Acceptable Alternatives to the Truth
James Quillian,Economist, Political Analyst, Natural Law

In economics and politics, I have an advantage that anyone could have but almost no one uses. I do not believe lies. That is not unfair. It is simply uncommon. In politics, the truth sits in everyone’s toolbox, but no one touches it. Any politician who tells it is immediately handicapped.

So I begin with a simple rule. When politics speaks, I assume I am not hearing the truth. All political communication is designed to achieve an outcome or advance an agenda. People who think they are hearing truth—especially from their favorite candidates—start from a false premise and end with a false conclusion.

Mainstream economics works the same way. Study it if you want to master a system that does not exist in the real world.

John Kenneth Galbraith saw this clearly. Liberal or not, he was unmatched at noticing what others missed. His solutions were wrong, but his observations were exact. In The Affluent Society, he introduced the term conventional wisdom. The phrase is common now, but its weight has been lost.

Conventional wisdom is not truth.
Conventional wisdom is the comfortable alternative to truth.
It is the belief system people cling to because the truth is too disruptive.

Policy is built on conventional wisdom, not on fact or logic. Often it is nothing more than adopting a lie and hoping it works because the truth is too troubling to confront.

Today’s conventional wisdom is easy to spot. The dominant belief is that the stock market is in a bubble created by investors bidding prices up. It is unsettling to consider the alternative: that we do not have a bubble at all, but a political agenda engineered to provide affirmative action for stock prices. Bubbles burst. Political agendas fail, but they do not burst. They simply stop working. A political agenda is whatever powerful people convince Congress to do.

Many economists see QE and fiscal stimulus as unnecessary and destructive. But you cannot get paid in this profession unless you promote the conventional wisdom the discipline rests on. That is why the belief that stimulus is needed—and that the Federal Reserve is a vital institution—remains untouchable.

Conventional wisdom is a reasoning substitute that displaces truth. The popular ideas circulating in liberal and conservative echo chambers are fragments of conventional wisdom that eventually harden into sound bites.

Truth enters the national dialogue only when suffering forces it in. When policies built on yesterday’s conventional wisdom begin to fail, people finally notice the truth they ignored.