CRF Blog

The Real Policy Wonks: How Economists Reshaped America

by Bill Hayes

In The Real Policy Wonks: How Economists Reshaped America, Knowledge@Wharton interviews journalist Binyamin Appelbaum about his new book, The Economists’ Hour about how economists grew into powerful figures who changed American policy.

Appelbaum: My book is mostly about the period from the late 1960s through 2008, what I call the economists’ hour, which is the period in which these economists are really dominant in shaping the course of public policy. During that period, they really do succeed in pushing government to focus on growth, and the very clear consequence is that inequality explodes. There are lots of reasons for the growth of inequality; economists are by no means solely responsible. But this decision to stop trying to prevent inequality, to stop taking inequality seriously as a public policy problem is a really important contributing factor.

Knowledge@Wharton: Without some of these policy changes decades ago, do you think the divide would be as large as it is now?

Appelbaum: I’ll give you a really simple comparison. If you look at the American economy and the French economy, most Americans take pride in the fact that America has grown more quickly than France. We see it as a validation of our economic model. But if you remove the top 1% of the population in both countries, what you find is that for the 99%, for the vast majority of Frenchmen and the vast majority of Americans, economic income growth has been much faster in France. It is easy to imagine a world in which you had more of a focus on distribution and less of a focus on the total size of the pie, and a lot more people ended up with larger pieces.

Knowledge@Wharton: Have other countries also seen that type of growth that allows some level of equality? [more]