Tuesday, May 16, 2006

The Economic Mythol-Gap

Capitalism is too important and complex a subject to be left to the economists...” --Jerry Muller

Yesterday we were discussing Lee Harris’ important piece on Why Socialism Isn't Dead. In it he makes the key point that socialism’s irrationality is its greatest strength. Since it isn’t operating in the realm of logic, it is therefore impervious to being logically disproved. Although it fails time and again, its failure proves nothing, as failure is simply transformed into a step along the way to inevitable success.

This leads to the startling conclusion that “the whole point of the socialist revolution is not that human societies will be transformed in the distant future, but that the individuals who dedicate their lives to this myth will be transformed... in the present” [emphasis mine]. Paradoxically, the purpose of socialism is not to achieve socialism; rather, “the myth of socialism is a useful illusion that turns ordinary men into comrades and revolutionaries united in a common struggle...”

As I have written before, one cannot transcend religion, for religion embodies objective metaphysical truth. Therefore, if one tries to sidestep it, it will simply return in the form of sub-religious magical thinking, such as scientism or socialism. Just as religion is the most fruitful way to “think about ultimate reality,” capitalism is the most fruitful way to think about economics.

But just as the person who rejects revealed religion falls back on “natural religion” (i.e., what can be revealed by the senses and perceptions), the socialist falls back on what might be called “natural economics,” that is, a flawed way of thinking about the creation and distribution of wealth that is more or less hardwired into our genes.

Remember, only a tiny, insignificant fraction of mankind’s evolution has taken place under modern circumstances. Rather, 99% of our human evolution took place in what is called the “archaic environment.” Where you situate the archaic environment is somewhat arbitrary, but let’s just go back to the emergence of archaic homo sapiens, which was half a million years ago. It is presumed by evolutionary psychologists that our human traits emerged and were selected during this period of time. Included among these traits would be our “natural” way of looking at the accumulation and distribution of goods.

So if we delve into the archaic environment, what can we learn about Economic Man? Certainly he wasn’t a capitalist. One of the most fascinating economics books I have ever read is The Mind and the Market, by Jerry Muller. What makes it so fascinating is that the book is not a history of economics per se, but a history of what people have thought about economics, which is mostly flat wrong, if not plain absurd. In this regard, it is similar to a history of medicine that looks at all of the crazy beliefs human beings have had about sickness and health. Until about a hundred years ago, you were lucky if most medical procedures didn’t actually harm you.

It is the same with economics. Until Adam Smith in the late 18th century, there was no understanding at all of how wealth was created. Hard to believe, but we are still fighting the same battle Adam Smith was, in that we cannot overcome something deeply irrational in the heart of man when it comes to thinking about wealth. By actually developing a true economic discipline, separate from all of the magical thinking that had previously pervaded the subject, Smith unwittingly detached the subject from its deeper irrational roots--as if he literally developed a “conscious economics” split off from “unconscious economics.” But this doesn’t mean that “unconscious economics” will disappear. To the contrary--like the Freudian unconscious, it will simply come back with a vengeance.

What I am suggesting is that in order to understand leftist economics, we must go all the way back to cave man economics, because that’s where it starts. And what do cave men believe? The default setting of mankind seems to be that wealth is fixed, so that it is a matter of fighting over one’s share--one persons gain is another person’s loss. People still struggle with the idea that the creation of wealth is unlimited, and that both parties of a transaction may benefit from it (such as in free trade).

In my opinion, the psychological mechanism of envy was evolved in the archaic environment as an expression of primitive economics. Remember, human beings are fundamentally social animals that evolved in small, face to face bands of only 20 or 30 individuals. Evolution actually selected these small human groups more than individual humans. Therefore, anything that facilitated the survival of these small groups was likely to be selected by evolution.

I believe envy was one of these factors, because envy is in fact a primitive form of socialist egalitarianism that helps to promote social solidarity. Remember, social solidarity is the purpose underlying what might be called the “envy theory” of primordial socialist economics, not the production of wealth. Indeed some (that is, I) might go so far as to say that nothing has changed in this regard: that the contemporary left is an expression of our primordial envy, which cannot help noticing that some members of the group possess more than others. Therefore, those with more must be attacked under the guise of equality.

Just as in the case of our primitive furbears, the purpose of the attack is not to create the conditions that advance the material circumstances of everyone, but to undo the psychologically uncomfortable conditions that make one feel envious. As Helmut Schoeck pointed out in his book Envy (listed in sidebar), the economically successful society must function as if the envious individual does not exist. It must learn to recognize him in his many guises, and ignore him.

