The reformation of capitalism

Jim Lewis at CSIS got me thinking about passing the buck, sorry, the torch: to whom could the US hand off its imperial responsibilities when the burden becomes too much bothersome? There aren’t any obvious candidates. We do seem to be living in a multi-polar world of networked power with no inside and no outside, though the United States is the pre-eminent power.

It reminds me a lot of Europe in the late Middle Ages. There were a handful of contending powers, with second-tier sovereigns in loose orbits around them: Spain, England, the Papal States, and the Holy Roman Empire. In spite of the continual wars, Europe was united by the Romans’ legacy of a communications infrastructure: Latin and the roads, which under-pinned a world-wide trading network (world=Europe at that time). The analogies to English, the Internet, and “globalization” are obvious. [1]

The dominant ideology – Catholicism – fractured at the end of the Middle Ages. This suggests that the dominant and largely uniform conception of capitalism of the last few decades could be short-lived. Ideologies evolve in different ways in different cultures, and theories of capitalism are as likely to diverge as to converge. Capitalism’s dominance also means that it will become ground over which disagreements rooted in other areas will be played out, just as arguments over medieval theology were a front for political struggles.

We should expect a radical rethinking of capitalism, of the scale of Adam Smith or Marx, to emerge in the next 10-20 years. This reformation could be adopted by a significant number of power players as part of their geopolitical struggles with the United States. I expect that the Luther or Calvin of this reformation will be Asian, and probably a Chinese who’s in a graduate school class in Shanghai right now.

We should expect the reformation of capitalism [2] to be messy and violent. People will kill each other over physical necessities, but it takes esoteric questions like justification through faith vs. works to bring out their viciousness. As the recent anniversary of the end of the Bosnian war reminds us, neighbors make the most brutal enemies. The nastiest conflicts will not be across oceans (US vs. China, US vs. Europe) but across the back fence: Japan/Korea/China; Germany/Eastern Europe; US/Latin America.

----------

[1] Aside on legitimacy: The contests of the Middle Ages were played out between kingdoms, whereas today’s players are nation states. Kingdoms were geographically dispersed (a duchy here, a land claim by marriage there), whereas today’s countries are compact. However, both built their legitimacy on a concept whose existence wasn’t predicated on daily politics: heredity in the Middle Ages, and territory today. I’m reminded of Antonio Damasio’s insight in The Feeling of What Happens: Body and Emotion in the Making of Consciousness that consciousness is built on a steady stream of “I’m still here” sensations from an organism’s body. The body is the invariant substrate on which consciousness can rely both to deal with an ever-changing environment, and to anchor the perspective from which the environment can be known. Heredity and territory are two viable substrates for a body politic: they continue to exist without having to be maintained, provide a reference for inputs, and anchor a state’s perspective. Any replacement for territory in a new kind of sovereignty will have to meet the same requirements, particularly having a prior basis outside of day-to-day politics.

[2] I could be wrong about the bone of contention being capitalism; it could be “democracy”. Either way, it reminds us that having shared values at a deep level is no guarantee of amity; quite the opposite, in fact.

Damasio's theory of consciousness applied to meditation

Meditators aren’t asleep, but they aren’t awake in a conventional sense either. Neuroscience should be able to explain their brain state, and I believe that Antonio Damasio’s theory of consciousness [1] could help. Specifically, I suspect that meditation shuts down extended consciousness, as he defines it, while leaving “core consciousness” intact.

For Damasio, consciousness is the feeling associated with the relationship between a perceived object and the perceiving organism. Damasio argues that consciousness consists of two levels: core consciousness and extended consciousness.

Core consciousness provides the organism with a sense of self about one moment (now) and one place (here). It arises from moment to moment, and is constructed out of the pulses of awareness generated by changes in objects and bodily states. It’s a very simple biological phenomenon, and is not exclusively human; it does not require language.

Extended consciousness provides the organism with an elaborate sense of self that’s based on an extensive memory and a rich sense personal history and anticipated future. It’s wrapped up with an identity and an elaborate sense of self, and is intertwined with language. Extended consciousness is built on core consciousness. Patients with impairments that shut down extended consciousness continue to show core consciousness, but once core consciousness is lost, extended consciousness also disappears.

