SYNOPSIS: Overview of pundits' reactions to Asian Flu. Conclusion-- they were all right, and Krugman was even righter.
Writing in the most recent issue of ''The International Economy,'' William Greider used the occasion of Asia's economic crisis as an opportunity to settle some scores with conventional economists who scoffed at his 1997 book ''One World, Ready or Not: The Manic Logic of Global Capitalism.'' ''They're not scoffing now,'' he declared. As it happens, he's wrong: they're still scoffing. Conventional economists never denied that crises happen; it was his explanation of why and how that they thought was silly.
In one sense, however, Greider has moved into the mainstream. Over the last few months there has been a flood of columns and essays about the lessons of Asia's economic woes. As far as I can tell, every pundit draws the same central lesson Greider did: whatever he thought before about the way the world works, whatever economic doctrine is identified with his name - the crisis proves that he was right. Practitioners of at least four schools of economic thought, who rarely agree about anything, have managed to find confirmation of their faith in Asia's misfortune:
*Champions of Capitalism. On the eve of the crisis, free-market enthusiasts were cheerfully announcing that, as The Wall Street Journal put it last March, the worldwide turn to free markets was fueling ''a global growth wave that is unprecedented in size and scope.'' The main reason for that high global growth rate was, of course, the extremely rapid growth of emerging Asian economies. When those economies suddenly went into reverse, did the global capitalist faithful question their confidence in the power of free markets? No, clearly the trouble with Asian economies was simply that their markets weren't free enough. Before the crisis they were advertisements for the power of capitalist thinking; afterwards, anyone could see that they were hotbeds of ''crony capitalism,'' a far cry from the real thing. And the crisis proves the superiority of the genuine article.
*Global glutters. Greider is only one of a number of people who worried that multinational corporations were building more manufacturing capacity than the world could possibly use. And they have no doubt that this crisis - even though it seems to have been largely driven by real-estate speculation, and even though the most conspicuous examples of over-investment involved local businessmen rather than multinational corporations - shows just how right they were.
*Asia-phobes. Until just a couple of years ago you couldn't open the pages of a public-affairs magazine without running into a commentary by one of the ''revisionists,'' who claimed that Japan and other Asian countries had developed a new and superior form of capitalism that was beating the pants off Western, free-market economies. You might have expected the leading revisionists to admit to having gotten it a bit wrong, or at least to show some signs of diminished confidence in their own judgment. But no. For the most part they are still opining as freely as ever.
James Fallows, the editor of U.S. News & World Report, declared as late as 1994 that ''Like it or not, we live in the world that Asian success stories have shaped. We need to figure out how to compete in it.'' Now, while conceding some flaws in the Asian model, he still warns that ''During seven years of unremitting distress for its financial system, Japan's manufacturers have accumulated trade surpluses of more than $700 billion.'' (Shouldn't this make him wonder whether trade surpluses are necessarilysuch a good thing?)
Others have managed to change tune without missing a beat. Clyde Prestowitz, whose 1988 book ''Trading Places'' predicted that Japan's government-business partnership would allow it to dominate high technology at America's expense, now declares that ''The Japanese model was a fantastic catch-up model, but it was not a model for all seasons,'' and has taken to denouncing crony capitalism and sternly lecturing Japan on the need for fundamental reform.
*Asia-philes. A larger, more diffuse group than the revisionists, this includes just about everyone who believed that Asia's past growth rates could be extrapolated into the future (without necessarily believing that the region's success was based on some novel form of capitalism, or that it had been achieved at Western expense). One of those, Jeffrey Sachs, is the Harvard professor who led a team that compiled last year's ''Global Competitiveness Report,'' with its Asia-friendly rankings. Did the crisis shake his conclusions? Not at all. It simply proved to him what he always knew, that even the strongest of economies can be devastated by a financial panic. And of course some Asian leaders, like Malaysia's Mahathir Mohamad, see not just panic but conspiracy at work.
Part of the problem, presumably, is that there is no licensing requirement for economic commentators; there aren't many economics professors among the global glutters or the Asia-phobes, but that doesn't stop them from adding to the cacaphony. A bigger part of the problem is that economics is for the most part not the kind of discipline where you can do an experiment that settles an issue beyond all dispute. True, you can get a bunch of undergraduates to buy and sell a fictitious commodity, or bid in a simulated auction; but you can't persuade the International Monetary Fund to rescue only half of the economies in crisis, using the rest as a clinical control group. All that we have are the lessons of history - lessons that are often positively Delphic in their obscurity. But even when history might seem to you or me to be speaking loud and clear, it is no match for the ingenuity of modern punditry, which can turn any event - no matter how much it may seem, on the surface, to contradict what the pundit was saying a few months ago - into an occasion for triumphant self-congratulation.
Oh, by the way, what about me? Back in 1994 I published a notorious article entitled ''The Myth of Asia's Miracle,'' which many people now credit with having forecast the current crisis. A close reading of that article might suggest that to the extent that I predicted anything, it was a gradual slowdown - not the sudden catastrophe that has overtaken the region. But, hey, I'm tired of fighting conventional wisdom. This time I'm ready to go along with what everyone believes: recent events prove that I was completely right.