Monday, January 23, 2012

Romney's latest talking point about how policy should be directed by people who have had a "job"

Romney appears to be doubling down on his talking point about how Obama and lots of people in the Administration have never had a "job," by which he means a private sector business job. Apparently that is what you need to decide, for example, on the merits of the case for Keynesian stimulus, or to evaluate global warming, or for that matter to set our policy towards Iran.

Back in the 1990s, I was once called as a witness at some sort of House sub-committee hearing on raising the minimum wage. The Republicans were in the majority, and I was one of their two witnesses. The other was Doug Holtz-Eakin. I had been called because of a recent article I had written in the U of Chicago Law Review, in which I skeptically compared min wage increases to their equivalent in explicit tax and transfer terms (i.e., a tax on low-wage employment that was used to fund a subsidy to people with low hourly earnings, and with no focus on household income over any longer period). The article was balanced, and I noted that some of labor markets' peculiar features made it plausible that modest minimum wage hikes would have genuinely ambiguous employment effects (as suggested by then-recent empirical work by Card and Krueger).

The background for the hearing was that the Republicans were not having any of it, so far as a minimum wage increase was concerned, but that they didn't feel they could just not hold the hearing. (Obviously they would never hold it today.) So it was a day for the Democrats on the sub-committee to beat up the Republicans a bit, since this was an issue on which the Dems would definitely poll better. They had their own witnesses, including I believe Jared Bernstein.

Anyway, at some point the Democrats started saying stuff like: What do we need these academics here for. Let's get some witnesses who actually know something about the minimum wage - minimum wage workers! Holtz-Eakin, while trying to tamp down his reaction, couldn't help being a bit sarcastic and irate. He suggested to the Democrats that, if that was how they defined expertise (rather than, say, by asking experts about the state of empirical knowledge), why not just fire their staffs and have all the issues decided by people who don't know anything.

Then we had to sit through some stuff about how "you people" just "don't get it," which was funny for me because I certainly do want to help low-wage and unemployed people but would not assume that they know the most about how to raise employment and wage levels.

When it was over, outside the hearing room a leading Democrat (I believe it was John Dingell) winked at me as if to say, hey, don't take it personally, it's all just show biz.

But now we have Romney basing an entire presidential campaign on essentially the same type of definition of expertise, only it relies on the perspective of the bosses rather than the workers.

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