How to introduce an economist

The season of the business convention is upon us again. From White Sulphur Springs to Palm Springs, resorts will be filled with meetings of trade associations and corporations, each featuring a well-balanced program of golf and lectures. The presence of an economist on these programs is obligatory, because the Internal Revenue Service believes that a conference including a lecture by an economist cannot be for the purpose of pleasure and must be a deductible expense.

As a result, hundreds of corporate executives and trade association presidents are going to face the problem of introducing an economist. It is a good bet that over half of them will use one, two, or even three of the following lines:

1. "Economics is the dismal science"

That was a favourite line of President Nixon's early in his administration, perhaps that was the only thing his speechwriter on economics, William Safire, knew about the subject. As time passed, both the President and the speechwriter learned more and gave up the cliché.

It is not an apt remark. Economics as a science is dismal only in the sense that it recognizes the existence of limits. But so do all sciences. Geometry is not called dismal because it says that the square of the hypotenuse cannot exceed the sum of the squares of the other two sides. Chemistry is not called dismal because two units of hydrogen have to be combined with one unit of oxygen to make water. No one goes around saying that these limits could be escaped by cutting marginal tax rates.
Now it is true that economists do not know where their limits are as well as other scientists know their limits. At times, economists have been too pessimistic in their judgements about the location of the limits. This was surely through of Malthus and his followers, who argued that the laws of economics and nature destined man to live at the level of subsistence. But such pessimism is not an inherent feature of the science. In our time, the prevailing error has probably been to be excessively optimistic - to overestimate the productive capacity of the system - and that has led to inflationary policy.

2. "As President Truman said, 'I wish that I had a one-armed economist, so that he wouldn't say on the one hand and on the other hand'."

If that was what Mr. Truman wanted, he was wrong. Economics is an uncertain science. To all the questions difficult enough to reach the President, the answers are uncertain. If the answers could be given with 100% confidence, the decisions could be made by a lesser official. It is the President’s role to decide what to do when no one "knows" what to do. It is the role of the President's economic advisers to tell him of his options and the POSSIBLE consequences of his decision. It is their role to tell that on the one hand this might happen and on the other hand that might happen. If the President isn't told that, he doesn't have the information he needs.

3. "Economists never agree."

This is sometimes buttressed with a quotation attributed to George Bernard Shaw that if all economists were laid end to end, they would not reach a conclusion.

That is, in fact, not true. Economists agree on many things - probably on most things. It has been observed that if almost any economic subject is discussed in a group including economists and non-economists, the economists are likely to agree with each other and to disagree with the consensus of the non-economists. The contrary impression results in part from the fact that non-economists look to economists mainly for answers to the questions on which economics is most uncertain - notably the short run forecast for the economy. Even on that subject there is usually not that much disagreement. For example in October's BLUE CHIP survey of economic forecasters, 30 out of 44 said that the real increase of the GNP between 1981 and 1982 would be between 1.2% and 2.9%. That is TOO MUCH agreement. The true range of probability is greater than that. On such matters the profession is divided into two groups. Most fall in the category of sheep, who cluster together to reduce the danger of an exceptional error. A few are contrarians, who exploit the sheepishness of the rest to distinguish themselves and hope for exceptional success.
If it is necessary to tell a joke introducing an economist, the best one goes like this:

A wealthy labour economist had an urge to have grandchildren. He had two daughters and two sons and none of them had gratified his desire for a grandchild. At the annual family gathering on Thanksgiving Day, he chided them gently to bless his old age with their progeny. "But I haven't given up hope," he said, "Yesterday I went to the bank and set up a one hundred thousand dollar trust fund to be given to the first grandchild that I have. Now we will all bow our heads while I say a prayer of thanks." When he looked up, he and his wife were the only ones at the table.

In any case, there is no need to introduce an economist with a joke. It is done, presumably, to put the audience in a tolerant frame of mind, but that doesn’t last. It only succeeds in irritating the economist, who then feels obliged to continue with other jokes. If the convention wanted jokes, it should engage Robin Williams. Economists should not be expected to tell jokes for one-fourth of Williams’ fee/

A sufficient introduction to an economist might be the following:

We will know here from Mr _______, professor of economics at _______. He has spent his working life studying, teaching, and practicing economics. He is not a fortune teller. He does not know when the interest rates are going to go down. If he knew that, he would have already told the public and it would be too late for you to profit from the information. But he knows things about the future of interest rates that fortune-tellers do not know. He knows what seems to have made interest rates fluctuate in the past and what may influence them in the future. I use interest rates, of course, only as an example of the many aspects of the economic present and future with which we are concerned.

Professor ______ has in the past served as a government official. But he nit a political partisan, and we have invited him here not to present the views of any political party but to tell us what economics has to say, as well he can. We have abandoned our past practice of inviting two economists, one Republican and one Democrat, with the thought that we could distil the truth from their competing statements. We found that this only gave us a cat-and-dog fight, which showed only who was the better debater – probably meaning the less honest.

Professor ______ has been a teacher and an adviser to government officials. We have asked him to take a similar role with us, and not to seek the role of salesman or entertainer.

Since many of you are already wearing your golf shoes, I may illustrate the role of an economist by comparison with the role of the teaching golf pro. He can instruct you in the rules of the game and he can explain to you what techniques tend to make for success and what do not. Where there are differences of opinion about that among qualified people, he can tell you what they are. But he cannot play the game for you. He cannot give you the physical equipment, the co-ordination, the judgement that made a good golfer. Some of you may become better golfers than the pro. Many of you will never break 100. But you will learn from him. So the economist cannot tell you what is going to happen or what you should do, but he can supply you with some of the information and ways of thinking that will be helpful to you in making up your own minds. He is worth listening to.

Source: Stein, Herbert, “How to Introduce an Economist,” Fortune Magazine, November 30,1981:134-135