Of course, we try our best to do that, and the United States has been the most successful country in trying to ignore its envious citizens, which is why the U.S. is such an economic powerhouse. But in America the enviers have formed their own party that revolves around the expression of their primordial envy. And in Europe the enviers have taken over, which is why European governments work so hard to appease primordial envy--and which is why their economic systems become weaker and weaker (which ends up creating even more envy, as in the rioting in France).

It is fascinating to read Muller’s history of beliefs about wealth, because it is as if the left has learned nothing. Prior to Adam Smith, it was firmly believed that only a shared, top-down vision of the public good would hold society together. The idea that a much more robust order could be achieved by each person pursuing his private interests was literally inconceivable.

You may think that we have transcended cave man economics, but just look at the furor over gas prices. The push for a windfall profits tax is the expression of pure irrational envy. Economically, it would be entirely counterproductive and self-defeating. In the long run, it would actually create more envy. But that is beside the point. Leftist ideas are not rooted in external reality but internal reality. What is important is the emotional satisfaction that can be derived from them, not their actual consequences.

You know this is true because gas prices, adjusted for inflation, aren’t even that high--comparable to 1981. Nor are gas company profits out of line with other industries. Nor, needless to say, is there any furor over all of the thousands of commodities commodities and consumer goods that have come down in price--which they inevitably do--because of the incredible efficiency of our capitalist economy.

In other words, envious man only sees that which provokes his primordial envy. The rest of economic reality goes undetected.

Out of time again. To be continued.


Mike A. doing his Gagdad Bob impression said...

In other words, the problem is not so much that they only show us the bad news. It's that bad news is all we want to hear. We're not motivated unless we're infuriated about something and arguing over it and trying to make a change. When we're stable, there are some of us who can't help but feel that we're stagnating.

Capitalism is the least unfair of all economic systems. It creates complacency and stability, which runs counter to human nature. Marxism is all about destabilizing the stable, afflicting the comfortable, subverting the dominant pairodimes.

On some level, therefore, Marxism retains a vitality that capitalism does not. Capitalism contains limitless potential, but to a species that was evolved to convert potential energy into kinetic energy, the pyrokinetics of Communism remain endlessly attractive.

Anonymous said...

Communist: "Sure, I'm running in circles, but at least I'm MOVING!"

Capitalist: "Sure, I'm sitting on my ass NOW, but I'm not wasting energy that I might need later."

will said...

>> " . . . Paradoxically, the purpose of socialism is not to achieve socialism; rather, “the myth of socialism is a useful illusion that turns ordinary men into comrades and revolutionaries united in a common struggle...” <<

I think it's easily overlooked that playing the revolutionary is just plain *fun* for a lot of people. There's a certain amount of cloak-and-dagger involved, it's romantic, heroic, play-acting. And of course it's play-acting in a free society. It's all pretend when you label the Bush admin. "fascistic" when you face no threat of being hauled off to a gulag or prison. But it's fun to pretend that you are under such a threat. Makes you feel important in a way that perhaps you feel you really are not.

So, this kind of energetic play-acting is good for keeping those inner demons at bay - hey, you're too busy saving the world to worry about just what a mess you are. As Henry Miller once said about John Reed, the American revolutionary in Russia: "What, didn't he have any personal problems to deal with?"

michael andreyakovich said...

Will: Ever read Alan Moore's original V FOR VENDETTA? Despite the inaccuracies, it's just as much of a sustained attack on Thatcher's England as the film adaptation is an attack on Blair's England (and Bush's America). And in both cases, you have the guy at the center of the story who acts as if he's playing at being a revolutionary - but Moore makes it clear that V's play-acting is precisely what makes him dangerous.

Lisa said...

You know the whole idea of socialism is something I just don't get. I am basically a lazy person and if I knew that I could be housed, fed, clothed, etc. the same exact way as everyone else regardless of how hard I worked, I would never lift a finger. Now multiply me by millions and who would pay for all of this? In what possible world could this ever work? I think it could only work if there were no humans left on earth and only robots that were programmed to work. Socialism and Communism are such stupid ideas. I find it hard to believe that anyone can even take them seriously. Duh!

Lisa said...

