A new Invisible Hand

Why New Economics Needs a New Invisible Hand

The New Invisible Hand suggests the existence of a middle path.

Here in New Zealand today is Darwin Day (12th Feb 2018).
That is fitting.
Darwin traveled widely, looked closely at things, and was able to think about things in ways that were not widely socially acceptable in his time.
What he did with what he had was amazing.
He had no idea of biochemistry, neucleic acids, computational or complexity theory, quantum mechanics – yet he championed the idea that differential survival of variants can lead to change.

Today we have so much more.

Today we know so many more classes of complexity.
We understand recursion, the ability of systems to fold back on themselves and create new levels.
We have computational tools and resources that are on double exponential expansions.

Some of us understand that being an aware human in today’s intellectual, economic and cultural reality already involves some 20 levels of cooperation in action.

And being able to see that cooperation allows for the emergence of complexity, while competition drives systems to simplicity, is a crucial part of the puzzle, and our survival.

Being able to see that cooperation can only flourish when at least two conditions are present:
1/ the risk to individuals (at whatever level of boundary set one defines individual) comes largely from factors outside of the population of individuals; and
2/ there are sufficient attendant strategies present to detect and remove cheating strategies from the population, and return any such cheats to cooperative behaviour;
is crucial.

The common conception of evolution as “nature red in tooth and claw” is not accurate, and it certainly can go that way if resources get scarce and move the balance of risk from external to internal factors within a population.
Cooperation, and our survival as a species, requires abundance.

We find ourselves facing several grand challenges:

1/ How do we both maintain sufficient abundance of all necessities, and sufficient freedom, for all people, so that cooperative behaviour is maintained across all social strata? (The technology is relatively easy, the social systems, and changes in modes of thought and understanding are difficult.)

2/ How do we achieve 1/ above, and maintain the biophysical environment within limits that are some approximation to optimal for life?

3/ How do we transition away from scarcity based markets to abundance based systems while retaining all the many essential and very complex functions that markets have performed in recent centuries ( in terms of distributed information processing, distributed governance, distributed risk management, etc {as per von Hayek et al} ) that are essential to life and liberty?

4/ How do we find a balance in law that maintains the essential boundaries, at the same time as it maintains essential freedoms?

Agree with David that the simple idea that it is either complete freedom or central control is so simplistic as to be an existential level risk in and of itself.

Reality is many orders of magnitude more complex than that.

In reality, we need many levels of distributed networks to make this system work.

Pretending anything less than that is insanity.

Yes we need to design systems that both value individual life and individual liberty, and does so within responsible social and ecological contexts, and that is a problem of sufficient complexity that it must be an ever evolving system.

Tools are neutral, it is how we use them, and to what end, that defines morality. And there will be as many solutions to that problem as there are individuals in existence.

And one cannot go down a path like this with any sort of simplistic understanding of liberty.

Liberty cannot be an absence of boundaries.

Any level of complexity requires boundaries for survival.
We are very complex entities, with many levels of systems, requiring many levels of boundaries to be able to survive.

The real question is, which of those boundaries present are actually necessary for the survival of us all, and which are there purely for the interests of some subset (ie are some form of embodied “cheating”)?

That is a really complex set of questions, and of sufficient complexity that there can be no clear and simple answer, ever; and it is a set of questions that we must each keep asking, and one that as a society we must develop ever better sets of tools to answer.

Fully automated production allows marginal cost of production to drop to zero. That means abundance is possible.

So exactly how we bring this new level of abundance to all, at the same time as we bring new levels of effective protection to every individual, and to the biodiversity of living systems, is the question for all of us?

One thing is clear beyond any shadow of reasonable doubt – that markets, with their value basis in scarcity, cannot do it alone. Our primary value metrics need to be based in abundance if this has any chance in logic of working, ie if any of us wish to survive long term.

The reasonable needs and wants of individuals are not infinite, they are for the most part quite finite and relatively easy (in the technical sense) to meet.

There are two terms in common use that are relevant in this context, that no longer have anything like their classical meaning:

To “sin” now means to do some “wrong” (usually against some arbitrary standard). It was once an archery term, that simply meant to miss the target. And all archers know that one gets better with practice. One needs to miss the target thousands of times before one can hit it reliably.

The term “meek” now means ineffectual. It was once a term applied to a fully trained and armed citizen who by conscious choice kept his weapons sheathed at all times except when they were absolutely needed. In that sense, it was a term that described the most powerful who had that power under conscious control and used it in the service of all.

Every one of us needs to develop all the skills and power we can, and we need to keep our weapons sheathed, unless absolutely required. And with a bit of luck, they never will be required – provided we develop the systems that can and do actually deliver abundance and security to everyone – no exceptions.

And for many sorts of weapons, keeping them sheathed can mean keeping them purely in the realm of information. There are many things that contain so much risk, they ought never to be made physical in any sort of ordinary context.

About Ted Howard NZ

Seems like I might be a cancer survivor. Thinking about the systemic incentives within the world we find ourselves in, and how we might adjust them to provide an environment that supports everyone (no exceptions) - see www.tedhowardnz.com/money
This entry was posted in economics and tagged , , , . Bookmark the permalink.

Comment and critique welcome

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s