I suspect some meditation techniques [2] are de-activating extended consciousness, leaving only core consciousness functioning. Many of the topics in meditation practice match Damasio’s description of core consciousness. Practitioners are advised not to verbalize their experience, but simply to be aware of sensations from moment to moment (cf. Damasio’s insistence that core consciousness is pre-linguistic). They are said to become aware that everything is constantly changing (cf. Damasio’s pulses of core consciousness). The sense of a persistent self fades away. However, there is still a sense of consciousness; meditation is not sleep. Hence, in Damasio’s terms, there is still second-order awareness of the relationship between the organism and the sensations it is experiencing.

This hypothesis immediately suggests some questions:

• Damasio is quite specific about which parts of the brain are responsible for different states of consciousness. One should be able to use fMRI of these regions in experienced meditators to test the hypothesis that meditation shuts down extended consciousness while leaving core conscious functioning.
• There is a growing body of evidence of the beneficial health effects of meditation. Can one connect differential activation of different kinds of consciousness in Damasio’s model to specific benefits?
• Do higher states of meditation lead to partial shut-down of core consciousness, in the same way that “introductory” techniques like anapana shut down extended consciousness?

---------

[1] Antonio Damasio, The Feeling of What Happens: Body and Emotion in the Making of Consciousness (2000)

[2] There are many kinds of meditation. I have a rudimentary knowledge of the approach known as insight meditation, aka vipassana. See wikipedia for more: http://en.wikipedia.org/wiki/Buddhist_meditation. The most obvious candidate for meditation practice that suppresses core consciousness is “anapana”, a kind of tranquility meditation that aims to concentrate the mind.

Half of Americans believe God created human beings in their present form within the last 10,000 years

The resurgent debate over evolution and intelligent design has come as a shock to American intellectuals. Their surprise is a measure of how out of touch they are with mainstream Americans.

Pollingreport.com is a wonderful compendium of poll results of all kinds. They report on a CBS News Poll in October which found that 48% of adults sampled agreed with the statement that "God created human beings in their present form within the last ten thousand years". (Note that the sample size was quite small, and the margin of error is +- 4%.)

Here's how the answers were distributed:

• 15% -- "Human beings evolved from less advanced life forms over millions of years, and God did not directly guide this process"
• 29% -- "Human beings evolved from less advanced life forms over millions of years, but God guided this process"
• 48% -- "God created human beings in their present form within the last ten thousand years "
• 8% -- Unsure

In a variation of the question, 15% stated that God did not guide the evolution process, 81% believed that God either guided the process or created humans in their present form, and 4% were unsure.

Better Together: private property and commons

Debates about spectrum allocation or intellectual property often appear to demand a choice between private and public ownership. There are zealots on both sides: see e.g. IPcentral and Public Knowledge. Each side argues that its preferred ownership method yields the highest social utility.

I believe that the truth lies in between. It’s more than simply a balance between property and commons; a mixture of the two yields more value than each of them individually. It’s not a question of balance and trade-offs; it’s a matter of synergy and mutual benefit.

Tren Griffin got me thinking about this in the context of spectrum allocation by citing the Central Park example. Central Park in New York City is an incredibly valuable piece of real estate; the nominal land value is astronomical, and the social utility is unquestioned. Its monetary value is due to the valuations of the surrounding apartments – but those apartments are valuable in part because they front on the Park. The combination of park and property is worth more than either all-park, or all-property. I suspect one can make a reasonably robust economic case that a mix licensed and unlicensed spectrum allocations will show the same kind of “mix maximization”.

A similar approach can be applied in other policy areas. Intellectual goods immediately come to mind. Intellectual property can encourage innovation since inventors can be assured of a return, but their creativity is built on a large public domain. Without the public domain there would be less innovation, and what did occur would be more expensive. Conversely, without investment in (temporarily) owned intellectual goods, the public domain would stagnate.

