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Risk and Reward

spun (1352) writes | more than 6 years ago

User Journal 17

The primary function of society is the sharing or mediation of risk and reward. Thoughts?

The primary function of society is the sharing or mediation of risk and reward. Thoughts?

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Primary Function? (1)

o1d5ch001 (648087) | more than 6 years ago | (#23565403)

Society is a automatic function of our particular organism. Like the heart, humans just pump away. We make babies, we have families, of one sort or another. Modern Industrial society is a statistical blip in the evolution of humans (and possibly the end of, but that's another journal post). So much cheap energy allows us to organize in different ways. So, I think the question is too broad, It has also been debated by some great minds such as Hobbes, Marx, Oliver Cromwell, Burke and Jefferson (my favorite).

In summary though, most people have become totally ignorant of the functions of community (society) and its rewards. The pursuit of short term monetary gains have outweighed building great, tolerant societies. We are too often guided by our limited knowledge, religious superstition, and the power hungry manipulating our most basic function, fear. (Be always ready for a nuclear attack!) So, society has become a way for the powerful to manipulate the ignorant and therefore increase their power.

Musical Interlude for the day, Dr. Steel. []

Praise "Bob", When you eat a hamberger, eat the hell out it!

Re:Primary Function? (1)

johndiii (229824) | more than 6 years ago | (#23565735)

Interesting thought. I think that some of the problems that we are facing are due to scale. While our innate behaviors work well enough in small groups, larger groups are vulnerable to manipulation (even if only based on statistical factors) and flawed by our inability to conceptualize a large association by anything other than the most general principles - the least common denominator, if you will. When the competing groups were small and relatively powerless, the consequences were more or less safe in the evolutionary sense. But when groups aggregate to become a noticeable proportion of the entire species - and have the power to render our living space uninhabitable, that is no longer the case.

Up to this point, the primary technological advantage has been with the aggregators - those who wish to create larger and larger groups. But information technology also cuts in the other direction, lending increased economic and social power to smaller groups. Naturally, those who derive their power and satisfaction from aggregation will fight that. The music industry paradigm of the distribution cartel against the individual producers and consumers is instructive. I believe that the same model will play out in a variety of circumstances over the near future (say, the next few hundred years), and will hopefully lead to some kind of organic compromise between the two tendencies.

I am not naive enough to suggest that this pattern explains everything, but I think that it is an important one.

Re:Primary Function? (1)

spun (1352) | more than 6 years ago | (#23570497)

Society transcends and predates humanity, and I think its function is the same in all species, which is why I'm trying to strip it down to it's most basic function. The heart, while automatic, has a purpose, and its purpose is similar to society's. The heart facilitates the sharing of risk and reward among individual cells by providing energy (oxygen and fuel), circulating information on potential threat, and the means for dealing with those threats.

When examining human societies, one can categorize them according to two basic driving principles, characterized by the human emotions of love and fear. Love is the feeling that prompts sharing of reward, fear prompts sharing of risk.

Re:Primary Function? (1)

bodan (619290) | more than 6 years ago | (#23586139)

I don't see why you'd sum it up in terms of risk and reward*. You can generalize it further in term of costs and benefits. Risk is just one of the costs that are shared (potential ones, to be precise).

(* Of course, if you need to express it in terms of risk, say because it makes a pet theory more elegant, you can express any cost in terms of risk. E.g., if I need to pay the cost of 1$, you can say that I have a 100% risk of loosing 1$. This of course works for bits of shiny metals, hours of work, tasty fruit, etc.)

I don't much like the idea of expressing any and everything in terms of market theory, but the fact is that it seems to make a lot of sense.* It even works with groups of cells trading nutrients and poisons. (You need to look at it a bit careful, because instead of "rational agents acting to maximize profits" you have "whatever is left alive maximized their profits, the rest are dead". Which on second thought might not be a bad description of human markets, either...)

(* I guess we don't like market theory because it implies directly that nothing has value in itself, including us, and anything's value is just what someone agrees to pay for it.** I don't know why it works, but I suspect it's because it's right...)

(**: Note that this doesn't have anything to do with money. If you tried hard enough I'm almost sure you can express anything's value in terms of love. Though you might have to be quite inventive.)