Enough of your tired tripe, nag! How bout each individual taking responsibility for themselves? Your whole line of logic and reasoning is so retarded. No one is saying that charity should not exist. All we are saying is that big government or big brother is not the most efficient way to go about it. You are really dense and I am not going to waste my time or cleverness, even though it is kind of fun being all snarky! ;) Isn't it beyond obvious that this is not the place for you? Ha ha ha, this is me laughing at you and your whacked out viewpoints. Good luck and good night!

Gagdad Bob said...

A reminder that comments that exceed the stupidity quotient or do not advance understanding must be deleted for the good of all. We understand you better than you understand yourself, as we used to be one of you. Therefore, posting here serves no purpose.

Move along now. There are plenty of blogs for your mode of consciousness. This is not one of them.

will said...

Nags, check my last comment from yesterday - it echoes Bob's comment. This is not the place for you.

Hoarhey said...

I missed out on the important message contained in the deleted post, and yet, the "differing modes of consciousness" epiphany grows. :)

Gagdad Bob said...


It is not a matter of agreeing or disagreeing. You don't understand what we're talking about, so you can't actually do either, appearances notwithstanding. So yes, I'd appreciate it if you'd refrain from commenting.

Lisa said...

Yes, Hoarhey, we keep plenty of Epi pens available to counter allergic reactions to stupidity! You really didn't miss that much, just think of the most basic lefty talking points and parrot them to yourself in a condescending tone!

will said...

Hoars -

:::adding some MiracleGrow to your epiphany:::

Yeah, for the most part, I think, the political perspective derives from the mode of consciousness, not the other way around.

will said...

Michael -

No, I havent read V F V, but will now check it out, thanks.

You know, as much as I appreciated Frank Zappa . . . he visited some Eastern bloc country during the Cold War, and was invited by some local jazz musicians to sit on one of their performances. The session was held underground, in total secrecy - a dangerous word of mouth was the only PR due to commie State oppression. Frank told the musicians (with a tinge of envy, I suspect, as he tried to establish his revolutionary bona fides)"Hey, we've got political oppression in the USA, too, you know." Uh, no, Frank. Not like that, you didn't. Not even close.

Hoarhey said...


ben usn (ret) said...

While free trade capitalism requires a form of synergy,
socialism requires SINergy, where everyone can receive an envyoplasty.
Ever notice how the leaders of socialism/communism always get more?
What is Casto's fortune? $900 million?
I'm sure he is feeling the "equality".

Sal said...

Will -
I was just thinking of Reed as a good example of socialism seducing someone from their true calling: first-rate journalist, failed revolutionary.

I think Warren Beatty actually got that idea across in "Reds", but it might have been my mode of consciousness telling me that...
Another excellent film about life under Communism: 'To Live' by Zhang Yimou.

Something just occurred to me - though Dorothy Day gave up being a socialist, I wonder if she, and her co-workers, were still operating under the pre-Adam Smith view of wealth. I will have to ask my Rerum Novarum go-to guy about this.

Bob - could you please recommend an intro to Frithjof Schuon? Thanks.

Gagdad Bob said...


Schuon is rather dense reading, so even I have to put him away from time to time. Plus, he really despises modernity, so that aspect has to be taken with a grain of salt. He's such a spiritually gifted man that I'm more than willing to overlook areas of disagreement.

Having said that, there is an Orthodox Christian, James Cutsinger, who assembled a compliation of Schuon's Christian writings, entitled "The Fullness of God." Cutsingger has also compiled a more general book on Schuon's approach to spirituality, "Prayer Fashions Man." And Cutsinger has written his own book that is based on Schuon, "Advice to the Serious Seeker." Then there is "The Essential Schuon," by Nasr. But that might be more of a challenge.

Also, I really enjoyed a recent biography by Aymard & Laude, Frithjof Schoun: LIfe and Teachings. That might actually be the best intro.

Sal said...

Oh, you mean he's not beach reading?
Darn. ;)

Nagarjuna said...

"You don't understand what we're talking about, so you can't actually do either, appearances notwithstanding."

Could anyone understand you if he disagreed with you, Bob, or do you believe that anyone who truly understands you must agree with everything you say?

Just curious.

Anonymous said...

Nag: In the words of Ed Koch - "If you agree with me on nine issues out of twelve, you should vote for me. If you agree with me on twelve issues out of twelve, you need a doctor."


Nagarjuna said...

Does that mean people should be allowed to disagree with Bob here or at least question him without having their posts deleted and being told to leave? :-)