Binyamin Appelbaum makes a big call in the New York Times:
As the quarter century of growth that followed World War II sputtered to a close, economists moved into the halls of power, instructing policymakers that growth could be revived by minimizing government’s role in managing the economy. They also warned that a society that sought to limit inequality would pay a price in the form of less growth. In the words of a British acolyte of this new economics, the world needed “more millionaires and more bankrupts.”
In the four decades between 1969 and 2008, economists played a leading role in slashing taxation of the wealthy and in curbing public investment. They supervised the deregulation of major sectors, including transportation and communications. They lionized big business, defending the concentration of corporate power, even as they demonized trade unions and opposed worker protections like minimum wage laws. Economists even persuaded policymakers to assign a dollar value to human life — around $10 million in 2019 — to assess whether regulations were worthwhile.
Peter Boettke points out the obvious:
The problem with narratives like Appelbaum’s isn’t that he is suspicious of the pretensions of economists, it is that he is blaming the wrong culprit for the mess we’re in. Here it is important that everyone of these critics read Gregory Mankiw’s very important piece, published BEFORE the financial crisis, on the macroeconomist as scientists (read Chicago New Classical and Monetarists) and the macroeconomists as engineers (read MIT/Harvard Keynesian and New Keynesians). The Chicago folks — and the Austrian, Virginia, UCLA, etc. folks — did not go to DC, did not write laws, didn’t attempt to orchestrate economic miracles abroad, or stimulate growth at home. They taught, they lectured, the researched and wrote papers in journals and published books, and a subset of them wrote opinion editorials and did interviews in various forms of popular media. In short, they were teachers and students of society. They did not get paid to be experts for the government in general. They were not advisors. But others were — from Keynes to Larry Summers — the line is long. Just look at the number of central bankers that were PhD students under Stan Fischer at MIT. Can you trace that same lineage to Milton Friedman? How about to F. A. Hayek? Mises? Right, I didn’t think so.
It wasn’t the free-market economists who were the social engineers.