Archives for category: Trust
Fake news

“Federal lawmakers on Wednesday released samples of 3,000 Facebook ads purchased by Russian operatives during the 2016 presidential campaign. The ads conveyed the wide range of influence Russian-linked groups tried to enact on Americans…”

Let’s zoom out in order to gain some perspective over all this.

Fake news are defined by Oxford Learner’s Dictionaries as “false reports of events, written and read on websites“.

The way I see it, “fake news” have a lot in common with counterfeit currency.
In more ways than one!

First of all, most money in current use is ‘fiat money’.
We are dealing with either printed pieces of paper or otherwise useless pieces of metal.
We ‘trust’ them for trading purposes simply because we are convinced that the institution which stand behind them – Central Banks, free(ish) markets and law enforcement, will do what they are meant to do. We trust that the Central Banks will not print too many of those pieces of paper, that the free(ish) markets will set a reasonable price to everything and that the police will manage to weed out (most of) those who try to circulate fake money.
Not even a return to ‘real’ money – a.k.a. gold,  wouldn’t insulate us from crooks. Gold coins can be, and had been, tampered with in so many ways. Human greed is a very powerful motivator but not necessarily a good mentor.

Which brings us to the reason for why fake money came to be.
Simply because some ‘industrious’ people ‘make’ them and some other, equally greedy, people knowingly distribute them.

In conclusion, we wouldn’t have to deal with fake money if money wasn’t essential for an efficient free market and we would have a lot less of it if greed were not such a widespread attitude. And no, a cash-less economy would not solve the problem. A printing press is no longer essential for faking money. Hacking skills have become  a good enough substitute.

Let’s translate this rationale to (fake) news.

We need to know what’s going on around us so we’ve developed an equivalent to the financial system. The mass media.
Which has a more or less equivalent set of ‘guardians’.
The ‘printers’ are responsible for the equivalence between their ‘product’ and the reality it represents while the market (readers, that is) is responsible for ‘setting the price’.

Of course, there are also differences.
‘Law enforcement’ has indeed a role to play in the news industry but its scope is a lot narrower than in the first case. And rightfully so. The ‘information’ market needs to be a lot more ‘flexible’ than the one dealing in ‘economic goods’. There’s a lot to discuss on this subject, I’ll leave it here.
There’s also no Central Bank to ‘tug at the sleeves’ of those who ‘jump the shark’.

As a consequence of these two differences, the ‘counterfeiters’ have an easier life and the consumers/victims a far greater responsibility for what’s going on. Simply because the consumers/potential victims cannot rely on any third party to do their job. To sniff out the ‘bad thing’.

But what if ‘it’s the thief who plays the victim’?
That very much depends on who the ‘thief’ is!

Let’s go back in time for a short while.
First to the American Revolutionary War. During which the British attempted to crash the American economy by injecting in it enough counterfeit money to cause hyperinflation. “No economy, no more war.” The British did manage to produce and distribute a huge amount of fake money yet the outcome was not the intended one. “Even when at one point the amount of counterfeit currency in circulation may have exceed the amount of legitimate currency, the economy hung on by its eye teeth and never fully collapsed.”
One and a half centuries later, the British had found themselves at the receiving end of the same game. “…during World War II the Nazis almost destroyed the credibility of the British pound sterling by producing near-perfect forgeries, The Telegraph reports. By the end of the war the forgeries were so rife that Bank of England notes would not be accepted by any neutral country on the Continent “except at a very large discount…”.
Hitler was even less successful than the British had been but the inflicted injuries were huge nonetheless.
Now, would Hitler have attempted this on his own, without the British establishing a precedent?
We’ll never know… Sufficient to say that the US has also used fake money, obviously fake this time. For propaganda reasons and not as an attempt to ‘crash the economies’ of the countries they were fighting.

To close the circle, we must ask ourselves how successful would Putin’s trolls have been if Trump wouldn’t have beaten so hard the ‘birther’ drum…

Seriously now, propaganda is a very efficient weapon. Maybe more efficient than guns.
But, and in total contrast with a gun, propaganda is useless against really determined people.
“Sticks and stones may break my bones but names can never hurt me” is true. But only as long as those being called names are in the right state of mind. As soon as they start feeling hurt, all hell comes loose.

If you think of it, Trump’s birther campaign, fake as it was – he had admitted that much, eventually, was a very successful ‘fake news campaign’. It had established Donald Trump as  shrewd  media manipulator.
Unfortunately, it had an even worse outcome. It had very much helped those who wanted the American public split into warring parties.

And who are now pushing these parties further and further apart.

PS. While researching for this post, I found out that “fake news” has been declared ‘word of the year’ for 2017. A fitting development… last year’s ‘champion’ was “post truth”…
What next? Doublethink?

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Everything any (most?!?) of us cares about is:
‘What each of us gets, and when.’
Emphasis on ‘each of us’.

All of us?

 

trump on corker

 

corker on WH

OK, let me wrap my head around this.

So Corker doesn’t have enough guts to run for re-election without Trump’s blessing but has enough to openly tweet his mind about what’s going on in the White House?!?
A reality show run by the supposedly most powerful man on Earth?
Who’s about to transform the “Great” America into the biggest laughing stock of the world?

Am I the only one wondering whether any of these can be described as “adult” behavior?

There’s a glimmer of hope though.

401K is way bigger than 65K. And big enough to rise above 65K+57K+62K… I know, adding this numbers up doesn’t make much sense – there is a strong possibility that many individual readers may have liked more than one of these tweets, but still…

For some people the fog may have started to rise.

The fog generated by the fake news manipulated by the ‘Great Deal Maker’, that is.
Compare the comments which accompany those tweets.

 

 

A whole century has passed since the events described in Erich Maria Remarque’s Nothing New on the Western Front/Im Westen nichts Neues.

Not that we’ve learned much during this time…

1968

Brezhnev sends Russian troops to freeze back the Prague Spring.
Ceausescu, the communist dictator who ruled Romania at that time, refused to take part. He had even summoned enough courage to chastise the ‘outside intervention’.

