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Dean Baker's new book, Plunder and Blunder: The Rise and Fall of The Bubble Economy, explores the stock and housing bubbles at the heart of our current economic crisis. This week, TAP Online is hosting a two-part discussion of the book, featuring Dean Baker, Josh Bivens, Eileen Appelbaum, Danilo Pelletiere, and Ezra Klein.Part one is up today. Dean kicks off the discussion:
Remarkably, even now, economists and policy analysts still seem determined to make housing and financial policy as though the bubble is not there. They talk about stabilizing housing prices without distinguishing between markets where the bubble is still deflating and those markets in which house prices are consistent with fundamentals.It would be difficult to believe that our top economists can still be so incompetent, but among economic policy makers, blindly following the conventional wisdom seems to be a job requirement. Even if this policy leads to yet another disaster, those responsible are unlikely to face any serious consequences. The taxpayers, homeowners, and job losers are the ones who pay the price of the economists' mistakes.Is there any way that economists can ever be held accountable for the quality of their policy advice? And, if they can't be held accountable, is there any reason that the public should ever take these experts seriously?Read the rest here, and look for part two on Thursday.--The Editors
