Thursday, June 24, 2010

Groucho Marx Syndrome Lives

Over the years, I have discovered a psychological trait that I call Groucho Marx Syndrome. Here’s the way it goes:

In the movie Duck Soup, Prime Minister Groucho Marx has been insulted by the leader of a neighboring country, and has slapped him in return, putting both countries on the brink of war. He is told that the leader will come to apologize, and agrees to meet him. Then he thinks out loud (from my memory of the movie), “I will hold out my hand in friendship, and we’ll shake. But suppose he doesn’t? That would be a fine thing, wouldn’t it, me holding out my hand and his refusing to shake it? What kind of cad would do such a thing? Me, holding out my hand and him refusing to shake it? How dare he! How dare he refuse to shake the hand of friendship!” And just then the leader walks up and Groucho shouts, “So, you refuse the hand of friendship? You cad!” and slaps the leader again. War ensues.

The point of Groucho Marx Syndrome is that certain people are prone to convince themselves that other people not only will do something bad to them, but have already done so – even when those other people haven’t, and won’t, do any such thing. Over the years, I have seen many worriers lapse into instances of Groucho Marx Syndrome – say, when they anticipate being fired and are hostile to the boss who they believe has already arranged to fire them, thereby causing the firing. But there are also people who are in the habit of convincing themselves that, behind their backs, most other people are spending their time undercutting them -- even to the point of saying to others “I know you made sure my application was turned down” when the application has not yet actually been decided on. For those people, behavior like that of Groucho Marx is habitual, is a Syndrome.

Over the years, I haven’t seen as much evidence of Groucho Marx Syndrome in public figures. Today, however, I was delighted and distressed to come across what seems to me be an excellent example of this psychological problem. Here’s the relevant quote from Paul Krugman’s blog:

“… one of Germany’s Wise Guys Men has lashed out at me in Handelsblatt over my criticism of Axel Weber:

Wolfgang Franz, who heads the German government’s economic advisory panel known as the Wise Men, tore into Krugman — and the US — in an op-ed in the German business daily Wednesday, titled “How about some facts, Mr. Krugman?”

“Where did the financial crisis begin? Which central bank conducted monetary policy that was too loose? Which country went down the wrong path of social policy by encouraging low income households to take on mortgage loans that they can never pay back? Who in the year 2000 weakened regulations limiting investment bank leverage ratios, let Lehman Brothers collapse in 2008 and thereby tipped world financial markets into chaos?” he wrote.

Now, what may not be obvious from this quote is that Paul Krugman is not a representative of the United States; far from it. Moreover, he was in some respects a prescient critic of some of the actions that Mr. Franz cites (in the case of encouraging low income households to take on mortgage loans that they can never pay back, it appears that Mr. Franz has his facts wrong, as Dr. Krugman notes). By contrast, I can find no obvious record in Mr. Franz’s publications of such anticipatory criticism, and a CNBC interview on Aug. 23, 2008 finds Mr. Weber not only apparently oblivious to the problems cited by Mr. Franz but also completely wrong about the medium-term and long-term outlook for the European economy. But that isn’t the real point here.

What Mr. Franz appears to be saying is, “The United States government is about to come in and tell us how to be prudent economically. How dare they? Aren’t they the folks who caused this mess? Aren’t they the folks who preached at the whole world that they knew better than everyone else? And now they’re coming here and telling us, who were ever so conservative economically, that we are doing it all wrong. What gall! They show up and tell us we’re running things wrong! Well, we won’t stand for it! We’re going to tell them off, right now!”

The rest of Mr. Franz’s editorial, translated by Bing, as I read it, appears to show some of the same style of thinking. Continue debt-backed investment and delay spending cutbacks? But everyone knows the US is just going to delay cutting back until too late; so they’re already too late, so we should cut back now. What about the continuing effects of German cutbacks on European policy and thereby on the rest of the world? Clearly we’re talking about our effects on the US. Our trade with them is miniscule; so there won’t be any effects, so there haven’t been any effects, so we have refuted that argument.

Just to reiterate:

(1) Paul Krugman is not the US government.
(2) By and large, there are different people running the US government’s economic policies and/or with a different message than those who were running it in 1980-2008.
(3) Mr. Weber has responsibility for the European as well as the German economy, and will have more responsibility for Europe in the near future as head of the ECB, which is apparently what Dr. Krugman is addressing.
(4) Today’s US government has not, as far as I can tell, officially agreed with Paul Krugman’s criticisms or recommendations yet.

With all undue respect, Mr. Franz appears to show strong signs of Groucho Marx Syndrome. The consequences of this Syndrome, between two people in ordinary life, are unnecessary ruptures and fights that benefit no one, least of all the person with the Syndrome. But, as in Duck Soup, some of these people represent nations. Let us hope that Groucho Marx Syndrome is not widespread among the actors in the present economic crisis.

Or economic war could ensue.

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