Monday, September 27, 2010

Conventional Wisdom, Ctd

Paul Krugman on how debilitating the force of conventional wisdom is:

When everyone … 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.

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.

In other words, as the Bard would say, "the fool doth think he is wise, but the wise man knows himself to be a fool."

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