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Spies Play Economists, Economists Play Spies

The New York Times on Friday the 13th headlined “Global Economy Top Threat to U.S., Spy Chief Says.” Many other papers followed suit with similar prominent headlines. Director of National Intelligence Dennis Blair staged a raid on the Big Issue of the Day as a “security threat” and thus something falling within his bureaucratic turf.

Thanks, Spy Chief, but we have enough trouble sorting out the advice of the expert economists on the Global Financial Crisis without adding the amateur opinions of spies.

Of course, Spy Chief’s turf raid could just be retaliation for foreign aid economists’ even more audacious turf raids on the worlds of spies and generals. Aid economists like Paul Collier in his book The Bottom Billion are trying to micro-manage the deployment of UN and Western armies around the globe, suggesting aid economists have hitherto-unsuspected access to both global intelligence and military knowledge.

Here’s an even more audacious proposal. Let’s go back to that old-fashioned world called Division of Labor and Gains from Specialization, where spies were spies, generals were generals, and economists were economists.

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  1. Oliver wrote:

    Specialisation is too important to be left to the specialists, as I believe Clemenceau meant to have said…

    Posted February 16, 2009 at 6:48 pm | Permalink
  2. Mike wrote:

    A few days back I read your New York Review of Books article that you linked to above. I was surprised that you didn’t comment on Collier’s claim that aid can give rise to dutch disease. I thought, perhaps incorrectly, that this would have been consistent with your work…

    Posted February 16, 2009 at 11:57 pm | Permalink
  3. oops wrote:

    with nobel economists like stiglitz and krugman intruding into international relations regularly, the division of labor idea is refreshing. spread the word in your camp. that cost only analysis of the iraq war book was pure intellectual dishonesty by stiglitz.

    or remember the general that arrived in iraq after sadam was toppled. he had a bag of cash to distribute. he realized that without goods on the shelves for the people to buy he would just cause inflation by distributing the money.

    lots of foreign affaris fields require some economics knowledge. yet economists fail to see that economic growth follows security. they are too busy crunching numbers and overaggregating everything while mocking the austrians.

    Posted February 17, 2009 at 11:14 am | Permalink
  4. Wills wrote:

    Don’t some of our problems arise from treating political issues (including military action and foreign policy) separate from economic issues? Collier may not be the best source for military advice, but I think he presents some ideas that generals should wrestle with as they make their military decisions. If anything, I think we need more interdisciplinary work. By the way, I look forward to hearing you speak here at BYU next month.

    Posted February 18, 2009 at 12:29 pm | Permalink
  5. C. Moree wrote:

    Dr. Easterly:

    Your point has merit. It may be a pareto outcome for economists and foreign policy people to remain in their respective worlds.

    However, I believe Denny Blair’s testimony was valid. Most national security experts believe the global economic crisis is the greatest short-term threat to U.S. national security. If you disagree with Blair’s assertions, I would encourage you to talk to members of NYU’s Politics Department. Much of Blair’s testimony was predicated on very sophisticated computer modeling that examined the links between economic crises and global instability. The National Intelligence Community has relied on number crunchers in the vein of NYU Politics in the past, and did so again when Blair gave his testimony.

    Posted February 22, 2009 at 9:11 pm | Permalink
  • About Aid Watch

    The Aid Watch blog is a project of New York University's Development Research Institute (DRI). This blog is principally written by William Easterly, author of "The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics" and "The White Man's Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good," and Professor of Economics at NYU. It is co-written by Laura Freschi and by occasional guest bloggers. Our work is based on the idea that more aid will reach the poor the more people are watching aid.

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