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Alice Rivlin Reminiscences

Summary:
I discussed the late Alice Rivlin here and here. Here are one personal reminiscence about Alice Rivlin and one thought about a 1993 or 1994 Wall Street Journal op/ed she wrote. At the December 1988 American Economic Association Meetings, Alice was on a panel with Martin Feldstein and Mike Boskin. The chair was Joe Stiglitz and the discussants were Joe Pechman, George Break, and John Shoven. The topic was “Tax Policy for the Next Administration.” In her comments, Alice said that when she was involved with budgets in the 1970s, the federal deficits through most of that time were not large but in the 1980s they were. She said that we needed tax increases but it was hard to see why we didn’t have these same controversies in the 1970s: we hadn’t needed tax increases

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Alice Rivlin Reminiscences

I discussed the late Alice Rivlin here and here.

Here are one personal reminiscence about Alice Rivlin and one thought about a 1993 or 1994 Wall Street Journal op/ed she wrote.

At the December 1988 American Economic Association Meetings, Alice was on a panel with Martin Feldstein and Mike Boskin. The chair was Joe Stiglitz and the discussants were Joe Pechman, George Break, and John Shoven. The topic was “Tax Policy for the Next Administration.”

In her comments, Alice said that when she was involved with budgets in the 1970s, the federal deficits through most of that time were not large but in the 1980s they were. She said that we needed tax increases but it was hard to see why we didn’t have these same controversies in the 1970s: we hadn’t needed tax increases then. The answer to that seemed obvious to me and so I stuck up my hand and was called on. I quoted Alice’s statement and then said words to the effect:

It seems obvious to me why the difference between the 1970s and the 1980s. In the 1970s we had high inflation, especially in the last half of the 1970s, combined with a highly graduated (progressive) income tax system. So those two factors together acted like a large money machine for the feds and that’s why they never needed to talk about raising taxes. What do you say to that?

Alice’s answer was terse and memorable: “Well, there’s that.”

I remember teaching a class in the winter quarter immediately following that event in which I quoted that. My students laughed and for the next few weeks, when a student would have a gotcha on something I said, I would say, “Well, there’s that.” Everyone would laugh.

The second thing I remember was an interesting op/ed she published in the Wall Street Journal about the Clinton health plan. At the time she was either deputy director of director of the Office of Management and Budget. I’m used to high-level government officials who explain what their president is doing using the word “we.” So, for example, “we believe,” “we think,” and “here’s what we’re doing.” But I thought I knew Alice Rivlin well enough to think she was a critic of the Clinton health plan. And, as the interview shows, she was.

How is a principled person to handle that? She handled it by, whenever she spoke about the Administration’s plans and thoughts in a way that likely differed from hers, using the word “they.” “They think,” “they believe,” etc. That was a real tell. I thought to write a letter to the Journal pointing that out but decided not to. My reason was that it was good to have someone like her on the inside and there was no benefit, other than personal glory, in outing her.

One final thing. In the whole long interview that I linked to, one name that hardly comes up is Alice’s fellow Clinton aide Larry Summers. I wonder if she had set as a ground rule for the interview that they not talk about him. My impression of Summers, both from personal experience and from other things, is that he’s a snake. My gut feel is that Alice thought the same thing. But it’s only a gut feel.

David Henderson
David Henderson is a British economist. He was the Head of the Economics and Statistics Department at the OECD in 1984–1992. Before that he worked as an academic economist in Britain, first at Oxford (Fellow of Lincoln College) and later at University College London (Professor of Economics, 1975–1983); as a British civil servant (first as an Economic Advisor in HM Treasury, and later as Chief Economist in the Ministry of Aviation); and as a staff member of the World Bank (1969–1975). In 1985 he gave the BBC Reith Lectures, which were published in the book Innocence and Design: The Influence of Economic Ideas on Policy (Blackwell, 1986).

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