Famed economist Paul Krugman, a columnist for The New York Times, admitted that he and other economists have been “wrong” to write off inflation as transitory in an opinion piece he published on Thursday.

Krugman noted in the piece that two schools of thought emerged this year as prices have soared, burdening lower-income and middle-class Americans with what is essentially a pay cut, despite rising wages. While himself belonging to “Team Transitory,” the economist wrote that he has been misguided to criticize those on “Team Persistent.”

He notably made this stance known on Twitter this past summer, informing his nearly five million followers of an alliance with those who would view the country’s economic woes through rose-colored glasses.

TEAM TRANSITORY — I like it and plan to steal it. This report does look like what you’d expect if recent inflation was about transitory disruptions, not stagflation redux https://t.co/cjfgPI6WjE

— Paul Krugman (@paulkrugman) August 11, 2021

Krugman on Thursday signaled a second-guessing of his fealty toward optimism. He also opined that what we might be seeing is something that resembles 1970s stagflation, rather than a temporary headache for consumers and companies:

Mainstream economists are currently divided between what are now widely called Team Transitory and Team Persistent. Team Transitory, myself included, has argued that we’re looking at a temporary blip — although longer lasting than we first expected. Others, however, warn that we may face something comparable to the stagflation of the 1970s. And credit where credit is due: So far, warnings about inflation have proved right, while Team Transitory’s predictions that inflation would quickly fade have been wrong.

But this inflation hasn’t followed a simple script. What we’re seeing instead is a strange episode that exhibits some parallels to past events but also includes new elements.

Krugman argued that while supply chain bottlenecks have largely been resolved, and he expects their effect on the goods of prices to help, inflation is a complicated issue. One so complex that its root causes have bewildered him.

Should the Federal Reserve raise interest rates? Krugman wrote he sees the potential for serious issues with rate hikes in 2022, which he concluded could sacrifice millions of jobs for the sake of lowering prices. He also came to a conclusion that surely pained him, considering his loyalty to Team Transitory and his career in economics.

Krugman wrote, “Maybe the real takeaway here should be how little we know about where we are in this strange economic episode. Economists like me who didn’t expect much inflation were wrong, but economists who did predict inflation were arguably right for the wrong reasons, and nobody really knows what’s coming.”

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