Who Should We Listen To?

Dean Baker is feeling dyspeptic — not for the first time — over a WaPo piece suggesting that slow growth is the new normal. Dean wonders why we should listen to people who have been wrong about everything so far. But it’s actually worse than he says.

In the article, the case for slow growth forever is mainly made by quoting Kevin Warsh, a former Fed governor. And Warsh is indeed someone who has been wrong about everything; a bubble denier who spoke of strong capital markets before the crash, a hawk who has been warning about the risk of inflation for three years, an invoker of invisible bond vigilantes who somehow managed to describe the supposed threat from these vigilantes as somehow both a certainty and unknowable.

If there is a special distinction to those of Warsh’s speeches and articles I’ve read, it’s this: he has had a habit of saying and writing things that are supposed to be profound, but say nothing at all. Can anyone tell me the point, if any, of this WSJ op-ed?

But wait: who is Kevin Warsh, anyway? Well, he’s a lawyer turned investment banker turned Bush appointee to the Fed turned Hoover fellow — not an economist at all. Now, I hate credentialism: there are plenty of fools with Ph.D.s, some fools with fancy prizes, and a fair number of first-rate economic thinkers without formal qualifications. Still, if someone is going to make pronouncements about how the whole nature of the business cycle has changed, you’d like some sign that somewhere in his life he has thought hard about, well, anything.

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http://krugman.blogs.nytimes.com/2013/03/03/who-should-we-listen-to/