I used to think that the title of this blog post derived from baseball great Yogi Berra. But I have also seen it attributed to Danish physicist Neils Bohr. (By the way, have you ever noticed that when people quote a great line, a very high percent of them attribute it to Mark Twain or George Bernard Shaw.) Whoever said it, the line about predictions is a great line.
Which brings me to the issue at hand. Over at Reason.com, Steven Greenhut, a savvy commenter on California politics and political economy and, by the way, a fantastic speaker if you're ever looking for someone who can both inform and entertain while at the same time digging deep, makes 10 predictions about California's future. It's titled "Tough Year Ahead for California's Taxpayers and Wealth Producers." The first 9 of his predictions are pessimistic and the last is somewhat hopeful. All of his predictions seem reasonable. I won't bother repeating them: you can check for yourself.
But. Here's what I wonder. Even though Greenhut's predictions seem reasonable, are they reasonable? That is, to what extent will they come to pass? I don't raise this issue because I have any deep insight that allows me to challenge any particular one of them. Rather, my perspective is that of someone who has been unduly pessimistic in the past. A couple of examples from my history of pessimistic predictions.
1. In the early 1980s, one of my bosses at the Council of Economic Advisers, the late Bill Niskanen, told me that at a Heritage Foundation event in 1984, he had asked a bunch of fellow Reaganites who were celebrating Reagan's "success" in trimming government spending whether they thought that by the end of a second Reagan term, he would have got federal spending to under 20% of GDP. The silence, said Niskanen, was palpable. Both Niskanen and I were pessimistic about the prospects. We were right. But we were wrong in thinking that Reagan was our last best hope. It did go under 20% of GDP, due both to Clinton and the 1995-and-on Republican Congress. The Republican Congress restrained the rate of growth of federal domestic government spending. And Clinton kept the U.S. defense budget on its glide path that Bush Sr. and his defense secretary, Dick Cheney, had chosen to reflect the end of the Cold War. (See my August 26 post, "U.S. Federal Budget Cuts in the 1990s," for more details.)
2. And speaking of the end of the Cold War, here's my other bad prediction. Here's what I wrote in The Joy of Freedom: An Economist's Odyssey about President Reagan's famous June 12, 1987 speech in front of the infamous Berlin Wall:
General Secretary Gorbachev, if you seek peace, if you seek prosperity for the Soviet Union and Eastern Europe, if you seek liberalization: Come here to this gate! Mr. Gorbachev, open this gate! Mr. Gorbachev, tear down this wall!
A year later, West German Chancellor Helmut Kohl says that the Berlin Wall will not come down in his lifetime.
I didn't write this down anywhere but at the time, I agreed with Kohl. I was wrong.
Notice something about both of my predictions. Neither was based on wishful thinking. I would have loved for government spending to fall below 20% of GDP and I was glad when it happened. I would have loved for the Berlin Wall to crumble and without a shot being fired and I was ecstatic when that happened. So I tend to be skeptical when people make predictions based on pessimism. They can be just as wrong as when they base them on excessive optimism.
If you comment on this post, I would appreciate your sharing your own history of predictions: pessimistic or optimistic, fulfilled or unfulfilled.