Re:Primary Function? (1)

spun (1352) | more than 6 years ago | (#23586967)

Well, cost and benefit are synonyms for risk and reward in my book, use whatever words you like, the concepts are the same.

As for market theory, first, people aren't rational agents. Second, people do not work primarily towards their own self interest. Modern economic and games theory research shows that people will act against their own self interest to punish unfairness. Most people value fairness and reciprocity over personal profit. We are cooperative animals by nature, and it is in our gene's best interest to enforce that cooperative nature and not let free riders destroy it. So market theory is based on untrue premises, it is not right or correct, and the whole "science" of economics is more like pawing through entrails for a glimpse of the future. Whenever it doesn't work, economists simply dismiss the anomalies. Its primary purpose is not to explain, but to excuse the abuse of power.

Re:Primary Function? - Re:Terminology (1)

bodan (619290) | more than 6 years ago | (#23626365)

I'm a bit ambivalent about the terminology issue. It's true that wants & needs (in positive or negative forms) can be in general expressed as (or translated between) different concept systems, eg. cost/benefit or risk/reward. So on the one hand, it seems that it shouldn't matter which way they're framed.

But on the other hand, we don't really have all these words (or word pairs) for nothing --- it wouldn't be economical, would it? ;) --- we could only have a pair of good/bad words, and be done with it. I tend to think that their usefulness stems from the fact that the "equivalence relation" (actually, the morphism) between two different wordings is not linear. So, for instance, some risks might be costs and others may be benefits. Even more, the morphism is not the same for every point of view (e.g., different actors).

So, even though you can always translate an argument from risk/reward to cost/benefit (if you're careful enough), the argument can be very different in shape and complexity. Returning to my theory, I think that's because different framings are useful because they include a lot of "common assumptions" about the morphism between the framings.

I'll re-frame this for another pair of hands: On the one hand, because in some framings an argument is simpler to express (thus less likely to make an error), different framings are not equivalent in their usefulness for analysis, though they are equivalent in their final meaning. If you'll accept a hand-wavy analogy, though it's possible to express any physics problem in terms of F=m*a and the laws of motion, some problems are much more easy to solve in terms of the conservation of energy.

Which brings me to the "other hand" part: since the different framings are functionally equivalent, I'm not sure I could call any of them "better" than the rest. But one criteria did come to my mind: generality. The principle of conservation of energy seems to come up in many more diverse areas of physics than equivalent statements in other framings. In the same way I feel that the cost/benefit point of view is more generic than risk and reward. It's more useful to get the "rules" right in this system, and then take a look at other points of view. (In a vaguely similar way, we tend to use conservation of energy as a "check" on theories formulated in other terms.)

In a kind of conclusion, yes, we can express any economic theory in terms of risk & rewards, but it's not really useful to do it except in *some* of those cases where nondeterminism is a crucial feature* that needs to be analyzed in detail. I'm not convinced that the "function of society" is in this class of problem. (Though I admit that even though it might not be very useful, it might be lots of fun...)

(If you'll tell me that everything in economy is uncertain and subject to risk, I'll point out that we don't use quantum theory and relativity in the vast majority of physical problems we solve, and for good reason.)

Re:Primary Function? - Re: Rational agents (1)

bodan (619290) | more than 6 years ago | (#23628413)

Most people value fairness and reciprocity over personal profit.

These nine words are exactly why I don't buy the "people aren't rational agents" counter-theory---and the more general "economists are silly" argument. It's plainly self-contradictory: If people _value_ X more than Y, isn't it plain silly to say they're irrational because they choose X over Y, just because we labeled Y a priori as "profit"?

The basic tenet of market theory is that nothing has value by itself. The value of X is just what some agent is willing to give in exchange for it, *no*matter* what the motivation is. Of course that changes from person to person, context to context and time to time, which makes it a very hard to reason about. So economists make some simplifying assumptions, do some experiments, and when the results don't match their expectations they draw the conclusion that people are irrational. The never-challenged assumption is that the economists are rational when applying the theory to the experiment, which is of course debatable. A couple of examples:

1) Fairness. Just as you mentioned, we are in a cooperative context (society), which makes fairness *valuable*by*definition, because people are willing to trade money for fairness. There's nothing irrational about except the experimenter's assumption that unfairly little money is better than no money at all + fairness.

