Friday, May 27, 2005

Critiquing Krugman

There has been some chatter in the blogosphere about Daniel Okrent's parting comments about Paul Krugman during their time at the New York Times. The offending sentences are:

Op-Ed columnist Paul Krugman has the disturbing habit of shaping, slicing and selectively citing numbers in a fashion that pleases his acolytes but leaves him open to substantive assaults. ... No one deserves the personal vituperation that regularly comes Dowd's way, and some of Krugman's enemies are every bit as ideological (and consequently unfair) as he is. ... But that doesn't mean that their boss, publisher Arthur O. Sulzberger Jr., shouldn't hold his columnists to higher standards.
Some have criticized Okrent for taking the shot at Krugman without providing even a single example. (See Brad DeLong's short post, as well as his subsequent links to commentary on the Daily Howler and a sidebar on Andrew Sullivan's treatment of the issue.)

I'm not going to get into the issue of whether Okrent should have provided an example. The discussion that followed Okrent's piece might lead one to believe that there are no examples. I'll remind my readers of one that occupied our time back in October. It started with the post, "Paul Krugman, Meet Irony." The key quote (with the offending statement highlighted) from Krugman's op-ed, "Checking the Facts in Advance" is:
Mr. Bush will boast about the decline in the unemployment rate from its June 2003 peak. But the employed fraction of the population didn't rise at all; unemployment declined only because some of those without jobs stopped actively looking for work, and therefore dropped out of the unemployment statistics. The labor force participation rate - the fraction of the population either working or actively looking for work - has fallen sharply under Mr. Bush; if it had stayed at its January 2001 level, the official unemployment rate would be 7.4 percent.
As I noted in my original post and the considerable discussion that followed (here, here, here, here, and here), there are two channels that allow the unemployment rate and the labor force participation rate to fall while leaving the employment-population ratio unchanged. The first is that people who want to work give up looking for work. (This takes the same person out of both unemployment and the labor force, with no one entering or leaving employment.) The second is that people who have jobs decide they don't want them anymore (perhaps to take care of their kids or go back to school), and they get replaced by someone who was previously looking for work. (This takes one person out of employment and the labor force and another person out of unemployment and into employment. Same net effect.) The two channels have opposite implications for whether we think the statistics are bad news for the economy.

Krugman asserts--via the word "only"--that the second channel doesn't exist. In his interview with Fortune, [Ed. corrected from Forbes] Greg Mankiw succinctly summarizes why many of us are so frustrated with Krugman's writings:

Q: How do you explain what you describe as this change in Krugman?

A: I guess if you're a columnist, you want to be widely talked about and be the most e-mailed. It's the same thing that drives talk show hosts to become Jerry Springer. You end up overstating the case because it makes good reading. The problem is that economists by their nature—with a lot of "on the one hand" and "on the other hand" in their prose—can make boring reading.
Krugman had his choice of (at least) three ways to phrase his statement. He could have said "only because," "primarily because," or "in part because." These three are listed in declining order of their rhetorical effect and ascending order of the confidence with which he could make the assertion. Taking a shortcut like this is inappropriate in any publication that aspires to be good journalism.

The process that my readers and I undertook in that series of posts that followed is an example of what Sulzberger should be implementing at the New York Times--before the op-ed can go to press. Challenge every assertion of fact, provide evidence to support it, or change the language to reflect alternative explanations. If the Times won't do that, then who needs the Times?

And even if the Times won't enforce such a rule, for the life of me, I cannot figure out why Paul Krugman would rather have his marginal $100 than 10 hours of skeptical fact-checking by a smart, conservative Princeton undergraduate economics major. It would make his writing better, like it used to be.

Other comments on my posts pointed out that some of the problems with the article are inherent in the op-ed medium. For example, it took me several posts to be able to get all the facts and the rhetoric right beyond my original statement. I say again, if op-eds suffer from these problems, then who needs op-eds? Any time spent reading Krugman in search of an informed, liberal economist's point of view is time that could be better spent reading Brad DeLong's blog.

Other blogs commenting on this post


PGL said...

Let's be fair. Some of the apologists for this weak labor market (aka Bush cheerleaders) have claimed all of the decline in the labor force participation rate is from voluntary departure. While you do an impressive job of surveying the details of what the BLS reports - I think we can agree that their data is not refined enough to give a definitive answer to how much of this decline is involuntary (Krugman's position) v. voluntary. I'll concede that "only" was a bit strong, but if this is the best one can do as far as claiming Krugman somehow lies, this whole debate has become rather petty.

Andrew Samwick said...