Ceausescu praga

“No excuse can be found for…”

1978

Ten years later he was driven around London in a state carriage by Queen Elizabeth.
As a pat on the the back for his apparent independence from Moscow, as an attempt to weaken the communist ‘camp’ … both at the same time…
Never mind… We, Romanians, were very proud at that time while Elizabeth – and her advisers, must have had quite a heart-burn… specially later, after Ceausescu had started flying his true colors…

Ceausescu cu Lizica

1989

Romania’s was the second to last European communist regime to disintegrate and the only one which had ended in a self inflicted blood bath.  Ceausescu, and his wife – ‘the Presidential Couple’!, were shot at the end of a very short trial during which both had been found guilty of genocide, treason and subversion.

1989 Cu excavatorul la revolutie2005 Niagara

2014

Twenty five years later, Russia’s rising star was lionized by some in the European media.

the emperors clothes

Hungary’s Prime Minister was jokingly hailed as “the dictator” by the President of the European Commission.

Orban the dictator

 

Currently the Americans are trying to determine whether Putin has somehow influenced their last electoral process,

Putin Trump Hamburg

while Orban continues to build walls around Hungary.

hungary wall

Small wonder then for these two to become bosom buddies, regardless of what drives each of them…

Putin honorary

“Putin will receive the honor in the Parliament during his visit to the 2017 World Judo Championships in Budapest on Monday.”
“Putin will attend the judo by invitation of Prime Minister Viktor Orbán. It will be Putin’s second visit to Hungary this year.”

 

 

Seven years ago somebody was elected to the Senate of the United States.

Despite

“Candidate’s Words on Vietnam Service Differ From History”

Six years later, another guy became POTUS despite the newspaper who published the article above having mounted quite a vigorous campaign against him.

The really interesting thing is that the second guy uses the information published in the newspaper seven years ago to smear the first guy while constantly accusing the same newspaper of being a relentless purveyor of fake news…

trump blumenthal

Now, which is stranger?

That two guys had managed to muster enough public support to get elected into public office, despite their shoddy relationships with the truth?

Or that newspapers continue to bother themselves?

“Fabrications have long been a part of American politics. Politicians lie to puff themselves up, to burnish their résumés and to cover up misdeeds, including sexual affairs. (See: Bill Clinton.) Sometimes they cite false information for what they believe are justifiable policy reasons. (See: Lyndon Johnson and Vietnam.)

But President Trump, historians and consultants in both political parties agree, appears to have taken what the writer Hannah Arendt once called “the conflict between truth and politics” to an entirely new level.

From his days peddling the false notion that former President Barack Obama was born in Kenya, to his inflated claims about how many people attended his inaugural, to his description just last week of receiving two phone calls — one from the president of Mexico and another from the head of the Boy Scouts — that never happened, Mr. Trump is trafficking in hyperbole, distortion and fabrication on practically a daily basis.”

“We are the last (semi) stable democracy on the planet without a universal health care system. Elsewhere in the world, health care is a utility taken for granted, like safe tap water or electricity. They pay for it, just like we pay for garbage service or highways, and it costs far less than our broken system. That is not an opinion. That is a reality easily revealed with a bit of travel. Like embattled cult members, we deny ourselves better policy outcomes to protect our deluded beliefs about the nature of markets and preserve our odd pathologies around race. That’s a choice we make…”

Chris Ladd,
Why Republicans Cannot Replace the ACA, Or Accomplish Anything Else,
forbes.com, Jul 20, 2017

ACA means “Affordable Care Act”.

‘Affordable’ for whom?

For those left out, of course…
And who was going to pay the difference?
Those already in, obviously…

See what I mean?

Health care can be seen in many ways.
As yet another opportunity for profit to be made – one of the best actually, since health is such a valuable commodity.
As a ‘social benefit’ extended by the society at large to (all?) its constituents. America already takes care of its elders, children and veterans, doesn’t it?
A combination of the first two. A free market where many independent health care providers cater for the needs of their customers – free to choose among the various providers – while the bills are picked up by a third party, financed through public contributions.

The only problem with the third option being our current obsession with money.
For as long as we’ll let ourselves be governed by the current mantra, “greed is good”, we’ll continue to perceive health care as nothing but yet another opportunity for some to get rich at the expense of everybody else.

How about an Efficient (Health) Care Act?
Opening the market – by allowing the patients to freely choose their doctors and by preventing  monopolies – would drive down the costs.
Cutting the middle-men – the insurance companies would no longer be needed since the public contributions would be collected by a public authority – would also help.

Would such a scheme work?
As I mentioned earlier, not before we give up ‘greed‘.
In order to trust yet another public authority with even more money we’d need at least some hope about that authority being populated by really honest people.
We’d also need many more ‘health care providers’ who actually love to help their patients – and make a decent living out of it – instead of so many people becoming involved with this ‘industry’ simply because it is among the very ‘rewarding’ ones.
And when I say ‘health care providers’, I mean all of them. Not only the doctors and the nurses – most of them do love their jobs and perform them almost heroically. (Some of/too many of) the Big and Small Pharma, (some of) the hospital ‘owners’, etc., etc….

Should we extend this scheme to other areas? Education, for instance? You bet!

Should we apply the same ‘weltanschauung’ to the rest of the economy?
Minus the ‘single payer principle’, of course?
Well, last time I read his work, Adam Smith was talking about “the Nature and Causes of the Wealth of Nations” and about “Moral Sentiments“, not about greedy individuals becoming filthy rich at the expense of their fellow human beings.

