Do Economists Believe American Democracy Is Working?
Not really–so say 302 members of the American Economic Association in a survey conducted by William Davis and Bob Figgins. Their results are presented in the May issue of Econ Journal Watch. The weird upshot is that, despite being cynical about the political process and its stupendous misfires, economists suffer from a status quo bias with respect to policy proposal. Dramatic institutional reforms are rarely, if ever, considered. Given the survey results–that even economists who vote for Democrats are skeptics–the authors suggest this preference for orthodox policy proposals must come from somewhere other than a deep abiding faith in the democratic process. Explanations range from focal point bias to institutional conservatism, among others. (Folk Activism, anyone?)
Davis and Figgins write:
On every pertinent issue in the survey, a majority (again, usually a large majority) of economists who identify themselves as Democrats express what can only be described as a cynical view of the political process. This finding certainly goes against the suggestion that economists, because they are social democrats, have confidence in America’s political process to improve social welfare. An appropriate story line for describing the survey results might read as follows—
Politics in America: A place where special interest groups exert influence over politicians who use creative public discourse with economically incompetent or ignorant voters in an effort to be re-elected, and where the eventual policy consequences are often not beneficial, except to special interests and politicians.
Now Davis and Figgins conducted the survey in 2006, well before crisis, stimulus, and bailout, and yet (and yet!), even in those halcyon days of Dow 11,000, economists of all political views were not impressed with American style democracy. All agreed one bad policy follows another. One wonders how they would update their beliefs in the age of turbulence. Perhaps the more democratically minded participants would sing a more optimistic tune now that BO is in office. Who knows. But here, far away from platitudes to the wonders of democracy, I take this as evidence in favor of dramatic reform. Here, we try to cure the disease. This survey tells a strange story…It is as if doctors diagnosed a disease and then refused to offer a beneficial prescription lest they insult some sensitive soul.