A claim that all of the decline is from voluntary departure would be equally absurd. But why did you say "a bit," when you also say that the BLS data cannot give us a definitive answer? :-)

The purpose of the post was to give an example of what Okrent called "shaping, slicing, and selectively citing" and what Mankiw called "overstating." There is no representation on my part that this is the best or only example.

I think the attention to detail that I am asking for goes right to the heart of what should appear in a newspaper. I took up this question in a slightly different context here.

spencerengland said...

If you read the word "only" to mean "100%" I do not see any way you can claim Krugman was wrong.

I just went back and read your entire history on this and find it hard to believe you spent this much effort on the issue.

But, one final point on the unemployeed person that went back to school. Typically, it is a safe assumption to make that a person that has paid for a semester of school would not take a job if offered. Yes, it is an assumption, but unless it had evidence to show that he would take a job the BLS would treat him as an indiviual that had dropped out of the labor force.

JG said...

"I cannot figure out why Paul Krugman would rather have his marginal $100 than 10 hours of skeptical fact-checking by a smart, conservative Princeton undergraduate..."

Ten hours? Two of my favorite Krugman "facts":

1) Krugman: John McCain is "confused" or "a panderer" for supporting the right-wing Republicans' Internet Tax Freedom Act, which would exempt Amazon and other internet retailers from sales tax.

Reality: The ITFA had absolutely nothing at all to do with sales taxes (actually use taxes) as shown by its bipartisan, near-unanimous passage, with use taxes continuing to be collected just as before ever since.

2) Krugman: "the revenue that will be lost because of the Bush tax cuts ... would have been more than enough to 'top up' Social Security and Medicare, allowing them to operate without benefit cuts for the next 75 years."

GAO (.pdf): On year 2000 law, without any Bush cuts, annual deficits will reach 20% of GDP in about 40 years and government will be unsustainable*

Would it have taken 10 hours to check those facts?

And there are lot more examples than these where 5 minutes of fact checking would have been worthwhile.

* Krugman's correction: Yes, well, the numbers I cited excluded the general revenue cost of Medicare (part B) from the cost of Medicare without my saying so, which is perfectly OK, so those who brought this up "owe me an abject apology".

PGL said...

What spencer said. I'm not defending every word Krugman has written - I just think it's a shame that there is a cottage industry of those who read every word he has ever written just to jump all over him. No one can look clean under this kind of scrutiny - unless they never write a word.

PGL said...

Final note: Andrew's suggestion as to fact checking is one I actually like and wish other organizations would do the same. I say this after reading another confusing set of "data" from Lawrence Kudlow over at NRO. But then - we know the standards at NRO are the bottom of the barrel and the NYTimes needs to do far, far better than that.

Andrew Samwick said...

For Spencer: It is precisely because the word "only" does mean "100%" that Krugman is wrong when he says "only because some of those without jobs stopped actively looking for work, and therefore dropped out of the unemployment statistics."

That this is still confusing is one of the reasons why I spent so much time on it (another being that it was clear that I had a lot to learn about some of the details of different people were treated in the unemployment statistics.)

alphie said...

Some of these people probably have joined the underground economy.

Roland Patrick said...

Krugman speaks:

"...surely it's inappropriate for the public editor to attack the ethics of one of the paper's writers without providing any supporting evidence. He responded to my request for examples with criticisms of specific columns. Those criticisms were simply wrong: in each of those columns I played entirely fair with my readers, using the standard data in the standard way.

"That should be the end of the story."

Well, of course. When Paul Krugman says 'jump', we all ask, "Over which bar?".

Tom G said...

I am happy to believe that Paul Krugman occassionaly goes overboard in his passion against the Bush administration. During the Bush-Kerry race, for example, I did not find his column on trade at all even-handed.

On the other hand, here are some sample quotes from the Mankiw interview that Andrew cited:

"There are conservatives—honest conservatives—who think we need to reduce the size of government. There are honest liberals who want to raise taxes to make government bigger. And then there are people who are putting their heads in the sand who do not want to do either. It's very clear that this administration is filled with conservatives who believe in smaller government, leaner government, and the tax cuts go hand in hand with that."

He acknowledges the Bush tax cuts " requires significant spending restraint, but that's what you're seeing in the President's budget proposal."

I don't think Krugman's done anything that touches that.

I am curious how Andrew would compare the two for accuracy. Or alternatively, compare the Krugman with the Wall St. Journal editorial page.

Tom G.

Robert said...

Your "example" does not support Okrent's claim that "Op-Ed columnist Paul Krugman has the disturbing habit of shaping, slicing and selectively citing numbers in a fashion that pleases his acolytes but leaves him open to substantive assaults." The number cited in the op-ed criticized by Samwick is payroll employment, unshaped, unsliced, and selected because it is very very important.

