Fiction and Factional Rage

One thing I often ruefully talk about on this blog is that getting people to cooperate and work well together is - obviously - hard. Yet working out incentives to get people to cooperate and flourish together is perhaps the central question we face as a society. The institutions of trust and cooperation and motivation that underlie the economy are of fundamental importance, and may fray or change as the economy evolves. That is an issue we duck when we talk about the economy just in terms of the latest data.

Adam Gopnik takes issue in an online New Yorker post with claims that an appreciation for fiction make people more likely to behave well:

And if these claims seem almost too large to argue, the more central claim—that stories increase our empathy, and “make societies work better by encouraging us to behave ethically”—seems too absurd even to argue with. Surely if there were any truth in the notion that reading fiction greatly increased our capacity for empathy then college English departments, which have by far the densest concentration of fiction readers in human history, would be legendary for their absence of back-stabbing, competitive ill-will, factional rage, and egocentric self-promoters; they’d be the one place where disputes are most often quickly and amiably resolved by mutual empathetic engagement. It is rare to see a thesis actually falsified as it is being articulated.

(h/t Arts and Letters Daily)

 

Too much happiness in Berkeley?

Can too much happiness be bad for you? Yes, says a Berkeley researcher:

 

But how exactly can we attain a healthy dose of happiness? This is the million-dollar question.

First, it is important to experience happiness in the right amount. Too little happiness is just as problematic as too much. Second, happiness has a time and a place, and one must be mindful about the context or situation in which one experiences happiness. Third, it is important to strike an emotional balance. One cannot experience happiness at the cost or expense of negative emotions, such as sadness or anger or guilt. These are all part of a complex recipe for emotional health and help us attain a more grounded perspective. Emotional balance is crucial.

 

What is the Economy for, Anyway

Here's a book I wanted to like, but just couldn't -What's the Economy For, Anyway?: Why It's Time to Stop Chasing Growth and Start Pursuing Happiness by John De Graaf and David Batker. It's one of those books which asks some of the right questions, but doesn't get very far with answers. They say in their introduction:

The authors of this book have been activists for reforms that, in their minds, would make the United States a more livable, just and sustainable society. ..And yet, for any economic, environmental or social improvement either author has suggested, there seems to be a common rebuke: What will that do to the economy?

.. In our view, there is a question that should take precedence over What will that do to the economy. It's the question What's the Economy for, Anyway? .. Successful economic policy in this country requires attention to non-economic values such as quality of life, fairness and opportunity.

So far, so good. And they have a good first chapter which discusses the limitations of GDP as a measure of activity (let alone welfare), which I - and indeed most economists - would agree with. I remember reading plenty of doubts about GDP even when I did economics in the late 1980s.

They talk about the development of national income accounting by Kuznets in the 1930s. And they talk about a recent scheme which was included in the Obamacare bill, "Key National Indicators System (KNIS)" which I hadn't come across, but should look at.

I also agree with their emphasis on time shortage and time balance as a key problem in modern Western economies, especially the US. Intriguingly, they suggest that one of the main explanations Western Europe and the US diverged on working hours since the 1960s was not so much higher taxation in Europe, as Nobel-winning economist Edward Prescott argues.

Instead, they say, the US made a conscious decision starting in the Kennedy administration to promote increased production rather than increased leisure because production had defense benefits during the cold war, and shorter working hours did not. They argue the AFL backed down on a 35 hour workweek in 1963 because of Kennedy Administration opposition. ( p103) Europe had more ability to turn increased productivity into shorter hours because of the US defense umbrella. I suspect this is a bit too conspiratoriial to be true, but it is worth some attention.

But the rest of the book turns into a cartoonish and partisan argument between what they call "nineteenth century laisez-faire" and noble progressives who want a more European-style social democratic state with more government regulation and higher taxation. They tick all the standard liberal boxes - more egalitarian redistribution, single-payer healthcare and stronger unions, even high-speed trains. It reads like a Democratic Party activist platform rather than an original take on the issue.

