Issue #343
The inflation cult: They’re always wrong, yet they persist
Wish I’d said that! Earlier this week, Jesse Eisinger of ProPublica, writing on the Times’ DealBook blog, compared people who keep predicting runaway inflation to “true believers whose faith in a predicted apocalypse persists even after it fails to materialize.” Indeed. Economic forecasters are often wrong. Me, too! If economists never make an incorrect prediction, they aren’t taking enough risks. But it’s less common for supposed experts to keep making the same wrong prediction year after year, never admitting or trying to explain their past errors. And the remarkable thing is that these always-wrong, never-in-doubt pundits continue to have large public and political influence. There’s something happening here. What it is ain’t exactly clear. But as regular readers know, I’ve been trying to figure it out, because I think it’s important to understand the persistence and power of the inflation cult. Paul Krugman, New York Times, 9-11-14.