Quiggin vs Stutchbury

John Quiggin gets profiled in The Australian today (motto: conservative everywhere but in the statistics) by Michael Stutchbury. I had always thought of Stutchbury as the sort of journalist who at least understands what the study of economics is all about but this profile reveals startling ignorance; the very same ignorance that conservative economists often display when trying to argue policy with John.

Quiggin no doubt deserves his distinguished fellowship for his theoretical work. But some may puzzle that, just as the warnings mount over the stalling of the 1980s and 90s economic reform agenda, the Economic Society honours someone who fought against the agenda in the first place. Zombie Economics argues it should be junked because “ideological” policies such as privatisation and central bank independence will cause another global financial crisis.

The argument that “Quiggin is fine when he does his academic stuff but throws it all away when it comes to public discourse” is complete and utter crap. John is the most ruthlessly neoclassical economist I have ever met. He uses the tools of modern economics religiously in ALL of this work. And his point is that those tools can support government intervention as much as they are often used in naive, textbook form to support deregulation and market-based agendas. That is why he is so powerful in public debates. He argues on the terms of those who exploit economics as an ideology. He lays out assumptions and relates those to facts. Do I think he always gets it right? No. But it is his assumptions, not the logical path from those assumptions to conclusions that I quibble with. The Economic Society was strong in their endorsement of all aspects of John as an economist.

This exposes the frustration that many on the right have with Quiggin. He is smarter and better at this than they are. And in deciding to pick on News Ltd, he awakened that machine to darken his credentials as a public figure in this country. We can now watch in amusement, like so many before his, as they desperately try to match him.

28 thoughts on “Quiggin vs Stutchbury”

  1. Call it “Cargo Cult Economics” after Feinman. We can also see it in discussion of carbon pricing when the idea of equalising tariffs on imports from non-carbon pricing countries is raised. Whereas an economic approach would suggest this for the precise same reasons it generally support the absence of tariffs, the Oz leads with “Environmental Protectionism!” headlines.
    Like the cargo cults they only see the headphones and runways, here low tariffs and past privitisations, with no understanding of the underlying process or theory.


  2. What a strange article. Everything I have read by Quiggin, whether I agree with it or not, is very well reasoned, and usually acknowledges that applying the theory within the realities of politics is never easy.
    In fact, the quote that sticks in my mind from Zombie Economics is that “the mixed economy is here to stay”. To me, that means that while there is often justification for governments to be ‘hands off’, there are very many cases where the SAME LOGIC says that governments should be ‘hands on’.
    Of course, this is just my own snapshot of his work.


  3. Joshua,
    “And in deciding to pick on News Ltd, [Quiggin] awakened that machine to darken his credentials as a public figure in this country.”

    That’s really all there is to it. It is a stupid, cynical, self-interested piece and you flatter it by assuming that there is some rational analysis within it to critique.


  4. Anything appearing in opinion columns and editorials in News Corp publications at the moment has to be read in the context that this is an organisation fighting to defend its reputation, if not its very existence. It is at war with anyone expressing doubts about its journalism practices or idealogical bias. Critics will be ruthlessly attacked in its newspapers and facts are likely to be the first causality.


  5. I haven’t found time to keep up with all the Quiggin output. Interesting to know that he has a mathematical background, which, up to a point, adds to my prima facie respect, even if LTCM and the freshwater model makers who gutted true Keynesianism (I rely for this on, inter alios, Minsky, Akerloff and Shiller, and quite a few others whose work has been made to seem more to the point by the GFC and its evident causes) have tended to build their very partial models of reality on an otherwise sound grasp of mathematics. However, I wish he would be a bit more modest about AGW which is no more in his sphere of formally established expertise than it is in that of Malcolm Turnbull or Tony Abbott. Perhaps it is out of solidarity with David Karoly, another worthy mathematician. But a proper regard for what is dependent on the parameters and functions of the many IPCC models and on adequate measurement would make him less certain of the supposed scientific consensus put together from bits and pieces of work done by many scientists of whom very few if any could sensibly be called “climate scientists” – unlike say Richard Lindzen who, embarrassingly, is on the other side. When John can point to reasons for believing in (a) positive feedbacks from extra water vapour resulting from the small (and logarithmically declining) increases in non-reflected radiation as a result of CO2 increases; (b) the absence of any natural explanations which might explain why the warming since the Little Ice Age has occurred apart from CO2 emissions and might continue at the same or a faster rate.

    Then. as an economist John might explain why we should do anything expensive (even a v. small carbon tax not used for serious tax reform and a GST surrogate increase and one which doesn’t apply a tax to imports with an imputed CO2 content a la Carmody) instead of building our economic strength and sovereign funds for the future. The idea that we have to act swiftly to forestall the impost of taxes on our exports of goods, services and, particularly commodities is as laughable as Kevin Rudd’s idea that Australia was going to be a heavyweight at Copenhagen.


  6. Joshua, this touchy entry was unworthy of you.

    For those not in Joshua’s parallel universe, a little refresher of why Stutchbury’s article might have some basis:


    Note in particular this self-incrimination:

    “For a variety of reasons, I apostasised from the free-trade religion early on and, for a while, became an outright protectionist in reaction.”