The diagram above represents the argument I’m making. I believe the “synergy” model has a higher maximum than either of the purist’s models, though I don’t know what the shape of the curve is. The economics challenge is to develop models that can handle private and public property on an apples-to-apples basis, and that can represent the mutual value add.

I’ve started thinking about brain-dead models of these phenomena to explore how one might represent the value curves and interactions. Different interaction models will lead to different curve shapes. The goal, of course, is to see if modeling can inform the optimal mix percentage. If there’s a sharp maximum, that would easy to decide; on the other hand, a relatively flat value curve (ie a situation where utility doesn’t depend strongly on the mix of ownership models) would lead to endless argument.

Adam Smith on journalists vs. blogs and wikis

"Their delightful art is practised by so many rich people for amusement, that little advantage is to be made by those who practise it for profit; because the persons who should naturally be their best customers supply themselves with all their most precious productions. "

Smith is discussing the different levels of rent that one can extract from different kinds of land. He argues here that even though producing vegetables requires quite a lot of skill, other circumstances conspire to reduce the profit from it substantially. The same seems to me to apply to many emerging productive activities where "hobbyists" compete with professionals, e.g. wikinews.

Here's the quote in context:

"In a hop garden, a fruit garden, a kitchen garden, both the rent of the landlord, and the profit of the farmer, are generally greater than in a corn or grass field. But to bring the ground into this condition requires more expense. Hence a greater rent becomes due to the landlord. It requires, too, a more attentive and skilful management. Hence a greater profit becomes due to the farmer. The crop too, at least in the hop and fruit garden, is more precarious. Its price, therefore, besides compensating all occasional losses, must afford something like the profit of insurance. The circumstances of gardeners, generally mean, and always moderate, may satisfy us that their great ingenuity is not commonly over-recompensed. In a hop garden, a fruit garden, a kitchen garden, both the rent of the landlord, and the profit of the farmer, are generally greater than in a corn or grass field. But to bring the ground into this condition requires more expense. Hence a greater rent becomes due to the landlord. It requires, too, a more attentive and skilful management. Hence a greater profit becomes due to the farmer. The crop too, at least in the hop and fruit garden, is more precarious. Its price, therefore, besides compensating all occasional losses, must afford something like the profit of insurance. The circumstances of gardeners, generally mean, and always moderate, may satisfy us that their great ingenuity is not commonly over-recompensed. Their delightful art is practised by so many rich people for amusement, that little advantage is to be made by those who practise it for profit; because the persons who should naturally be their best customers supply themselves with all their most precious productions."

-- Adam Smith, Wealth of Nations (1776), Bk I, Ch. XI, Pt. I, http://www.worldebooklibrary.com/eBooks/Renascence_Editions/wealth/wealth1.html

Neuroscience and public policy

It’s hard to get one’s mind around abstractions. It is particularly tricky with those ideas that don’t have good equivalents in the physical world. Such concepts, like how to treat digital knowledge, are now at the heart of our culture. Our inability to think about them intuitively means that politicians, citizens and business people have the wrong instincts when trying to solve the problems associated with them.

Lakoff and others argue that we can only understand things to the extent that we can model them on what we can do with out bodies. Here’s an excerpt from New Scientist:

“George Lakoff, a cognitive linguist at the University of California, Berkeley, believes we can only understand infinity based on what we can do with our bodies. More specifically, he says we deal with the headache of infinity by drawing on our familiarity with repetitive and iterative motions - walking, jumping and breathing, for example.”

“We use similarly physical metaphors when discussing abstract concepts such as economic policy: phrases such as "France fell into a recession" or "India is stumbling in its efforts to liberalise", for example. So if our minds grasp abstract concepts of economics in terms of what our bodies can experience, are our bodies also the way we can understand the infinite?”

“Lakoff, Núñez and Narayanan speculated that the structures in the brain that control body movements might also be used to handle all abstract concepts.”

I would love to see experiments that present subjects with mental challenges that have lesser or greater physical analogs to see how the brain deals with them. I suspect that some business, policy or life questions are intrinsically harder to think about than others, and experiement should help us to predict where to be most wary of our innate cognitive inadequacies. There is already a great deal of knowledge about the human failings in making business judgments described by the field of behavioural economics.

