It’s On…
Clash of the econogeeks. Bryan Caplan and I apparently have another wager.
UPDATE: Because I fear that my genius is (as usual) being misunderstood, let me do one last iteration on this and I promise I will drop it. In the comments of Bryan’s new post, one of his fans congratulated Bryan on setting me straight on the mathematics of it all, and then said:
“It’s also great to see someone publicly making predictions in advance.”
To which I replied:
Bryan has done nothing courageous of the kind; he’s like Janet Reno taking “full responsibility” for Waco, and then not resigning. He “went out on a limb” and said that if unemployment breaks 8%, he will reevaluate the effectiveness of TARP.
And then, a long time after that daring public proclamation, he thinks it is so obvious that TARP has been a failure, that he chastises bailout proponents for not looking at the lessons of history.
Doesn’t anyone else see a problem with that, or am I taking crazy pills?
Third time: your remark would be relevant if Bryan Caplan believed the only relevant metric for judging TARP were the government-published unemployment rate. I don’t think that’s the case.
Oops, found another metric Bryan proposed:
http://econlog.econlib.org/archives/2008/10/the_bailout_wil.html
OK that’s good, I didn’t remember that one (maybe I never saw it). Although, doesn’t the government officially say that it’s made a boatload of money on TARP so far? So now, based on the two criteria for the success of TARP that Bryan Caplan has suggested, both are in favor.
Again, it’s fine if Caplan still says, “This doesn’t outweigh my priors,” but it’s weird for him to say bailout proponents are ignoring the evidence.
(And you’re right Silas, I was being sloppy with a priori / priors in my other post. You can believe me if you want to, but I do know the difference.)