As I pointed out in an earlier post, Milton Friedman tried fruitlessly to make headway within the profession in dealing with the matter of nominal instability in the 1970’s. I have a book that chronicles many of his exchanges with his peers. In reading these exchanges, one interesting thing to note is there never is any real “meeting of the minds” so to speak. It’s an intellectual back-and-forth that feels more a who’s who of really brilliant minds that is full of all but persuasion.

I can’t really say for sure, but it seems like many of the public education materials he produced during his lifetime were not intended to be merely exercises in civics. There was likely an underlying purpose in going around the stalemate; because people are people no matter how educated and brilliant, and are subject to the same human psychological frailties as everyone else. We all put our pants on in the same fashion, and we all have trouble admitting error especially when the error has resulted in hardship on a grand scale.

I have to be the first one to admit that I’ve been pretty hard on people who were involved with monetary policy in the period leading up to and during the Great Recession, as if I somehow expect them to be more than human. But I view having the power to make policy as a different circumstance. It means having the responsibility to check the bias at the door and do the right thing regardless, even after making a mistake. It’s much different than exchanges between private people where one can just go on with a bad argument forever without hurting anyone. Policymakers simply do not have that luxury because bad arguments produce bad results that would otherwise persist in perpetuity.

In my own life, I find it quite liberating to approach my profession with humility. Being objective uncovers new discoveries that I would otherwise miss. If I thought I knew everything matter-of-factly, I’d never learn anything new and never be any better than I am today – full of fatal flaws and bad arguments forever. But then again, I started my career at the Xerox Center for Research and Technology, then attached to PARC, where failure was celebrated as a way of finding out what doesn’t work so we can move on to what does; and people who liked their own ideas a little too much didn’t have a very long shelf life. Humility was part of the culture and part of success in developing products that improved peoples’ lives.

If the economics profession isn’t about improving peoples’ lives, what then is it about?