From Elizabeth Warren’s book, as relayed by a review in the NYT.
After dinner, “Larry leaned back in his chair and offered me some advice,” Ms. Warren writes. “I had a choice. I could be an insider or I could be an outsider. Outsiders can say whatever they want. But people on the inside don’t listen to them. Insiders, however, get lots of access and a chance to push their ideas. People — powerful people — listen to what they have to say. But insiders also understand one unbreakable rule: They don’t criticize other insiders.
Pointer from various places–I first saw it from Tyler Cowen.
Remember that the basic social rule is to reward cooperators and punish defectors. I believe that without such a social rule, trust would break down and we could not have markets. However, that does not mean that the social rule is always a wonderful thing. Criminal gangs operate the basic social rule, also–they reward people who cooperate with the gang and punish people who defect from it.
The basic social rule gets applied in politics and in academics. A visitor from Mars would have a really hard time understanding how macroeconomics got into the cul de sac in which it had arrived when Olivier Blanchard wrote that the state of macroeconomics is good. I would say that Dornbusch and Fischer were really good at rewarding cooperators and punishing defectors.
I know it’s not a real long shot, but I knew the “Larry” was going to be Larry Summers. I was going to make a comment, and it turns out I should have, after his note on global universal health care that I now officially (and again, it appears I am right) place him in the Cass Sunstein camp. The problem with people like Larry who articulate things they think they discovered like “don’t criticize other insiders” is I think they go overboard. They start looking for ways to overdo it instead of figuring out exactly where the line is and how much they can criticize, they make it a virtue to wash people’s ballcaps.
I’ll explain the problem with Warren later, but if I were at that party, I would have said “Larry, you are such a douche” and I guarantee everyone would have laughed with me.
Which, I’m sure you realize, is ample indication you would never be invited.