Role of the Economist

...Who isT) He tends to be a symbolist...

...Johnson began bombing North Vietnam in February 1965, war contracts were being let in late 1964 and early 1965, and the stimulative expectations of military escalation were already being felt...

...Something Happened JOSEPH HELLER Knop/, $I0 IRVING ~IALIN Bob Slocum, the narrator of Joseph Heller's new novel, is obsessed by doors...

...Slocum is not an ordinary neurotic...

...he does not know what lies outside it, 20 December 1974:272...

...We would also contend that deliberate mass murder on the scale of the Vietnam war left no more room for doubt on the morality of high level government participation than would helping improve the efficiency of the German regime in 1944...

...Thus, since at times "we do observe cutbacks in defense spending," it is concluded that the alleged power of the militaryindustrial complex is overrated (although Tobin does attribute "some billions of dollars" to its influence...

...But Tobin does not mention the vigorous, positive support given the war by many of the New Economists--the "guns and butter" sales pitch of Walter Heller and his successors on the CEA, their willingness actively to mislead Congress and the public on the economic effects of the war, and their backing of the 1968 income surtax whose only purpose was to finance further military escalation in Vietnam...

...All of this Tobin attributes to the "great tax cut...

...In discussing the reasons for high U.S...

...Economists can play a modest role in this process...

...And his statement that "subsequent increases from 1965 to 1971 in federal civilian outlays were even more substantial: $9.4 billion" is made without any mention of the fact that during the same period military spending rose by $21.5 billion...

...More fundamentally, it seems not to have occurred to him that "world events" may reflect prior policy decisions, and may even be deliberately manufactured as part of the policymaking process--e.g., he includes the "Gulf of Tonkin incident" as an external event "explaining" military outlays[ Tobin shows no awareness that there is an issue of cause and effect here, and that there is a literature that could be examined to shed light on this matter...

...Perhaps even less convincing is the final tribute heaped upon the New Economics--that the serious problems that faced us in 1957-60, "stagnation, unemployment, and frequent recession," have been "substantially solved...

...The same can be said of his efforts to dismiss the employment and income impact of high military budgets throughout the postwar period...

...nation has vast, and growing, interests abroad and that, as Presidential Council on International Economic Policy chairman Peter Flanigan put it in March 1973, "there are close ties between our political and military relationships and our economic dealings abroad...

...although he would prefer to remain in his study, he is shocked to find his family--his wife and two childrenmwanting to enter...

...Although he fears entrapment, he finds strange comfort in his claustrophobia...

...The doors, at least, are definite...

...Tobin contends that the position of the New Economists should be regarded as strictly a matter of "personal commitments and beliefs" and that it is not clear that "any national interest" would have been served by their dissociation from government...

...unemployment record in the postwar period: through all the discussion of the achievements of the New Economics in solving the problem of unemployment no mention is made of the fact that in January 1962--when Tobin himself was a member of the Council of Economic Advisers-the Kennedy Administration redefined "full employment," as prevailing if 4 percent of the total labor force was unemployed rather than 2 percent...

...Tobin later asserts that "through July 1965, perhaps longer, defense was not supporting the [economy's] recovery...

...Tobin correctly points out that federal nondefense purchases rose faster than defense outlays from 1961 to 1965m $5.2 billion as opposed to a reported $2.3 billionmbut he neglects mentioning that in 1965 the level of Pentagon spending was still triple that of civilian spending ($50.1 billion versus $16.8...

...If they behave as the New Economists have, however, advising their powerful superiors within the .~onstraints of what the latter will find "agreeable, and prepared to serve big business and the state on any set of policy premises, little of long-term constructive value will be contributed by the profession...

...The statement that military outlays were not aiding recovery until mid-1965 or after is indefensible...

...He is confined to his decaying body...

...Nor would anyone realize that since the end of the postwar boom in 1948, only large injections of military spending for the Korean and Vietnam wars have been able to push officially measured unemployment below the 4 percent mark, in 1951-53 and 1966-69...

...Tobin is understandably defensive on the role of the New Economists in the Vietnam war...

...From mid-1965, of course, military spending took off and climbed past the $74 billion mark by 1970...

...In sum, military Outlays played a critical role in the JFK-LBJ economic "boom," and Tobin's attempt to downplay their importance is at best unconvincing...

...BOOKS THE ROLE OF THE ECONOMIST RICHARD B . DU DOFF AND EDWARD S . HERMAN The New Economies One Decade Older JAMES TOBIN Princeton University Press, $6.50 This set of lectures treats the rise and decline of the New Economics in the 1960s, the post-1965 attacks on that doctrine and its practitioners, and current problems in economic stabilization policy...

