Why do we listen to economists who are always wrong?
- 30 so-called 'top economists' have called for a wealth tax in the UK
- Left-wing economists hold free markets to an impossible standard
- Markets are not perfect, but the process of trial and error they encourage moves us closer to efficiency
On July 28, more than 30 so-called ‘top economists’ called for a wealth tax in the UK. Glance at the list of signatories and you’ll see the usual names who oppose almost any market reform: Thomas Piketty, Ha-Joon Chang and Martín Guzmán. Ironically, just over a year ago, many of them signed another letter warning against Javier Milei’s reform programme in Argentina, which they described as ‘potentially harmful’ to the Argentine people.
Fast forward to today, and historian Niall Ferguson calls Argentina’s economic turnaround a ‘man-made miracle’. Milei ended Argentina’s fiscal deficit for the first time in 123 years. Annual inflation plunged from 211.4% in 2023 to 43.5% by mid-2025. UNICEF reports that 1.7 million children have been lifted out of poverty since he took office and according to Econométrica’s EMAE, the economy grew by 8% year-on-year in April.
The piece is short and well worth reading. Apart from economists who are always wrong, it raises a wider question about academics in other fields who are always wrong too.
As we know, we have ended up with a political culture where being wrong can be politically, socially, professionally and financially advantageous. That's a formidable array of benefits.
4 comments:
Immediate thought. Why.are "top economists" not rich? Because they are useless. Or because the thought of being rich is anathema.
So therefore people who are richer than them must be brought to their leve! or lower. The fact that they, the Top Economists, are better off than the rest of society? Well, we do not think of that.
Doonhamer - yes it's the killer question - why aren't they rich? Keynes became wealthy, but as a tribe they seem to be like many other professions, those in a position to make a bit extra out of of unreliable punditry do so.
You seldom hear of the very best professionals (accountants, economists, lawyers) because they work for the richest, global, private families.
You seldom hear of the less gifted professionals (accountants, economists, lawyers) because they work for the richest, global companies.
You sometimes hear of competent professionals (accountants, economists, lawyers) because they work for the local or central government.
You often hear of publicity seeking professionals (accountants, economists, lawyers) because they are not reliable enough for better grade employment.
DJ - that could be produced as an employment status pyramid or maybe or some similar illustration. The unreliable ones wouldn't necessarily be at the base of the pyramid though, because they may do very well out of their unreliability and their perceived status can be very high.
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