(OK, so you want to know *why* people value fairness in those split-money experiment, and why the experimenter is in fact wrong when judging them irrational? Because the latter forgot that money *also* don't have intrinsic value. If my parter in the experiment leaves with significantly more money than I do, this causes a measure of inflation: after we leave the experiment he is willing to pay more for X than I am, which rises the price of X, so I might not be able to obtain it. (For an arbitrary X.) Thus, if I refuse to accept an unfair split, we're both broke, but the price of X is lower because potential buyers have less money in aggregate.

Consider the more generic problem of fairness. Why do we have some punishments *above* the exact "reparation value" for some crimes? There isn't any direct value in taking resources from X and giving them to Y (or even to the government). Worse, X might go bankrupt and be prevented from further contributing to the economy. If X is jailed, the society as a whole actually pays to feed them, instead of letting them fend for themselves. You might not agree, but I think there *is* a point to such waste, and that's prevention. A certain society might miscalculate the exact value of that benefit, true, but the simple idea of spending money to keep ex-criminals in jail---even those we don't consider future risks!---is not intrinsically irrational: it might prevent other crimes by people who don't want to go to jail.)

2) Instinct. There is much discussion of how people's decisions are affected by "irrelevant" and misleading facts; see for instance the "1 dead out of ten" is bad but "9 saved out of 10" is good, or how people make "irrational" decisions based on hunches, popularity, etc. Well, the hunch and the instinct is clearly irrational (i.e., we can't always give a reason), but *making* the decision might well be rational. The experimental fallacy here is (I think) forgetting that "reasoning before a decision" always has a cost. To make what economists usually call a "rational" decision costs time (you need to find out how things work, why, etc) and/or risk (you might not be smart enough to reach the best decision anyway). On the other hand, taking an "instinctive" decision is cheap in time (so you can dedicate your reasoning time to the meta-game of making many more instinctive decisions) and efficient risk-wise: crowd wisdom *does* exist, otherwise we wouldn't live in a society, and "instinctively" we tend to follow the opinions of those who we think "know better". (Whether or not we pick *those* persons correctly is another decision, so we're back to square one.) Also, as is often observed, instincts formed for a reason. It is also observed that those reasons *might* not be valid anymore, but (a) it's hard to decide how often that happens and (b) they work pretty well often enough to make using them reasonable.

Note that neither "reasonable" nor "rational" mean "correct". It's perfectly possible to always make rational decisions and loose, for instance at Poker. To continue this analogy, economists who watch someone accept pot odds lower than his hand's odds of winning would decide they're irrational, ignoring (a) that they might be bluffing or (b) that they might think the opponent is bluffing or (c) that every player might be playing several other games at the same time, and accurately judging the odds sometimes takes too much time, or (d) that he might have made an arithmetic error (betting too much because you think your rabbit foot's lucky is irrational, bet betting too much because you made an error dividing 731 by 237 is not), or (e) he places more value on occasionally winning a round with a ridiculously bad hand than on the money (e.g. because he's very rich, the stakes are low, and he loves to tease his friends), etc, etc.

In short, the guy might loose the hand, or the game, but that doesn't necessarily mean that he's irrational.

* * * * *

OK, so what I'm trying to say is that market theory is based on true premises, but that market theorists sometimes forget them.

The basic premises are as far as I can tell:
(I) The value of anything is no more nor less than the most of what someone else is willing to exchange for it.
(II) In a free market people make exchanges, trying to maximize their profits and minimize their costs.

