Sat, Nov 17, 2012 - Page 9 News List

US public opting for pragmatic idealism over wishful thinking

By Robert Shiller

His 2005 book, The Pro-Growth Progressive, contains many ideas about how to make the economy perform better. None is grandiose, but together they might help substantially. Some of these ideas found their way into the American Jobs Act, which might have had some real impact had Congress passed it last year.

The act embodied some of what Sperling describes in his book: subsidies for hiring, wage insurance and job training, as well as support for education and early learning. Moreover, the jobs act would have offered some balanced budget stimulus — the kind of stimulus that would boost the level of economic activity without increasing the volume of government debt.

However, the public, despite its concern about unemployment, is not very interested in the details of concrete plans to create more jobs. Sperling is just not very visible to the public. His book was not a best seller: in commercial terms, it might be better described as a dud.

Sperling is fundamentally different from the typical academic economist, who tends to concentrate on advancing economic theory and statistics. He concentrates on legislation — that is, practical things that might be accomplished to lift the economy. He listens to academic economists, but is focused differently.

At one point in his book, Sperling jokes that maybe the US needs a third political party, called the “Humility Party.” Its members would admit that there are no miraculous solutions to the US’ economic problems and they would focus on the “practical options” that are actually available to make things a little better.

In fact, the US does not need a new political party: with Obama’s re-election, voters have endorsed precisely that credo of pragmatic idealism.

Robert Shiller is a professor of economics at Yale University.

Copyright: Project Syndicate

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