In an excellent analytic post on Frederic Mishkin’s money textbook, Scott Sumner wonders about Mishkin’s motives in giving an incorrect Aggregate Demand curve and in dropping a question that had been in the previous edition about the effect of the Fed paying interest on reserves. This last is breathtaking because it is strange to drop a question, not when the question seems abstract and irrelevant, but when the question has suddenly become quite relevant because the Fed has, for about two years, been paying interest on reserves.
In stating these criticisms and others, Scott says about five times, tongue in cheek, “If I was a conspiracy buff.” It’s obviously his way of attributing motives without quite doing so. I don’t object to that: it’s a rhetorical style I rarely use because I like to be blunter but I understand, especially given Scott’s fondness for Mishkin, why Scott uses that style.
Here’s my objection: Scott, like many people today, uses the word “conspiracy” incorrectly. The whole idea of a conspiracy is that it takes two or more people conspiring. If someone on his own, because of his own motives and incentives, tells less than the truth, that’s not a conspiracy. When I was on talk shows in September and October 2008, and I stated that Henry Paulson was not to be trusted because he was looking out for his Wall Street buddies rather than for Americans in general, I was sometimes asked if I was hinting at a conspiracy. I wasn’t. He was plenty able to work to help his buds without conspiring with them. I have no idea how smart or unsmart Hank Paulson is, but he hardly had to be in contact with his friends on Wall Street to know that they were suffering huge losses from the financial crisis.
Next time you hear someone attribute a belief in conspiracy to someone else, ask yourself if the person making the attribution is talking about conspiracy or is simply talking about, possibly unethical, self-dealing.
In fact, I’d like those commenters willing to take the time to give examples where people charge others with believing in conspiracy when those so charged have never even hinted at their own belief in a conspiracy.
READER COMMENTS
Scott Sumner
Dec 13 2010 at 2:31pm
Call me naive, but I’m not convinced Mishkin does have bad motives. I found his rebuttal to Inside Job to be fairly convincing; I linked to it in the final postscript.
My point was that the average person would look at the evidence I presented, and conclude Mishkin was trying to slide over some information that doesn’t fit his current worldview, but I generally don’t assume dark motives w/o a smoking gun. And then there is the subtle influence of being an insider in positions of power–it’s hard to know how that affects one’s views, even if only subconsciously.
You are right about my misuse of the term ‘conspiracy.’ What was I thinking?
J Mann
Dec 13 2010 at 3:07pm
Scott, I was rushing to defend you, but you already stepped on my point!
Nevertheless:
IMHO, “conspiracy buffs” are widely believed to have a pessimistic or paranoid belief in human nature, such that Occam’s razor typically points to secret malfeasance over happenstance, incompetence, or well-meaning but misinformed action.
You’re right that there aren’t enough people to have a literal conspiracy here, but if Scott were a “conspiracy buff,” then he would also be the sort to suspect concealed nefarious motives in individual action as well.
David R. Henderson
Dec 13 2010 at 4:35pm
@Scott Sumner,
Wow, Scott, I missed it! I’m so used to people being coy when they say words to the effect, “If I were a conspiracy buff,” that I assumed you were being coy and not quite willing to come out and say what you think. That was unfair to you and I apologize.
@J Mann,
I agree about the correlation between ascribing base motives and believing in conspiracies. I tend to be someone who ascribes base, or at least narrowly self-interested, motives to well over half the people in government but who does not tend to believe in conspiracies except in the narrow legal sense. When the Senate votes, for example, to rip people off, you could say it’s a conspiracy: it’s just that it’s one that’s out in the open.
David L. Kendall
Dec 13 2010 at 6:00pm
Conspiracy is not required to get an outcome that could have happened by conspiracy. Conspiracy is actually quite difficult to pull off, if the number involved goes beyond two people.
All that’s really required to get the outcome of a conspiracy is mutual, uncoordinated recognition by multiple persons that they all have the same horse in some race.
I’d say that observation pretty well fits the Mishkin example. He’s a former Fed board member. He gained admission to the temple. Why should we be surprised that he sings from the Fed hymnal?
Lots of economists know the Fed song book rather well. They sing it to their students uncritically year in and year out. Is it a conspiracy? Not at all. But it could just as well be, if conspiracy on such a scale were even remotely possible, which it isn’t.
Can anyone seriously deny that economists as a profession have a big horse in the Fed race?
Jacob Oost
Dec 13 2010 at 7:05pm
parsing….parsing….re-reading….parsing…..Oh. Yeah, me too.
Andy Hallman
Dec 13 2010 at 11:35pm
I agree, Mr. Henderson. “Conspiracy” has come to mean doing something for reasons other than those stated, and the part about “two or more people acting together” is often forgotten.
BZ
Dec 14 2010 at 5:30pm
I think the most important point about language has been missed here: it is conventional, and as such, changes. When language changes, the new meanings and new words are absorbed seamlessly into society. Said another way, language, like an economy, is an emergent order. It makes no more sense to complain about some word usage not matching the definition in a dictionary than to complain that the products on the shelf at Sears don’t match those in my 1928 Sears catalog.
So, “Conspiracy” may refer to “more than one persons conspiring together” in some dusty old dictionary. However, dictionaries are slower to change than speakers are.
David R. Henderson
Dec 14 2010 at 9:28pm
@BZ,
Your analogy with Sears doesn’t work. The items on the shelf today are 2010 items. But the word conspiracy is used to mean “having bad motives or responding to base incentives” (analog of 2010 goods) but then people turn around and say it couldn’t be a conspiracy because it would be hard for people to get together and pull it off (1928 items). What makes it a putdown to claim someone believes in conspiracy is that it’s usually implausible to believe that people can get together than way. So the person using the term gets the desired effect of the putdown but only by equivocating on the use of the word “conspiracy.”
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