I admit it. I used to be an economist, but I took the cure. I have nevertheless always liked the work of John Kenneth Galbraith (1908-2006)
and now his son James K Galbraith (1952-) has said something memorable:
‘Leading active members of today’s economics profession….have formed themselves into a sort of Politburo for correct economic thinking. As a general rule – as one might have expect from a gentleman’s club – this has placed them on the wrong side of every important policy issue, and not just recently but for decades. They predict disaster where none occurs. They deny the possibility of events that then happen….They oppose the most basic, decent and sensible reforms, while offering placebos instead. They are always surprised when something untoward (like a recession) actually occurs. And when finally they sense that some position cannot be sustained, they do not re-examine their ideas. They do not consider the possibility of a flaw in their logic or theory. Rather, they simply change the subject. No one loses face, in this club for having been wrong. No-one is disinvited from presenting papers at later annual meetings. And still less is anyone from outside invited in.’
My late father John spent the last five years of his life writing to the British Government, and Governor of the Bank of England explaining to them exactly what would the consequences would be of their economic policies, and he was right, though he left school at 14 and never formally studied economics. And his reasoning was far more cogent that the dolts he was advising to mend their ways. I had a similar experience with the Chief Economist of my corporation, who now teaches economics to the impressionable young in a leading business school, having presumably inhaled the Cool Aid at MIT. In 1998 he assured me that recessions were a thing of the past, and that Alan Greenspan had abolished them, so we didn’t need a corporate downturn strategy. I asked him if he had heard Keynes expression that using monetary policy in a recession was like pushing string?
James and his Dad John: