Economics and the Noosphere

Picking up where we left off yesterday, we're inquiring into mankind's great leap forward, after thousands or even millions of years of economic stagnation (that is, if we want to include pre-Homo sapiens such as old Homo erectus and the like).

In fact, I wouldn't even call it "economic," since the rational underpinnings of an economy -- e.g., prices, secure private property, rule of law, etc. -- are precisely what we lacked; nor would I call it "stagnation," again, because every species is stagnant. Every species subsists on what is available in the surrounding environment. Truly, our great leap forward was an existential discontinuity, and not just a prolongation of biology.

And ever since it started, there have been people predicting it was petering out, or who warned that it would end in catastrophe, or who actually want it to end. Remember the Simon-Eherlich wager? How about the perennial myth of "peak oil?" Global warming hysteria is just the latest outlet for these hopeless pessimystics.

One commenter mentioned the centrality of energy to our Great LF. This is correct, except that energy isn't just energy.

Rather, it must of course unite with information in order to become useful. By way of illustration, Gilder cites a seemingly mundane example involving the history of lighting. Note how it parallels yesterday's sad story of man's long economic flatline:

"[F]or millions of years, from caveman's fires to the candles that illuminated the palace of Versailles, the labor cost of a lumen-hour of light dropped by perhaps 75 percent." But the emergence of gas light in the nineteenth century resulted in a a huge decrease in the price of light, and "the arrival of electricity in the 1880s produced another thousand-fold drop."

Now, the question is, how can we possibly measure the resulting improvement in our quality of life? We're talking about "a million-fold increase in the abundance and affordability of light itself," but that's just a number. The real impact is incalculable, and very few people take the time to think about what a miracle it is. And again, it is a miracle, if by miracle we mean a vertical ingression into the horizontally closed flow of time.

Note also that any leftist along the way could have proclaimed that we have quite enough light to go around, and that it's just a matter of redistributing it so that everyone gets enough -- say, three candles a day, or a bucket of kerosene, or whatever. In the 1970s it was gasoline every other day. The mentality never changes.

The other critical point is that no one -- certainly not any central authority -- planned for any of this benevolent progress. If they had, we'd probably still be using candles. No doubt manufactured by Solyndra.

Again, a free economy facilitates and protects information; an unfree one -- to the extent that it is unfree -- crowds out information with power. It "protects the centripetal power of kings, bureaucracies, politicians, and other purchasers of economic influence."

Obama-style krony kapitalism is just the latest version, but there are always going to be economic parasites and free-riders. Hemingway once called critics "the lice on literature." You might say that leftists are the lice on economics. They have no idea how to create wealth, only how to exploit it. The only difference is that they are not as intelligent as lice, in that lice at least have the good sense to avoid killing the host.

California is subject to the one party rule of such suicidal parasites, with utterly predictable consequences. Are they worried about hundreds of billions of dollars in unfunded public pensions for their fellow bloodsuckers? Nah. What are they worried about, then? About making sure that sexually confused children can pick the bathroom they want. Progress!

I don't know about the sexually confused ones, but I do know that any healthy, sexually unconfused male will naturally choose the girls locker room.

I guess Jerry Brown wanted to shed the "Governor Moonbeam" image, and finally prove that he's not from this solar system at all.

Now, if we examine the deep structure of the economic miracle described above, what's really going on?

First of all, I would suggest that economic growth is only possible in an open system that is specifically open to entrepreneurial creativity, imagination, innovation, and most importantly, to failure. I was reading something just yesterday -- can't remember where -- that if failure is not permitted, then neither is success. We must be free to fail, which is why there is no such thing as an unfree launch in the econosphere.

Conversely, leftists view the total economy as if it were a closed system with a set amount of wealth. They "believe their mission is to seize capital for the masses," and just infuse a bunch of money at the back end -- i.e., the demand side -- to reinflate the balloon. Which is a little like taking water from the deep end of the pool and pouring it into the shallow end.

Our president, for example -- the noted constitutional scholar -- has pointed out that the founders got it wrong in not giving sufficient power to the state to seize property and redistribute cash from one end of the pool to the other.

The problem is, any elected idiot can seize money. But that doesn't mean he's seizing wealth.

Again, a million dollars in the hands of Bill Gates is very different from a million dollars in the grubby hands of some bum on the street or in the White House. As Gilder explains, "detached from a capitalist, there is no capital."

Rather, in order "to create wealth, knowledge and power must be merged." This infusion -- or vertical ingression -- of information into capital doesn't appear on any accounting statement, because it is qualitative, not quantitative. You might say it's "in the cloud" -- the cloud of the ultrahuman noosphere that surrounds the material world.

Consider all of the "quantitative easing" by the Fed, which simply removes information from the economy. Conversely, Reagan unleashed entrepreneurial activity by what we might call "qualitative easing," through which it became much easier for venture capitalists to unite with entrepreneurs to create "informational capital."