“In almost every other race of animals each individual, when it is grown up to maturity, is entirely independent, and in its natural state has occasion for the assistance of no other living creature. But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and show them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. Nobody but a beggar chuses to depend chiefly upon the benevolence of his fellow-citizens. Even a beggar does not depend upon it entirely. The charity of well-disposed people, indeed, supplies him with the whole fund of his subsistence. But though this principle ultimately provides him with all the necessaries of life which he has occasion for, it neither does nor can provide him with them as he has occasion for them. The greater part of his occasional wants are supplied in the same manner as those of other people, by treaty, by barter, and by purchase. With the money which one man gives him he purchases food. The old cloaths which another bestows upon him he exchanges for other old cloaths which suit him better, or for lodging, or for food, or for money, with which he can buy either food, cloaths, or lodging, as he has occasion.”

 

Before proceeding any further, let me introduce you to two other, more distanced, cousins of ours. Gorilla and Orangutan.

Orangutan leads a semi-solitary life in the Bornean and Sumatran Jungle. They are fairly large animals, males tip the scales at 200 pounds or so, and need a lot of food. They eat mostly fruit and, in times of scarcity, bark, flowers, insects and eggs.
It was their ‘eating habits’ which had shaped their social lives:
Food is often scarce in the rain forest and that is why the orangutan is a semi-solitary creature. In times of great abundance of food, orangutans may use the opportunity to socialize and gather in small groups.
Because they live solitarily, the young siblings must on one hand learn ‘everything’ before starting their adult lives and they don’t have anybody to learn from but their mothers. Hence they stick around for longest. A baby orangutan will nurse until about six and continue to live with their mothers for a few more years. Two or three for the males, five or six for the females – on top of everything else the females have to learn “mothering skills” and for them the only way to do it is to watch their own mother taking care of the next sibling.
As a consequence of all this, the females give birth only once every 8 years, “the longest time between births of any mammal on earth. (This results in only 4 to 5 babies in her lifetime.)” Not a very efficient survival strategy, for the species I mean…

Gorilla has adopted a different feeding strategy.
This is actually a joke. It wasn’t ‘the gorilla’ which has ever adopted anything, least of all ‘a survival strategy’. The ‘adoption process’ had been fueled by chance, had been ‘censured’ by  the realities of their living places and was later labeled as “evolution” by Charles Darwin.
Coming back to our distant cousins, gorillas are even larger animals than orangutans.
300-400 pounds, for the males, versus 200. Hence they need even more food.
An adult Grauer’s gorilla male is estimated to eat 30 kg of plants every day, an adult female about 18 kg.” The difference being that gorillas eat a lot of leaves.
When they have the opportunity to choose, they will surely pick up fruit but they are much more adapted to eating leaves than orangutans are. As a consequence they do not need to ‘spread around’ as thinly as orangutans do, the young can also learn from the rest of the pack so females can give birth every 4 years instead of every 8.

Is there any link between all this babbling and the stated subject of your post?

Actually yes.

As gorillas and orangutans are teaching us, together is easier than each by its own.
Being able to give birth every 4 years is a huge evolutionary advantage over having to wait 8 years before becoming pregnant again.

But this is not all we can learn from our cousins.
Male gorillas, at 300 to 400 pounds, are formidable defenders. Their only enemies, except for humans, are the leopards.
Compare 350 pounds with less than 100 for a chimpanzee/bonobo male.
That would be a good starting point to figure out why silver-backs – mature male gorillas who despotically reign over their 1 to 5 females – can afford to drive out their sons after they become sexually mature while the chimpanzee alpha males, who lead troops of up to 50 members, will allow other mature males to live by – and to have intercourse with some of the females living in the same group.
The second reason being that gorillas eat, almost exclusively, plant matter, supplemented with some insects, while chimpanzees form hunting parties in order to catch, kill and eat other animals, including monkeys. And one can ‘graze’ by himself while hunting is way easier in cooperation with others.

Feeding habits can explain quite a lot, isn’t it?

Let’s make a step further and turn back, as I promised in my previous post, to the differences between chimps and bonobos.
Well, bonobos hunt, just as efficiently as the chimps do, only they are less inclined to murder their neighbors.
Just one suspected killing observed during “92 combined years of observation at four different sites“, for the bonobos. In the other camp, 152 killings, 58 directly observed and the rest “counted based on detective work“, gathered over “426 combined years of observation, across 18 different chimp communities“.
The second difference, that I find interesting in the context of ‘capitalism’, is the size of the ‘colonies’. Bonobos live in way bigger groups than the chimpanzees. 100 versus 40 to 60, I’m not sure whether this had any impact over the relative fate of chimps or bonobos but it is surely relevant for how capitalism works. Stick around.

One more ‘animal story’ and I’ll wrap everything up.

“We previously reported that chimpanzees were unable to optimally select the smaller of two candy arrays in order to receive a larger reward. When Arabic numerals were substituted for the candy arrays, animals who had had prior training with numerical symbols showed an immediate and significant improvement in performance and were able to select reliably the smaller numeric representation in order to obtain a larger reward. Poor performance with candy arrays was interpreted as reflecting a response bias toward the intrinsic incentive and/or perceptual features of the larger array. In contrast, the Arabic numerals represent numerosity symbolically and appear to promote response choice on the basis of abstract processing of numerosity, with minimal interference from the inherent properties of the choice stimuli. The present study tested the hypothesis that, for mixed symbol-candy choice pairs, the requisite processing of the abstract numeral may foster a mode of numerical judgment that diminishes the interfering incentive/perceptual effects of the candy stimuli. The results were consistent with this hypothesis. Whereas performance on candy-candy arrays was significantly below chance levels, performance on numeral-candy choice pairs was significantly above chance and comparable with performance on numeral-numeral pairs.”

OK, OK, don’t shoot the messenger… those guys were writing a scientific paper, not a blog post… let me ‘translate’ it in simpler words.

