We need a new narrative for how markets work. We now have enough pieces of the puzzle to start putting it all together.
I am all for reason and self interest, and those things need to be on the largest time scale possible and across the greatest range of physical and strategic environments possible.
Thus reason and self interest demand of one environmental and social responsibility.
It is not reason and self interest that are the problem, it is ignorance and poverty that force short term survival strategies to the fore, rather than more rational long term survival strategies.
In the long term, I have no remaining shadow of reasonable doubt, that cooperative strategies, that provide every sapient entity (human and non-human, biological and non-biological) with enough resources and freedom to do whatever they responsibly choose, where responsibility in this sense means taking all reasonable steps to mitigate risks to the life and liberty of all other sapient organisms, and consequentially to take all reasonable actions to care for the life carrying capacity of the environment we live in, provide the greatest long term individual benefit (expected utility).
Axelrod and Ostrom and others have clearly shown that long term cooperation requires sets of attendant strategies to detect and remove cheating strategies.
When one recursively applies that strategic approach to each emergent level of complexity (including realms of abstraction), then one rapidly gets into realms of diversity far beyond anything yet experienced. And provided everyone has what they consider reasonable, that isn’t an issue.
Markets are not rational, and cannot be.
Markets are based in scarcity.
To have value in a market something must be scarce to someone.
One can make a sound case that air is the most important commodity to any human, yet it has no market value, because it is not scarce to anyone – it is universally abundant.
Universal abundance in this sense does not mean infinite, the amount of air is finite, and it is sufficient to meet the needs of all.
Human needs are like that.
The mathematical equations may contain infinities, but very few people have behavioural needs that are anywhere near approaching such things. Most people have quite moderate needs, and are well satisfied when those are met.
Thus the idea of using market values as metrics for long term planning must deliver far from optimal outcomes (in terms of both life and liberty).
So the idea that markets, places that measure value based in scarcity, can rationally meet the needs of humanity, is not actually logical.
The hypothesis fails this simple test.
Markets cannot be internally incentivised to deliver the sort of universal abundance that humans need.
Markets are, in this sense, fundamentally based in scarcity.
That wasn’t a great issue when most things were genuinely scarce, and markets were largely a distribution tool.
Now that we have exponentially expanding powers of automation, and we can in fact deliver a large and exponentially expanding set of goods and services in universal abundance, market incentives are not simply failing, they are actively working against the interests of a large and expanding set of humanity.
The logic of that is now undeniable.
I completely align with Rand that we need to act rationally (or at least in the best approximation we can manage in our context, given our many levels of individual heuristic approximations), and I make the strong claim that markets are now moving into the strategic territory of delivering greater risk than security when one takes the long term (100 year plus) view of self interest. I never got to debate that directly with Rand, though I have debated it with Piekoff.
I also align with Lo’s characterisation that reason is actually composed of levels of heuristics assembled over some scale of evolutionary time (either genetic or cultural or personal) by differential survival among variants.
Lo’s characterisation of evolution is fundamentally flawed where he writes: “Competition, mutation, innovation, and especially natural selection are the basic building blocks of evolution.”
Yes, those are all part of the picture, but when one looks at the evolution of complexity from a systems perspective, it becomes very clear that new levels of emergent complexity are the result of new levels of cooperation, and that it is cooperation, not competition, that is fundamental to the survival of complexity.
And the strategic logic is clear, raw cooperation is vulnerable to exploitation, and requires ever more complex sets of attendant strategies to detect and remove the exploitative (cheating) strategies. That too becomes a complex evolutionary arms race, as the nature of the boundary evolves.
So yes – we have complex adaptive systems; and
we have cooperation; and,
we have ever more complex sets of attendant strategies (boundaries).
All of those are required.
And yes, from one perspective those things are a restriction of freedom, just as a cell wall is a restriction on the freedom of movement of the molecules within a cell. And without a cell wall, the complexity that is a cell cannot exist.
At this more abstract level, morality is one of the necessary boundary conditions required for a level of social complexity to exist, it is the cell wall of this new level in a very real sense (recurs as far as needed through levels of abstraction).
The view of evolution as competition is only half the picture.
Yes evolution can involve competition, and it can (and does, at many levels) involve cooperation.
The determinant of which gets to dominate seems to be: from where do the major sources of existential risk to individuals within a population come.
If the risk comes from other individuals of the same species, then competitive strategies will tend to dominate within that population.
If the major sources of risk come from factors outside of the population, then cooperation can emerge and stabilise.
That has a lot to do with availability of resources.
Our exponentially expanding technology allows us to do more with less far faster than our population is expanding.
We have the ability to put all real risk outside the population, and thus empower cooperation.
Market incentives actually tend to destroy any such emergent trends towards universal abundance of anything, to retain a marketable scarcity. That is all that intellectual property laws are in a very real sense.
Cooperation is possible.
For our long term security, cooperation is essential.
And do not confuse cooperation for centralisation.
Biology tends to mitigate the risks that come with centralisation by massive decentralisation, distributing both production and decision making as much as possible.
I argue that the major reason markets have a strong historical association with liberty is because of their function in distributed decision making.
We now have other tools that can do this far more efficiently.
I would add “cooperation” into Point 5
“5. Survival is the ultimate force driving cooperation, competition, innovation, and adaptation.”
I would say that the sentence “As long as those challenges remain stable over time, their heuristics will eventually adapt to yield approximately optimal solutions to those challenges.” makes sense in the context of evolution, but makes no sense in the context of modern technology and markets, as the challenges (any level, all levels) are changing exponentially over time.
Thus the great challenge facing humanity is, can we survive the existential risks posed by markets in the context of exponentially expanding technological innovation.
I say the answer it yes.
I say the answer involves universal respect for individual life and individual liberty, and both of those must exist in contexts of social and ecological responsibility.
It now seems very probable to me that some form of universal basic income offers the best transition strategy to get us through the next 30 to 50 years, as life extension and molecular level manufacturing technologies mature to the level that they can be delivered universally, and we see exponential growth in the diversity of social cooperative forms (all firmly based in a respect for individual life and individual liberty, which demand of all social and ecological responsibility).