Friday, August 17, 2007

Red's Rage

Seems to me that an occupational hazard in all of this blogging is that one easily can begin to obsess about particular issues and/or individuals. In RRR case, this risk is particularly acute in the case of ‘Red’ Midwinter and his regular interventions on the topic of Scotland’s budgetary position and prospects. Yesterday’s performance, as reported here, reads like vintage Red. The trademark authority, the political side-swiping, the “we’re doomed I tell ye” predictions. Let’s face it – an optimist he is not. But particularly worrying is that he is quoted by the ever-fawning Hack MacMahon as repeating a comment he first made after the FM announced his Council of Economic Advisers – this being that the Executive has "no responsibility for managing the Scottish economy… and only has microeconomic powers". Of all the assertions he has made recently, this has to be one of the more revealing. As any first year student of economics (hopefully) will tell you, economic growth is defined not as year to year changes in GDP (which records the growth of aggregate demand and is heavily influenced by macroeconomic – fiscal and monetary – policy changes over which the Scottish government presently has virtually no control), but is defined as the (long term) growth of potential output of the economy. And the growth of potential output is substantially influenced by (supply side) microeconomic policy decisions over which the Scottish Government commands considerable policy authority. It is therefore incorrect, and indeed economically illiterate, to argue that Scotland's government has no responsibility for managing the economy because it only has control over microeconomic policy levers. These are the principal levers required to manage the economy in any meaningful sense.

Such ignorance of an elementary proposition in economic theory might be forgivable if coming from a journalist, but is deeply worrying when made by Scotland's "leading" expert in public finance. And this isn’t entirely a matter of point-scoring vis-à-vis Red, fun though that is. It is also a reflection that in some of his pronouncements, as here, Red is simply confused and wrong (i.e. he doesn't know what he's talking about). Which itself suggests that the multiple “papers” of which he is an author (and which are devlishly hard to find in the public domain) have not been adequately reviewed by Red’s academic peers – peer reviewing being an entirely “normal” practice within the industry. As elementary an error as this one would certainly have been picked up in a proper peer review exercise. It is indicative of an approach to public policy commentary that is at best cavalier and at worst intellectually dishonourable.

1 Comments:

Blogger mewmewmew said...

Which itself suggests that the multiple “papers” of which he is an author (and which are devlishly hard to find in the public domain) have not been adequately reviewed by Red’s academic peers – peer reviewing being an entirely “normal” practice within the industry. As elementary an error as this one would certainly have been picked up in a proper peer review exercise.



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