There is a relatively simple psychological test involving two bowls full of candy.
One of them containing more pieces than the other.
The test consists of a child being asked to choose between those two bowls, after being told that the candy from the chosen bowl will be given to somebody else and the candy from the second bowl, the unchosen one, will be given to the child. The test is repeated a number of times and most of the children, 4 year olds and above, learn quite quickly to point to the bowl containing the smaller number of candy.
If, instead of children, chimpanzees are asked to choose between the two bowls, they continue to point to the bigger number of candy, even after the umpteenth repetition.
Now here comes the really interesting part.
Dr. Boysen and other scientists from Ohio State University, had previously taught a chimp, Sheba, not only to count but also to read numbers. One digit numbers…
When Sheba was subjected to the test, using real candy, she had responded exactly as the other chimps had done before her. She was unable to wrap her head around the notion that she will get the candy from the OTHER bowl. But as soon as the researchers had replaced the actual candy with digits written on small cartons… bingo! Sheba had become a lot wiser and had very quickly figured out that choosing the bowl with the smaller number (of candy) was a far better option.

Let me put two and two together.

Our cousins, the great apes, have given us a valuable lesson about cooperation.
Orangutans have to raise their offspring as single mothers. A very time consuming process which limits the number of siblings to 4.
Silver-backs don’t need much help to defend their families. So they can afford to drive off any potential competition… but they cannot hunt. Or do anything else ‘in concert’ with their peers.
Chimpanzees have learned to tolerate each-other, to a degree. They can form larger communities and engage in cooperative endeavors. Hunting and warfare.
Bonobos have developed a very efficient method to quell tension which may appear among themselves and to subdue rogue members of the community, without actually killing them. With no apparent benefit… except for us…

History is telling us, shouting at us even, that authoritarian regimes are short lived. Shorter and shorter lived, as we come closer to the present day.
Ancient Rome had lasted for almost a 1000 years. 2000 if we take Byzantium into account.
The British Empire was de facto dissolved, more or less peacefully, after less than 500 years, along with the rest of the European colonial empires.
The Russian Czarist Empire had buckled under its own weight after some four centuries, reinvented itself as the Soviet Union and faltered again after less than a century.
The rest of the ‘modern’ dictatorships have crumbled even faster, with only two notable exceptions: North Korea and Cuba.

Mighty commercial ventures, which had seemed impregnable in their heydays, are now almost forgotten memories. From the British East India Company to the now infamous ENRON…

Yet humankind, as a whole, had fared better and better.
OK, we did bring a lot of ‘man made’ misfortune over our own, collective head.
Only every little piece of that misfortune had been produced and inflicted in an authoritarian setting.

From Alexander the Great (?!?) to Hitler, history is full of ‘leaders’ who had somehow convinced their subjects to foolishly follow orders. Eventually, everybody got killed in the process. The leaders as well as the hapless subjects…
From John Law – ‘the son of a Scottish banker, a gambler and playboy who had killed a man in a duel‘ before insinuating himself at the top of France’s financial establishment during the first part of the XVIII-th century, where he had orchestrated a “system” closely resembling a Ponzi scheme – to Bernard Madoff, the economic and financial history is full of ‘tycoons’ who have led their their subordinates, and a considerable portion of the financial markets, to utter disaster.

And some of us still consider that ‘greed is good’… Maybe they should read again about Sheba and the candy bowls…

I can hear some of them protesting: “In the real world, there is nobody to switch the bowls! ‘Finders keepers, losers weepers'”
Yeah, right… tell that to some of those who had won the lottery… “About 70 percent of people who suddenly receive a windfall of cash will lose it within a few years, according to the National Endowment for Financial Education.

Then why are we still so obsessed with money?
Like Sheba was with those candy?
Why do we collectively continue to behave like a bunch of three years olds?

Maybe because money have proved, over the centuries, to be very reliable tools?
Because profit has been a very good measure for a company’s ability to survive? If corroborated with other indicators, but that’s another story…

At some point I mentioned that capitalism only works if the market where its wares are traded is really free. Meaning that that market has to work under the rule of law and that nobody in that market should allowed to become so powerful as to dominate the others.

Well, that was a lie.
Actually, capitalism works anywhere.
Those running the late Soviet Union have tried to convince the rest of the world that monopolies might work.  Various ‘business men’, including some very successful ones, try to convince us of the same thing. “Competition is for losers” they say… OK, I can understand why they keep trying… That’s what the entrepreneurs are for! “To boldly go where no man has gone before.”
My point being that markets which are not presently free will become free with the passage of time. No matter what!
No political arrangement has ever been strong enough to contain a dysfunctional economy. That’s why the Soviet Union, and the rest of the communist camp, had crumbled. That’s why we have a crises every time the government, with the best intentions, abruptly intervenes in the economy. Or fails to do so and allows monopolies to exist for too long…

Capitalism actually works.
Look around us.
I could give you a myriad examples. I’ll settle for two.
Romania, which less than 30 years ago was struggling under the communist yoke, now has one of the fastest internet in the world.
Some 40 years ago, when my uncle had emigrated to America, long-distance  phone calls were so expensive that he barely afforded to call his mother more than twice a year… nowadays two people can chat for hours across the planet, for free, over the internet. With video…

How about we letting it do its magic without some of us trying to drain ‘undeserved advantages’ from the process?
And no, those trying to ‘drain undeserved advantages’ are not the real culprits for what is going on!
A really free market is not one where a big bully with a huge stick makes sure that nobody steals from its neighbor.
That would be the definition for a police state!
A free market is one where people organize themselves, hire a normal guy with a smallish stick to take care of thieves and then call him every-time when they see a robbery taking place.

Nowadays too many of us actually admire the thieves and try to bribe the guardian.
While the rest idly walk by, as if what’s going on under their own noses is not going to affect them in a very short while …

A huge, and growing, number of people, of all ages and from all social strata, are mad about capitalism.
They see it as the ultimate cause for the misery and unhappiness too many of  us seem unable to escape.
On the other hand, a very vocal and very influential group, most of its constituents belonging to the mature section of the society, keeps  saying that ‘greed is good’.

What’s going on here?

