COLUMN ONE : Economists Watch in Quiet Fury : Clinton has left economists feeling shut out, igniting a debate. As economics becomes mathematical, is it becoming incomprehensible and irrelevant?

The professional jealousy drips from the telephone receiver like battery acid:

“If you had a nasty mind, you might think that a man without any professional credentials was so insecure about it that he was trying to keep those with genuine professional credentials out.”

The speaker is a prominent economist, a leading talent in academic circles, a rising star who once had high hopes for a senior post in the Administration of President-elect Bill Clinton. But to his dismay, he has been shut out.

For that, he blames Robert B. Reich, a Harvard lecturer and writer who has been overseeing economic policy for Clinton’s transition team and who is Clinton’s nominee to be labor secretary. A lawyer by training, Reich nonetheless is the intellectual guiding light behind Clinton’s economic agenda. And it galls economists with impeccable academic credentials that a professional interloper has been handed so much authority by the President-elect.

The backbiting doesn’t end with Reich. Economists were even more stunned when Clinton turned to a rebel within their own ranks, Berkeley professor Laura D’Andrea Tyson, to chair the Council of Economic Advisers, an institution that they believe should act as the profession’s de facto embassy in Washington.

Envy. Petty slights. It’s not a pretty sight. But ever since the Nov. 3 presidential election, campus politics has collided with presidential priorities, creating turmoil within the normally placid world of professional economics and offering a revealing glimpse of an unusual professional subculture.

The problem, as economists see it, is that the first new President in at least a generation to put economic policy at the top of his agenda has given short shrift to their profession and their ideas. Leading economists have watched in quiet fury while Clinton has turned to non-economists like Reich and mavericks like Tyson to develop his campaign program, run his transition policy operation, and fill top posts in his Administration.

This is not the Camelot they had envisioned.

“They were hoping that Clinton would be a reincarnation of John (F.) Kennedy, who brought the best and the brightest to Washington, including brilliant economists who later went on to win Nobel prizes,” said Gary Hufbauer, an economist at the Institute for International Economics in Washington.

Yet if economists are feeling spurned, it may be their own fault. Increasingly, the profession seems out of step, both with public policy and national politics.

Over the last generation, economists--perhaps insecure about their profession’s standing as a real science--have focused more of their efforts on mathematics-based “econometric” research that sometimes seems almost impossible for anyone but other economists to decipher. Broad-based economic research that can be translated into an action plan for government is increasingly rare, critics of the profession argue.

That has left an opening for non-economists like Reich, popularizers who can talk in plain English to political leaders and the public about how to confront the critical problems facing the nation.

In addition, the mainstream of the profession has become increasingly conservative and far more skeptical of the ability of the federal government to intervene successfully in the marketplace.

That was not a political problem for the profession during the Ronald Reagan-George Bush era, when Washington policy-makers thought the same way. But Clinton and his closest advisers share a fundamental belief that government has an important role to play in shaping the economy and that clearly puts them at odds with the mainstream of the economics profession.

To be sure, traditional economists have not been shut out of the Clinton camp. Nobel laureates like Robert Solow, a professor at the Massachusetts Institute of Technology, and other esteemed economists were prominently featured at Clinton’s economic summit in Little Rock, Ark., last month. More than 500 economists signed an advertisement endorsing Clinton’s economic agenda during the campaign. And many who are now complaining still believe that the direction of Clinton’s program is the right one.

What’s more, as Clinton begins to fill sub-Cabinet positions, at least a few economists are coming up with good jobs, thanks in part to a concerted, behind-the-scenes lobbying campaign by an informal group of leading economists at Harvard and elsewhere. Princeton economist Alan Blinder has been tapped to be Tyson’s deputy. Lawrence Summers, a Harvard professor who is now on leave and serving as chief economist at the World Bank, is likely to become Treasury undersecretary handling international affairs. Harvard economist Larry Katz is expected to win a key Labor Department post under Reich.

Still, precious few have broken into Clinton’s inner circle. “I felt like they were patronizing me,” complained one.

The initial target of the traditionalists’ wrath was Reich, Clinton’s choice to head the Labor Department. Many economists consider him to be an amateur policy wonk, a mere lecturer who was twice rejected for tenure at Harvard’s Kennedy School of Government.

“His work is poorly researched and inconsistent, and is not tenurable material,” sniffed one Harvard economist.

“Bob’s problem has been that he doesn’t know how much he doesn’t know,” about economics, added Francis Bator, another Harvard economist.

Then came Tyson, who has earned the enmity of the high priests of the profession for daring to challenge its orthodoxy on the extent to which free and open trade can work in a messy and competitive world.

“Jaws dropped” on word of her appointment, said New York Times columnist Peter Passell in a caustic commentary that reflected the profession’s views.

Tyson describes herself as a “cautious activist” who believes that government must be willing to use industrial policy to help critical industries. Within the hothouse world of professional economics, however, such modest dissent is enough to warrant ostracism. And it didn’t help that she won the job over Summers, one of the brightest lights in the profession.

“She is out of the mainstream of economic ideas,” complained Allan Meltzer, an economist at Carnegie Mellon University in Pittsburgh, Pa. “Generally, the (Council of Economic Advisers) in the past has been successful when it brings mainstream economic ideas and analysis to an Administration and trying to stop things that don’t make economic sense. She will not only not stop those things, she will be proposing them.”

It became clear early that the conservative tilt that had endeared many mainstream economists to the Reagan and Bush Administrations could be a liability with the Clinton camp.

