Thursday, June 12, 2008

Defending Jason Furman on Social Security

An article in the LA Times accuses newly appointed economic policy director for Obama, Jason Furman, of having supported privatizing social security. There are a number of issues on which most progressive economists would differ with Furman, but this claim that he supported privatizing social security is simply an outright lie as pointed out on both brad delong and ecnomists view. Instead, he was one of the firmest and most effective critics of the Bush plan to gut social security.

One place he did that was from a perch as a co-blogger on the predecessor to this blog, the much-missed Maxspeak, formerly run by Max Sawicky. During the period of the battle over the Bush attack on social security, Dean Baker was also a co-blogger there, and it was command central for those opposing the Bush plan (with people like Bruce Webb and I also making a lot of noise there). It was from Maxspeak as transmitted through Brad Delong to Paul Krugman, the NY Times, and then the broader media that the most effective anti-Bush-plan arguments were promulgated, transmitted, and then brought to bear. Whatever one thinks of his views on Wal-Mart and other matters, Jason Furman played an important role in this successful effort to preserve social security as it is.


CMike said...

Now I know you guys have ties to the old Max Sawicky web site. However, I think Paul Krugman was dialed in on this Social Security issue before Brad DeLong was bringing him news from MaxSpeak.

From Dean Baker and Mark Weisbot's "Social Security: The Phony Crisis:"

page 4: Krugman later admitted, though, that he "went overboard in supporting Pete Peterson's position on entitlements and domgraphics...I broke my own rule that you should always check an argument both with a back-of-the-envelope calculation and by consulting with the real experts, no matter how plausible and reasonable its author sounds" (Kruman 1996b).

Both Krugman and Thurow fell for the "entitlements trick," a device deployed with great success by advocacy groups like Peterson's Concord Coalition. The idea is to lump Social Security and Medicare together as "entitlements for the elderly."


I sort of assumed the experts Krugman was referring to were Social Security actuaries and perhaps Dean Baker. Krugman certainly called out candidate Bush for his shell game on Social Security privatization in the 2000 campaign - I think that's where the term "fuzzy math" first popped up before the Bush campaign engaged in some Jujutsu by adopting it as their own complaint and directing it at candidate Gore.

I would be interested in any comments about the history of the academic defense of Social Security mounted by Baker, Weisbot et al. and later by Krugman beginning(?) in the mid-nineties.

ProGrowthLiberal said...

Brad DeLong has a mist read piece on this LATimes hit job on Jason. said...

I did not mean to suggest that DeLong and Drugman only learned of these arguments from Maxspeak. Many people knew this stuff, but were cowed to speak because of he widespread public hypnosis. The time path was first noise on Maxspeak, then on Brad Delong, then by Krugman.

Actually the first to expose what pile of crap the Trustees projections were was the late Robert Eisner. Then it was Dean Baker and Mark Weisbrot.


Anonymous said...

Off-topic (not too much), can anyone tell what he's been up to? said...

"He"? Furman or Eisner. Eisner died in the late 1990s. Regarding Furman he has been at the Brookings Institution and most recently was co-director of the Hamilton Project, viewed as a centrist project associated with Robert Rubin. The NY Times reports that some labor union leaders are unhappy with the appointment of Furman, with this being a major reason why. The Hamilton Project has been pro-free trade, among other things.


Diamond Jim said...

Barkley, I suspect anonymous was using "he" to refer to Max, from whom we haven't had enough news. I'd like to know what Max has been up to, in any case. said...

"He" revealed his current activity when he publicly signed a petition supporting students at Notre Dame. However, you all will just have to track it down yourselves.

Bruce Webb said...

Well I started following this issue on more or less a daily basis back in 1997 and once the blogosphere took off around 2000 have infested (err, contributed to!!) every Social Security thread I could find.

Generally speaking Baker and Weisbrot were voices in the wilderness in the late nineties. The overall narrative of 'crisis' was so engrained that almost no one felt compelled to actually check the data. Whether people supported or opposed Social Security in principle everyone simply assumed that someone must have done the homework, surely you couldn't get near universal consensus among both professional economists and 'serious' members of the MSM on such a key issue without somebody actually being conversant with the numbers in Table VI.F7.

But so it proved. It turned out that almost no one had even cracked the cover of the Annual Reports and of those that did few people ventured beyond the 13 page summary to engage with the data tables. I remember to this day the moment I actually started getting heard on MaxSpeak when some high level conceptual discussion was interrupted by some guy noticing "maybe this guy has read the Reports".

But generally speaking there was not much discussion of this prior to November 2004 outside of places like Cato's Project on Social Security Privatization, most people on either side of the question thought the basic issue of 'solvency' had been settled years before and in the negative.