Economists and the Economy

I have a continuing spat with the economists who have all too often been wrong, both in predictions and worse in recommendations. In a recent blog entry by Mankiw, whose projections paralleled my comments for the past 4 years as regards to the actions of the current Administration has an interesting blog entry.

This post takes its title from a new article at Econ Journal Watch.  Here is the abstract:

"In early 2009, the incoming Obama administration’s Council of Economic Advisers predicted real GDP would rebound strongly from recession levels. In a blog post, Greg Mankiw expressed skepticism. In their blogs, Brad DeLong and Paul Krugman sighed. Of course there would be strong growth, they maintained, because the recovery of employment would mandate it via Okun’s Law. Mankiw challenged Krugman to a bet on the issue, but there was no response. Of course we now have a good idea of the likely outcome, but I posit a hypothetical time series econometrician who, at the time of the blog entries, applies some standard forecasting methods to see whether DeLong and Krugman’s confidence was justified. The econometrician’s conclusion is that Mankiw would likely win the bet and furthermore that a rebound of any significance is unlikely. The econometrician has no idea how DeLong and Krugman could have been so confident in the CEA’s rebound forecast."

Now my rants have been targeted at Romer and her now infamous January 11, 2009 paper from the "Office of the President Elect" stating what one would expect from the Stimulus. As we have chronicled for almost 4 years her projections never came close. Mankiw and others were more on target. One thus wonders where we may be in another 4 years if we are to continue this way.