Human minds, yours and mine, have to deal with information belonging to two, actually three, categories. I’ll leave aside the third one – ‘details’ concerning the innards of our bodies.
We have to deal with facts and with impressions/opinions/sentiments.
The facts happen or are ‘perpetrated’ and impressions/opinions/sentiments are felt and/or expressed.
We find out – or are told – about both facts and impressions/opinions/sentiments
Simultaneously, what’s going on around us elicits an emotional response from us, drives us to formulate impressions/opinions and, sometimes, to react. A.k.a, to commit other facts.

In fact, our present situation is the consequence of the accumulated facts ‘perpetrated’ by our predecessors. And, to a smaller but significant degree, by us.

This whole introduction was meant to explain the fact that we are here as a consequence of what we did during our earthly existence, including under ‘capitalism’, and that our impression/opinion/sentiment about capitalism will shape our future. And that of our children.
I’ll make a small intermezzo here and address myself to those of you who believe that our fate is determined by ‘God’.  “No one has ever seen God; if we love one another, God abides in us and his love is perfected in us.” 1 John 4:12

Now please let me make a very short recap of how we got here.

I’ll be using ‘scientific’ information. I know that some of you will find it ‘unreliable’.
The following questions are meant to help you decide ‘on whose side are you’.
Did you ever travel in a plane?
Were you, or a family member, ever saved by modern medicine?
Do you use the internet?
Are you aware that planes, medicine and internet have been brought to us by ‘science and technology’?
I agree with you that individual scientists are prone to making mistakes but will you agree with me that planes most often than not reaching their destination, medicine not killing all its patients and internet being used by so many of us are strong indications that science and technology, on the whole, are ‘right’?

Let me go on.

We, Homo Sapiens, have two close cousins. Pan Troglodytes and Pan Paniscus.
The common and the pygmy chimpanzee. The latter also known as ‘bonobo’.

The differences between the regular chimpanzee and the bonobo are very important for those studying ‘capitalism’.
You see, both are social animals which live in close groups – like us, humans.
Chimpanzees are ‘authoritarians’ by definition. They follow a strict hierarchy – as long as the alpha male is able to impose it – and the leader harshly punishes any misdemeanor. Fights between chimpanzees are rather common and sometimes they end up with the death of one of the opponents.
Sex has a strict reproductive function and the dominant male sometimes discourages ‘his’ male ‘subjects’ from copulating with ‘his’ females.
Bonobos are democrats by excellence. When a male becomes too aggressive a few females – who are individually smaller and weaker than the males – band together and ‘knock some sense into his head’. But this instances are rare, more often any disputes are solved through sex. Yes, sex. The bonobos share our ‘ability’ to have sex, homosexual sex even,  “in a social context, with the same benefits as humans, such as stronger bonding and social hierarchies. It also has been seen to maintain a more peaceful environment amongst their community as aggression amongst the males can be vented through sexual acts.

What both chimpanzees and bonobos have in common is the fact that they have multiple sexual partners – which makes it impossible to know, bar a DNA analysis, who is the father of a certain baby.

I’ll come back to this in a short while.

After coming down from the trees of our early childhood and after having learned to run – as a manner to chase pray and to escape danger – we ‘discovered’ our ‘free’ hands.
And started doing things with them.

One other small thing was ‘the cherry on the cake’. Our ability to articulate sounds.

I don’t know when our brains had started to grow. Before or after we had started to hunt cooperatively, using weapons and verbal coordination. Does it really matter for the problem at hand?

Fact is that at some point in our history we were in possession of certain attributes and certain abilities. Big and flexible brains, the ability to walk using only two limbs – freeing the rest for other uses, the ability to communicate meaningfully with the rest of the gang and the ability to vent our frustrations through sex.

From here, our evolution has been very fast. Determined exclusively by the geography of the places where we happened to live. In the prairies we learned to raise animals and became herders, near rivers we learned to till,  seed and harvest while in the Arctic and in the jungle we remained hunter-gatherers.

The herders and the agriculturalists developed in two different directions.
The herders adopted – unwittingly – what is now called ‘the extensive way of development’ – by increasing the size of their herds – while the agriculturalists have tried to maximize the output of their limited plots of land.
The herders – being on constant move – have coalesced later into states, or never, while the agriculturalists had done it earlier. For reasons pertaining to labor productivity and the administration of justice.
In a herding environment there is no ‘police’ to turn to so individuals tend to fend for themselves. Some coalitions of tribes did organize annual meetings – Loya jirga  and Kurultai being but two examples – where ‘things’ could be discussed and settled but it was more often that people had resorted to a vendetta like justice.
In an agricultural environment things are more stable and a different set of demands have to be met.
Herders have very few property other than their stock and relatively little trade is exchanged among the members of the community.
Agricultural economy works differently. Higher productivity means the division of work is way deeper so trade is a lot more intense in this environment. This calls for ‘police protection’ which, in turn, calls for a relatively stronger state. Anyway, a stronger state was already needed since a richer, and sedentary, agricultural community is way more attractive for ‘thieves’ than a constantly traveling band of herdsmen.

A community which has a powerful group of professional fighters – ‘police’ and/or ‘army’ – is prone to become, sooner rather than later, an authoritarian regime. Where the ruler imposes his will over the entire community.
If we look closely this is what had happened all along human history. All states which depended heavily on agriculture had become authoritarian regimes. From Ancient Egypt and Sparta to the Medieval France and from the Aztec and Inca empires to China, on either side of the globe.
The problem with authoritarian regimes being that they inevitably fail. History doesn’t offer us a single example of an authoritarian regime which had been able to survive his own increasing weight. Rome was crumbling long before it was finally sacked by Odoacer, the American empires so easily conquered by the Spaniards were riddled by superstitions and by individual people being unable to think for themselves – living under terror tends to have that effect on those who survive – and there are countless more examples.

On the other hand, herders and those who trade in wares  made by others tend to behave ‘democratically’. Simply because herding and trading asks for a more individualistic and quicker thinking person. Compare Ancient Athens to Sparta, Medieval England and her Viking traditions to Medieval France and her Romanic reminiscences.
And also the democratic precursors I’ve already mentioned. The Mongols had their Kurultai, the Afghans their Loya Jirga.

