Speaker 1: Ye. Welcome to the Bloomberg Surveillance Podcast. I'm term Keene
Speaker 1: jay Leie. We bring you insight from the best in economics, finance, investment,
Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,
Speaker 1: Bloomberg dot Com, and of course, on the Bloomberg. This
Speaker 1: past weekend, the field of economics lost a giant. This
Speaker 1: program lost a very good friend. It is with great
Speaker 1: sadness that I say that Princeton University economist Alan Krueger
Speaker 1: has died. The course was suicide. He was fifty eight. Alan,
Speaker 1: who had been a professor at Princeton seven, served in
Speaker 1: Obama's White House from after a stint as the Treasury
Speaker 1: Department's Assistant Secretary for Economic Policy. In addition, he served
Speaker 1: as chief economist at the Labor Department for a year
Speaker 1: during President Bill Clinton's administer ration. Our listeners will remember
Speaker 1: him joining us on nearly every first Friday of the
Speaker 1: month to discuss the payrolls report. He made us all
Speaker 1: smarter every time he spoke, and put in great effort
Speaker 1: to help us all care about the people behind the
Speaker 1: data in a way not enough people do. He cared
Speaker 1: a loyal public servant and a world renowned labor market expert.
Speaker 1: I want to bring in on the phone now Danny
Speaker 1: Blanche flat Denmouth Professor of Economics. And here in the
Speaker 1: studio Michael Mckeeblinberg International Economics and Policy correspondent, Mike Sad
Speaker 1: Sad day Um, and we get the opportunity now, and
Speaker 1: we should take the opportunity to reflect on his legacy.
Speaker 1: We were all shocked, and his legacy is a great one.
Speaker 1: And uh when all he wishes that he had been
Speaker 1: able to read the tributes to him over the last
Speaker 1: twenty four hours um before he died. Because he was,
Speaker 1: as you say, extraordinarily well respected. The amount of the
Speaker 1: number of contributions he made in the labor anomics area tremendous.
Speaker 1: Starting with his work on the minimum wage. He and
Speaker 1: David card theorized that maybe what the books were telling
Speaker 1: us was wrong and that minimum wages don't decrease unemployment.
Speaker 1: New Jersey raised the minimum wage. They went to the border.
Speaker 1: They looked at cities on the Pennsylvania side and the
Speaker 1: New Jersey side and found that there was no real impact.
Speaker 1: The findings remained controversial, and uh, there are caveats, but
Speaker 1: basically he changed the whole conversation. And now we have
Speaker 1: cities and states across the country raising the minimum wage.
Speaker 1: Probably would not have happened without Alan Krueger's work. Yeah,
Speaker 1: Danny Blanche Flower, come on in here, because one thing
Speaker 1: Jonathan said, that's very true. Uh, he cared. Alan Kruger cared.
Speaker 1: And can you give us a sense of some of
Speaker 1: the research that he did. Uh, that really made a
Speaker 1: huge difference from your perspective. Right, And a great friend
Speaker 1: of mine. I've known since the beginning with the end
Speaker 1: of the nineties when he first went to Princeton. So
Speaker 1: and I remember, actually he has book on the Mister Measurement.
Speaker 1: Actually we bought him a hat David Carden and Alan
Speaker 1: hats and I have long memories of Alan. I mean
Speaker 1: a titan of the field. I mean a great empiricist.
Speaker 1: If people go and look at Google Schollar, here's ninety
Speaker 1: thousand sights that's unbelievable. And work across the whole range
Speaker 1: of fields. So the Mister Measurement work is courses was crucial.
Speaker 1: But there's lots of other things. There's work on education,
Speaker 1: there's early work on growth, um, there's work on inequality,
Speaker 1: on computers, on uber on terrorism, on long term unemployment,
Speaker 1: on opioids, all all all work related, two problems out
Speaker 1: there that Alan saw about trying to look at problems
Speaker 1: in the world, trying to do something about them and
Speaker 1: trying to fix them. And obviously we should also talk
Speaker 1: about the policy work that he did um as chief
Speaker 1: eclumnist at the Labor Department with Robert Reich and Bill Clinton,
Speaker 1: who wrote a beautiful comment yesterday for him, his time
Speaker 1: as Assistant Secretary of the Treasury with Geitner, and then
Speaker 1: again his time for Obama as a as the Chief
Speaker 1: Economic Advisor, and again Obama wrote a beautiful thing yesterday.
