Need != right was a really interesting insight. In all honesty, I know very little about communism, so I'll definitely need to give this another read after I read Rand.
What other beliefs of yours did this book change? I'm really interested in that.
Been a while since we talked. First off, I enjoy reading your blog. I’m highly grateful that I can keep up with you as you cross intellectual, professional, and personal cornerstones. Your blog helps me reflect on where I am in my life, and your posts are always abundant with nuggets of wisdom. Thanks for keeping me and everyone else who reads this in the loop.
I wanted to say a few things to which I hope you get the chance to give some thought.
The rational individual model is the essential assumption of neoclassical economics, as everyone knows. However, it has become recently clear from literature in the past few decades, including from outside of the economics field, that there may be flaws to this assumption. Rational individualism, as theorized in concepts within rational choice theory and social choice theory, is a tool used to explain actions taken up by an individual in a circumstance where material gain or loss is forthcoming. However, it has moral underpinnings that are inherent and undeniable, with cultural roots in the West that can be empirically and historically observed, from Oscar Wilde to Robert Owen and other developments in 18th and 19th century literature and philosophy. Economists, and to some extent psychologists, are predisposed to the tendency to forget this when theoretical arguments are made about individuals, which are then used to reinforce other ideologies about human nature. The traditionally “non-economic” facets of individualism are neglected when economists conduct controlled experiments to illustrate ideas such as free riding and other game theoretic truths, which are true in a vacuum. While the mathematically-proven experimentation has contributed much to the understanding of the individual and legitimacy of the field, they hold very little merit when the area of economic interest becomes intertwined with highly complex factors such as the state, the international community, and path dependence. The study of groups, as well as ethnographies of non-Western communities (Sub-Saharan Africa, for instance), exposes different paradigms that govern individual behavior: not just the self-interested wealth-maximizing behavior we are used to bearing in mind in our ideas of the person.
The primacy of Western individualism as an explanation of human nature makes it easy to draw the line between unbridled rational individualism and the belief that we are all in a better place than we used to be and thereafter extend that to a morally virtuous idea of what capitalism is, when in reality, it aggregates the most amount of wealth to a very, very small (less than 49%) amount of people when left willfully unwatched. Global inequality can be directly attributed to the Gilded Age and Industrial Revolution, when ideas of communism were first being formulated. To morally elevate things tied to self-interest, which we now know is an incomplete explanation for the behaviors of people and relative across geographical and cultural contexts, and its related manifestations including achievement, wealth aggregation, and so forth, can be arguably seen as egregious when you profit not only from your labor but the system from which you were allowed to prosper. As you said, your geography largely determines your destiny: not just your physical locus or passport but also your geography in relation to power, culture, and predisposition to economic fortune. While these things are out of your control, you can’t call an ideological departure from capitalism evil, just as you can’t call capitalism good, and especially not just because the Soviet Union was a murderous dictatorship that failed to operate in the context of a capitalist global economy.
I too think we should be glad to live in a time of unprecedented abundance. While it happened by the “labor and smart decision making of our ancestors,” the labor which built the first modern infrastructure exploited the people who labored in the best case scenario, the worst case being that they were slaves. That’s why we got communism in the first place. We inherited that as much as we inherited anything else we can be thankful for, if not more, because we inherited first along the continuum of time.
Rights are not real facts of life, and deep down we all know this. They are created and propagated by the world’s most formidable international organizations and nation states out of necessity, because global capitalism yields no graces unto the bottom portion of benefactors from the system. Giving people rights is indeed inherently arbitrary (despite the argument of some universalists), based various degrees of necessity across multiple spectra, but calling it “mooching” is entirely misguided and ignorant of the reality of our world.
I recommend reading about Ubuntu, the relations ethical paradigm from Southern Africa, including the tribal ethnographies and ethical papers that are out there. Also, the The Great Transformation
by Karl Polanyi is, in my opinion, a fascinating read for anyone interested in economics.
