The Future Is Uncertain, Plan Accordingly

Michael Giberson

Apparently, the Washington Post thinks is it newsworthy that economists canít foretell the future.

In a story headlined Economists Uncertain of Energy Costsí Impact, the Post reports that economists agree that higher energy costs in recent weeks dampened economic growth, but economists are not sure what the economy will be doing in the future. Iím not so sure that the conclusion is newsworthy, but it probably is worthwhile reminding readers in the nationís capital about the limits to knowledge.

However, just because economists donít know just what the economy is going to do in the future doesnít mean reasonable plans cannot be made.

Yesterday the Post reported: Airline Industry Losses to Widen In 1st Quarter. Contrast that story with todayís report that Southwest Airlines Profit Jumps as it carried more passengers and paid less for fuel than competing carriers. Apparently, Southwest has hedged the price risk of 85 percent of its fuel needs, some of it as much as four years in advance and at a crude oil price of $26 a barrel.

Put the three articles together and you get the lesson for the day: The future is uncertain, plan accordingly.


2 thoughts on “The Future Is Uncertain, Plan Accordingly

  1. However, just because economists donít know just what the economy is going to do in the future doesnít mean reasonable plans cannot be made.

    True. But the fact that they cannot predict the future behavior of the economy, cannot agree on what would maximize the well-being of the economy in the future, is one more sign that the dismal science has little in common with real ones.

  2. “True. But the fact that they cannot predict the future behavior of the economy, cannot agree on what would maximize the well-being of the economy in the future, is one more sign that the dismal science has little in common with real ones.”

    You know, I was just thinking the same thing about biologists. They claim to understand how the human organism functions, but yet they have *no idea* where each person in the world will be physically located at a given point in time in the future.

Comments are closed.