posted by: CBBB | June 21, 2009 at 03:19 PM So -- how about looking at the record numbers of 55+ boomers working just or mainly for healthcare, and compare and contrast to the 20 somethings and teens without jobs -- and by the way, this generation outnumbers even the boomers. Now tell me how this is sustainable without national healthcare to get the boomers to retire?? Posted by: donna | June 21, 2009 at 03:33 PM I am beyond stunned that Brad DeLong is acussing someone of being so ideological that their principles are corrupted. How could a man who regularly blogs with subject lines like "THE REPUBLICANS ARE SO VERY EVIL AND STUPID AND WICKED AND THE GOP MUST DIE OMG!!!!!!!!!!!!!!!!1111!!!1!!" have the audacity to accuse anyone of this? The irony is disgusting. Posted by: TheOctagon | June 21, 2009 at 03:33 PM I've been pretty disappointed with Mankiw after reading his blog. Its usually links to other articles or rehashing things written 20 years ago that did not withstand the test of time (wisdom?). He might post a link to a recent article on healthcare that, surprisingly, knocks down any public option. But he won't post links to the 5 articles that have substantive replies. This is not how an academic should approach a debate. Instead, we get one-sided arguments and links to ass-kissing reviews of his textbooks on Amazon. I make it a point to read his blog to know what the most popular conservative economist thinks, but rarely do I get an informed or inquisitive view on anything. Posted by: Patrick | June 21, 2009 at 03:46 PM This is Mankiw of Mankiw, Romer, and Weill (1992), right? The original shlocky piece of b.s., about which the two nicest things that can be said are (1) it has distracted Macro people for fifteen years and (2) it would have been much better if it had been Mankiw, Romer, Weill, and Thoma (or Gellman or Hamilton or Galbraith or Davidson or Greene or...). And where's the Amy Finkelstein/Kate Baicker love in that first 'graf?? Posted by: Ken Houghton | June 21, 2009 at 04:11 PM Looks like Octa is acussing him- or herself! Posted by: brosna | June 21, 2009 at 04:11 PM http://delong.typepad.com/sdj/2009/06/paul-krugman-urges-greg-mankiw-to-pay-more-attention-to-quality-control.html
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Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control
6/29/09 11:51 AM
Why are these GOP economists so anxious to "rush though" their "flawed ideas" out into the media? Why don't they take their time to fully form them, like they want the politicians to? Seems ironic, eh? Posted by: VennData | June 21, 2009 at 05:03 PM "told me more recently that intellectual principles almost always weigh much less in the balance than political allegiances." surely you should know that from self-knowledge rather than someone telling you. :-/ Posted by: kayalvizhi | June 21, 2009 at 07:55 PM Inexorable law of politics: The people who make the "people eat too many cheeseburgers" argument can invariably be counted on to oppose any public policy intended to encourage people to eat fewer cheeseburgers. Posted by: bcamarda | June 22, 2009 at 06:57 AM "I thought that Chicago-School economists believed in these principles too. But someone--was it Mark Lemley?--told me more recently that intellectual principles almost always weigh much less in the balance than political allegiances." I'm a mathematician and a statistician, not an economist. So I'm sure MY political allegiances weigh heavily in the balance when I play around in economics, because Econ is NOT my academic discipline. I probably have a better grasp on economic principles than Robert J. Samuelson does, but that's not saying much. But the thing is, Econ is SUPPOSED to be an academic discipline, which means it's supposed to be practiced with some degree of intellectual rigor by those who are academics in the field. There should be limited room for those academics to fail to apply such rigor in substantiating their public economic pronouncements without getting laughed out of the field, just as would a mathematician who publicly said kooky things about math, such as claiming that any math done with imaginary numbers was invalid. That this does not happen, that an economist's political allegiances can have such a powerful effect on his professional conclusions, suggests to me that while there undoubtedly is a true intellectual field of study at the core of economics, that a great deal of what passes for economics is unworthy of being regarded as part of a valid intellectual discipline. Posted by: low-tech cyclist | June 22, 2009 at 07:02 AM "[W]e’re spending 6 or 7 percent of GDP more on health care than other countries — call it a trillion dollars a year — without any clear advantage" The flip