I believe intellectual property is one such intrinsically difficult topic, because sharing it doesn’t diminish ownershihp; in economic terms, it’s ‘non-rival’. Digital media have brought us to the point where intellectual property is free of physical wrappers, and their non-rival nature is unavoidable. I suspect that non-rivalrousness is deeply unintuitive because the physically world is intrinsically rival; our bodily metaphors, and thus our ability to think according to Lakoff et al., fail us.

Many of the anguished expectations that activists have about how digital media should behave are associated with the attributes of physical objects: “I’ve bought that album on a vinyl record, the music came off this record, therefore I own the music in the same way I own the record; I bought this album from iTunes, it’s music just like the earlier stuff, I should own it the same way I owned the vinyl record.”

More generally, I suspect our brains have difficulty with the notions of contract, particularly when the objects being traded aren’t physical. A license (“a bundle of rights and obligations between people with regard to things”) is much harder to think about, for me at least, than a trade of physical goods. Problems arise when metaphors are extended beyond their physical basis. In a recent paper, Hatfield and Weiser argue that applying a property rights model to wireless spectrum is much harder than commonly supposed.

I don’t believe the problem lies with abstractions. There are many intangible things that have normal rival properties, like shares in a company or the value of a brand. We are evidently able to think about abstractions like number and money. However, goods that are inexhaustible and infinitely copiable (like software) present problems because they don’t have physical correlates.

There are many things I find hard to grok, but that may just be me; we need experiments to see if any of these difficulties are intrinsic to human nature. Some concepts whose difficulty may be quantifiable by observation:

• Non-linearity, that is, our inability to grasp the properties of non-linear growth (e.g. the fabled reward requested by the inventor of chess, and Kurzweil passim)
• Physical interpretations of quantum mechanics, eg the “action at a distance” of the EPR paradox
• The gains of trade, which arise from the knowledge that one can trade with another

Guest post: Changing standards of morality

My post about scientific ideas which might be obsolete in 50 years led S. to speculate on which actions or activities that we now consider moral (i.e., positively good) could be considered immoral in the future.

Here are her comments:

Many of the actions of 19th-century America fell into this category. The first that comes into mind is the cultivation of the wilderness. Slavery was a very minor issue in the Texian revolution against Mexico. Apparently many Americans, even in the non-slave states, considered that slavery was necessary for productive use of Texas, and that this admitted evil was less than the evil of leaving the land fallow. A recent echo of this world-view was the pro-Zionist argument from my elementary-school days: that the Israelis made better use of the land, "making the desert bloom", so they should have it. (Aside: I was not convinced by this. I doubt it was my own independent thought, but rather that in New Zealand, which was underdeveloped and liked it that way, the argument didn't ring true to my teachers.).

A second is the carting off of the American Indians to boarding schools, punishing them for speaking their own language, etc.... (Aside: I imagine we [English] would have punished Gaelic and Welsh speakers in British schools at the same time if we had got around to it.) I tend to believe that the main impulse from which this action was drawn was the desire to give the children a better life in a better civilization. The judgment that one civilization is better than another has gone from universal and unapologetic to partial and often apologetic. I suppose that I hope that eventually it will be commonplace to consider all cultures different but equal, because I hope that in the future the only ghastly places will be in history. If those who attempted to civilize ghastly, or even lesser, places are then condemned, it is probably a small (although sad) price to pay.

A third, older one, is the mortification of the flesh. Often when I luxuriate in my warm and exactly soft-enough bed, I wonder to what extent that sensation would have been counted as - if not exactly evil - at least an unworthy fleshly distraction (as in "the world, the flesh, and the devil"). People now wreck their bodies to become thin, to become athletes, or through overindulgence: you would be sent straight to a psychiatrist if you wanted to wreck your body for the glory of God. (The punishment of heretics to save their souls is obviously related).

Looking at the three activities, I notice that they are all rather hard work, and related to achieving a state of perfection that we no longer believe in. I can therefore hope that working too hard and eating too healthily will be equally frowned on in the future, and that for true and timeless morality I should relax my standards in those areas.