When everyone – tout le monde, as Tom Wolfe used to put it, meaning a relative handful of people, but everyone who supposedly matters – is saying something, it takes a real effort to step outside and say, wait a minute, how do we know that? It’s especially hard if you spend most of your time hanging out with other Very Serious People; I know that I myself have a hard time saying that people I know personally are talking nonsense, even when they are. The VSP effect is one reason smart bloggers, both on economics and on politics, have generally been a better guide to what’s really happening in America than famous reporters: their distance, their lack of up close and personal insights, is actually an advantage.Then lower down:
This is what you need to know: important people have no special monopoly on wisdom; and in times like these, when the usual rules of economics don’t apply, they’re often deeply foolish, because the power of conventional wisdom prevents them from talking sense about a deeply unconventional situation.Hmm. On the other hand we need genuine subject-matter expertise, which Krugman provides on Economics. On the other hand it is very easy for experts to be too narrowly focussed. I keep asking questions on his blog along the lines of "If world-wide demand were raised by world-wide government action to the level necessary to get unemployment down, then how much oil production would the economy need, and can we produce that much oil at the moment?". My point is that (a) we need government stimulus directed to produce cheap energy to be an (imperfect) substitute for oil; and (b) we need to also soak up private demand (energy crisis bonds?) to prevent smashing (again) into the limit of oil production and crashing the economy. But am I right? As Krugman and others point out, things are very similar to Japan 15 years ago when there was no energy or other shortage. We are missing any way to think clearly about these things. Just different groups of people using lots of adjectives and doing lots of arm-waving (yes there are lots of numbers being thrown around, but their implications are far from clear).
Which brings us back to the question of who has a special monopoly on wisdom. I claim that the subject matter of mathematics is how to think clearly about problems. Yes mathematicians spend time thinking about unimportant problems that they just happen to be able to describe succinctly. And also trying to understand mathematics itself better. But the real problems that drive mathematics are in the real world. Inference is a universal aspect of clear thinking, and this has to involve Bayesian analysis and using maximum entropy to understand what we know before we look at the evidence and how the evidence modifies what we know [and I'm not saying these are easy tools to use]. But this doesn't get us very far in understanding real world economic and environmental problems. I'd be rash to comment but I feel that the place to look has to be flows in configuration space, and the principle of Maximum Entropy Production will be the key to understanding that.