The term ``the conventional wisdom'' has become so much a part of the language that people forget that the phrase was coined by John Kenneth Galbraith just 30 years ago in ``The Affluent Society.''
Professor Galbraith said that, in some measure, the articulation of the conventional wisdom is like a religious rite - ``an act of affirmation like reading aloud from the Scriptures.''
Business executives would feel better for hearing the virtues of free enterprise praised once again. Economic scholars would feel secure in hearing the efficiencies of the free market reaffirmed.
At the higher levels of scholarship, Galbraith said, the conventional wisdom made originality highly acceptable ``in the abstract'' and, indeed, the vigorous advocacy of originality even became a substitute for originality itself.
Yet Galbraith held that conventional wisdom had an important function: It protected society from too facile a flow of thought. He warned that a great stream of intellectual novelties, if all were taken seriously, would be disastrous for society.
However, the conventional wisdom, in both capitalist and Communist societies, is not fixed; it is periodically overcome, not by new ideas, but by the march of events, which may expose old ideas as useless or dangerous.
In the Soviet Union, economic stagnation has exposed the follies and dangers of central planning and control. And General Secretary Mikhail S. Gorbachev is congealing the new conventional wisdom into the terms ``glasnost,'' or openness, and ``perestroika,'' or reconstruction; wherever one meets them, at home or abroad, Soviet spokesmen cite the terms as the new gospel.
What is the emergent conventional wisdom in the United States? Here is brief rundown of some of its key elements:
- ``A new international monetary system is needed.''
Floating exchange rates, which not long ago were hailed by nearly all economists as the optimal means of permitting individual nations to pursue their own national policies for growth and stability, as they chose, have proved too disturbing to trade, investment, financial markets and national economic development. So the conventional wisdom now calls for a return to fixed, or at least much more stable, exchange rates. But the wisdom does not yet say what that new international monetary system should be.
- ``In an interdependent world, closer coordination of national macroeconomic policies is essential.''
The alternative of trade barriers and capital controls to serve national interests is unacceptable, as the sinking fortunes of Rep. Richard A. Gephardt in the presidential race signifies. Since protectionism is out, new rules for …