So you might think that it wouldn’t have been a disaster had the U.S. followed Singapore’s example and replaced its “pay-as-you-go” tax and transfer retirement pension system with a system of mandatory personal accounts actually invested in the market. But, no. They hide the dots so the reader can’t connect them. They really do seem to go out of their way to prevent the reader from grasping that the Social Security reform proposal they deride was a mandatory savings program and that the mandatory savings program they praise finances retirement security.
Akerlof has a Nobel Prize. Shiller is a Nobel short-lister. So it’s hard to pin this on ignorance or incompetence. What’s going on!? ...
This bit of Animal Spirits gave me whiplash. It’s incoherence is simply overwhelming if you happen to know a bit about pension systems and retirement savings. Maybe we’re seeing an unresolved problem of dual authorship. I don’t know. What I do know is that this section of the book really does conveys the impression that some care was taken to omit very relevant details, and therefore to create a misleading picture — an impression only reinforced by Akerlof’s joshing, self-approving anecdote about his reputation for promoting demogogeury on Social Security. As Akerlof and Shiller are both phenomenally accomplished scholars who I’m sure have well-deserved reputations for intellectual honesty, I expect they’ll want to revise this section for the paperback edition of their book.
I haven't read the book, so I can't be sure who's right. But Wilkinson quotes several passages at length, and it looks pretty bad. Especially when he gets around to (implicitly) accusing Akerlof of intentional dishonesty in order to justify his past political advocacy.