Feel free to text and call if any of what I said is unclear. I want to be sure that I understand your point of view completely and that mine makes sense. Anyway, I’d like to catch up with you sometime.
Wishing you a restful and serene end of the year, and sending love from the Low Countries.
Adrian! Well written man. I would like to read more of your posts if you wrote blogs.
Lot to answer...
1. "Rational Econ Man"
I agree this model is flawed. We learned it in college and it didn't seem to make any sense to me. When I said rational, my meaning was "self interested."
Sure different people have different interests, but is it not fair to say that a sane person should put their self first? I would challenge that even the person who "puts others first" does it because it makes himself feel good. (For more on that idea you might like the book Awareness by Anthony DeMello)
2. Capitalism creating Wealth inequality
This makes sense to me. And it does seem like a problem. But I'm still not sure I agree with penalizing high performance.
But even so, like Naval says, ultimately true wealth creation makes everyone richer. Everyone in the world is richer because Steve Jobs created the iPhone, not just Steve and Apple. Or if you fly on an airplane between North America and Europe, you are automatically 100x richer than your ancestors who came on a boat, thanks to the hard work and ingenuity of the people who came before you.
3. Capitalism good?
I would call capitalism good because on the whole it promotes innovation. And that's what's accelerated the world out of poverty. And so the idea that capitalism creates inequality is a funny one. Because capitalism is what created the wealth in the first place.
Does that mean it's perfect, probably not. (see wealth inequality), but I'm certain it's the best economic system we've ever had and any system that focuses more on dividing the pie than growing it is destined to fail.
Happy to read any texts or essays you wanna send me via whatsapp, thanks for the challenge man.
Very good points, couldn't agree more with all three. This is a pretty hot discussion right now for those in our age bracket, and I find there's always a lot to unpack every time it comes up. The topic of self-interest never ceases to interest me as well. Thank you for pointing these things out.
And as always, thank you for the reading suggestions!
Need != right was a really interesting insight. In all honesty, I know very little about communism, so I'll definitely need to give this another read after I read Rand.
What other beliefs of yours did this book change? I'm really interested in that.
And P.S, sorry about the girlfriend situation!
Hi Connor,
Been a while since we talked. First off, I enjoy reading your blog. I’m highly grateful that I can keep up with you as you cross intellectual, professional, and personal cornerstones. Your blog helps me reflect on where I am in my life, and your posts are always abundant with nuggets of wisdom. Thanks for keeping me and everyone else who reads this in the loop.
I wanted to say a few things to which I hope you get the chance to give some thought.
The rational individual model is the essential assumption of neoclassical economics, as everyone knows. However, it has become recently clear from literature in the past few decades, including from outside of the economics field, that there may be flaws to this assumption. Rational individualism, as theorized in concepts within rational choice theory and social choice theory, is a tool used to explain actions taken up by an individual in a circumstance where material gain or loss is forthcoming. However, it has moral underpinnings that are inherent and undeniable, with cultural roots in the West that can be empirically and historically observed, from Oscar Wilde to Robert Owen and other developments in 18th and 19th century literature and philosophy. Economists, and to some extent psychologists, are predisposed to the tendency to forget this when theoretical arguments are made about individuals, which are then used to reinforce other ideologies about human nature. The traditionally “non-economic” facets of individualism are neglected when economists conduct controlled experiments to illustrate ideas such as free riding and other game theoretic truths, which are true in a vacuum. While the mathematically-proven experimentation has contributed much to the understanding of the individual and legitimacy of the field, they hold very little merit when the area of economic interest becomes intertwined with highly complex factors such as the state, the international community, and path dependence. The study of groups, as well as ethnographies of non-Western communities (Sub-Saharan Africa, for instance), exposes different paradigms that govern individual behavior: not just the self-interested wealth-maximizing behavior we are used to bearing in mind in our ideas of the person.
