And I guess I’d be right now, if I said it again. Look, there are all kinds of things you can say about economists—it’s not for nothing people know what you mean when you say someone has an economist’s interpersonal skills—but with economics, as with law or any other field, if everyone says you’re wrong, you should listen. If you read any of the same blogs I do, you will know that Hillary Rodham Clinton not only doesn’t listen but is proud to let you know it:

STEPHANOPOULOS: But can you name an economist who thinks this makes sense?

CLINTON: Well, I’ll tell you what, I’m not going to put my lot in with economists….

So below, here’s what I had to say about such people four years ago. I mean, if the politicians are going to recycle old acts, can’t I recycle old comments on those acts?

Financial Times (London, England)

February 27, 2004 Friday

Sound economics requires respect for the facts: ERIC RAUCHWAY:

BYLINE: By ERIC RAUCHWAY

SECTION: COMMENT; Pg. 13

LENGTH: 779 words

Last week more than 60 distinguished scientists warned that the White House will do to natural science what it has already done to military and social science: politicise it out of all useful relation to reality. In an open letter, the Union of Concerned Scientists expressed its dismay at the Bush administration’s tendency to set aside “fact-based data” that did not support its otherwise-based policies. But science will survive President George W. Bush, just as it survived Pope Urban VIII, Galileo’s adversary. We shall have to hope the same holds true of economics, which is more vulnerable to the administration’s blithe dismissal of data.

Lately Americans have indulged in the supposition that market forces operate like gravity, working without our help. In truth, markets of any significant scale and scope rather resemble the gravity-defying machines to which we routinely trust our lives. Like aircraft, modern markets require predictable policy management based on sound, widely available information if they are to stay aloft - and as the International Monetary Fund warned this January, America’s present fiscal policy threatens to drag down the global economy. Yet the White House continues to denigrate sound economic data in preference to its intuition - and in doing so is following a disastrous precedent.

The Republican Party did not always scoff at politically neutral economic numbers: 120 years ago this year a Republican administration created the Bureau of Labor Statistics. Its first commissioner, Carroll Wright, believed fervently in the virtues of modernity, expecting that fact-based data would free policymakers from conceptual straitjackets. Informed policy aiding the growth of private industry and the wide distribution of its benefits would provide a higher standard of living, proving socialists wrong. The only enemy of economic knowledge - and of progress - was political interference. “Even when the head of (a statistical) office has been appointed for purely political reasons,” Wright declared, “the incumbent has soon realised the sacredness of his office and he has learned that to tell a statistical lie is the most harmful thing a man can do.”

Wright discovered it was insufficient not to tell lies; one had also to be permitted to tell politically uncomfortable truths. No sooner had he begun a series of price and wage data to provide factual bases for policymaking than his bureau came under attack - not least because he had the poor judgment to begin what was meant as a politically neutral project in a presidential election year. During the campaign of 1904, the BLS data endured criticism for ignoring troubled sectors of the economy and for serving the interests of the incumbent president, Theodore Roosevelt. In the political fallout and bureaucratic reshuffle that ensued, Wright gave up his job and his ambitious BLS series were discontinued.

Political attacks on such data - which turned out on later examination to be reasonably good - prevented the emergence of policy regimes based on regular observation of economic trends. Options narrowed, and a hopeful faith in self-correcting mechanisms such as the gold standard sprang up where fact-based policies might have grown. The hardening of monetary and fiscal policy into the sclerosis of the interwar gold standard regime produced disastrous results, making the 1930s depression rather greater than it need have been. This failure might have been avoided if in the 1910s US leaders had been more flexible. But to do that they would have needed greater confidence in making economic decisions based on data instead of ideology - a confidence they denied themselves by undermining the BLS.

Spurred by the first world war, the BLS began to develop new series, establishing in 1927 its monthly payroll survey of employment. Disputing BLS data became the last refuge for failed adherents of economic orthodoxy: heading into his 1932 re-election campaign President Herbert Hoover subjected Ethelbert Stewart, the BLS chief, to forcible retirement in retaliation for standing by consistently (and accurately) gloomy unemployment figures.

Mr Bush, it is often noted, has a job-loss record unmatched by any president since Hoover. Instead of learning from Hoover, Mr Bush is imitating him, declaring prosperity is just around the corner while his spokesman derides statisticians and economic modellers. It is too late to hope that this administration will restore honour and integrity to the White House economic policy process. We must have faith that its Democrat challengers show a higher regard for facts.

The writer teaches history at the University of California, Davis

Copyright 2004 The Financial Times Limited