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Book Review: Econospinning by Gene Epstein

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Gene Epstein, economics editor for Barron's magazine, has written a new book called Econospinning that promises to reveal "how to read between the lines when the media manipulate the numbers". Unfortunately, Epstein doesn't deliver on that promise. Instead, he lines up a few targets and goes after specific examples of their liberal use of economic data to suit their own political agendas. When I say "liberal" use, there's a double meaning – most of Epstein's targets are those on the left end of the political spectrum.

The first half of the book could conceivably have been titled "Paul Krugman is a big fat idiot", as Epstein cites examples of where he believes the New York Times columnist twisted employment data in an election year to paint an unflattering picture of the U.S. economy. It's difficult to decipher whether Epstein has valid arguments in the maze of data he offers, but in fairness I may just not be smart enough. What I couldn't help but think, however, was that when it came to his arguments against Krugman and others, those indicted had no opportunity to defend themselves, thus making it no clearer whether they were econospinners or whether Epstein might be as well.

That may be the nature of this type of book, but it doesn't help readers understand who's telling the truth versus who's spinning the numbers.

Other Epstein targets in Econospinning: Steven Levitt's argument in Freakonomics that legalizing abortion resulted in reduced crime, Barbara Ehrenreich's report on the difficulty of poor people getting ahead in the book Nickel and Dimed, and CNN's Lou Dobbs. Again, other than a couple of half-hearted swipes at The Wall Street Journal and Alan Greenspan, the majority of those targeted represent the political left, which calls into question Epstein's motives.

Econospinning is at its best when it goes after the methods of economic data gathering versus the conclusions of those who interpret it. For example, he makes a convincing argument against the government's reporting of monthly payroll and unemployment data, saying this data is often revised significantly (with revisions ignored after the spin associated with the initial release of numbers) or reported upon breathlessly even when results are statistically insignificant.

Unfortunately, for readers who buy Econospinning in hopes of understanding who's honest and who's blowing smoke, there's no assistance forthcoming. In fact, despite marketing the book as a guide to "reading between the lines", Epstein admits he's done no such thing in Econospinning's final two paragraphs:

Finally, I had planned a chapter of advice to the average reader. You'd like to know what's happening to the economy, but with all that econospinning out there, how do you cope?

In this case, I ended up having far less to say than I had thought. I conclude instead on an upbeat note: If the people attacked in this book actually read it, maybe their stuff will improve.

For those of us not occupying the political extremes, this seems less like an upbeat note and more like a lame conclusion.

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About Justin McHenry

  • Kitty O’Keefe

    As a past post-graduate instructor of Security Analysis, I have reviewed the work of countless authors in search of any who approach the subject of economics in an empirical manner. None did so more thoroughly than Mr. Epstein. His premises are based on the best scholarly data I have found, and he draws conclusions based on fact.
    If his findings are at odds with yours, I would suggest that perhaps you have a preconceived idea of what they should be, as opposed to what data supports.

  • http://www.indexcreditcards.com Justin McHenry

    Well, first off, I should say I have no preconceived idea of whether Epstein is right or wrong, and I have no findings to compare his to.

    My point is this–Epstein overwhelmingly chooses as his targets those who represent the left side of the political spectrum. Even if everything he writes is correct, it is still true that he has selectively chosen who to take on in his book.

    If everything he says in his book about Paul Krugman is true, does that mean Paul Krugman is always wrong? Is Epstein hoping to plant the seed that Krugman is always wrong by using a few examples of “gotcha”?

    Also, should we come to the conclusion that economists that might be branded as conservatives are always right? Or is it just as likely that they spin the numbers to their liking just as often? We can’t tell from this book because Epstein spends most of his time on those representing the left. And, because he does so, it calls into question his motives and casts suspicion on everything he writes.

    If Epstein’s methods are the best in the world, great, I’d love to be enlightened. But when he uses his methods on an unlevel playing field, I don’t feel I can trust him more than anyone else.

    And of course, since I don’t know you and your qualifications (other than being a past post-graduate instructor of Security Analysis, which doesn’t bring to mind expertise in economics), I have no reason to trust your word on Epstein’s expertise, either.

    Not all of us are on the political extremes. What we’d like is credibility from a source, not uneven statistical evidence that suggests an author’s personal bias.

  • http://philobiblon.co.uk Natalie Bennett

    This article has been selected for syndication to Advance.net, which is affiliated with newspapers around the United States. Nice work!

  • Virginia J Frazier

    I saw Mr. Epstein tonight on tv talking about his book, Econospinning. He was at Barnes and Noble in New York recorded in November, 2006. I am a retired mother of five living in Florida with no initials after my name (although my children have some :))I just want to say that I agree with Justin McHenry when he says that Mr. Epstein’s book is bias and does not deliver on the promise of his title. I would like to see him appear on CNN’s Lou Dobbs program. Lou would eat him alive.

  • http://www.diablog.us Dave Nalle

    Lou Dobbs, like Paul Krugman, is a raging idiot and there’s no way he’d ever have a serious economist on his show.

    Dave

  • Kitty O’Keefe

    Gene Epstein HAS appeared on Lou Dobbs’ show, and, if by being ‘eaten alive,’ one means bases statements on empirical data, Mr. Epstein definitely did the eating.