>With 4 years of data we now know who was right and who was wrong
Do we? I think at best you could argue that what was done was wrong, that doesn't imply the other alternative was right. There exists more than two possible courses of action and thus we can't simply anoint one as right and the other as wrong, they could in fact both be wrong. I think that is one big problem with macro-economics as a science, you can't really have controlled experiments whereby we try each of N hypothesis in turn, controlling externalities, and see which yields the most accurate outcome vis-a-vis the predictions that that hypothesis made. Even repeating what worked N years ago isn't a guarantee of anything, since it is highly unlikely that all the confounding variables are the same.
You seem to be implying that because economists can't run clean experiments like physicists, they can't prove or disprove anything, they can't tell us what happened and they certainly can't guide us. At this point I have to ask, how is your view of economics different from theology? What is the point of such a useless field of study?
Of course, economics can be useful. Economists have a ton of data and a wide variety of tools with which to conduct their study, and while they can't achieve the purity of physics, economics can still be a valid and useful field of study. The problem isn't economics itself, but practitioners whose views are clouded by politics, ego and money.
> You seem to be implying that because economists can't run clean experiments like physicists, they can't prove or disprove anything, they can't tell us what happened and they certainly can't guide us.
This is exactly correct. Just because we don't have the means to do the kinds of experiments we want, doesn't mean we get to change the definition of proof. And if you do, you certainly shouldn't call it science. If there was no good way to do a falsifiable experiment in physics we wouldn't say "oh we have a lot of data though, so i guess we should just look at the correlations and assume causation in this case". The question would simply remain open, perhaps indefinitely. This is the most frustrating thing about discussing economics with anyone: if you're truly honest, you should admit that you can pluck examples in history to prove just about anything. Each side will say "oh that's not comparable because ____". And you know what, they're right! Since no two situations are the same, we rely on our "gut" to tell us what variables, despite being different, "didn't really influence or matter". The idea that you can for example draw any conclusions about economic policy from the 50s, a ridiculously unique time where all the production of the world except the US was more or less destroyed, is absurd. The idea that you can look at the effect of ONE policy in Germany, a country of different size, culture, laws, and other policies, and say the same would happen here is equally crazy. It's data sure, but not particularly useful data if you are honest about the science of it. Those techniques would get you laughed out of any other scientific field.
> At this point I have to ask, how is your view of economics different from theology? What is the point of such a useless field of study?
My view (I am not the op), is that yes, most people who believe in macro economics principles are closer to theologists than scientists. It is indeed quite possibly a useless field of study, given that there are huge disagreements and it doesn't even matter because a politician will usually do something completely based on the next election or special interests anyways, so even if we did know for sure it wouldn't matter. ( a funny article by mr Krugman himself on this: http://www.nytimes.com/2000/06/07/opinion/reckonings-a-rent-... )
Now, there are alternative forms of establishing knowledge other than science (for example there are no experiments in math, and math isnt science), and you can argue that the position "I don't know" can be a very wise one and an economic policy all in itself. But the idea that "doing x will for sure do y" is silly, ESPECIALLY since a timeframe is rarely ever attached to it.
If there was no good way to do a falsifiable experiment in physics we wouldn't say "oh we have a lot of data though, so i guess we should just look at the correlations and assume causation in this case". The question would simply remain open, perhaps indefinitely
What do you think of astronomy? Science, or should we wait for the development of experimental astronomy (yes, I know a lot of it is based on experimentally based physics, but none of that gets tested at interstellar distances, objects the size of stars, etc)
What about Kepler, and Newton with his laws of gravitation? Science, or did it only become science once we had machinery to measure gravity?
I think economists can do science, but their subject is much harder/less anemable to the scientific method than e.g. physics. Because of that, their results are less spectacular then those of physicists (psychologists, similarly, have a harder time than physicists applying the scientific method)
Also, that is harder to discriminate between true and false theories makes it easier for 'crackpots' to make a living in those fields.
Do we? I think at best you could argue that what was done was wrong, that doesn't imply the other alternative was right. There exists more than two possible courses of action and thus we can't simply anoint one as right and the other as wrong, they could in fact both be wrong. I think that is one big problem with macro-economics as a science, you can't really have controlled experiments whereby we try each of N hypothesis in turn, controlling externalities, and see which yields the most accurate outcome vis-a-vis the predictions that that hypothesis made. Even repeating what worked N years ago isn't a guarantee of anything, since it is highly unlikely that all the confounding variables are the same.