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Gruber And Selective Disclosure

I barely even know what Paul Krugman is arguing here. In both of his posts attacking anyone calling into question the lack of disclosure on the part of Jonathan Gruber, he acknowledges that Gruber should have disclosed his relationship. That’s really the end of the game here. Nobody is really saying that Gruber didn’t come to his conclusions honestly (though I’ll return to this in a moment) or isn’t saying now what he wouldn’t have said if he was not under contract. The problem is that the White House repeatedly used Gruber as an “objective source” while he was under contract, and neither the White House nor Gruber bothered to disclose that fact for months. That’s all too common in our political culture, and a legitimate problem.

Glenn Greenwald has an appropriate response. For instance, Glenn notes that Gruber’s explanation to Krugman, which offers new information, makes this even more troubling:

I was contracted with HHS for technical modeling assistance. When designing a policy like this, policy makers want to consider a million different permutations: different AVs, tax credit amounts, employer assessments, etc. Basically, in a perfect world, we would all just rely on CBO for all these permutations. But CBO has limited resources and can’t work directly with the administration. So I provided the administration & congress (mostly senate finance) with the kind of modeling that CBO does to help them narrow options to a more manageable list that they could send to CBO.

It makes sense to use modeling to get a preview of CBO analysis, and Gruber’s models are recognized as among the best. But like the White House, members of the Senate Finance Committee like John Kerry, who put together the structure of the excise tax, were publicly saying things like “this bill will raise wages, don’t trust me, trust independent expert Jonathan Gruber,” when at the time Gruber was working with the Committee on their modeling. Greenwald:

Anyone listening to this would have had no idea that Gruber wasn’t just some independent authority, but was actively working with both the administration and Kerry’s Committee in exchange for large payments. Not disclosing that — and instead affirmatively selling Gruber as some kind of detached, objective expert (“hey, don’t listen to me; listen to that independent expert over there”) — is just wrong. As Sunstein himself argued, people who are truly “independent” have more credibility in the eyes of many than those who are on the government payroll. For that reason, to depict someone who is actually in the latter category as being in the former is simply deceitful. How could anyone possibly defend that?

Perhaps this blind spot on the part of Krugman could just be academic courtesy to a colleague who is working on a proposal he favors. But I want to add something to this about the nature of Gruber’s views. Merrill Goozner notes in the comments of Krugman’s piece that Gruber, in fact, has changed those views, or at least allowed for more ambiguity in them, prior to this year.

Two years ago, in a paper published on the NBER website, he showed that raising co-pays and deductibles harms patients, especially those with chronic diseases. He has both admitted that the misnamed Cadillac tax will raise co-pays and said in published comments that “there is no evidence” that it will cause harm. This is diametrically opposed to what his research showed before working for the Obama administration.

Similarly, Larry Mishel, the EPI economist who has lots of experience on wage issues, confirmed in an FDL blog comment that Gruber admitted to him he “exaggerated” the case for wage growth when health costs decrease:

I think his error in the case I’m criticizing is that he’s a health care economist and doesn’t know the details about wage trends. I, on the other hand, have been studying wages for thirty years or more. Gruber clearly over-reached with the argument about health care driving wage trends and has acknowledged that to me privately (yesterday).

Mishel says this while defending Gruber over his contract with HHS. But it’s a huge point. I have no problem with Gruber being a technical modeler for the government. I have a somehwat bigger problem with his talking about the health care bill upon which he has been contracted without disclosure. I have a bigger problem with other politicians citing him as an “objective source” when he’s working for the government. But I have the biggest problem with Gruber selectively articulating his confidence with this or that element of the bill unless called on it. He has neglected the work of his own research into the effects of higher co-pays and deductibles. He has admitted to exaggerating when talking about health care and wage trends. But he wouldn’t have acknowledged any of this in a one-way conversation when he wrote an op-ed, or in a conversation with a journalist either unaware of countervailing data or inclined to believe his pronouncements. Only when an economist like Larry Mishel or a labor writer like Steven Greenhouse calls him on his statements does he walk them back.

That’s something of a second-order issue with Gruber, but it doesn’t speak well of him. And it goes to the heart of the non-disclosure; he doesn’t disclose FACTS in the same way he doesn’t disclose the nature of his financial relationships – or rather, he only does when he has to. The need for disclosure is one thing – but there’s also the need for fact-checking in journalism, to ensure that opinion-makers aren’t given the leeway to maximize their views and minimize any contradictory information.

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David Dayen

David Dayen