Rhetoric and Reality and President Obama

Ok, who listened to President Obama's press conference last night discussing his first 100 days in office?  If not, track down a transcript.  First, despite the fact that the questions are scripted and it is not an open give and take forum, Obama is masterful at making one think it is an open and critical dialogue in which the best argument wins.  His rhetoric appeals to anyone who finds reasonableness a virtue --- which should be anyone.  Conservative pundits often point back to Reagan as the example of rhetorical master, but Reagan was a rhetorical master based on an ideological principle --- "Mr. Gorbachev Tear Down This Wall" or "Trust But Verify" when dealing with the "Evil Empire".  Obama is a rhetorical master for the egg-head class.  We want rigorous debate, we want all sides heard, we come at this with no ideological blinders on, but instead let good argument and evidence win the day.  We listen hard, think even harder, and make up our minds based on reason and evidence.  He uses this rhetoric so much, we believe it.  Politics not by principle nor by interest, but politics as good conversation, where good is defined by the norms of academic debate in the ideal.  It is as if the intellectual culture of the University of Chicago has come to Washington.

Second, Obama seems completely sincere in his  proclamation that he has enough on his plate dealing with two wars, a health care crisis, the need to improve education, bring us energy independence, and deal with a potential pandemic to also want take over the economy.  He told everyone last night that he would have loved nothing more than to have come into office and not had to deal with the economic crisis, but had he not dealt with it as he did, we would have faced the collapse of the entire financial system.  Government had to take over the banks and had to take over the auto-industry. But his goal, he assured us, is to return the banks and the automobile companies to the private sector as quickly as possible.  Again, the rhetoric is reasonable, but also stresses the sense of urgency and responsibility with which the actions were taken.  Perhaps the debate couldn't go on much longer because the need for action was immediate. So even a reasonable person will cut off discussion and move to act based on the best information available to him.  If he didn't act as he has these first 100 days, to the best of his knowledge we would be in a much worse situation than we are with respect to the economy.  So perhaps the University of Chicago culture cannot quite make it to Washington --- at least the arguments of Chicago economists such as Cochrane or Zingales or Mulligan or Murphy or Becker.

Third, this does raise a broader issue about the relationship between ideological blinders and pragmatic politics --- either of the interest group or debate club variety.  When I was writing my book The Political Economy of Soviet Socialism: The Formative Years, 1918-1928, I framed my contribution as bringing the economic way of thinking into a dispute among historians on whether the excesses of the War Communism period (1918-1921) were due to ideology or expediency, and whether the instability of NEP was due to the internal logic of interventionism or opportunism on the part of Stalin.  The historical narrative I presented was one in which an ideology confronts a refactory reality.  The tragedy of the Soviet Union was indeed due to an ideology, but we only come to know the "tragedy" of it because of the logic of economics that points out that this particular ideology cannot possible achieve what it sets out to achieve in this reality.  The tragedy is instead the unintended and undesirable consequence of policy steps.  But to the leaders who acted in 1917 and 1918, and in 1921, and again in 1928 (and along the way) their decisions were filtered through the ideological lens of Marxism.  There was revolutionary sincerity on the part of Lenin, Trotsky, Bukharin, Stalin, etc.  There was opportunistic politics as well, but those opportunities presented themselves precisely because the sincere belief system failed to achieve its goals and thus failure required explanation and action.  In short, ideology frames what is considered expedient. And expedience is what is considered "reasonable" in a time of crisis.

I think our current policy path proves this interaction thesis once again.  The economists who have been studying our financial mess closest to those in power are sincere when they argue that had we not acted policy wise the way we have we would have faced financial ruin as a country (and perhaps world-wide).  They sincerely believe the steps taken then and now are the only reasonable steps to deal with the crisis.  But what if they are wrong?  They are wrong, the argument goes, because their analytical frame of reference (the set of eyeglasses they are wearing to "read" the crisis) is wrong.  So rather than fixing the crisis, they in fact are creating the crisis.  Is this debate taking place vigorously inside the Obama White House?

Finally, how sincere does one believe the claim that the US government wants to return the banking system and the auto-industry to the private sector as quickly as possible really is?

Whatever doubts one might have, one must admit that to egg-heads the professorial style that Obama adopts and the ease with which he speaks to us is pretty effective that he is a man of "reason" and not ideological emotions run amock all the while his administration is engaged in a series of hyperactive ideological moves to transform the US economy.  Obama is masterful in his rhetoric, but the consequences will be devastating in reality if the mainline of economic thinking (from Adam Smith to F. A. Hayek and Milton Friedman) is the more accurate portrayal of reality.  The most ambitous ideological dreams do run afoul of a refractory reality.

Comments

[liberty]

Thank you Pete! This was the best post I have read of yours to date, I think. I can appreciate it especially, of course, because I know the NEP crisis well and because I am such a strong believer in taking lessons from the socialist experience. But I think that anyone can see that this is a great post.

[Michael Foley]

This reminds me of how Russell Roberts frequently talks about how economists operate under a philosophic bias. Because economies are so complex, it is often easy to site studies that support your view of the world, or discount studies that conflict with it.

This seems like similar theme. Obama draws reasonable and intelligent conclusions based on the lens through which he views the world. (Of course, his lens is skewed, and ours is clear!)

If we are right, and Obama leads the economy into destruction, our side will write studies demonstrating our claim, and his side will be able to discount our arguments.

I hope you are right that events vindicate Smith, Hayek, and Friedman's portayal of reality, but I'm cynical here. Wouldn't Roosevelt be viewed differently if the world works that way?

