Everything Is Political

Peter Diamond has a depressing op-ed in today?s Times, withdrawing himself for contention as a member of the Fed board in the face of Republican opposition.

What you need to know about Peter is not just that he?s a very great economist, but that he?s an economist?s economist ? someone who is a deeply respected theorist, not at all someone who made his way as an ideologue. His work is basically apolitical.

Except that these days everything is political.

Never mind the obviously fake concerns about his suitability for the Fed. Obviously, Peter was blackballed for two sins: being personally a Democrat, and having been nominated by Obama.

The thing is, the Fed was supposed to be above and aside from the partisan brawl. It never was, completely ? but that was an ideal to be striven for. No more.

I think the rejection of a Nobel laureate for a seat at the Fed is tied, in a fundamental way, to the willingness of economists with decent professional reputations to sign on to the increasingly crazy proclamations issued by Republican politicians. Whether they are honest with themselves or not, what they?ve realized is that they face a loyalty test ? or maybe that?s an apparatchik test; if they have any ambitions of serving in a policy position, they have to prove themselves willing to follow the party line wherever it goes.

There?s nothing comparable on the other side. For one thing, you don?t find people like Christy Romer or, well, me taking positions on policy issues that are directly at odds with what they?ve said in their professional writings; whereas you see that a lot on the Republican side. And ex-officials on the Democratic side like Christy or Jared Bernstein are quite willing to criticize Obama policies, if only from a basically friendly position.

The way that the polarization of our politics is corrupting the theory and practice of economics is, to be sure, not its biggest cost. But it?s not trivial, either.

Source: http://krugman.blogs.nytimes.com/2011/06/06/everything-is-political/

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