"Many matters in academia, such as who gets funding, what gets published and who gets employed are settled by a relatively small group of people." (Lucas: "Legitimacy of peer review" )
Often we hear "peer-reviewed" praised as a feature of high-quality papers in science or mathematics - in particular in modern mathematics where a comparatively small fraction of believers in transfinite set theory have conquered most positions as academic decision makers.
This position is criticized by others, for instance [Henry Flynt: "Is mathematics a scientific discipline?" (1996)]
No matter how much the content of mathematics exploits paradox, mathematicians express dedication to policing their doctrine against inconsistency. Mathematicians do not welcome those who attempt inconsistency proofs of favored theories. [...] I will propose that the main factor in the establishment of "truth" in mathematics is professional procedure and discipline. [...]
Truth is negotiated on the basis of manipulation of import by distorting interpretations. Interpretation takes the form of discarding traditional intentions concerning mathematical structure: the privileged position of Euclidian geometry; the invariance of dimension; the association between integer and magnitude; uniqueness of the natural number series; etc.
From time to time, results are discovered which patently embarrass the conventional wisdom, or controvert popular tenets. [The Gödel theorems.] Then follows a political manipulation, to distort the unwanted result by interpretation so that it is seen to "enhance" the popular tenet rather than to controvert it. [...]
Even if my sense of the situation is right, the appearance of such a professionally compelling proof would be more a matter of packaging and selling than anything else. [...] The biggest hurdle such an attempted proof faces is professional discipline. Whether inconsistency proofs are recognized to have occurred is subject to entirely "political" manipulation.
On the other hand there are also peer-reviewed journals in other fields where the unscientific character is even more suspicious.
http://www.astrology-and-science.com/d-rese1.htm Contains abstracts of 91 studies, most of them empirical, from four astrological research journals. There are 37 abstracts from Correlation: Journal of Research into Astrology 1981-2007 published by the British Astrological Association, 22 from the now defunct Astro-Psychological Problems 1982-1995 published by Francoise Gauquelin in France and (in 1989-1990) by the National Council for Geocosmic Research in the USA, 18 from Astrologie in Onderzoek [Astrology under Scrutiny] 1986-2003 published by Wout Heukelom in the Netherlands, including its precursors 1977-1985 published by NVWOA the Dutch Society for Scientific Research into Astrology, and 14 from Kosmos 1978-1994 published by ISAR, the USA-based International Society for Astrological Research. At the time the first three journals were the world's only peer-review astrological journals devoted to scientific research, whereas Kosmos was more an astrological journal than a scientific research journal, hence the fewer abstracts.
So my question: Is "peer-reviewed" a guarantee of scientific quality or even truth or not, and if not, what ethical standpoint should be assumed and expressed toward it?