Again, no one planned the consequent technology revolution. Rather, it was just a matter of getting out of the way and letting the noosphere do its thing.

In any event, it is this openness to verticality that "is the source of restoration that prevents the circular flow from running down into inanation. When the circular flow seems healthy, it is only because we do not notice that it is being constantly replenished. Such constant replenishment and revitalization by new information and knowledge is the only solution to the dissipation and physical entropy that is normal at all times..."

The other day, reader Julie commented that this sounds a bit like "as above, so below." Precisely. We could take the above paragraph and say the exact same thing of the vertical flow of grace -- or of our tension toward the Great Attractor -- in the absence of which we are just absurcular tale-spinning Darwinian monkeys chasing our tails.

Busting Out of Our 99,000 Year Economic Slump

Williamson asks, "Are you so sure that your preferred model of education or health care is the right one?" Yeah, I'm pretty sure. What's not to like? It's less expensive, no government agents force you to do anything, you get to keep your own doctor (or pick your own school), and there are no death panels (or soul-destroying political agendas).

"So sure that you'd be willing to stick a gun in somebody's face over the issue?" Nah. I would prefer that both be rooted in consumer choice and voluntary transactions, i.e., freedom and information and not power and coercion.

Again, going back to Gilder's thesis, power is a substitute for knowledge. Political power has always existed in the world. What has been lacking is information -- usually due to political power blocking its channels.

One source of human information is the genome. Let's stipulate that for all practical purposes it hasn't changed a great deal in the past 100,000 years or so. We might call it a low-entropy carrier, in the sense that it is quite ordered, and doesn't contain sufficient information to facilitate or account for any human advance. In this way, we are like any other species, which settles into an evolutionary niche and then stays there.

Which would explain why there was almost no human progress for roughly, oh -- rounding up -- about 100,000 out of those 100,000 years.

Focusing in on just the past two millennia, "If you make a chart of the world's GDP from A.D. 1 until now, you will see a flat line that lasts for the better part of two thousand years. And then the line goes vertical around 1750."

So if we want to be perfectly accurate, Homo sapiens was mired in a deep slump for about 99,737 years. Not a promising debut -- and if you were a betting man, you would have had no earthly reason to believe anything would suddenly change after 99,000 years of stasis.

Even the Obama economic slump -- and the FDR slump before that -- hasn't lasted 99,000 years. It just feels that way.

But the underlying reason for the slumps is similar: power over information. Why is this distinction so important?

I would say it is because what is really unleashed after 1750 is freedom -- i.e., ordered liberty -- and therefore human creativity, the latter of which is more or less infinite. Unlike the genome, which is obviously finite, the human mind is boundless. All progress is human progress; and power is just one type of noise that interferes with it.

First principles are important. Duh! In reality, poverty is the universal condition. Again, it has been man's fate nearly throughout his existence. Deviations from poverty are the rare exception. Therefore, we want to study quite closely the conditions that make this possible. I mean, right?

The left either ignores such questions, or turns them on their head. The leftist's first principle is envy, i.e., someone has more than I do, or something I want. Never mind how he acquired it. I want it!

But envy is a prime example of an ordering mechanism that destroys information. It's easy enough -- assuming sufficient power, i.e., violence -- to make everyone equal. At the cost of nullifying all the information in the system.

For example, we could have "full employment" tomorrow merely by forcing everyone to grow their own food. Or, at this rate, Obama will achieve full employment by forcing a sufficient number of workers -- each one a module of information -- out of the job market. Well played! That's what I call an organized community. Idle, but organized.

Another point the left forgets is that the real minimum wage is always zilch. Sure, you can pay a fast food worker more than he's worth, but here again, this will only destroy information, for example, information pertaining to a fast food worker's economic worth.

So, exactly what happened at 1750ish o'clock? "For the first time in history, the living standards of the masses of ordinary people... undergo sustained growth." And "Nothing remotely like this economic behavior has happened before" (Robert Lucas, in Williamson).

Such a leap certainly can't be explained by genetics; it's not as if "we were monkeys in 1749 and Ben Franklin in 1750."

And yet, a certain ontological -- or at least existential -- leap did occur around that time. Surely it cannot be a mere cosmic coincidence that Adam Smith's The Wealth of Nations was published the same year as the Declaration of Independence. For, taken together, these two texts delineate exactly what it took for man to finally bust out of his epic losing streak.

Seen in this context, we can see how a Karl Marx -- and all his intellectual spawn -- was the great echoing antithesis to the unleashing of human progress. You might say that he represents the voice of the primordial demon that would keep us shackled to our low-entropy state of existence, in which there is no income inequality because poverty is so evenly distributed.

More generally, everywhere Marxian ideas have reappeared in history -- say, in the figure of Obama -- it has been in the form of power trumping -- and humping and thumping -- information.