That's it. The wrong parts of economy come up when people partly forget those principles. Common errors:

a) Some things you can't buy at any price, so they're infinitely valuable. - No, they're just priceless, i.e. their value is undefined. (But you usually *can* buy them, though sometimes not with money; see point [c].)

b) Some things you can get for free, so they have no value. - No, you're probably forgetting to count some cost. The air you or your car is breathing costs at least the risk that you won't have air in the future.

c) You can't buy friendship or love. - You might not accept to pay money for it, but that doesn't mean it's value is zero: you're probably trading companionship, time or pleasant emotions with friends and lovers.

d) People aren't working towards their self interest. - Yes they are, they just have different interests than you (or even they) think. (E.g. if X says they are pro-choice but they vote a pro-life person doesn't mean they're working against their self interest. They're trading their "pro-choice-ness" for something else they expect their vote to get, including possibly release from their hidden guilt over aborted babies.)

e) People work towards their self interest, so a free market leads to the best (or most efficient) allocation of resources. -- No, it's not that simple. 1) You can work in your best interest (i.e., try) but at the same time distance yourself from it (i.e., fail); this is because knowledge can't be infinite, so you're always going to have to take chances. 2) Even if you did have a lot of knowledge capacity, the market only becomes asymptotically "perfect" if it's competitive, which is much less trivial to ensure than it looks, and if friction (cost of relocating & exchangi value) is very low, which it rarely is. 3) Since everyone has a different interest (i.e., their own), it's not even that well-defined what the "best allocation of resources" means.

f) Because of point (e), market theory and free markets are useless. -- No, that's not right either. Real-life approximations of free markets don't give the "best conceivable" results, but that doesn't mean that there are better alternatives. (In fact, given the constraints of real-life, there very probably aren't.)

g) Money are an absolute measure of value. -- No, they aren't. They're just a proxy of it, an abstract item used to facilitate exchange. Remember that value is *defined* as what someone is willing to exchange for something. The value of money is a complicated "average" of many, many exchanges. See "monetary policy", "exchange rate", "inflation".

h) Any value can be expressed in money, at a certain point at least. -- Well, no, not even that. If you look closely at the definition of value, you'll see that it's not a "measure" in the mathematical sense; it's not an ordering, and not even a preorder mathematically. Someone could be willing to exchange A for B and B for C but *not* A for C, as far as the definition of value goes. In general, it doesn't have to be reflexive, transitive or total.

i) Because of (g) and (h), money is a silly invention. -- No, it's not. You can't generally use a spaceship to go to the toilet, but that doesn't necessarily mean that a spaceship is useless as a mode of transportation. In particular, money do facilitate a lot of exchanges.

j) So market theory is based on untrue premises, it is not right or correct, and the whole "science" of economics is more like pawing through entrails for a glimpse of the future. -- That's a bit inconsistent. Those quotes are silly when applied to the entire domain (though they would be perfectly reasonable when applied to some economists in particular): you know as well as I do that that's how science(*) works in general. We don't ever have the "true" premise or the "right" theory (what does that mean, anyway?) We just look around, try to guess the rule (call the result a "theory"), deduce what would happen if our guess is right -- and since the world is too big we make some simplifying assumptions at that -- and then check to see what happens. When it matches well enough, we use it again, when it doesn't we're back to guessing. The whole science-in-quotes things is usable only when the thing doesn't work as above, i.e. you can't ever check your guesses. It's true that in economy (and sociology, and psychology) it's very hard to do the testing part, but it's still... "sciency" ;)

(*: I don't quite include "math" as a science, because it doesn't have anything to do with the universe by itself. The statement that "math can be used to describe the universe" _is_ a scientific theory, however, and quite successful.)

k) Whenever it doesn't work, economists simply dismiss the anomalies. -- Yeah, well, so do anarchists, socialists, communists, royalists, capitalists, democrats, republicans, libertarians, doctors, priests, string-theorists, etc, etc. It doesn't mean that economics (or sociology) is a pseudo-science, it just means there are a lot of bad economists that take a lot of inaccurate theories too seriously. Sure, economic theories are often wrong. But all sciences from before Platon till after Einstein have been wrong, why would we expect perfection from economy?

l) Most people value fairness and reciprocity over personal profit. -- Oh yeah? Well then, try doing the "profit-sharing" game with ten million dollars in the pot. Do you know how many people would refuse 10% of it because it's unfair? I don't, but I'm sure it's much fewer than would refuse 10% of 100$. My theory is "all people put a certain monetary value ('personal profit') on fairness and reciprocity", and the relationship is very complicated. In this case I'd think most non-millionaires would accept the unfairness.

* * * * *

"Its primary purpose is not to explain, but to excuse the abuse of power."

Ah, come on, Spun, you know better than that. That's an even worst "scientific" theory than all the misinterpretations I listed above: this one is not testable.