You disagree with Krugman's interpretation of the number. Your criticism of Krugman does not support Okrent's

I can imagine no stronger evidence that Okrent is wrong and that there is, indeed, no example.

Ah also jg helps. His first example of a factual error is that Krugman says a tax on sales over the internet is a "sales tax". The semantic question is answered by a vote in congress. jg surely you must understand that a favorable vote in congress can't prove that something isn't pandering.

In the second case Krugman should have written "'top up' [the] Social Security and Medicare [trust funds]," It is obvious from the phrase "top up" that this is what he means and my version is longer and uglier. That is he is talking about the trust funds hence not medicare (part B).

Of course it is silly to talk about the trust funds when the present value of deficits in the general fund is huge. However, it is Bush, not Krugman, who decided to attempt to shift discussion to the trust funds, as if an actuarial imbalince in the trust funds has a different effect than a much huger actuarial imbalance in the general fund. Note Krugman, like jg, is trying to link the two discussions. Krugman's claim is not in error just vague because it relies on an idiom (top up). Jg's criticism is a devastating criticism of Bush, but has nothing to do with Krugman.

I really honestly believe that jg thinks Krugman is in error because Krugman wants to raise taxes while jg wants to cut spending. Like the post, this is not fact checking, it is debate, and it was not what Okrent was talking about.

JG said...

Robert wrote:

"Ah also jg helps. His first example of a factual error is that Krugman says a tax on sales over the internet is a 'sales tax'. The semantic question is answered by a vote in congress..."

Semantic queestion?? Geeze. ;-)

Robert, internet sales are subject to sales tax like all other sales. That ain't semantics. If you think it is, try being a retailer who doesn't collect them.

Krugman wrote at length that the ITFA would repeal that sales tax on internet-made retail sales -- citing Amazon's sales as an example -- while leaving other store-made retail sales still taxed, and said McCain was "confused" or a "panderer" for sponsoring a bill that would do such a bad, bad thing.

But the fact was that the ITFA had nothing whatsoever at all to do with sales taxes, nothing at all, and repealed exactly $0 of them. There was never any consideration of it making Amazon's sales tax free.

Krugman was just plain factually wrong -- at a howler level.

Now I know this possibility arrives as a near incomprehsible shock to some -- but the time does come when we must face facts.

And not hide from them behind semantics. ;-)

"In the second case Krugman should have written 'top up' [the] Social Security and Medicare [trust funds],' It is obvious from the phrase 'top up' that this is what he means"

Ah, so you are saying that when Krugman wrote...

"The Bush tax cuts, not the retirement programs, are the main reason why our fiscal future suddenly looks so bleak", since their lost revenue would have been "more than enough" to allow SS and Medicare "to operate without benefit cuts for the next 75 years."

...the accurate "obvious" message that average readers of the NY Times drew from those words was ...

"without the Bush tax cuts government would collapse in 40 years, as annual deficits reach 20% of GDP due to the 14-digit current value general revenue funding deficit for Medicare, while the general revenue saved from the Bush cuts is used only to plug only the payroll tax deficit of Medicare, 'topping off' its trust fund...."

Why sure. That's practically the same thing! There's nothing at all misleading to the average reader about the first paragraph compared to the reality of the second.

'Cause after the trust fund was topped off Medicare could operate without benefit cuts for the next 75 years. And without the tax cuts it wouldn't be nearly so bleak to have 20%-of-GDP deficits in 40 years! ;-)

Hey, just for fun, here's a recent third example of truth to be found hidden deeply beneath PK's surface words....

[PK] "Wednesday Mr. Greenspan endorsed Social Security privatization ... he offered no justification at all ... Mr. Greenspan offered no excuse for supporting privatization"

[MSNBC ] "The normally placid Greenspan rose almost to the threshold of passion as he made a class-based argument by contending that private accounts would allow low-income people to become mini-capitalists — in his view, a very good thing.

"'When you have assets which you own, which you can bequeath to your children, (assets) which have your name on them, I think it is highly desirable thing, because you give wealth to people in lower-and middle-income groups who have not had it before'..."

Should that qualify as a "justification" or an "excuse" coming from AG?

(AG also cited increasing national savings, securing promised benefits, etc., but let's stay with just this one)

Now, OK, if you want to reply that PK wasn't being misleading about numbers in that case, I'll have to concede.

Arun said...

Krugman was quite right on the ITFA. McCain had introduced an extension to the ITFA that would have forbidden sales tax on internet commerce.