I just feel these arguments about laissez-faire versus regulation are stale and outdated. The deeper issue is technology is altering possibilities. We can't go back to the progressive era of Theodore Roosevelt, even if we wanted to.

It is true, as they argue, that the economy ought to be ultimately about life, liberty and the pursuit of happiness. But one look at Europe this week ought to tell us that their favored continental social democracy and the unfettered welfare state has its own problems. The left tends to be blind to the problems of legitimacy and negative incentives created by its policies.

They are right to question the more extreme versions of laissez-faire and libertarianism. But I don't really believe many people hold to that quasi-nineteenth century view any more, outside Ayn Rand admirers. Progressivism was necessary at one stage in history. Anti-trust laws, child-labor laws, deposit insurance, even the EPA were all necessary advances over robber baron gilded age capitalism. But the next stage of evolution of the economy is going to require different thinking. And we won't find it in this book at all.

 

How American Culture has changed (or not)

So we live in an age where you can stream live kitten play around the world.

But it is possible to exaggerate how much society has changed - or at least how much American society has changed. That is the conclusion of a fascinating history of American culture, Made in America: A Social History of American Culture and Character by Claude S. Fischer. It is serious social history, an attempt to draw together immense amounts of research into letters and diaries and archives from the past. The footnotes alone run to 102 pages, almost half the length of the text itself.

He attempts to grapple with how Americans think and feel and group together over the last few centuries. And he says much of what we tend to believe is wrong. America has not become a more transitory, impersonal, selfish society. Toqueville still has a contemporary ring, after all.

Modernization theory, the story of transformation of feudal , rural intimate communities into impersonal industrial societies, does not really fit the United States. In many important respects, American character and culture has changed surprisingly little since colonial times.

Americans do not move residence more than they did in the late 1700s, he says. They have not turned away from religion. They have not become more violent (rather the opposite). They have not become more indifferent to the needy. The most fundamental difference, he says, is we have more of everything.

Consumption

Americans today may be entranced by consumer glitter, he notes, but so were Americans centuries ago. They may have been obsessed with ribbons or tea services and china instead of iPads and Prada, but the psychology was much the same.

In 1774, at least 42% of poor householders' estates included tea services. Americans consuming urges seem mo more compelling and their materialism no more acute now, compared to then. What mainly changed was the massive scaling up - the democratization of luxury. There were more goods and more Americans who could desire or acquire them.

Nor is a tendency to get overstreched on debt a new development. In the past, households turned to payday lenders to make it through the gaps to the next paycheck.

In 1890, the average household owed, including mortgage and consumer debts, about double the average household income; in 2007, even though credit was far easier to get, average debt was realtively lower, about 1.75 times average income. p82

Surely Americans are working more hours than they used to, because they want more material goods? Not true, he says. Americans work far fewer hours than their forebears did, especially if you count early retirement. Hours increased after 1970, but

.. a fair summary of the research is this: in the last few decades, individual American workers did not work more hours, but more American couples did. .. Changes in work time thus had much more to do with changing gender roles and with the economic insecurities of the era than with consumer desires. p84

It was not because of a more materialistic outlook in postwar years.

We do have more of eveything. And we underestimate how much life has improved, especially in terms of health. In the eighteenth century, Americans like George Washington were often in acute pain because of rotting teeth and other ailments. Parents saw many of their children die in infancy.

The life expectancy of an American newborn lengthened by about thirty years over the twentieth century - for white women, from dying at about fifity to dying at about eighty. p25

And our fiscal problems because of medicaid and medicare need to be seen in this light:

in 1900, Americans spent about twice as much on funerals as on medicine; by 1990, they spent about ten times as much on medicine as on funerals. p27

Driving, smoking and underexercising became the new health problems;

Illnesses of abundance had replaced illnesses of scarcity. p27

As I often argue, we have got so used to thinking of problems of scarcity that we find it hard as a society to think about problems of abundance.

