ICYMI: Groundwork’s Rakeen Mabud Featured in The American Prospect’s Special issue on Economic Policy Models

Mabud & Dayen: “Though economists may not want you to believe it, the assumptions they build into their models are actually embedding a perspective about the economy.”

Today, The American Prospect launched its April special issue, “Washington’s Secret Policy Engine,” which pulls back the curtain on the outsized influence of flawed macroeconomic policy models in U.S. policymaking. Groundwork Collaborative’s Chief Economist Rakeen Mabud co-wrote the introduction “Hidden in Plain Sight,” with the Prospect’s Executive Editor David Dayen. The special issue shines a bright light on macro models and what needs to change to create better policy.

Over the next two weeks, The Prospect will publish 10 articles detailing the flawed assumptions of these models, the disparate impact they have on policies designed to address racial inequities and climate change, and their heavy sway on Washington’s lawmakers.

KEY EXCERPTS

“There are dozens of [ideas] that are…quietly shoved aside, or not even contemplated, thanks to a series of obscure gatekeepers who have come to dominate the way we deal with America’s most pressing challenges. They use the language of math and the presumption of certainty to dismiss innovative solutions before they can build a coalition of popular support. They claim to be neutral arbiters reflecting rigid realities about how the world works. But their methods are uncertain, their biases barely concealed, and their ideological goals apparent—if you know where to shine the light.”

“As an economist and a journalist who rely on data and evidence, we are in no way reflexively skeptical of the use of numbers. We would not condemn models per se, any more than we would condemn a calculator or a slide rule. But we also know the old adage that predictions are hard, especially about the future. The bigger the system being modeled, the harder those predictions come to the truth. That’s particularly true when you’re talking about enormous sectors like health care or the environment, or in the case of macro models, the entire national economy over a span of years or even decades.”

“These models therefore reinforce, justify, and calcify a particular theory of change, backed by the same players that have been trying to embed a conservative, neoliberal ideology in Washington politics for decades. And it’s clear why this has been so successful: in the hands of a politician, an estimate that makes your policy look good or an opponent look bad can be extremely powerful.”

“Every time a politician or media figure ties budgetary numbers to a particular policy, it reinforces the macro model’s importance. But when that evidence is rooted in assumptions and ideologies that ultimately damn progressive ideas to the dumpster, these models are only useful for those who agree with them.”