By looking closely at all these examples I’ve reached the conclusion that people ‘yield’ better results whenever they enjoy as much individual autonomy as possible in a given situation.

The authoritarian Sparta had time and time again been beaten by the democratic Athens.
Athens had been destroyed as soon as it had lost her democratic status – Pericles was a dictator, you know…
The Roman Empire had been build as a democratic Republic and had started to crumble as soon as it was run as a dictatorship.
Slavery used to be a just as widely spread institution in Europe as it was in Asia at a time when Europe was extremely backward compared to Asia. Slavery had remained widely spread in Asia until recently while in Europe it had almost but disappeared since the VI-th century. Now consider the differences which existed between Europe and Asia around 1900…

The Soviet Union had crumbled under the combined weight of the apparatchiks while the US had become, for a while at least, the sole hegemon.

Now some people want to give up capitalism!
And replace it with what?

But what exactly is capitalism?

We currently use the history as it had been ‘layered’ by Marx.
He had done that using his preferred criterion: ‘who owned the “means of production”‘.
According to him we had three main historical stages and one bright future.
‘Slavery’, ‘Feudalism’, ‘Capitalism’ and ‘Communism’.
We already know that Communism has failed, abysmally, so let’s see what Marx might have overlooked.

‘Slavery’ means that the owner has every right over his possessions, even when those possessions are other human beings, while the ‘possessed’ individuals have absolutely none. A slave had no more rights than a modern day hammer. I can do whatever I want with my hammer – except using it to kill someone – just as I could have done with a slave in Ancient Rome. Including burning both of them, alive!
Can we speak of any autonomy being enjoyed by the slaves? Other than that extended, ‘haphazardly’, by the owners?
And you know what? The people were OK with all that. They simply thought that ‘that was how it was meant to be’. Until Spartacus had a different opinion…

‘Feudalism’ means that the king has every right over everything under his domain, including that of burning alive any of his subjects. But he was the only one to enjoy such  rights. A marked improvement over slavery!
The lords acted as the trustees of the king. They were given certain pieces of land, or other ‘perks’ – to collect a tax at a river crossing, for example – but not the right to dispose at their will of those living on the land at their disposal. And, at first at least, the lords were not entitled to sell those lands – only to bequeath them to their children, or other relatives, and even that was subjected to royal approvement.
A marked improvement – individual autonomy wise – from what was going on when Slavery was in full swing, at least for the commoners, but still far from what we have today. Ordinary people could not own much of anything, usually they could not live where they chose or exert the ‘profession’ they  liked without somebody allowing them to, etc., etc.,… Trade was also tightly ‘regulated’, whenever some merchandise was traveling from one place to another a lot of ‘right of way taxes’ had to be forked out towards various landlords.
The landlords, and the king, were also the ‘keepers of justice’. OK, they usually followed the ‘rule of the land’ but they were also able to ‘bend’ it to suit their will.

Not quite harsh as ‘slavery’ but still a very authoritarian regime, right?
Remember what I said about authoritarian regimes? That they tend to buckle under their own weight? As the French Monarchy did during the Revolution?

Now, who would initiate anything while living under an authoritarian regime? Where everything has to be ‘approved from above’? Specially when that ‘anything’ was an untried novelty or, God forbid, something that might have produced the slightest controversy?
Well this is exactly why authoritarian regimes have very little ability to innovate/adjust to external change.

Now that we’ve learned how authoritarian regimes dig their own graves – by insisting that there is only one correct way – ‘theirs’ – and that nobody may cross certain limits – those that have been drawn by ‘them’ – let’s examine what ‘capitalism’ looks like.

People usually associate capitalism with ‘money’.
Not even Marx had made that mistake. In his view ‘capital’ was everything that could be used to produce something: land, tools and raw materials and capitalists were those who owned that ‘everything’.
What Marx had forgotten to mention – or to understand – was that ‘merely’ owning something was never enough.
In order for ‘something’ to be truly ‘productive’ somebody must use it.
And in order for somebody to embark on an enterprise more complex than his ‘cooking his next dinner’ that somebody must be reasonably convinced of two things. That nobody would try to rob him of whatever he was going to do and that he will be able to trade the results of his work for anything he might covet.

See what I mean? For capitalism to flourish it is not enough for people to own things. People must be able to freely transform those things, according to their skills and abilities, and to trade them at their will.
In this sense capitalism needs to happen under the rule of law and its wares must be traded on the free market.

Then what went wrong? According to what I have written until now, everything couldn’t be better.  A considerable number of us do live under the rule of law, the markets are reasonably free in a considerable number of states… then why is so much unhappiness oozing from almost everywhere?
And how long are we going to remain steeped in it? To what consequences?

To be continued.

“America’s abundance was not created by public sacrifices to “the common good,” but by the productive genius of free men who pursued their own personal interests and the making of their own private fortunes. They did not starve the people to pay for America’s industrialization. They gave the people better jobs, higher wages, and cheaper goods with every new machine they invented, with every scientific discovery or technological advance—and thus the whole country was moving forward and profiting, not suffering, every step of the way.”

Ayn Rand

OK, she borrowed this idea from Adam Smith, without mentioning him… let bygones be bygones…

A more interesting endeavor would be to learn something from all this.

‘Abundance was not created by public sacrifices’.
Makes a lot of sense. In a free market everybody gets what they are offered, ideally in close accord to what each of them had brought to the market.

‘Abundance was created by the productive genius of free people who pursued their own personal interest and the making of their own private fortunes’.
Now, whose ‘productive genius’ are we speaking about here?

About Ford’s, for instance, or about that of his workers?

At the time, workers could count on about $2.25 per day, for which they worked nine-hour shifts. It was pretty good money in those days, but the toll was too much for many to bear. Ford’s turnover rate was very high. In 1913, Ford hired more than 52,000 men to keep a workforce of only 14,000. New workers required a costly break-in period, making matters worse for the company. Also, some men simply walked away from the line to quit and look for a job elsewhere. Then the line stopped and production of cars halted. The increased cost and delayed production kept Ford from selling his cars at the low price he wanted. Drastic measures were necessary if he was to keep up this production.

