My favourite such prediction was the OECD's bi-annual Economic Outlook, which proclaimed in June of 2007 that "the current economic situation is in many ways better than what we have experienced in years".
That was two months before the crisis began.
You might think that, after such an extreme failure, economists would be trying to find what went wrong with their modelling. That has happened at policy institutions like the Bank of England and, to its credit, the OECD.
The Bank of England established the "One Bank" research unit after the crash, has employed many researchers from outside economics, and is, in my personal experience, very receptive to non-mainstream ideas now. The OECD established a new unit called New Approaches to Economic Challenges, and is also much more receptive to non-mainstream views than it was before the crisis.
But universities have been a very different proposition.
In university departments, the reaction of the mainstream has been to defend their paradigm, and to penalize those who criticize it. Whereas in the past they would tolerate the odd dissident as just "that guy down the corridor with those weird views" and let him/her teach a range of service subjects, now they are actively targeting such non-conformists for removal.
A recent instance of this was the decision of the University of Vermont to sack a popular lecturer, John Summa, for teaching mainstream economics in a critical manner. The case has all the nasty characteristics of an academic bunfight, of which I've experienced several myself. Do read John's GoFundMe appeal, even if you don't wish to make a donation.
In the end, he was dismissed, and he is now challenging that dismissal via a court action. I wish John the best, hope that justice will prevail, and I've made a small donation ($100) to his cause. I'd be pleased if you did too. He needs $4000, and he's about 60% of the way there.
I've reproduced some of John's evidence below, but there's much more on his GoFundMe site.
John Summa's Statement
Despite solid evidence of exaggerated and false claims used against me to persuade the Dean to deny my reappointment at UVM, these mischaracterizations were ignored by the Vermont Labor Relations Board when they ruled on my grievance. The case is now being appealed to the VT Supreme Court.
But I need help! Click here to learn more:
I allege that proven false and exaggerated claims masked disapproval of my ecological critiques of standard (supply and demand) neoclassical model economics (which I fully and fairly taught according to over 2,500 student evaluations). I maintain that there is no evidence whatsoever to support the Chair’s biggest claim that I was not teaching the standard (neoclassical) model “fully and fairly”.
I argue that the Chair was leading the removal of a popular and maverick veteran teacher who was exposing students (after teaching models fully and fairly and getting good reviews from students) to the truth about the profound failures of core curriculum models students are required to learn (and do learn). Among other shortcomings I highlighted is the failure of these models to address global warming, growing inequality and systemic market failure.
Purging popular and challenging teachers cannot be tolerated. Help me fight against academic cronyism and intellectual nepotism at UVM. Make a pledge!
Despite some Nobel prize winning economists saying these models are “foolish” and “dead-end” approaches in today's world (information I shared with students), I was nevertheless removed based on the belief that I was not teaching “good” economics (Chair's choice of words) -- a reference to the same models now discredited by some of the profession’s own leading practitioners. Apparently the Dept. Chair is unaware that there is no consensus on what constitutes "good" economics. Your good economics is my bad economics and vice versa.
The Faculty Standards Committee (FSC) at the University of Vermont was not fooled by the actions of the Chair and voted unanimously to reappoint me and described the review process as “tainted” (and believed the Chair was “out to get” me, according to a whistleblower who came forward to inform me of this fact).
If you would like to help me, please make a donation at my gofundme page. Here is the link
Thanks for helping me stand up to the enemies of freedom of expression and alternative thinking about economics.