I worry when Mankiw cites Oregon

It is not often that I come across "Oregon" in serious economic policy analysis.  After all, while the state is famous for, among other things, microbreweries, hippies, Nike, it is not any leading light on economic issues.  Unless they are bad examples of economic policies!  Which is how Greg Mankiw uses one example from Oregon, in his detailed essay on the challenge government economists have faced over the past year and a half, and the lessons for the discipline itself.

(The essay is a wonderful illustration of how all the fancy math and jargon is not needed at all, even though at the drop of a hat economists would love to say "as a first approximation" and then scribble a couple of second-degree differential equations! It is a must-read in order to understand the points of departure in the economic recovery ideas debated: government spending versus tax incentives.)

Anyway, in discussing the jobs created or jobs saved claims of the Obama administration, Mankiw presents one of the issues related to this--data reporting errors and false claims (I wonder whether he intentionally chose not to quote Hayek in this context; I recall that Hayek wrote about how in a Soviet system bureaucrats have an incentive to misrepresent numbers):

Some employers, for instance, have counted money used to provide pay raises to existing employees as “creating” jobs. Thus the Wall Street Journal reported last November that the Mid-Willamette Valley Community Action Agency in Oregon had claimed to create 205 jobs with its $397,761 in stimulus money — spending less than $2,000 per “new” job.

Really?

We don’t want to be France!

The following I agree with:

Doug Schoen, a Democratic strategist and pollster who worked for President Bil Clintonfor six years, said that should Mr. Obama win next month, he should not mistake his electio for a mandate for sharply higher taxes on the wealthy or major government expansion. “The polling I’ve done shows that people are anti-Republican, not pro-left, not pro- redistribution,” he said. “They’re ever more skeptical of Washington.”

For example, in the poll by CBS News released earlier this week, 44 percent of Americans said businesses now faced “too much” or “the right amount” of regulation, compared to 43 percent who said they faced too little. In a New York Times/CBS News Poll in September, 42 percent said Mr. Bush’s tax cuts, which overwhelmingly benefit the wealthy, should be made permanent, while 36 percent said they should be allowed to expire over the next several years.

Most strikingly, 34 percent described themselves as conservative, compared to only 20 percent as liberal. Those figures have hardly changed since September 2000, when 32 percent described themselves as conservative and 20 percent as liberal.

... Jeffrey Garten, a professor at the Yale School of Management who was an undersecretary of commerce in the Clinton administration, said lawmakers are likely to impose stricter regulatory oversight on several industries — especially financial companies and markets. 

... “I’m scared about the next year but I’m very optimistic we’ll come out of this in good shape,” he said. “We very well may come out of this horrible situation with a better version of American capitalism — it’ll be a little tamer; it’ll be a little more regulated.”

“But this country is built on an appetite for risk,” he added. “We don’t want to be France.”