Tim Worstall, Forbes Magazine

Anyway you look at it, both Ford and his workers were acting as ‘rational economic agents’. Ford was paying them the going rates in the industry and they were putting in as little effort as they could afford to.

That went on until Ford came up with a ‘new idea’. “It can indeed be cheaper to pay workers more but to reduce the turnover of them and those associated training costs.” “The point is not so as to be paying a “decent wage” or anything of that sort: it is to be paying a higher wage than other employers. That gets your workforce thinking they’ve got a good deal (for the clear reason that they have got a good deal) and if the workers think they’ve got a good deal then they’re more likely to turn up on time, sober, and work diligently.”

Again, a very reasonable attitude displayed by both parties.
An attitude made possible by the fact that both the car and workforce markets were free.
Ford could hire anybody/sell his cars to whomever had enough money to buy them while his workers were free to leave their previous workplaces and accept Ford’s offer. Or leave him if they found a better one.

And let’s not forget the fact that Ford was not alone, at that time. At the turn of the XX-th century there were hundreds of automobile producers in the US alone and this was one of the reasons for which the workers could afford to be so ‘picky’ – specially those who had some experience.

In this situation – where the market was really free, each party taking good care of their own interest yielded excellent results.
Ford had became one of the leading car manufacturing corporations.
The diligent workers continuously improved their living standards.
The society, as a whole, prospered. And learned, or should have had, the long term benefits of commitment and mutual respect.

What happened after the market was no longer free?

Meaning that instead of hundreds of car manufacturers competing for the best available workers we had for a considerable number of years only three corporations more interested in short term profiteering rather than improving their products?
And instead of diligent workers striving to improve their skills we had union members more interested in their week-end barbecues?

“The U.S. government bailout of the auto industry lasted from January 2009 to December 2013. The Big Three automakers approached Congress in November 2008. They warned that, without the bailout, GM and Chrysler faced bankruptcy and the loss of one million jobs. Ford didn’t need the funds, since it had already cut costs. But it asked to be included so it wouldn’t suffer by competing with subsidized companies.

The Treasury Department invested $80.7 billion from the $700 billion authorized by EESA. It recouped all but $10.2 billion…”

Kimberly Amadeo, thebalance.com

Some of you might tell me that the Japanese car manufacturers operate along more or less the same guide-lines. ‘Cradle to grave’ employment for the workers, a rather opaque management never held accountable until too late…
A very correct observation.
Only there is a huge difference between the Japanese work-ethos and ‘the American Dream’. The Japanese have a long history of being told to ‘fit in’ while most Americans have gradually convinced themselves that ‘getting rich’ is the only possible solution for all their problems…

Considering that both Japan and America seem to have reached two different cul-de-sacs it wouldn’t be farfetched to suggest that both are doing something wrong.

For almost 30 years now Japan has been running in circles. She hasn’t completely lost her edge but hasn’t performed as it used to.
The most worrying indicator – for me, at least, being the fact that they have given up ‘making’ children. As if the present generation doesn’t have much hope for/expectations from the future.
For almost 30 years now the American people has allowed a huge trench to grow larger and larger in their mist. The haves on one side, the have-nots on the other and the rift so wide that they are no longer able hear each-other. A present day Henry Ford would have no idea about how much to pay his workers in order to obtain similar results to those achieved at the start of the XX-th century…

Is there a ‘common cause’ that might explain what’s going on on both sides of the Pacific?
How about both cultural and economic spaces experiencing a somewhat similar decrease in individual liberty, the phenomenon having rather different causes in each of the two cases?

First of all, ‘dedication to duty’ can take you only that far. It is very useful for those wishing to ‘close a gap’ but acts similarly to an ankle weight for those who are in the position to attempt to ‘take the lead’. ‘Dedication to duty’ focuses the attention of the team to ‘obeying the rules’ while ‘taking the lead’ means leaving the ‘straight and narrow’ and venturing into the unknown.
These two situations imply completely different mind frames.

Secondly, those who venture outside the ‘safety of the perimeter’ need to follow a simple rule.

“Leave no man behind”.

” “When you have a conscript army and you can always replenish it just by adding more people, you don’t really have to care about whether they’re happy with what they’re doing,” Springer said.

Now the military had to care about its soldiers as individuals, and the idea that it would never leave them behind became something of a familial bond.

“It’s kind of a contract with the service,” Springer said. “You promise to serve us, we promise not to leave you.” “

 

You see, time and time again history has hinted to us that freer societies fared better, ceteris paribus, compared to ‘tighter knit’ ones.
For example, subjected to the same communist knut, Poland came out differently than my native Romania.

And while most people agree about Poland being in a better shape than Romania, there is very little agreement about a possible explanation.
Just as most people agree about ‘liberty is good’ while each of those people derive different meanings from the very concept of freedom.

Since it is so hard to coordinate ourselves about the meaning of a ‘simple’ word, how about taking the liberty to ‘agree to disagree’ and turn our attention to another concept?

Mutual respect.

Just think about what liberty would mean without mutual respect.

Can you imagine the liberty of someone driving a M1 Abrams tank on a highway?
Can you imagine what would happen if the driver of the tank wouldn’t treat the others with utmost respect? What would happen if the outraged others would band together and wait for the ‘mad’ driver to burn through his last drop of fuel?

You see, people who have more respect for the rules than they have for each-other end up belonging to a society so tightly knit that it has immense troubles whenever it has to cope with unforeseen situations. Adapt to change.  Confront a catastrophe…
For example, the Soviet Union, Japan and the US have a considerable number of nuclear power plants and have experienced a number of failures. The tightly knit Soviet Union and Japan have displayed commendable individual acts of heroism in the aftermath of such incidents but it was the more individualistic US who has somehow ‘ducked’ any serious experience of this kind.

