A Talent for Missing the Trends; Political, Economic, Climate Projections All Fall Short
Byline: Richard Rahn, SPECIAL TO THE WASHINGTON TIMES
Did you notice that the major economic forecasters, both private and government, totally missed the global credit crisis and size of the recession?
The mainstream consensus economic forecasts made in December 2007 for the year 2008 for the United States, Europe and Japan predicted roughly twice as much growth as actually occurred. You may recall that a year ago, when oil prices were racing toward $147 per barrel, the high-paid wizards at Goldman Sachs were projecting it to go over $200 per barrel - it is now $40-something a barrel. A few economists claim to have forecast this great recession, but most have been pessimists for years, and predicting nine out of the last three recessions is not really an example of forecasting brilliance.
The foreign policy/political forecasts were even worse. A year ago, as the presidential nominees of both parties were being selected, the widely held belief was that the great issue would be Iraq. The Democratic establishment believed Senate Majority Leader Harry Reid's words, the war is lost.
Because of that belief, the Democrats selected their most antiwar candidate, Barack Obama. The Republicans nominated John McCain, who was the champion of winning the war, in part, through the surge, which indeed did work.
Each candidate had essentially sewed up his respective party nominations before the extent of the economic problems became clear. In retrospect, it is unlikely Mr. Obama and Mr. McCain would have become the nominees given what we know now about the economic situation. Each party had other candidates with stronger economic credentials who would have been more credible.
In the mid-1990s, when the fear of global warming was first becoming fashionable, the global warming theorists said we had only 10 years to make fundamental changes with carbon dioxide (CO2) emissions or the planet was doomed (i.e. the hockey stick thesis).
Well, it has now been more than 10 years. and the planet has actually been getting cooler over the last decade, which was not forecast by a single major climate model (oh, well). Also the polar ice cap has not disappeared, and the polar bear population is getting bigger, not smaller! It seems those who claim the variable output of the sun (sun spot theorists) has more effect on Earth temperature than CO2 might just be right.
A major reason the global warming misinformation is still so hyped is that government subsidizes many producers of noneconomic alternative energy sources and many scientists with an economic interest in repeating the claim. Those in the political class love the idea of a climate crisis because it gives them more power and money to do something about it.
Getting it all wrong is not new. In 1900, Europe was enjoying unprecedented peace and prosperity. …