Speaker 1: So this is a sad, sad loss for our field,
Speaker 1: a sad loss to me of a friend, Danny. Let's
Speaker 1: talk about the late eighties. Michael talked about Allen's contribution
Speaker 1: to the minimum wage debate. It was the late eighties
Speaker 1: and overwhelmingly there was this massive consensus that for low
Speaker 1: wage workers, if you establish a minimum wage, you'll put
Speaker 1: up that minimum wage. It would damage employment. Just walk
Speaker 1: me through how much Annan Krueger did to just change
Speaker 1: the way we think about something that we take for
Speaker 1: granted now, right, I mean, I was I remember it
Speaker 1: very well. The early I've been working on wages, and
Speaker 1: I remember David Carl and Allen working on this project.
Speaker 1: I went to the original conference about the book in
Speaker 1: I think or I think it was, And basically the
Speaker 1: thing that they did was it was past breaking in
Speaker 1: two senses. It was past breaking because the result you've
Speaker 1: talked about, and it was past breaking because they conducted
Speaker 1: experiments which actually have taken over an economic which in
Speaker 1: the in the eighties and early nineties was just dominated
Speaker 1: by theory. So Allen and David, particularly now and later
Speaker 1: pushed this thing where you go and look at the world.
Speaker 1: And what they looked at was this experiment. And then
Speaker 1: they sitting in Princeton, They're interested in what goes on
Speaker 1: to at the minimum wage, and they and they looked
Speaker 1: at an experiment of fast foodhouses um along the border
Speaker 1: between New Jersey and Pennsylvania, and you saw a rise
Speaker 1: in the right in the minimum wage in I think
Speaker 1: it was a New Jersey if I recall. And what
Speaker 1: they did was they actually looked and went measured what happened.
Speaker 1: And what they found was one of the big things
Speaker 1: they found is as the minimum wage was right was increased.
Speaker 1: What you saw was that people actually ended up and
Speaker 1: they hired better people, but people day longer. So actually
Speaker 1: what it turned out was employment fact in some of
Speaker 1: the results, you actually see a rising employment. Arise in
Speaker 1: the minimum wage from a very low level generated the
Speaker 1: result that employment actually rose. And this was hugely controversial.
Speaker 1: You can look back at the literature and the comments
Speaker 1: made by all kinds of people about the work that
Speaker 1: they did, and this generated a huge debate. And I
Speaker 1: think the answer the big deal was arise in the
Speaker 1: minimum wage when it was so low actually had positive
Speaker 1: employment effects. So that was hugely controversial. But methodologically, really
Speaker 1: they introduced this thing when you go and look at
Speaker 1: the world, you see what happens there and you report it.
Speaker 1: And that's why the book was so important. And then
Speaker 1: Alan followed all kinds of stuff like that later I'm
Speaker 1: conducted surveys and so on, and did so when he
Speaker 1: worked for President Obama. Um so I mean, I mean,
Speaker 1: as I said, I think the right word I would
Speaker 1: say is a true tightener, and the other thing I
Speaker 1: actually sound and perhaps go back to what Mike was saying,
Speaker 1: I think the question Alan was an absolute shoe it
Speaker 1: to win the Nobel Prize there's no doubt of that.
Speaker 1: Probably the greatest, the greatest incuraicist we've seen of our age.