side of this is also disturbing. The US government already spends as much of the GDP on health care as Canada, and more than the UK, yet it only covers 27% of the population rather than 100%. See here and here So if we are taking other countries as a guide, the government already spends enough to have universal coverage, but we don't actually have universal coverage. Something else is going on, and we might want to figure out what it is. Posted by: Sebastian | June 22, 2009 at 10:18 AM This comment is also a follow-up on Sebastian's. In the US public funds pay for 60-65% of all healthcare dollars through Medicare/Medicaid, federal and state/local employee/retiree coverage and tax deductibility of employer-sponsored coverage. On the other hand, US healthcare expenditure from all financing sources constitutes about 16% of GDP and growing, whereas the highest such percentage in the EU, Canada, Japan, and Australia is 12% (in Switerland). Outcomes are lower in the US also. We have built not the best health care system but the the best economic blood sucker. Posted by: d4winds | June 22, 2009 at 11:42 AM "So there must be an equilibrium position of marginal value of wingnut welfare vs the marginal value of reputation." Posted by: jhe I've seen no evidence that acting like a right-wing partisan hack has *any* reputational costs, for elite economists. Posted by: Barry | June 22, 2009 at 03:21 PM "How could a man who regularly blogs with subject lines like "THE REPUBLICANS ARE SO VERY EVIL AND STUPID AND WICKED AND THE GOP MUST DIE OMG!!!!!!!!!!!!!!!!1111!!!1!!" have the audacity to accuse anyone of this? The irony is disgusting." Examples please. And also please explain in detail where Mr. Delong erred in his analysis of said Republicans. Thanks in advance.
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Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control
6/29/09 11:51 AM
Posted by: ed | June 22, 2009 at 03:39 PM Octagon, the difference is that Brad is showing the inadequacy of Makiw's analyses. Note also that Mankiw doesn't enable comments, whereas Brad does. Whether Brad is too bitchy in picking on Republicans is independent of his economic savvy. Turn away from the pages of mirrors and think outside the octagon. Posted by: Neil B ♪ | June 22, 2009 at 05:13 PM Reason -- logic and critical method in handling evidence -- are compelling. If you are not willing to be compelled by them, they can not be your business. The most conservative professor in whose classroom I ever sat was probably Demsetz, who, back in the day chose to be nemisis to John Kenneth Galbraith. He did not just accept the compelling nature of logic, he sharpened it like a razor and sliced and diced. He didn't repeat talking points from know-nothings, and he was rarely tendentious. He wrote the best rationalization I ever read for public utility regulation. The conduct of these fools is truly shocking to me. I don't object to partisanship, per se. Prof. DeLong, mostly applies his in good-natured fun. In the unlikely event that the Democratic Party ever gets itself well-organized enough to have a dogma, let alone a cable news network, I would expect DeLong to come up with, at least, a smart version of the dogma, if he didn't choose to dissent outright. What's shocking, really, is not that these guys choose to be conservative partisans, but that they repeat nearly mindless, faxed talking points. Aren't they supposed to come up with smart versions of conservative philosophy for the Party of Stupid? Posted by: Bruce Wilder | June 22, 2009 at 11:24 PM I don't at all understand why life expectancy would be considered a schlocky metric. We can at least do a good job of counting dead bodies, and we're pretty good at recording age at death. We're living 4% less than the Canadians -- ordinarily, I'd find that pretty disturbing. Looking at the metrics favored by Mankiw, it sounds as if he thinks that good health care has nothing to do with an ounce of prevention, and everything to do with a pound of cure. On the other hand, "an ounce of prevention" might encompass more than just medical procedures -- it might include everything from a national ban on transfats, to true regulation of tobacco as a drug, to higher gas taxes to keep people from sitting in their cars so much. Posted by: dr2chase | June 23, 2009 at 08:03 AM My ECON201 - Intro to Microecon book was by Krugman. My ECON202 - Intro to Macroecon book was by Makiw. I did better in the ECON201 class. Interesting to see them go head to head. Posted by: daenku32 | June 24, 2009 at 08:57 AM
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Paul Krugman Urges Greg Mankiw to Pay More Attention to Quality Control
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