by Mitch Kokai
Senior Political Analyst, John Locke Foundation
I couldn’t help but recall a recent critique of the so-called electoral “efficiency gap” when reading the article that marks Andrew Ferguson‘s return to Commentary magazine. It’s titled “The Night Data Died.”
In both cases, the author laments the elevation of statistical analysis over the reality of human action.
In turning to social science, in making it the source of knowledge about the behavior of human beings, the political world is not alone. Indeed, it came rather late to the game. For a generation now, every businessman in the developed world has been bragging about how big his data is. Where he once might have trusted his intuition and experience and acquired wisdom to sense the movement of a marketplace, he now hires bespectacled, poorly groomed youngsters with sloping shoulders to produce algorithms that can be pasted into power points, which will in turn wow the shareholders and board of directors. Every field of American life—preschool education, baseball, book publishing—has succumbed to the conceits of social science.
The arrival of Barack Obama brought the reliance on data in politics and government policy to its present level of intensity. His election in 2008 became Exhibit A. His campaign staff’s obsession with “quantitative analysis” was plausibly credited with finding pockets of previously ignored Democrats and getting them to the polls. The magic failed four years later when Obama’s turnout actually fell, but no matter. The data delusion is hard to shake. …
… Ominously, Washington’s obsession with reducing human activity to the x’s and o’s of an algorithm goes beyond campaigning. President Obama helped popularize the academic enthusiasm of “behavioral economics” to enshrine the rickety findings of economics and social psychology in government policy. He even issued an executive order—the man did like his executive orders, didn’t he?—requiring every federal agency to deploy a team of behavioral scientists to help in drafting regulations. The potential for mischief was enormous. I’m happy to report that Obama’s order has had almost no consequences, besides the simplification of a few government forms and the increasing frequency of email communication with the recipients of government loans. But it was a close call.
The data delusion grips us even as the failure of data lies all around us. A politician’s reliance on polls is matched only by the well-documented capriciousness of polling. Every quarter, government economists make forecasts that are duly reported by journalists and never come true—a fact that journalists report much less often. No policymaker, no matter how consumed by data, foresaw the greatest social calamity of our young century, the financial collapse of 2007 and 2008. And the collapse itself was at least in part a failure of “quants” who had come to believe their statistical models allowed them to manipulate markets to their advantage. Meanwhile, for nearly a decade, the wizards at the Federal Reserve have used the most impeccable data to orchestrate a robust economic recovery that always seems a few quarters away.
Now, though, even the most data-driven geek should find the evidence impossible to ignore—because the failure is being quantified.