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Hicks: Economist's 'truthiness' unmasks Obamacare

November 22, 2014

Mike HicksIt should come as no surprise that many economics professors are called upon to help develop public policy. Economics is a practical discipline and economic models offer a great deal of insight into almost any policy.

The process typically involves using a mathematical model to better understand the effects of a proposed policy proposal. Over the years, I have done a fair bit of this myself, including work for three Democratic and four Republican governors. In no instance was I asked to help hide an effect of the law or to deceive voters.

That brings us to the sad case of professor Jonathan Gruber.

Gruber is a well-regarded health economist who created a micro-simulation model that has been used to craft health care policy (aka Obamacare). But, unlike most micro-simulation models that do something novel to explain policy, Gruber’s model is highly sought after because it replicates the version used by the U.S. Congressional Budget Office. Thus, it can be used to outwit that organization’s candid assessment of the effects of a policy proposal.

We know this because Gruber has been explaining the value of his model to do just that. Over the past years at several events, he described how the law was written in a “tortured way” to deceive CBO estimates because of the “stupidity of the American voter.”

It is not clear from his comments whether he thinks this is a good approach or he is merely lamenting the experience.

Once the messiah of Obamacare, Gruber has been extensively denied by disciples of policy obfuscation. A man who frequented the White House and was cited at length by Obama, Ms. Pelosi, Mr. Reid and others now finds himself carefully unremembered by all of the above.

That is to be expected, because his truthiness is gravely damaging to the legacy of Obamacare. Without Obamacare, there is nothing to show for the past six years but public debt.

Disdain of the voting public is nothing new, and there is no better example than the passage of the Obamacare legislation. Recall that it was rushed to a vote before a newly elected Massachusetts senator, who opposed the law, could be seated. It isn’t what Gruber said, but what Congress did, that has provoked such fury.

In the end, contempt for the will of voters is an unhelpful sentiment. If the public does not understand your ideas, the blame is not theirs. Moreover, frustrations with Obamacare are not due to stupidity, but rather because voters judged its architects to be untrustworthy. Gruber has done us all a great service by confirming the good judgment of voters.•

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Hicks is the George and Frances Ball distinguished professor of economics and director of the Center for Business and Economic Research at Ball State University. His column appears weekly. He can be reached at cber@bsu.edu.
 

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