Also, let's say I admit everyone else in the world are miscreants that aim only to erode the human spirit with insidious theories. There's just me and you who have a disinterested debate:

Do you agree with the two basic premises I laid out above, and with the way I applied them in the analysis of common economic fallacies?

Re:Primary Function? - Re: Rational agents (1)

spun (1352) | more than 6 years ago | (#23629087)

You are redefining things to suite your argument. You are conflating the errors in the 'science' of economics with the errors in other sciences, when there are differences in orders of magnitude between say, physics, and economics.

I refuse to accept your interpretation of the split money experiments. No one thinks their choices are going to affect inflation, that is ludicrous. The fact is, people act against their own self interest to enforce fairness, and you can redefine words in order to 'win' the argument, but that means nothing.

Self interest is not the same as "what I want to do in the moment." People always do nothing more or less than what they want to in the moment. That is not always in their self interest. By your logic, someone committing suicide is acting in their own self interest. That is a laughable interpretation of the phrase 'self-interest.'

I agree with your first premise of value. I don't agree with your second premise. People do not always attempt to maximize profit or minimize cost, unless you are willing to stretch the definitions of those words past the breaking point.

That is my main point: people value other things far more than profit. People value fairness and reciprocity and are motivated to take a personal loss in order to create and enforce fairness and reciprocity. While this is good for society, it goes against individual se3lf interest.

a.) agreed, but pointless. What is the importance of this observation, or its relevance to the discussion?

b.)Ugh. redefinition of commonly accepted words in order to further a market based world view.

c.)More of the same.

d.)More of the same. Self interest has a commonly accepted meaning, and it isn't "What I want right this second." See my comment regarding suicide.

e.)Ignores many other market failure modes such as imbalance of information, natural monopoly, and externalities.

f.) Holy crap, what a stretch. Again, you are ignoring common market failures. Do you know there is a fairly simple algorithm, an extension of the "You cut I choose" method of dividing cake, that is extensible to an arbitrarily large set of actors and resources? It is provably better than market allocation, and that is just the first counter example that springs to mind. To say nothing is possibly better than the market is just crazy fanatacism.

g.) Who thinks money is an absolute measure?

h.), and i.) agreed.

j.) What are you actually saying here? It looks pretty ambiguous.

k.) economics is wrong an order of magnitude more often, and economists ignore data far more often than in other sciences. Yes, all science is fallible, and all theories are temporary, but that does not excuse the unscientific nature of economics.

i.) these games were done in India, and the pots contained, on average, many months worth of pay. Interestingly, the more money at stake, the more likely people were to refuse outrageous offers, not less.

My theory is testable. It makes certain predictions. For instance, economic research that contradicts the world view of those in power will not be reported. That is happening. Next, economists will be caught falsifying data or manipulating research more often than in other sciences. Check. So right there, we have falsifiability, and my theory is scientific, though perhaps not correct.

Do you agree that it is possible to abuse a purely free market system? Do you agree that the free market can be used to manipulate the free market? If value is only what people will pay, then having more money gives you more control over value, doesn't it?

Function of Society (1)

Morosoph (693565) | more than 6 years ago | (#23565783)

The primary function of society is the sharing or mediation of risk and reward. Thoughts?

Society is. We create society in the same way that water molecules generate waves. If society has a function, it has as little to do with humans as the function of waves has to do with water molecules.

We can attempt to steer society though laws and norms, although in doing so, we're quite likely to find our natural interests usurped by "memes". Still, it is reasonable to call a least-effort system of arbitration "natural law". Society might not have a (human) purpose, but that doesn't mean that we can't work with its grain for the benefit of mankind any more than we can't sail the seas.

Sometimes we need to sail against the wind, which typically involves tacking to the left wing, and the right. More usually, society overwhelms its component individuals, and you end up with growing authoritarianism as the structures of society (hierarchy, blind norms) overwhelm individual reason... Society's interests, if it has them, are the perpetuation of strengthening of such arbitary forms.

Re:Function of Society (1)

TuringTest (533084) | more than 6 years ago | (#23567641)

Somehow, your post has reminded me of Solaris [] . Society seen from the outside, as you describe it, seems as weird as an alien living world.

