The Economics Discussion Thread

This is from a New York Times interview with Jamie Galbraith:

Do you find it odd that so few economists foresaw the current credit disaster?
Some did. The person with the most serious claim for seeing it coming is Dean Baker, the Washington economist. I saw it coming in general terms.

But there are at least 15,000 professional economists in this country, and you’re saying only two or three of them foresaw the mortgage crisis?
Ten or 12 would be closer than two or three.

What does that say about the field of economics, which claims to be a science?
It’s an enormous blot on the reputation of the profession. There are thousands of economists. Most of them teach. And most of them teach a theoretical framework that has been shown to be fundamentally useless.

Here’s the Wall Street Journal, writing about Robert Rubin:

Under fire for his role in the near-collapse of Citigroup Inc., Robert Rubin said its problems were due to the buckling financial system, not its own mistakes, and that his role was peripheral to the bank’s main operations even though he was one of its highest-paid officials.

“Nobody was prepared for this,” Mr. Rubin said in an interview. He cited former Federal Reserve Chairman Alan Greenspan as another example of someone whose reputation has been unfairly damaged by the crisis.

Noam Chomsky:

[T]he commissars, the secular priesthood, the state ideologists…I think it is an extremely corrupt group. I think this is also the group that is the most subject to effective indoctrination, tends to have the least understanding of what is happening in the world, in fact, tends to have a sort of institutionalized stupidity.

Mark Twain:

Sometimes I wonder whether the world is being run by smart people who are putting us on or by imbeciles who really mean it.

George Orwell:

Whether the British ruling class are wicked or merely stupid is one of the most difficult questions of our time.