Re: The Chicago Smirk

[Eugene Coyle]

Tom Walker is telling the story of my life as a crank. Speaking of stories, my 2002 essay in The Electricity Journal is titled "Economists' Stories, and Culpability in Electric Deregulation." The essay opens: "The most powerful and committed proponents of deregulation were driven by the opportunity to profit from it. But a STORY, beyond greed alone, was needed to win the battle for the minds of politicians, editorial writers, and opinion leaders. The story provides cover to politicians and others seeking to persuade the public to disbelieve what is plainly before its eyes. Economists provided the story for deregulation of electric power." And it concludes: "Debating with economists is pointless. Simple and complete rejection is the way to deal with them. Economic theory is past its sell-by-date Economists nevertheless go on training successive generations in meaningless and destructive modeling. Economists are like the Bourbons, of whom Talleyrand remarked that "They forgot nothing and they learned nothing." National policy is set on the unchallenged fiction that prices in the US economy are based on the cost of production. This fiction, story, or perhaps closer to the mark, this lie, must be rejected by journalists, regulators, and politicians. The public knows that prices are based not on the cost of producing a product or service but on what the seller can get -- what the traffic will bear. The story creates a cognitive dissonance as the public struggles to believe its ears by denying what it sees with its own eyes. Journalists, regulators, and politicians must clear this up. The story should carry no weight. No weight at all. In between I mention some economists, including De Long, Larry Summers, and Borenstein and Bushnell of the Univ. of Calif. Energy Institute. None of the economists would engage, of course. Why should they? Gene Coyle Tom Walker wrote: Although they may not explicitly acknowledge it -- even to themselves -- Friedman and his minions know intuitively that they are re-telling old folk tales. Each time they retell these tales the audience nods appreciatively, "that's how it goes! that's how it goes!" Neither the audience nor the storyteller distinguishes between the conventional story and "how it really is" and for good reason: no one can say how it really is. "That's how it goes" means little more than that's the way we've heard it so many times before. Critics don't have a story. They have to settle for poking holes in the myth. The holes are soon glossed over and easily forgotten. Myth is memorable and critique is not. Critique is hard work and has to begin again each time. Those who have their own, non-conforming story are cranks. Because no one has heard their story before, they feel they have to "prove" it; something that can't be done. The surest sign of a crank is insistence on the obviousness of what nobody else sees. If you have to insist, you're probably deluded. The tellers of the old tales don't have to insist because people readily recognize the old tales. How could they not? They've heard them so many times before. The smirk comes from the self-assurance that one's opponents are either critics or cranks, or more precisely that one's opponents will likely be seen by the audience as critics or cranks. Nobody loves a critic, no one takes a crank seriously. There's no fraud like an avuncular old fraud. Tom Walker 604 255 4812