Solaris (1)

Morosoph (693565) | more than 6 years ago | (#23568363)

Interesting. I have intended to see Solaris since a friend raved on about it, but never got around to it.

I paid dearly for my view of society, since a few years ago, I went to see a therapist who was a bit of a trendy lefty. After I told have that the golden rule doesn't work "because different people want different things", and generally not seeing that things were a particular way "for a (good) reason", he took me for being a sociopath (I now have a diagnosis for Asperger's syndrome), and proceeded to undermine me - and therefore my confidence to challenge him - over several years until I sufferred a catastophic breakdown.

I now summise that he didn't have the intelligence to overcome society within him, and so (intending the best) merely became an enforcer of conventionality. Although I am now less influenced by Nietzsche nowadays, I can understand his "letzte Mensch"; the last man, who is a product of evolution very well now.

Re:Solaris (1)

spun (1352) | more than 6 years ago | (#23570237)

Oh fuck. Worst possible outcome to therapy. One of the most cogent criticisms leveled against the field is exactly that: the aim of therapy is not to get you healthy and free, it is to make you fit in.

The other most cogent criticism is that the field is based on abnormal psychology, the psychology of damaged individuals, rather than the psychology of healthy and free individuals. Those two criticisms were what the humanist psychologists such as Maslow tried to fight against.

Perhaps not "primary" (1)

johndiii (229824) | more than 6 years ago | (#23565859)

I'm not sure about "the primary", unless one defines risk and reward very broadly, but it certainly is an important function. I would generalize a little further, and say that the primary function of society is to provide infrastructure (of which risk and reward sharing is a part). The more economic power a society has at its disposal, the better the infrastructure is - and the more free the members of the society are to follow their own ideas.

At tension with that freedom (as I suggested in my reply to o1d5ch001), are power brokers. They depend on being able to wield large groups as instruments of personal power. Nearly all power is personal in essence, in my opinion, because someone, or a small group, has to make the decisions. The larger the decision-making entity, the less effective the decisions. Even exercised toward good ends, such power will eventually act pathologically on a free society.

Re:Perhaps not "primary" (1)

spun (1352) | more than 6 years ago | (#23570375)

If infrastructure is seen as 'physical plant that is shared," then we are talking about the sharing of reward and the decreasing of risk, as infrastructure is itself a reward of labor and a tool to mitigate risk.

Primitive humans 'worked' about four hours a day, but they had no surplus and next to no capacity for mitigating risk. You either did well or you starved. Now, we work longer hours but we have a huge investment of shared rewards built up.

While I agree that larger decision making bodies are inherently less efficient, there are general principles which can decrease that inefficiency. Free flow of information up and down the decision making chain is one key. This implies complete transparency.

Another key is enforcement of responsibility. If one is making decisions for a large group, one must be prepared to shoulder the responsibility for one's decisions. If the people a leader represents have no power to punish poor decisions, the system rapidly fails.

A final key, in my opinion, is a complete social safety net. Without this, even non sociopaths will act selfishly, attempting to hold on to positions that have outlived their usefulness. This leads to vast inefficiencies. If people knew they would be safe even if they voluntarily gave up their positions and power, they would be less reluctant to do so when the time inevitably comes when a position has outlived its usefulness.

Hmmmm. (1)

SatanicPuppy (611928) | more than 6 years ago | (#23570171)

Well, certainly risk. We're communal animals, and communal animals form social groups because the group provides a competitive advantage...When you get attacked by a tiger, it's a lot better to have a couple of friends nearby with pointy sticks.

Likewise the group allows for diversity and specialization. Thag, who can't throw a spear to save his life, but who is a top notch spear maker, can focus on spear making and be fed by his customers.

I can see that situation as a type of reward; certainly my life is better because I can use my brain rather than being forced to live off my muscles. But I think, in the end, that that reward is incidental to the mitigation of risk, same as with the reward of offspring...It just happens that the safety of the individual makes offspring more likely.

Otherwise, human nature being what it is, most people seem to spend their time trying to capture rewards for themselves, at the expense of their neighbors.

Re:Hmmmm. (1)

spun (1352) | more than 6 years ago | (#23571153)

Would you say then that the sharing of reward is for the purpose of mitigating risk?