Speaker 1: We really have lost someone who was really important. The
Speaker 1: the idea that he looked at data and gathered data
Speaker 1: that wasn't available and based his conclusions on data very
Speaker 1: important because a lot of people look at his career,
Speaker 1: they look at the minimum wage, they look at his
Speaker 1: employment in two Democratic administrations, and they say he had
Speaker 1: to be a liberal Democrat, But he was really uh
Speaker 1: an economist looking at problems. As Danny said, one of
Speaker 1: the most interesting things he did was look at the
Speaker 1: effect of licensing unemployment. You have to be licensed to
Speaker 1: be a hairdresser, you have to be licensed in states
Speaker 1: to braid hair, things like that, and the impact that
Speaker 1: had on holding down employment. And that is a conservative
Speaker 1: cause and a lot of people on the Republican side
Speaker 1: have cited that as important work. So it wasn't that
Speaker 1: he was taking a liberal or conservative viewpoint. He was
Speaker 1: taking an economist foot point. And he really also highlighted
Speaker 1: the opioid epidemic as a problem for the labor force,
Speaker 1: showing detailing how nearly half of men fifty four and
Speaker 1: not in the labor force took pain medication every day.
Speaker 1: This was revolutionary, Danny, and definitely changed the conversation in
Speaker 1: the United States about this about this epidemic. Absolutely, I
Speaker 1: had a big influence on me. I talked to Alan
Speaker 1: about the work that he'd done. I actually went off
Speaker 1: afterwards that wrote the paper myself about pain. I mean,
Speaker 1: Alan's work was really important. Let's let's broaden it, um.
Speaker 1: The work on pain was really important. To work on
Speaker 1: people leaving the labor force was really important. So this
Speaker 1: was about I mean, I absolutely agree with everything Might
Speaker 1: just said. I think you would also say his work
Speaker 1: was about trying to improve the human condition. I mean,
Speaker 1: think about this work about opiod. Mike's completely right, this
Speaker 1: is not political. I'm I always think that what Alan
Speaker 1: did was he snapped at the heels of complacency, try
Speaker 1: to look at things and said is that right? So
Speaker 1: he went and worked on Uber. But there's a great
Speaker 1: paper he works on trying to look at what happened
Speaker 1: at Firestone, looking at the looking at the evidence and
Speaker 1: the factory and says, why did those Firestone tires fail?
Speaker 1: Turned out they failed because the quality of workers who
Speaker 1: actually made him in a two week period was actually
Speaker 1: the really important thing that Alan went and looked at
Speaker 1: the data and thought about it as as Mike said,
Speaker 1: not political in that sense, trying to think about improving
Speaker 1: the human condition and understanding how how the economy works.
Speaker 1: And I think that's that's crucial and central to his contribution.
Speaker 1: I mean, work on inequality. What what what? What? Why
Speaker 1: is the inequality rising? What's the cause of it? He
Speaker 1: talked about computers and the use of computers impacting people's
Speaker 1: wage rates. That's not political, It's about trying to understand
Speaker 1: how the world works. Danny is great to catch how
Speaker 1: but you Danny Blanche flat down with professor of Economics
Speaker 1: and a special thanks to Michael mcke Blomberg International Economics
Speaker 1: and Policy correspondent. We should say that if you are
Speaker 1: having thoughts of suicide, please do call the National Suicide
Speaker 1: Prevention Life Flotline at seven three eight to five, or
Speaker 1: go to Speaking of Suicide dot com, forward slash resources.
Speaker 1: Princeton University economist Alan Krueger has died. His contribution to
Speaker 1: the field of economics cannot be overstated. He will be
Speaker 1: missed by all that knew him, including all of us
Speaker 1: here at Bloomberg. Over the weekend, America lost a brilliant
Speaker 1: economist and many of us lost a dear friend. This
Speaker 1: according to former President Barack Obama. He was talking about
Speaker 1: Alan Krueger at the Princeton professor and advisor to UH
Speaker 1: former Presidents Obama and Clinton. UH President Obama saying he
Speaker 1: saw economic policy not as a matter of abstract theories,
Speaker 1: but as a way to make people's lives better. He
Speaker 1: died over the weekend at age fifty eight. The cause
Speaker 1: was suicide. UH. We want to remember Alan Krueger for
Speaker 1: so many things, for his contributions to the field of economics,
Speaker 1: but also to his personality which graced this show, graced
Speaker 1: many shows on Bloomberg and throughout the media and economics
Speaker 1: profession influenced politics, crossed both aisles of the political spectrum
Speaker 1: and joining us to do so. Bessie Stevenson, Bloomberg Opinion columnist,
Speaker 1: former U S Department of Labor Chief economist, currently Associate
Speaker 1: Professor of Public Policy at the University of Michigan's Ford School,
Speaker 1: joining us by phone. Peter Koy also joining us Bloomberg
Speaker 1: Business Week, Head of Economics. Here in our Bloomberg eleven
Speaker 1: three Oh Studios, Betsy, I want to start with you.