Summers, for instance, was vetoed by Vice President-elect Al Gore for the chairmanship of the Council of Economic Advisers because of the conservative views he expressed in a World Bank memo on environmental issues. He argued that the Third World may be “underpolluted” and that it would make economic sense to shift polluting industries from highly developed to lesser developed countries. Summers has defended the memo as written purposely to be argumentative, accusing critics of taking his statements out of context.

“There is an acceptance within the profession of a more laissez faire view of economics,” observed James Tobin, a liberal Yale economist who served on the White House economic council in the John F. Kennedy Administration. “I’m a dissenter. I’ve resisted the onslaught.”

“There is a greater focus on market responses to economic problems, rather than government responses,” noted Zvi Griliches, a Harvard professor and president-elect of the American Economic Assn., which is meeting in Anaheim this week.

All of that has led to a counterattack from non-economist public policy analysts and other Clinton allies against the orthodoxy of the profession. While rallying around both Reich and Tyson, they have gone on the offensive on America’s Op-Ed pages to charge that the economics profession is becoming increasingly irrelevant to political discourse.

By choosing Tyson, “President-elect Clinton . . . has done the economics profession a service by adding it to the list of institutions that are ripe for change,” wrote Jeff Faux, a Clinton campaign adviser and president of the Washington-based Economic Policy Institute, where Tyson has been an adviser. Faux, who does not have a doctorate in economics, accused the economics profession of “bad manners and sour grapes.”

Economics columnist Robert Kuttner, a board member at Faux’s institute, noted that the profession opposes Tyson largely because she “chooses to work in English rather than algebra and to study the real economy rather than build sand castles.”

Increasingly, economists are willing to concede that such criticism is not too far off the mark. And many are seeking changes that would affect both the nature of economic research and the conservative bent of the profession.

Older economists wearily report that they have been hearing complaints about the overly technical nature of their research for nearly as long as they can remember. “When I went to Washington 30 years ago, older economists thought I was too statistical,” recalled Tobin.

Yet the trend, which began at the close of World War II, has clearly accelerated in the last generation, thanks in part to the computerization of college campuses and the drive by economists to compete for status and research funding with other scientists.

If economics is a behavioral science, goes the reasoning, then it needs to take advantage of the most advanced scientific tools available. Moreover, it must create models that can be mathematically tested and proved.

But that can lead economists down a slippery slope, since the real economy involves real people and human motivations do not always boil down to arithmetic equations. “How do you quantify a telephone call from MITI (the Japanese government’s industrial policy agency) to a Japanese company?” asks Faux in an interview.

The real technical economists often skirt that problem by focusing their research on narrow issues that can fit within the confines of mathematical models. In journals such as Econometrica, the bible of technical economists, practitioners debate how to make their models more effective and mathematically sound, often without addressing the ends to which they are used.

The result: Mathematics tends to drive the research, rather than the other way around. And the results offer limited insights into how society works.

The titles of two articles recently published in Econometrica show why Clinton and other political leaders might have difficulty deciphering today’s econospeak: “Monte Carlo methodology and the finite sample properties of instrumental variables and statistics for testing nested in non-nested hypothesis,” and “Semiparametric estimation of monoton and concave utility functions for polychotomous choice model.”

Even some economists shake their heads.

“I have a rule of thumb that I will cancel subscriptions to economics journals if I go for a whole year without being able to understand at least one article,” said Don Ratajczak, an economist at Georgia State University in Atlanta. “I’ve finally gotten to that point with some of them. In trying to make economics scientific, they have made it not useful.”

Many economists defend the technical research, arguing that it is needed to push the outside edge of the profession’s understanding of how the world works. “The drive is for deeper understanding and that drive leads you into things whose policy relevance is not visible right away,” said Griliches.

Others stress that the technical research has not precluded work that could be useful in Washington, because the profession has grown so rapidly that it can accommodate it all. In fact, the American Economic Assn. launched a journal in 1987 to counter the technical trend and provide an outlet for broader policy-related articles.

What’s more, while they are frustrated here at home, American economists are playing a growing role in public policy outside the United States--especially in Eastern Europe and the former Soviet Union. For instance, Harvard’s Jeffrey Sachs and a handful of adventurous American economists have become roving international advisers, as newly capitalist governments struggle to stave off economic collapse.

Even so, it clearly takes special skills to bridge the gap between the academic and public policy worlds. Even more rare are the economists who are liberal enough to share core Democratic beliefs that the government should intervene more forcefully on international trade, industrial policy and regulatory matters.

“Too many economists want to import, in the name of science, their conservative ideology to Washington,” complained one economist who is close to Tyson.

Of course, the Clinton team is not the first new Administration to snub the economics profession. In 1980, Reagan won the presidency with a philosophy--supply-side economics--that had little backing in the economics profession.

Supply-siders like economist Arthur Laffer and writers George Gilder and Jude Wanniski were derided by the economics profession as mere pamphleteers.

Yet these rebels brought a political revolution to Washington, and mainstream economists took a back seat throughout the Reagan Administration. Indeed, since the 1960s, the profession has rarely been able to duplicate the influence and visibility it attained under Kennedy, when broad-thinking economists like Walter Heller and Tobin played key roles in shaping policy.

Economists have lived with that reality for years, but they were hoping for a change with Clinton, especially after he promised to “focus on the economy like a laser.”

But the economic problems that worry Clinton the most are ones that few academic economists think much about.

“Economists think they have a God-given right to powerful positions in government,” observed Rudi Dornbusch, an economist at MIT. “But the typical economist has not spent much time researching the important issues that are facing Clinton--what to do about the inner cities, how to make American corporations No. 1 again, what to do about education, what to do about job training.”