Alex Rosenberg and Tyler Curtain pose this question in an op-ed for the NY Times. They are approaching this issue poorly for three reasons.
First, when there is open intellectual debate between people of different ideologies (fresh water vs salt water, Austrian/Chicago-schools vs New Keynesians), it makes no sense whatsoever to stand back and claim that all parties are equally wrong simply because you don’t see some sort of consensus offered up from the melee. You have to work a little harder than that – look at what each side is saying and judge each side on its merits. Passing judgment on the debating sides as a whole is very much like questioning what the human brain has been good for, using religion and physics as equally relevant pieces of evidence, and calling the disagreement between the two a “cacophony”! It would be laughable if these two authors didn’t have PhD’s and actually teach critical thinking. (For another example… It’s like looking at the current intransigence of Republicans and Democrats and being inspired to ask whether legislative bodies or democracy are really good for anything!)
Second, they assert that physics and other material sciences have increased in predictive accuracy, and so if economics is a science, it ought to as well. It is true that physics has gotten more accurate at predicting common phenomena better over time, but it would be wrong to suppose that physics is a settled science where consensus more or less always rules. And it is useful to note where the unsettled debates continue to this day – in, yes, physics. There are a surprising number of physicists that radically differ from what outsiders would think of as the “mainstream” on issues such as the applicability of MHD to electromagnetic systems, the nature of solar flares, the nature of Dark Energy and Dark Matter, the nature of time, or even issues as pedestrian as whether a fusion reactor can be designed that would produce more electricity than it consumed. Hawking and Susskind were debating the fundamental nature of Black Holes up until just a few years ago. Einstein never accepted Quantum Mechanics (nor did Schrodinger – or his cat). The inventor of superconducting quantum interference devices – which ushered in a revolution in the everyday usefulness of superconductors, left the field to hunt for ghosts. And then there’s climate change – which still has plenty of PhD’d dissenters, regardless of what you think of their scientific credibility.
There is a school of plasma physicists that believe the Sun doesn’t actually fuse hydrogen at its core – but rather fuses a lot less in its upper atmosphere. This “Electric Universe” camp insists that comets expel material due to EM sculpting. They believe the cratered surfaces of Mars and the Moon are caused by plasma scaring, not meteors, and thus the assembly we call the solar system is probably much younger than the 4.5 billion years currently estimated by the mainstream. Some believe that gravity is not a real effect – but rather a side-effect of electromagnetism. Some believe Relativity is all wrong. Some believe our concept of solar flares is all wrong. Some believe the galaxy rotates as a result of a colossal magnetic field, not gravity, and are convinced that this model explains the lack of fall-off in rotation speed that was the mainstream’s first clue that Dark Matter might exist. There are lectures of their meetings on youtube where you can listen to a physicist expound on his explanation that the martian dust-devils photographed by our robotic rovers could not possibly be dust-devils caused by wind, as we are used to, because the ionization threshold of the martian atmosphere is too low for its atmosphere to suspend dust in a spiral of the observed shape – and thus it must be an electromagnetic phenomenon. Halton Arp is a famous astronomer with some of the most interesting galactic clusters named after him – but he still insists that Red Shift (and thus the whole basis of Dark Matter, Dark Energy, the Big Bang, and on and on) is all wrong. Many in this camp believe that supernovas, novas, and variable stars are caused by changes in electromagnetic currents.
The point I’m trying to make is that every science – even physics – has vigorous debate wherever the experimental horizon lies in that field. It is hard to dismiss debate for any phenomena that cannot have a controlled experiment conducted by two or more different groups. In physics, this horizon lies in space, in exotic matter, in ultramassive bodies, etc. In economics, the predictive horizon (of consensus) is there, but is isolated to the fairly mundane, small-scale economic phenomena.
Which leads to the third error. The reason there is (still) vigorous debate in economics is we – as a society – do not do what it would take to settle macroeconomic debates. What would that take? Controlled, well-measured, pre-agreed experiments in macroeconomic policy, such as increases or decreases in this or that type of tax in one state or nation while a similar state or nation either makes no change. Or we let our FED “increase the money supply” in one part of the country some small-ish percent, while holding it steady elsewhere. Or allowing academics or the government to have real-time access to information like how much money you have in your bank account, wallet, credit card balances, stock accounts, etc. With the right experiments we could very quickly turn macroeconomics into a vividly consolidated science – but we would have to let go of a lot of our privacy, and allow academics to jigger-around with tax and legal policies here and there (even if by relatively small differences) and just accept that we’re all human guinea pigs being used to settle some of these issues once and for all.
Frankly, I’m all for doing that – especially since it would be a much greater legacy to pass on to future generations than the outcome of the current political bickering. I would love to see minority parties relegated to playing the role of scientific adviser to the majority, with no great say in effective policy – only a say in setting up the conditions for effective monitoring of current policy, complete with predictions and counter-predictions, so that we can change the debate in each election to be about the NEXT issue, not a rehash of the same, tired ideas, over and over again. Frankly, our “political science” – in the sense of X policy will lead to Y – is in just as sorry a state as our macroeconomic science. But the only real problem is that we are not facilitating the experiments to allow bad ideas to finally be dismissed, once and for all. It might be painful to go that route – but it would actually be worthwhile, in the end, because policy stagnation, legislative inaction, and the kind of economic half-measures that result from compromises in this debate that are readily on display in the EU – all have much greater costs in the long run. And don’t get me wrong – human beings would die as a result of such experiments – but that’s the cost of progress, just as occurs most vividly in medicine. But just as in medical research, when you see that either your treatment group or control group are experiencing an abnormal rate of negative outcomes – you stop the experiment early. We should do the same in economics… and politics.
So the answer to these authors is, no, economics is not worthless. But more to their point, no, we should not choose a FED chairman that will treat the economy more like “music theory than Newtonian theory.” We should pick a FED chairman that has been proven right about macro issues most often amongst the candidates (Janet Yellen), and then start the experiment. But if “the experiment” goes (objectively) badly during her (or anyone’s) helm, we should choose a replacement from the latest round of most accurate, viable candidates. Yes, I realize I just proposed ending the “5-year term” that was imposed on the FED chairmanship to avoid political squabbling. I don’t think these fixed-term limits are very useful – but leaving the decision to appoint (or replace) a FED chairman to a politician is also a bad idea. Can we raise our governance technology to a new level, and allow a poll of qualified academics in a related field determine who should fill this or that role?