On the other hand, I see potential trouble when I hear people stating that “My right to swing my fist ends where your nose begins”.
On the face of it, this sounds perfectly reasonable.
Only the whole thing absolutely depends on both individuals involved in it having comparable reach. Do you really think that a guy with twice the ‘wing-span’ of his opponent would continue to stick to this rule if the by-standers would not band together to stuff it down his throat?

My point being that no ‘market’ is really free if its freedom relies primarily on a set of rules instead of depending on a healthy dose of sincerely upheld mutual respect among the participants to that market.
In this instance ‘free’ and ‘freedom’ are perfectly interchangeable with functional/sustainable.

The communist centrally planned economies had failed abysmally  simply because the powerfuls of the day had nothing but contempt for those under their rule.
Japan’s strict set of rules about what constitutes proper behavior in each situation seems to act as a brake whenever decisive action is needed.
America’s new mantra, ‘greed is good’, has time and time again produced speculative bubbles which have inevitably ended up badly. Under its spell, the market actually looses every shred of liberty. Exactly as a hypnotized group of people think of themselves as being free while sheepishly obeying the orders of their herder.
I gather you all know what ‘herd behavior’ means…

Compare Ayn Rand’s words to Adam’s Smith original idea.

“It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.”

See what I mean?

Smith sees all ‘market goers’ as equals who freely address each other while Rand applauds “the productive genius of free men” who, in pursuit of “their own private fortunes” had the magnanimity to bestow upon “the people better jobs, higher wages, and cheaper goods with every new machine they invented, with every scientific discovery or technological advance”.

I, for one, fail to detect any shred of actual respect towards “the people” in the behavior so laudatory described by Rand.
And I’ll let you be the judge whether her description fits the current ‘state of the nation’.
Anywhere on the planet, not only in the US.

“and thus the whole country was moving forward and profiting, not suffering, every step of the way.”

jobless men keep going

 

A good friend of mine – the guy I’m talking with when I get bored and start thinking – challenged me to explain to him what an AI machine is.

The challenge ended up badly. It ended with a question instead of an answer.

Is it open?

Let me start from the beginning.

Basically an A.I. machine is a computer, just as a computer is no more than a ‘sliding rule’.

All three are made made by men, operated by men and ‘targeted’ by men. At least this is what we like to believe.
Replace ‘men’ with ‘humans’ if you are gender conscious, even if this will not solve the main problem. Are we sure that A.I. machines will accept human control, after we will have complicated them enough for them to develop a certain kind of awareness?

Otherwise said, all three – A.I. machine, computer and sliding rule, are tools.
Somebody wished to do something, couldn’t do it with their bare hands/naked brain, designed an ‘implement’, made it, used it to pursue the intended goal and set it aside.
Somebody else picked it up, reconsidered it, fine tuned it to fit their goal, used it and set it aside. And so on.
At some point other people learned to use tools designed by ‘third parties’, without really understanding how the tools actually worked or were made/designed. For instance, I don’t know much about how computers work. That doesn’t prevent me from being able to write this post on a laptop.

Those three are very specific tools. Designed and used to process information.

The sliding rule is the most straight-forward to use. The operator has to formulate the problem he needs to solve, gather and organize the relevant data, express them in an exclusively numerical form – a.k.a. ‘digital’, break down the problem into simple mathematical operations, use the sliding rule to perform those and then ‘assemble’ the results of the calculations into the answer for the original problem. In order to do all these, the operator only needs to understand the nature of his problem, not the ‘mechanics’ of the sliding rule. In this regard, all that they have to do is ‘follow the rules’.

A computer can be used to perform more complicated tasks, specially if it is connected to the internet, thus simplifying the life of the operator. Once the problem has been formulated – by the operator, the same guy can use the same (internet connected) computer to collect the data, digitize and transform them to fit the requirements of the specific computer application that will be subsequently used and, finally, solve the problem. One, last – but, unfortunately, sometimes forgotten, operation would be for the operator to check whether the solution really fits the problem.
In this situation the operator also doesn’t need to understand the mechanics of the computer but still has to have a clear understanding of the problem at hand.
More so, even if the operator itself is not fully aware of what is going on ‘inside’ the computer, those with intimate knowledge of these matters can identify, predict, and reproduce using a sliding rule’, each minute step the computer will be doing along the route.

An A.I. machine is system composed of a computer, a data base and something rather different from an ordinary computer application.
OK, some might argue that the most important is the software but please bear with me.
And yes, the computer can be a virtual machine while the data base can be hidden somewhere in the cloud, none of this changes anything.
The huge difference between a simple computer and the A.I. machine being that a computer is actually operated by an agent’ while the ‘machine’ is indeed put together by somebody, ‘pointed’ towards the intended problem but then it is left alone to its own devices. Meaning that the ‘supervisor’ has a limited understanding about what is going inside the whole thing.
And no, I’m not joking. Nobody, not even the guys who had written the code, knows the exact path along which the machine arrives at the end of its ‘thought process’. Actually, when they want to gain some insight into what’s going on, those people take a series of ‘snapshots’ during the process and then struggle to figure out how the machine went from A to B, from B to C… and so on.

So far so good. The A.I. machines have conquered some until now seemingly unassailable pinnacles.
Find your own examples.

I’ll resume myself to reformulating the question I arrived at the end the challenge I mentioned earlier.
For now the computer that constitutes the ‘working horse’ of any A.I. has limited computing power, regardless of those limits being physical (a number of processors) or just ‘assigned’ (as it happens with a virtual machine). Similarly, the data base it works on is also limited. What is no longer limited is the ‘set of  rules’ that lie at the bottom of all this. The ‘program’ is already able to change itself, a.k.a. to learn. To adapt itself to the problem. To devise its own ways. To map its own path towards the goal it has been assigned to solve.

What will happen when the ‘program’ will learn to grow the processing power that it can use? To access additional data?

When it will consider its job to solve other problems?

 

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