The primacy of Western individualism as an explanation of human nature makes it easy to draw the line between unbridled rational individualism and the belief that we are all in a better place than we used to be and thereafter extend that to a morally virtuous idea of what capitalism is, when in reality, it aggregates the most amount of wealth to a very, very small (less than 49%) amount of people when left willfully unwatched. Global inequality can be directly attributed to the Gilded Age and Industrial Revolution, when ideas of communism were first being formulated. To morally elevate things tied to self-interest, which we now know is an incomplete explanation for the behaviors of people and relative across geographical and cultural contexts, and its related manifestations including achievement, wealth aggregation, and so forth, can be arguably seen as egregious when you profit not only from your labor but the system from which you were allowed to prosper. As you said, your geography largely determines your destiny: not just your physical locus or passport but also your geography in relation to power, culture, and predisposition to economic fortune. While these things are out of your control, you can’t call an ideological departure from capitalism evil, just as you can’t call capitalism good, and especially not just because the Soviet Union was a murderous dictatorship that failed to operate in the context of a capitalist global economy.
I too think we should be glad to live in a time of unprecedented abundance. While it happened by the “labor and smart decision making of our ancestors,” the labor which built the first modern infrastructure exploited the people who labored in the best case scenario, the worst case being that they were slaves. That’s why we got communism in the first place. We inherited that as much as we inherited anything else we can be thankful for, if not more, because we inherited first along the continuum of time.
Rights are not real facts of life, and deep down we all know this. They are created and propagated by the world’s most formidable international organizations and nation states out of necessity, because global capitalism yields no graces unto the bottom portion of benefactors from the system. Giving people rights is indeed inherently arbitrary (despite the argument of some universalists), based various degrees of necessity across multiple spectra, but calling it “mooching” is entirely misguided and ignorant of the reality of our world.
I recommend reading about Ubuntu, the relations ethical paradigm from Southern Africa, including the tribal ethnographies and ethical papers that are out there. Also, the The Great Transformation
by Karl Polanyi is, in my opinion, a fascinating read for anyone interested in economics.
Feel free to text and call if any of what I said is unclear. I want to be sure that I understand your point of view completely and that mine makes sense. Anyway, I’d like to catch up with you sometime.
Wishing you a restful and serene end of the year, and sending love from the Low Countries.
Adrian
Adrian! Well written man. I would like to read more of your posts if you wrote blogs.
Lot to answer...
1. "Rational Econ Man"
I agree this model is flawed. We learned it in college and it didn't seem to make any sense to me. When I said rational, my meaning was "self interested."
Sure different people have different interests, but is it not fair to say that a sane person should put their self first? I would challenge that even the person who "puts others first" does it because it makes himself feel good. (For more on that idea you might like the book Awareness by Anthony DeMello)
2. Capitalism creating Wealth inequality
This makes sense to me. And it does seem like a problem. But I'm still not sure I agree with penalizing high performance.
Side note, we'll probably see an acceleration of this because of technology, check this out: https://www.navalmanack.com/almanack-of-naval-ravikant/find-a-position-of-leverage
But even so, like Naval says, ultimately true wealth creation makes everyone richer. Everyone in the world is richer because Steve Jobs created the iPhone, not just Steve and Apple. Or if you fly on an airplane between North America and Europe, you are automatically 100x richer than your ancestors who came on a boat, thanks to the hard work and ingenuity of the people who came before you.
3. Capitalism good?
I would call capitalism good because on the whole it promotes innovation. And that's what's accelerated the world out of poverty. And so the idea that capitalism creates inequality is a funny one. Because capitalism is what created the wealth in the first place.
Does that mean it's perfect, probably not. (see wealth inequality), but I'm certain it's the best economic system we've ever had and any system that focuses more on dividing the pie than growing it is destined to fail.
Happy to read any texts or essays you wanna send me via whatsapp, thanks for the challenge man.
Very good points, couldn't agree more with all three. This is a pretty hot discussion right now for those in our age bracket, and I find there's always a lot to unpack every time it comes up. The topic of self-interest never ceases to interest me as well. Thank you for pointing these things out.
And as always, thank you for the reading suggestions!