February 2, 2015

More Questions for Professor Gruber

Mark J. Warshawsky

Former Senior Research Fellow
Summary

Gruber’s repeated expressions of support for the ACA, combined with his compensation by the administration, do begin to call into question whether he was more of an advocate, and less of an unbiased technical expert or disinterested economics professor, thereby undercutting his responsibility to do his job as an academic. That key ethical and professional issue does not apply to just Gruber. It applies to some in the academic community who seem to operate as advocates for one side or the other or who primarily engage in political commentary. Is that the appropriate nature of an academic faculty job, even in part?

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On December 9, 2014, the House Oversight and Government Reform Committee held an important hearing in which the main witness was professor Jonathan Gruber, an MIT economist and a key adviser to the Obama administration on healthcare reform. There was an element of politics in the hearing, to give Republican and Democratic representatives the appropriate opportunity to express their outrage, on behalf of their constituents, at the arrogance and cynicism of Gruber’s remarks about the ‘‘stupidity’’ of the American voter. I share their outrage. My anger may be felt more keenly because, like Gruber, I have a Ph.D. from Harvard, do paid work in public economics, and have started an association as a visiting scholar with MIT in January. I feel his disturbing comments dishonor the profession and may cause people to doubt the fairness and objectivity of these essential institutions.

Moving beyond Gruber’s wholly inappropriate manner of speaking, the hearing also began to delve into underlying substantive issues about the moral elements of policy analysis and discussion, the current nature of legislative processes, judicial review of the content and structure of the Affordable Care Act, and the current interpretation of and compliance with federal and state laws governing tax-exempt charitable institutions regarding private inurement. Those issues are worth further exploration.

Moral Elements of Policy Advice
There is an apparent internal contradiction and illogic in Gruber’s most famous statements about the stupidity of the American voter. He describes how duplicity, in terms of minimizing and hiding the massive redistribution of wealth that is the central effect and perhaps even the main purpose of the ACA, was needed to pass the legislation. In particular, the various penalties could not be called taxes, healthcare cost control efforts were said to be strong, and there had to be no admission of the transfer of resources from rich to poor, from healthy to sick, and from young to old. Because if things were called and described as what they in fact are, then the legislation would not have passed because American voters would have opposed it as contrary to their interests. Putting it in my words now, if the experts had been loyal to their professional callings and told the objective truth, voters, who are smart and can be taught to understand the situation, would have rejected the reform law through their elected representatives. In short, average American voters are not stupid; rather their values are different: They do not embrace more redistribution or want to subsidize more healthcare spending. But then, that is a matter of a difference in value judgments from what apparently motivates Gruber in his support for the ACA, not a matter of intelligence or expertise.

Is there a different reasonable interpretation of what Gruber was trying to say? Or is he stating that the ends (more widespread health insurance coverage) justify the means (not sharing relevant information about the legislation)? Should the moral and political elements and assumptions in policy analysis and advice be clearly disclosed? This is an important topic to pursue further with Gruber in gaining a broader understanding of the current use of economic policy analysis in the realm of political action.

As a related matter, Gruber’s repeated expressions of support for the ACA, combined with his compensation by the administration, do begin to call into question whether he was more of an advocate, and less of an unbiased technical expert or disinterested economics professor, thereby undercutting his responsibility to do his job as an academic. That key ethical and professional issue does not apply to just Gruber. It applies to some in the academic community who seem to operate as advocates for one side or the other or who primarily engage in political commentary. Is that the appropriate nature of an academic faculty job, even in part? Mark J. Warshawsky was formerly Treasury assistant secretary for economic policy and is now a visiting scholar at the Mercatus Center at George Mason University and at the MIT Center for Finance and Policy. This article follows on and deepens the discussion of important issues raised by Jonathan Gruber’s 2014 testimony before the House Oversight Committee on Oversight and Government Reform about his work on the Affordable Care Act.

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