[Greg Ransom]

Philosopher Harry Frankfurt has a very serious article on what Barack Obama is good at:

http://www.gwinnettdailyonline.com/articleB5BD6D4417AF444DBD8F9770AA729B26.asp

Frankfurt explain why we are living in the age of b*llsh*t but he doesn't explain why the university educated social science and humanities "intellectual" class has such an enormous taste for b*llsh*t.

[Greg Ransom]

Pete, have you had a chance to read Obama's memoir yet?

[Greg Ransom]

Obama comes out of a left-wing cohort where "debate" wasn't part of the culture, where PC rules demanded that anyone who dissented from the intellectual consensus was excluded from the "cool club" of the left. Obama dramatizes this culture in his memoir, which people have established by interviewing those involved that much of it is made up fictionalizations of internal conflict which Obama seems to have experienced within himself.

[Greg Ransom]

At the NY Fed Geithner ignored / rejected Shiller's analysis as an official NY Fed committtee analyst telling him that a problematic bubble was growing -- then Geithner eliminated Shiller's position at the NY Fed.

These guys don't have any track record of understanding what is going on.

[Greg Ransom]

The key word here is "seems". It's been well established that Obama is a first class b*llsh*tt*r in Harry Frankfurt's sense of someone who tells people what helps him get what he wants, without any reference to how what he says relates to the true facts of the matter.

Pete writes:

"Obama seems completely sincere in his proclamation that he has enough on his plate dealing with two wars, a health care crisis, the need to improve education, bring us energy independence, and deal with a potential pandemic to also want take over the economy. He told everyone last night that he would have loved nothing more than to have come into office and not had to deal with the economic crisis, but had he not dealt with it as he did, we would have faced the collapse of the entire financial system."

[Bob Murphy]

Pete wrote:

"We want rigorous debate, we want all sides heard, we come at this with no ideological blinders on, but instead let good argument and evidence win the day. We listen hard, think even harder, and make up our minds based on reason and evidence. He uses this rhetoric so much, we believe it. [Economics] not by principle nor by interest, but [economics] as good conversation, where good is defined by the norms of academic debate in the ideal."

I just changed two key words in the quote above. That reminds me not of U of C but of someone else...

[Zac Gochenour]

Obama is a very good lawyer. The sign of a very good lawyer is someone whose rhetorical skill enables them to state their position on an issue, show a reasonable understanding of all opposing positions, then repeat his original position except this time it is framed as the reasonable conclusion based on consideration of relevant information. In fact, the only thing that has been considered is how this position advances the progressive political agenda.

Don't be fooled. The University of Chicago has not come to Washington. Its politics as usual.

[K Sralla]

Is it possible that the dark side of the force may have clouded our thinking? How would we know if the president is really the Sith Lord we have been searching for, and not mearly a misguided but well-meaning politician? Sith Lords do not usually come out and publically announce they are Sith Lords. The council needs to search its feelings (and noses).

[Greg Ransom]

Richard Epstein and other witnesses say that Obama never participated in the intellectual culture of the U. of Chicago -- he didn't go to faculty events, he didn't chat with faculty in the faculty lounge, he didn't participate in faculty debates, etc., etc.

The only university panel event I have records of that Barack Obama participated in was one on education sharing the panel with Bill Ayers, organized by Michelle Obama.

Try a Google search. That's the only one.

[Grant]

Political actions are mainly signaling, because the public has so little of a cause-and-effect understanding of policies. Obama may simply be trying to signal intellectualism and reasonableness, but I think that is better than nothing.

We signal all sorts of things we don't really feel, like altruism for strangers, or a respect for the truth over our own theories. Yet the actions taken to signal these things do in fact help strangers and advance the understanding of our universe. A rich man may not care at all about the poor, but he gives to charity for what it signals about himself.

Similarly, Obama probably only wants power; I doubt he really cares how he gets it. However, our institutions have channeled his desire for power into signaling intellectual honesty, which means he will have to, even if only to a small degree, be intellectually honest.

I think this is a step in the right direction, even if only a very small step. Democracy does work - it just doesn't work very well.

[Martin]

"he didn't go to faculty events, he didn't chat with faculty in the faculty lounge, he didn't participate in faculty debates"

Yet he still had the chutzpah to refer to himself as a world respected authority on Hayek (despite never ever publishing an article in a refereed journal) on his website.

Shocking!

[Greg Ransom]

Martin -- it ain't brag if it's true.

[Rob]

Pete,

I just came across this article about Richard Posner questioning free market capitalism in his new book. I'm a law student and greatly respect Judge Posner's opinions/economic senses -- he always seems to be on the ball. So when I hear something like this from him, it really raises a lot of questions in my head that maybe "we" are on the wrong side of the argument. Of course, I'd like to hear your take on it (either here or in a separate blog post) -- I imagine others would also find this interesting. I haven't read Posner's book yet, but I'm looking forward to it.

Here's a link:
http://www.huffingtonpost.com/2009/04/20/judge-richard-posner-disc_n_188950.html

[Current]

Have you guys read Jeffrey Friedman's paper "Popper, Weber, and Hayek: The Epistemology and Politics of Ignorance."

See
http://www.criticalreview.com/crf/jeffreyfriedman.html

It's very interesting for thinking about this sort of stuff. Though I don't agree with all of it by any stretch.

I know Pete has read it because Jeffrey gives him an acknowledgment.

[Martin]

I did not realize Obama was a world-respected authority on Hayek despite having published nothing on Hayek