Human nature is not static. It is malleable and dependent on circumstance. Broadly speaking, when people are motivated primarily by fear, they act selfishly. Society currently creates individuals motivated primarily by fear. But it can also create individuals primarily motivated by love, and these types are cooperative.

There are two stable modes for society, and it is hard to switch between them. One is what I like to call the culture of famine, the other is the culture of the feast. But just because it is hard to move from one to the other does not mean that one is "natural" and the other is not.

No, it's to maximize viable offspring (1)

An Onerous Coward (222037) | more than 6 years ago | (#23616659)

From an evolutionary standpoint, I think that society has the described effect, but only as a stepping stone to reproductive success. But I'd personally like to see us wrest control from evolution, and start pursuing beneficial forms of collectivism for their own sakes.

I was listening to a discussion about the implications on happiness research on public policy. Of course, in order to achieve "balance", KQED had this right-wing shill [] on. If his ideas weren't a dead giveaway, Amazon relates him to Jonah Goldberg, Dinesh D'souza, Thomas Sowell, and climate inactivist Roy Spencer. Anyhow, he was constantly pointing to the 'uniquely American' desire for personal liberty. Apparently, we Americans so love our personal liberties that the happiness that would come from a German-style system of 6 weeks vacation a year is nothing compared to the unhappiness that would come from having such a thing mandated by the dreaded government. Same went for health care. We would be so distraught at paying more taxes that the happiness gained by 40M Americans who could now afford health care would be a trifle by comparison.

In his mind, the government cannot do anything to increase anybody's happiness, except by stepping aside. Which, to me, is like saying that if society does mediate risk and reward, then we could do with a lot less society.

Looking at who American society tries to reward and to protect from risk these days, he may well be on to something. Our electoral system seems designed to protect incumbents from the whims of the public, else why would the 2006 election (in which about 6% of seats changed hands) be described as a political tsunami? The wealthy are protected from most of the consequences of the actions that corporations take in the name of making money. It is virtually impossible to revoke a corporate charter, no matter how grievously it abuses the public trust. Finally, capitalism assures that the whims of the fortunate few carry more economic weight than the grinding needs of the many.

To some extent, this has always been one of the downsides of society. The more successful few could get the many to do a lot of work for their benefit. Exhibit A: the pyramids. It raises questions of what scale of society can best respond to human needs, but I don't see a clear pattern. The FLDS society (the ones who have been all over the news in the last few months) is a tiny group of a few thousand, but is run autocratically, to the detriment of the participants. Other societies of millions seem to do a pretty good job of responding to the desires of the public (I'm thinking mostly of the Northern European countries). But I've heard convincing arguments that a society as culturally and geographically diverse as America's is largely ungovernable.

But getting back to your point, I think you're on to something. With a band of hunter/gatherers, you can assume that hunting success was highly variable, and the consequences of failure were enormous. But the collective success of, say, twenty hunters would be much more predictable. Add in language, and one person's discovery of a new resource (a water hole, a good hunting site, or a vent of vespene gas) would be transmitted to the whole group, conferring survival advantages on everyone. We even got to the point where some could give up hunting altogether, and specialize in other skills, knowing that society would protect them from starvation.

I think it's possible to go too far with protecting people from risk. The cries of "nanny statism" are mostly overblown, but there are times when mediating risks will lead to more risky behavior. I think it should mostly be used to shore up areas where our individual decision making isn't sufficient. Take John McCain's "health care plan." He claims that if you expose people to more of the cost of their own health care (pretty much the opposite of medical insurance), they're more likely to avoid expensive, unnecessary procedures. But the studies seem to indicate that people are very bad at discerning what is and is not medically necessary, so people are almost as likely to delay necessary procedures as unnecessary ones.

We're also very bad at estimating the future value of long-term efforts. People, left to themselves, tend to underinvest in retirement. Hell, given the choice between a dollar today and two dollars in a week, a surprising number of people will take the dollar. We're hard-wired to grab while the grabbing is good, or a tiger will come along and eat the animal we hunted. Try explaining to a libertarian why we might want to leave some oil or trees or fish for people as few as five generations hence, and you run into the same sort of thinking.
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