Speaker 1: I I know you know you knew Alan Krueger personally.
Speaker 1: Can you give me a sense of what his biggest contribution,
Speaker 1: in your mind was to the economics profession. Oh, that's
Speaker 1: a really a hard place to start. I think, Um,
Speaker 1: Alan's biggest contribution to the profession was his insatiable curiosity,
Speaker 1: and that insatiable curiosity led him to UM investigate so
Speaker 1: many things that have gone on to be incredibly important.
Speaker 1: Lots of people cite his minimum wage work UM, which really,
Speaker 1: through careful empirical analysis, shows that the kind of negative
Speaker 1: employment effects that we are our models taught us might
Speaker 1: happen with a minimum wage didn't seem to be as
Speaker 1: bad in practice. UM. And that again came out of
Speaker 1: his real curiosity. He had a knack for trying to identify, um,
Speaker 1: what economists call natural experiments, trying to look around the
Speaker 1: world and see, is there something that can help me
Speaker 1: get at the root causal effect of some kind of policy?
Speaker 1: And so with that, you know, he's pioneered a real
Speaker 1: empirical revolution. And uh, and so I think if you
Speaker 1: ask somebody the profession was his biggest contribution, it was
Speaker 1: um what some people call the credibility revolution, bringing empirical
Speaker 1: analysis to economics in order to be able to objectively
Speaker 1: look at questions and find the answer regardless of your
Speaker 1: preconceived notions, based on scientific analysis. Peter, boy, you were
Speaker 1: the chief economist of the Labor Department, which was a
Speaker 1: job he had had before. What what did he tell
Speaker 1: you before you took that post? Um? You know he
Speaker 1: uh uh. For me, it was a really um tough
Speaker 1: decision whether I should take that post because I was
Speaker 1: actually still an assistant professor. I was a ten year
Speaker 1: yet um, and you know, Alan had the view that
Speaker 1: it was a really hard job, but it was incredibly
Speaker 1: fulfilling and that what we were doing and our profession
Speaker 1: was trying to make people's lives better and getting some
Speaker 1: experience on the ground. Um. You know, actually working with
Speaker 1: a policy um that we were um studying and debating
Speaker 1: would make me a better economist than he was, right, Peter,
Speaker 1: you know, it's interesting to me. I'm thinking of some
Speaker 1: of the more recent contributions, uh that Professor Krueger made
Speaker 1: having to do with the opioid epidemic, where he changed
Speaker 1: the conversation very much about what the impact was. Can
Speaker 1: you give us a sense of how much he did
Speaker 1: change that conversation. You know, as Bessie Stevenson said, he
Speaker 1: was all about getting the data and looking at it
Speaker 1: in fresh ways, and people have had a sense that
Speaker 1: opioids were an issue, but it wasn't until he gathered
Speaker 1: the data that people grasped how big the issue was.
Speaker 1: I think he found that if you looked at um
Speaker 1: working age males who were not in the labor force,
Speaker 1: close to half of them were taking pain killers of
Speaker 1: one kind or another. And that, you know, could have
Speaker 1: been as hard to disentangle the cause and effect, whether
Speaker 1: it was because they were in pain that they were
Speaker 1: out of labor force, or whether it was taken to
Speaker 1: pain killers that made the mindfit for the labor force.
Speaker 1: But one way or another, it was crucial information that
Speaker 1: has really, I think made people even more sensitive to
Speaker 1: the depths of the opioid crisis and is as many
Speaker 1: other things he's done, led to policy changes. So definitely,
Speaker 1: Alan Krueger made a lot of contributions on the economics side.
Speaker 1: On a personal level, he was just a wonderful guy
Speaker 1: and Betsy Stevenson, you you spent a lot of time
Speaker 1: with him. I mean, can you give us a sense
Speaker 1: of what it was like to work with him. UM.
