About Hindsight Bias:

Hindsight bias is a well-known cognitive distortion where people tend to perceive past events as having been more predictable than they were. It is sometimes referred to as the we-knew-it-all-along phenomenon. More often than not, the judgment is asserted with a smug or pretentious air.

In the political world, this tendency is often used to soil the reputation of high-profile decision makers. For example, if the economy has turned south, the out-party will usually blame the president for it and fit a story around how we all knew it would happen. Blame may either be ascribed to particular actions (e.g. government spending decisions) or else to inaction (e.g. the president was distracted and economies falter if not managed). In fact, however, even the best economists have poor track records for predicting the economy. Plus, the president’s actual control of the economy is very limited, and in an economic system there are years-long lags between actions and effects.

It is inconvenient to consider that the decision-maker did not have the information we have now, or that the other alternatives available would have had even worse outcomes.

As cognitive scientist Daniel Kahneman says:

You cannot help dealing with the limited information you have as if it were all there is to know. You build the best possible story from the information available to you, and if it is a good story, you believe it. Paradoxically, it is easier to construct a coherent story when you know little, when there are fewer pieces to fit into the puzzle. Our comforting conviction that the world makes sense rests on a secure foundation: our almost unlimited ability to ignore our ignorance.

Overconfident blame narratives appear in other realms as well, such as problematic international events, electoral shifts, environmental problems, and so on. Hindsight Bias makes it difficult to learn from past experiences because it distorts the analysis of past events, too, leading to poor judgment.