According to Gilder, the conventional account of our recent economic success doesn't even begin to do justice to the magnitude of the transformation:

"The central scandal of traditional economics has been its inability to explain the scale of per capita economic growth over the last several centuries. It is no small thing." He says that there has actually been "a 119-fold absolute increase in output in 212 years," and that conventional economic models can only account for about 20 percent of that.

What accounts for the rest?

To be continued...

The Secret of Left's Success: Speaking Power to Truth

Kevin Williamson's The End is Near reminded me once again of how the illiberal left is at an advantage, since for them politics reduces to power, and it's always easier to make people do things than to persuade them to do things.

I think this explains why left wing talk radio is such a failure. Who wants to be persuaded that he is incapable of making his own decisions? This is analogous to reasoning with someone to abandon his reason. Why not just skip the middleman -- logic, argument, and evidence -- and go straight to the power?

The purpose of political talk is to inform, to inquire, to question, to explain, etc. But leftism needs none of these things. Rather, it needs only power, so all the talk is just so much babbling as a prelude to the real issue: I get to tell you what to do.

We routinely tell three year-olds to use your words! Try that on an angry and entitled three year old in an adult body. With a loaded bazooka.

Thus, the state didn't need to convince anyone that socialized medicine is a good idea. Rather, it just went ahead and enacted it. "You have to pass the bill to find out what's in it" -- which is just an extension of "you have to elect Obama to find out what's in him." Or "Please authorize my use of force, even though I need no such authorization. Rather, I just need someone else to blame for f*cking this up."

"The necessity of large-scale cooperation is what allows nonpolitical processes -- human action -- to learn and evolve. Coercion is the negation of cooperation, and the power to coerce is what keeps politics from learning" (Williamson, emphasis mine).

Take Keynesian economics, for example. Doesn't work, obviously. But it doesn't matter. The state doesn't need to convince anyone that it works. Rather, it only needs to hold a gun to your head and say, "it works, right?"

"Perhaps that seems too strong for you? If so, try the following experiment: Stop paying your taxes, or refuse to send your child to the local government school or government-approved alternative," or "feed the poor in Philadelphia without government permission," etc., "and then see how long it takes for the government to dispatch to your home a team of men with guns to enforce your compliance, seize your property, or put you into a cage."

It reaches into everyone and everybody -- for example, my racket, clinical psychology. Try helping a sexually confused adolescent struggling with homosexual urges. Again, the state didn't need to argue the case; like most everyone else, it has no idea what causes homosexuality. Rather, it will simply strip you of your livelihood if you should dare to get between the state and a potential lifetime Democrat.

"Political power cannot be reasoned with," and after all the intellectual posturing is over, "the philosophy is the same as that of the raptor in Ted Hughes's 'Hawk Roosting,' who proclaims: My manners are tearing off heads.... No arguments assert my right" (ibid.).

Or, in the words of the world's greatest orator, "I won."

Leftists who claim to cherish liberty are not even phonies: "The IRS" -- i.e., the teeth of the state raptor -- "has three times as many employees as the FBI, a much larger budget, and investigative powers" that dwarf any other agency.

"Imagine being asked to submit an annual statement to the Pentagon or CIA detailing your employment situation, living conditions, marital status, banking information, major financial transactions, net worth, travel records, etc."

You don't argue with the raptor, you just feed it: "Failure to pay taxes is routinely punished with sentences much more severe than those given for serious violent crimes such as armed robbery -- which is ironic, given the extent to which taxation itself resembles armed robbery: a man with a gun demanding money" (ibid).

Conservative classical liberals want less of all this state power, so as to have more genuine power over ourselves, i.e., self-rule. But in order to make the case, we are reduced to using the power of speech.

Yes, the truth sets us free. Which the IRS knows full well, hence its attempt to tear off the head of the Tea Party. It's what raptors do.

The Left has No Means of Becoming Less Stupid

Which, of course, I mean literally, not polemically, and certainly not as some kind of gratuitous insult. I am always here to help. It's what I do. So Back off, man. I'm a psychologist.

This is one of the theses of Kevin Williamson's The End is Near, although he is apparently too averse to hatemail to express the sentiment so candidly.

Rather, he demonstrates how government is intrinsically inefficient, dysfunctional, and irrational, because it has no means of becoming less wrong. In short, it cannot evolve. So it stands to reason that the people -- i.e., leftists -- who support this way of allocating our resources and organizing our collective life will suffer from the same deficit, either as a cause or consequence. They too cannot become less wrong about politics.

"In biological terms, the operative mechanism of evolution is... death. Species evolve because death sorts out the reproductive success of individual members of that species" (Williamson). But the state is more or less immortal. It cannot go out of business, no matter how wrong, how inept, how unsatisfactory its products. Obama is trying as hard as he can to prove this.