Speaker 1: So you know, Alan was really a wonderful guy. Is
Speaker 1: the right way to say. He's extremely generous, UM and
Speaker 1: in kind and easy going, and those were not Um
Speaker 1: qualities they too often found an economists. He was. He
Speaker 1: was someone who really was enthusiastic about all his foreignings
Speaker 1: and was excited to share them with people who wanted
Speaker 1: to listen. UM. And you know, Katherine Rampell has a
Speaker 1: really lovely column about being his research assistant and the
Speaker 1: Washington Post and how he you know, took her, you know,
Speaker 1: the suggestions of a nineteen year old about how he
Speaker 1: couldn't prove his writing, which she now cringes to think
Speaker 1: about UM with you know, joy and happiness that you know,
Speaker 1: that was his approach. He was a person who was
Speaker 1: really easy to talk to. UM. And and I think
Speaker 1: mentored just an enormous amount of people. And I think
Speaker 1: you see that by that outpouring of tributes and grief
Speaker 1: UM on social media, because he really did take the
Speaker 1: time to mentor young faculty and young undergrads and people
Speaker 1: who were interested in economics. UM. And you saw that
Speaker 1: on your show. He would take the time to come
Speaker 1: and and chat with you guys about economics, because that
Speaker 1: is is who he was with, someone who was always
Speaker 1: excited to be around people and help, you know, advance
Speaker 1: the study and knowledge of economics. And when he would
Speaker 1: come into the radio studio or the television said, he
Speaker 1: would stay after the segment was over. He would come early,
Speaker 1: and he would talk about tennis, and he would talk
Speaker 1: about vacation plans. So it was not just, you know,
Speaker 1: a sort of hit and run. Peter Koy, I am curious.
Speaker 1: There is this feeling that economics is sort of its
Speaker 1: own language and then it speaks of different curves and ratios.
Speaker 1: And Alan Krueger really touched on pop culture in many ways.
Speaker 1: At one point even looking at concert tickets how they
Speaker 1: had surged him price. It started to generate more revenues
Speaker 1: for performers than CD sales. Can you talk a little
Speaker 1: bit about the sort of importance of the tangible aspects
Speaker 1: of some of his research. He incorporated the economics of
Speaker 1: rock and roll into his freshman econ course at Princeton,
Speaker 1: which was hugely popular, and it's because it was a
Speaker 1: window into supplying demand, changing nature of labor markets that
Speaker 1: you can really learn from and that was a book.
Speaker 1: He's a book out this year called rock an Omics,
Speaker 1: and he's um, I hope it sells really well because
Speaker 1: in some ways it'll be his last gift to us.
Speaker 1: It's incredibly sad. Yes, thank you both for being with us.
Speaker 1: Betsy Stevenson, Bloomer opinion columnist, former U S Department of
Speaker 1: Labor Chief economist as well as an associate professor at
Speaker 1: the University of Michigan's Forward School. Peter Koy, Bloomberg economics
Speaker 1: editor for the Business Week magazine, joining us here in
Speaker 1: the Bloomberg Interactive Broker Studios. We are remembering Alan Krueger,
Speaker 1: Princeton professor, advisor to UH former Presidents Barack Obama and
Speaker 1: Bill Clinton, longtime economics behemoth, someone who is expected to
Speaker 1: win the Policer Prize UH and and and really in economics. UH,
Speaker 1: we lost a huge giant of the field. UH. He died.
Speaker 1: The cause was suicide. He was fifty eight years old.
Speaker 1: If you are having thoughts of suicide, please do call
Speaker 1: the National Suicide Prevention Lifeline at two seven three, eight
Speaker 1: to five five, or go to Speaking of Suicide dot com,
Speaker 1: Forward Slash resources get help, seek it out how the conversation. Uh,
Speaker 1: it is worth it. Thanks for listening to the Bloomberg
Speaker 1: Surveillance podcast. Subscribe and listen to interviews on Apple Podcasts, SoundCloud,
Speaker 1: or whichever podcast platform you prefer. I'm on Twitter at
Speaker 1: Tom Keene before the podcast. You can always catch us worldwide.
Speaker 1: I'm Bloomberg Radio