...It is also interesting to see Tobin confine himself to "any national interest" as the sole criterion for determining an appropriate personal stancemthe vaunted "internationalism" of economists sometimes looks thin indeed...

...Not a single one displayed the moral courage of a J. F. terHorst, despite far more severe provocations...

...He does not know what others are doing or saying behind them...

...By 1971 the federal government was spending a reported $71.6 billion per year on the' military and $26.5 billion on the civilian public sector...

...This no doubt involves a "judgment" on both the nature of the Vietnam holocaust and the importance and worth of the faceless Indochinese victims of the American juggernaut, but the evidence of large scale and systematic criminal behavior was as public even in 1965 as the facts about the crematoria...

...but, on balance, this is a disappointing book...

...One could hardly guess from this history that upon taking ofCommonweal: 271 rice President Kennedy immediately hiked Eisenhower's final Pentagon budget by 6% and that overall, on conservative estimate, military outlays increased by 15% from 1960 through 1962...

...A much more plausible explanation for the 1960-1965 economic advance, we would suggest, is military spending, which (as the reader might by now anticipate) goes wholly unmentioned in Tobin's account of the "triumph" through 1965...

...Prosperity after 1945 did not require a/l that much defense-spending, so the notion that capitalism requires military outlays may be dismissed without further analysis...

...Tobin's defense of the New Economics, especially against the "cross-fire from the left," is both petulant and question-begging, and in general Tobin fares badly when he ventures forth from his bastion of technical expertise into the sociopolitical sphere...

...He begins by dating the "triumph" of the New Economics from JFK's Presidency through 1965, to which he credits a 31 percent growth of real output, creation of 6.8 million new jobs, and a lowering of unemployment "virtually" to 4 percent...

...He makes doors metaphysical entities...

...But he also sees doors at home...

...The possibility that part of the civilian increase was derivative, necessary to placate labor and some minority group leaders and allow Johnson to pursue his main business--military victory in Vietnam --would hardly enter Tobin's mind...

...it is what lies behind the doors which really terrifies him: "Even at work, where I am doing so well now, the sight of a closed door is sometimes enough to make me dread that something horrible is happening behind it, something that is going to affect me adversely . . . . " Slocum associates doors with work...

...Tobin's historical account of the 1960s contains parallel distortions...

...His correlation is so silly, and Tobin himself so intelligent, that we must assume that he is still unable to free himself from the Cold War premise that the United States is only a passive agent, not an active force pursuing its own interests...

...Since Tobin is an able economist, there are illuminating moments, particularly in his critique of the Milton Friedman school of monetarism and his discussion of various policy options...

...Tobin defends the New Economists' silence on Vietnam, their unadulterated growthmanship through the 1960s, and their tardy interest in matters of the environment and income distribution in terms of the political constraints on policy advice...

...Imagine what a roasting Tobin would administer to a "Marxist" who played so fast and loose with facts and statistics...

...In criticizing "Nee-Marxist" analyses of military spending, Tobin not only ignores some important str.ands of radical thought (such as the emphasis on our heavy external interests), his method is to take a number of discrete hypotheses, caricature them, and then attempt to refute each in turn without relation to the others...

...His clincher, that "defense spending actually declined in the years 1962-65," is disingenuous: reported Pentagon expenditures rose from $44.9 billion in 1960 to $51.6 billion in 1962, after which they leveled off to a 1963-65 average of $50.3 billion annually...

...Our calculations for the period of 1960 to 1965, however (from the latest Report of the President's Council of Economic Advisers), which give Tobin more than the benefit of the doubt (especially since 1960 was a recession year), show that real GNP rose 27 percent and only 5,3 million new jobs were created...

...He wholly neglects the educational and opinionshaping role of economists and other intellectuals, The solution of our basic economic problems is going to require a new awareness of relationships and possibilities of change along with a significant shift in values by mainstream America...

...He tells us in his very first words: "I get the willies when I see closed doors...

...In his entire discussion of the military budget, in fact, Tobin never once mentions that our...

...An imperfect correlation for each critical hypothesis taken in isolation brings a sarcastic rejection of each, whereas Tobin's own "naive" model is asserted without discussion...

...Tobin never asks why the United States was compelled to "respond" to these events...

...Imagine, too, how Tobin would treat a radical who dealt with any topic so elusively as Tobin himself deals with the U.S...

...military expenditures, for example, Tobin devotes two pages to a chart showing such expenditures fluctuating in relation to "major crises in international relations since 1945," and he suggests that "a naive explanation in terms of [U.S.] responses to world events fits the facts very well" (p...

...Furthermore, the "great tax cut" was not even enacted until February 1964, and its effects would have taken another two or three years to be fully realized...