Take most any product in the marketplace, and see how it has evolved in recent decades. Williamson cites the example of the cell phone. I remember a friend in the late 1980s who had one of these gizmos -- it was the size of a car battery and didn't work especially well. But at least it only cost 10,000 in today's dollars.

I am not what you would call an early adopter. Rather, I'm a late-to-never adopter, but even my rudimentary cell phone is exponentially better than the Gordon Gekko brick-style model of a quarter century ago. Why is this? And why is the Post Office just as bad as ever?

Imagine if, in 1990, the federal government had decided that cell phones are so important a human right that everyone is entitled to one. They throw billions of dollars at the Cellyndra Company to produce millions of the BrickPhones we still lug around to this day. Because the company has been freed of marketplace constraints, it has no need to evolve, adjust, improve, reduce costs.

Williamson asks us to think about Social Security, which was instituted in 1935. What other consumer products from that era are still in use? Now try to imagine all the innovation that has been lost as a result of Social Security being spared the need to evolve. President Bush attempted one tiny innovation to bring the system up to date, and look what happened. An entrenched government system doesn't know how to improve, but it certainly knows how to defend itself. It does so by enlisting a legion of left wing crockpuppets and sneermongers to come to its defense.

It seems that everything improves except government and those things government deeply involves itself in (we'll leave culture and morality to the side for the moment, but there is a latent relationship there as well, if only because of the educational establishment's monopoly on access to fresh young skulls of mush).

Williamson writes of how "middle-class people have access to things that either did not exist a generation ago or were restricted to the very wealthy." And common consumer goods -- automobiles, for example -- are vastly superior to what existed a generation ago. Today's average car is much better than a luxury car of 30 years ago.

"But there is another class of goods that either stagnates or follows the opposite trajectory: lower quality, higher price. These goods include education, health insurance, and many basic governmental services" (ibid.)

Nor could you improve these things by having even the Most Intelligent Man in the Universe at the top, for the same reason that, say, the visions of Steve Jobs couldn't become reality in the absence of a competitive market offering a continuous stream of corrective feedback, so the company could become less wrong over time.

We again come up against Hayek's knowledge barrier, which the left, by definition, imagines it can break through. But as Williamson points out at the beginning of the book -- citing the famous 1958 essay by Leonard Read -- no one even knows how to make a goddamn pencil (i.e., has personal knowledge of forestry, mining, metallurgy, engineering, machining, chemistry, marketing, sales, et al), so someone who presumes to know how to remake the healthcare system is truly delusional. There's really no other way of putting it.

You might say that ignorance of complexity is a measure of the depth of ignorance. Thus, no amount of knowledge can replace the most important knowledge of all: that the system is too complex to be reduced to some pinhead's abstraction.

And in politics there is no penalty for being wrong, because you're always playing with someone else's money and shifting responsibility to third parties, and no one can see the connections unless they go off grid and exit the educational/media matrix controlled by the left.

I want to shift gears and enter into the cultural/spiritual aspect of this question. By coincidence, this weekend I read a couple of typically clueminous essays by Schuon, one called Modes of Spiritual Realization, the other The Anonymity of the Virtues.

In the first, Schuon highlights the axiom that there exist three principle modes of approach to God, i.e., knowledge, love, and action. Here we are concerned with knowledge, because naturally we want to become less spiritually stupid: less blind, less deluded, less lost in subjectivity.

As an asnide, imagine if government invented a religion!

You don't have to imagine. It's called liberal statism.

Anyway, let's say I'm some kind of presumptuous brainiac who wants to possess Total Knowledge of God. Well, first of all, if there's a knowledge barrier preventing total knowledge of pencils, what makes you think there's less of a barrier vis-a-vis God?

So, do we have to remain in total ignorance? Yes and no. Schuon writes that

"Strictly speaking, a man should not wish to 'acquire' a particular virtue" -- in this case, knowledge of the Divine -- "but to eliminate a particular vice; to realize a quality is to destroy the fault that is contrary to it..."

Now, speaking of Obama, "There are men with the vain ambition to be exceptionally intelligent, and this makes them all the more stupid." In other words, intelligence is rendered stupid if it is unaware of its intrinsic limitations.

Intelligence is a mirror, and a mirror doesn't require much in order to accurately reflect its object -- basically "purity," or lack of contamination. You could say that the mirror belongs to God, whereas we are responsible for the smudges -- insane passions, envious resentments, quests for domination, pretenses to omniscience, tenured stupidity, etc.

"In a certain metaphysical sense, only our faults belong to us; our qualities belong to God, to the Good as such. By eliminating the vices, we allow the qualities of God to penetrate our soul." Or, "from another point of view... it is we who enter into the virtue" -- in this case, intelligence.

So, as in politics, we become more intelligent by slowly ridding ourselves of the stupid.