This is how Bill Clinton defined Robert Rubin, an American economist who held the position of Secretary of the Treasury (the incumbent equivalent of Secretary of Economy in Argentina) at the time Clinton said “It’s the Economy, Stupid”as president of the world’s leading power between 1993 and 2002. Hamilton was the first US Treasury Secretary.
Rubin, who could boast the favorable numbers of his administration and the praise of Clinton, nevertheless argues in a new book that perhaps his luck was more and less the result of political will and his own decisions.
In The yellow pad, making better decisions in an uncertain world [El anotador amarillo, tomando mejores decisiones en un mundo incierto], the author goes beyond the simple account of his routine, anecdotes and experiences as a civil servant. Recall that Rubin published his memoirs twenty years ago, in which he recounted the details of the Clinton government’s bailouts of Mexico in the Tequila Effect.
That 2003 book may already have the DNA of this current version: it was called in an uncertain world. Rubin returns 20 years later with the same concept, uncertainty as a topic that no longer belongs only to statisticians and mathematicians.
Economics has adopted, shaped and crowned the use of statistical probability as it did 100 years ago at the hands of John Maynard Keynes and his theory to explain the Great Depression. Rubin now ventures to say that this type of analysis will be more needed in the future due to the problems plaguing the world and the global economy. “It is the great challenge for the generations to come. From climate change and nuclear proliferation to income inequality and growing authoritarianism at home and abroad, they will be far greater than what my generation has been forced to face. The need for a robust approach to decision making in the face of uncertainty has always been great, but now it is greater than ever.
The former secretary confesses that one of the most grueling tasks he faced as a civil servant was constantly dealing with decisions in contexts of high uncertainty where the correct answer is not obvious in advance. A recurring theme in American politics and which even Barack Obama has addressed in his memoirs.
The economist states that his favorite tool for estimating the probability of an event is to write all his notes in a simple yellow notebook (hence the title of the book) “not quantifying every aspect of every decision, it would be impossible, but it helps me in my way of thinking and incorporating probabilistic thinking in the real world”.
Maybe that’s why Rubin ends this way it is a mistake to evaluate a decision by its results alone and that then the work of a finance minister may receive more credit than it deserves if its mandate coincides with that of an economic boom. “I know many places where luck can make a big difference”says of his extra jobs on Wall Street and the Treasury. Rubin had been at Goldman Sachs before coming to the Treasury with Clinton.
A book also released in recent days (in Spanish) and reminiscent of Rubin’s is that of another former minister of the economy. But from Argentina: Jorge Remes Lenicov, who held that position in 2002 and with Eduardo Duhalde as president. Remes worked on the exit of Convertibility, the renegotiation of contracts and the balancing of public accounts. In the first quarter of 2002, Argentina had already achieved a fiscal surplus (Rubin, a great defender of fiscal equilibrium, does not brag about his achievements as minister, but boasts of the reforms he has promoted and a fiscal era: the United States has achieved a tax surplus in 1998 for the first time in 30 years. Remes tells the story of withholdings in Argentina).
Remes says inside 115 days that to drive the economy you have to do it “learn from our rich historical experience”. And Rubin points this out “The best way to make the best decisions for the future is to learn from the mistakes of the past”. “The decision-making process has two components – Remes explained to the Economic Office-, conviction of the plan and political support. But they always appear imponderable”. In his case it was Duhalde’s sentence (“who deposited dollars will receive dollars”) and the Court’s position against economic measures. Remes, criticized within his cabinet, left office in 2002.
Thus it is then confirmed that in order to be good in Economics, to distinguish oneself at the helm of the Ministry of Economy or to be compared to Alexander Hamilton, the die is often cast. Rubin, perhaps, did. Paddles, less.
Source: Clarin
