Grading PolitiFact's grading of the stimulus bill

The PolitiFact headline caught my eye.  Here's how it looked at FaceBook:

I will focus on two general aspects of this PolitiFact entry, the visual presentation and the literary content.

The appearance of the FaceBook version offers special prominence to the bar graph seen just below "PolitFact.com."  Once one gets to the full story by clicking the link, one has the opportunity to read a caption that describes the graph as part of the Obama administration's claims about itself ("David Plouffe, a political adviser to President Obama, circulated this chart ...").  I would suggest that the placement of the graphic provides an implicit support of the positive effects of the stimulus bill.  That effect is only slightly diminished at the main page, coupled as it is with the Truth-O-Meter rating of one of Vice President Joe Biden's  claims about reduced job losses over time.

So the visual presentation makes the stimulus bill look pretty good, even if the arguments underlying the presentation may be specious.  But what about the content?

The content, considering the piece is billed as a grade of the stimulus bill, contains precious little grading.  Indeed, it might not exaggerate the situation to state that authors Robert Farley and Louis Jacobson did not offer any specific effective/not effective judgment at all.  Instead, they treated the reader to a series of of political statements and expert opinions--more in line with the traditional methods of the objective reporting paradigm.

The story isn't exactly the best example of objective reporting, however.  In spite of a number of research references to Heritage.org, the assessment of the experts at Heritage apparently did not find their way into the Farley/Jacobson story.

Is that important?

Yes, it is.  Economists disagree on many things, and the Keynesian approach to economic intervention remains a very contentious point.  However, though Keynesian policies remain controversial among economists, they also remain very popular.  Thus, it is easy to find a good number--even a clear majority--who will affirm that Keynesian spending will effectively boost an economy.

The uncited work of Brian Riedl at Heritage.org offers a counterpoint to the entirety of the PolitiFact story:

Heritage Foundation, "Why Government Spending Does Not Stimulate Economic Growth: Answering the Critics," by Brian M. Riedl, Jan. 5, 2010  

Heritage Foundation,"White House Report Claims Stimulus Success-Despite 3.5 Million Job Losses," by Brian M. Riedl, Jan. 14, 2010  

Heritage Foundation, "CBO Says Stimulus Is Working Because We Predicted It Would," by Brian Riedl, Dec. 1, 2009  

The first of these articles provides an excellent explanation of Keynesian economics, by the way.

Farley and Jacobson end up relying on Keynesian assumptions to imply the success of the Keynesian stimulus.  It is worth noting that the third article by Riedl listed above, "CBO Says Stimulus Is Working Because We Predicted It Would," deals with that same aspect of begging the question.

CBO Director Douglas Elmendorf proclaimed that (Keynesian) economists' predictions of job creation were more accurate than the records of those spending the stimulus money.  But if that's the case, how would one ever test the accuracy of the predictions in the first place?  What is the origin of their predictive cachet?

Therein lies the mystery.  The Keynesian economists say Keynesian economic approaches work just great.  News/opinion outfits such as PolitiFact report what the Keynesians say.  So it must be true, right?

PolitiFact offered no grades as such in this story.  But even though I took a less formal approach than usual on this post, I will offer some grades:

Robert Farley:  F
Louis Jacobson:  F
Catharine Richert:  C

Though I don't know who researched what, Catharin Richert only did research on this piece.  As a result, she's off the hook for the implicit logical errors in the content, including such things as the post hoc ergo propter hoc fallacy.  It was great that Riedl's work appeared in the list of sources, but unfortunate that the content of the story appeared to entirely ignore Riedl's contribution to the argument.

Overall, this PolitiFact story was a faux fact check.  All it did was affirm that Keynesian economists affirm the Keynesian approach.  As Riedl points out, with no thanks due to PolitiFact, at some point the empirical data from economic outcomes need to support the Keynesian models or else the latter are open to question.  It looks like PolitiFact cherry-picked its expert commentary.


Afters:

One of the key experts cited in the PolitiFact story was Gus Faucher, director of macroeconomics at Moody's economy.com.  "Augustine" Faucher's FEC-listed political contributions have all been to Democrats, including a $300 gift to the Obama campaign in Sept. 2008.

Does that mean that we can't trust Faucher?  No, it isn't so simple as that.  Faucher undoubtedly believes in Keynesian principles and government intervention in markets, so his comments as to their effectiveness are simply what we should expect regardless of whether he supported Obama's candidacy.  Faucher's politics when added to his predisposition toward the Keynesian approach should cause us to take his expertise with a grain of salt, though.  He is not a neutral party on this issue.



March 3, 2010
Corrected typographical error on the spelling of Gus Faucher's name (I had spelled it "Guy Faucher").  Apologies to Mr. Faucher and my reader(s).