    Unambiguous. He himself admits that he became, not merely a protectionist, but ‘an outright protectionist’ for a while. And that he ‘apostatised from the free-trade religion early on‘. [My emphasis.]

    Not much neo-classicism there. QED.
    It took me all of 30 seconds to find this via google. I could easily find a lot more, on a lot of different topics.
    I should add, that what John says was ‘for a while’, was during the Hawke/Keating years of tariff reform, when the economic case for reducing very high tariffs was a lot less ambiguous than now. I could back that timing issue up with evidence also, if I could be bothered. I could also easily include evidence that Green-Left weekly was running the same line at that time, but I think I can safely assume that no-one reading this blog would doubt that!
    And yet John (and Joshua!) wonders why John doesn’t have the respect of mainstream economists – government, private, or academic – when he talks public policy! Where do they think Stutchbury gets the sources for such an article from, if not form his connections in the Treasury, RBA, private-sector economists, and so on . . .


  7. John has it, there is a lot more to why Quiggin isn’t taken seriously by many people.
    His entry on ‘why there will never be another Liberal government in Australia’ is a good example that he’s really a fringe guy. It was a clear example that wishful thinking had replaced analysis for a lot of what he writes.
    Quiggin is an example of bad things that happen because of regular columns or blogs, people become more and more partisan and talk themselves into becoming little Chomskies.
    Like many I was a regular reader of his blog a while back and I even wrote up his wikipedia entry but now only go there for laughs.


  8. I am indebted to John Renoff for illustrating the point – taking neoclassicism as a set of policy prescriptions rather than a process from which those policies may, but not must, be drawn. By this the policy becomes totemistic and the speaker, either Renoff or Stutchbury, is left cranky and flustered when the totem is questioned.


  9. John Renoff,

    I think you’ve misquoted John Quiggin in context. The parts you didn’t quote: ‘Now, I don’t have a preconceived position either way, and try to assess the issues on their merits.

    One point that comes out of any neoclassical economic analysis is that, at tariff rates below around 10 per cent, the (traditional trade-theoretic) benefits associated with a reduction to zero are trivially small. This is because the welfare loss associated with a tax are proportional to the square of the tax rate, and the square of 0.1 is 0.01 (1 per cent).’ Don’t know any of the trade literature but I’m assuming John Quiggin is quoting established results.

    Don’t know enough about John Quiggin to comment on his broader ideological positions but going on that post alone doesn’t seem heterodox. JohnQ doesn’t explicitly state he wants to raise trade barriers but was making the point there is little marginal benefit from taking trade barriers to zero which I assume he believes the position being taken by the ‘free-trade religion’. To me that sounds like a position based on technical merits rather than an ideological one.

    On a matter of definition, I’ve always thought neoclassical economics was a methodological description rather than an ideological one.


  10. the assassination piece on John makes him look even more like a hero fighting the beast.
    If you run the search words ‘ “john renoff” economics ‘ you get only the entry above ….. Mr Renoff has never been seen before or after on blogland.


  11. It would help Frijters if he learned how to spell Renouff.

    More generally, JQ is an ardent suppressor of free speech at his Blog, where anybody daring to disagree with him is sooner or later banned. Stutchbury makes that very point, quoting JQ as follows:

    ‘The Australian is a “worthless gutter press rag”. It is a “sad joke”, … It is “part of a political machine, using its power and wealth to crush its opponents and critics by whatever means it finds most convenient”.
    Murdoch’s readers “have demonstrated, over and over, that they prefer comfortable lies to inconvenient truths”. That’s because “everyone is increasingly aware that truth and falsehood are no longer meaningful terms for those on the Right” ‘.

    And therefore the Murdoch press should be closed down, just as JQ suppresses all dissent at his Blog.

    Brave New World.


  12. Tim Curtin
    Fritjers spelled “John Renoff” exactly how John Renoff himself spelled it above. It’s not clear why you would expect him to add an arbitrary “u” into the name.


  13. As Tim says, , I oppress him by not publishing his important scientific research on my blog, and by detecting his lame attempts at sockpuppetry. This contrasts sharply with the Murdoch press, which is committed to print, immediately and in full, anything that anyone sends in to them.


  14. John Quiggin is recognised as one of Australia’s top economists for very good reasons. The trouble is, he isn’t afraid to speak truth to power. So it’s no surprise that power would respond with character assassination.

    The arrogance of the once great Oz and the corporation that is its owner reminds me of another, once great, Oz, immortalised by Shelley:

    …a shattered visage lies, whose frown,
    And wrinkled lip, and sneer of cold command,
    Tell that its sculptor well those passions read
    Which yet survive, stamped on these lifeless things
    The hand that mocked them and the heart that fed.
    And on the pedestal these words appear —
    “My name is Ozymandias, king of kings:
    Look on my works, ye Mighty, and despair!”
    Nothing beside remains. Round the decay
    Of that colossal wreck, boundless and bare
    The lone and level sands stretch far away.


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    I really enjoyed last Friday’s AFR which had quoted Krugman saying it was a badge of honour to be defamed by the Murdoch press; less of an honour to be defamed by Stutchbury. But really Tim Curtin, public debate in action hardly merits drawing parallels with totalitarianism. Criticism of the right wing press isn’t the start of a Kulak genocide.


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