All the same, Fischer doubts the Easterlin paradox is real: that wealth has grown in recent decades but happiness has not.

For all this debate, there is probably no paradox at all: in the last decades of the century, unlike generations before, average Americans did not really get much wealthier. National wealth grew, but the gains largely went to a top few. So why would we expect average Americans to get much happier? p238

He thinks that wealth on balance probably does make people happier. But there may be another paradox. Even as feelings of security and the predictability of life have increased in many ways, we may have become fixated on more abstract anxieties.

Some scholars contend that modern Americans have arrived at a "postmaterialist age". Secure in body, they now focus on the soul - on higher personal goals, such as self-improvement, and higher social goals, such as saving the environment.

.. There is a yet more pessimistic view of American's sense of security. The "age of anxiety" was a popular catchphrase in the years after World War II... Perhaps reducing the mundane risks of life made the remaining risks or emerging ones more fearsome. Will the stock market fall? Will the plane crash? Will the glaciers melt? Mass media may exacerbated worries... Material security, then, may have ironically produced an age of anxiety. p56-7

This is an interesting counterargument to some of the things I say on this blog - that our major challenge is to re-orient the economy towards more specific purposes that encourage human flourishing. What if we just become more and more worried instead about things outside our control? People think in many strange ways about risk. Perhaps we will over-demand insurance and security.

Instead of rising up the hierarchy of needs to "self-actualization", as Maslow thinks, making the most of our talents, we will get stuck and fixated on irrational fears.

I think there is a genuine cautionary warning here. We may not use abundance to our best advantage. Right back at the beginning of this blog, we saw Keynes had doubts about how society would cope once the economic problem was solved, as well. He thought society in general might have a nervous breakdown, like bored upper-class housewives in his own era.

One thing Keynes said is not a worry, however. He condemned the over-purposive man who lived too much in the future.

He does not love his cat, but his cat’s kittens; nor, in truth, the kittens, but only the kittens’ kittens, and so on forward forever to the end of cat-dom.

He never had a kitten cam.

Voluntarism

The biggest theme of Fischer's book, however, is he sees what he calls voluntarism as the central feature of American culture and character.

The first key element of voluntarism is believing and behaving as if each person is a sovereign indiviudal: unique, independent, self-reliant, self-governing and ultimately self-responsible. Free men of early America stressed the importance of attaining what they called "competency" or "virtue," the independence that came with having enough property to support a household on one's own. The second key element of voluntarism is believing and behaving as if individuals succeed through fellowship - not in egoistic isolation but in sustaining, voluntary communities.

Americans have the freedom to choose what communities they belong to. We expect to conform to community norms or organizational purposes while we are members. But we can also freely exit and join a different community. Easy to enter and easy to leave explains many American institutions, from the labor market to religious affiliation to the inclination towards contractualism.

Individuals make this implicit contract by joining the group: I am free to stay or leave, but while I belong I owe fealty to the group. One might also call this the "love it or leave it" rule. (p99)

This is very different to old world organic communities of blood and soil. And the story of American social history is how more and more groups have been brought into this voluntarist culture.

Where does that leave us? Human nature and human psychology don't change that quickly. But the circumstances of life have been transformed since colonial times. We have astonishing materialist abundance now. But we still have the same hopes and fears.

 

 

 

 

 

The Quarter Life Crisis

Here's an interesting site, which I found found from a intelligent comment on an earlier post. It explores the problems faced by young adults in their late twenties, applying some of the recent findings of positive psychology to issues like career choice and values. It looks like a serious attempt to grapple with an extremely important issue - beset by student debt, rapid economic change and changing social structures, young adults have a hard time.

One interesting thing I'd like to read as well is international comparisons. Are choices simply harder in recessionary times, or is there a broader international issue of "failure to launch" with deeper underlying problems? Japan has its herbivores, for example. Italy has its adults living at home well into their thirties.

 

Kitten Cam

If you're a network tv boss or hollywood mogul, you're probably worrying about where the next big hit is going to come from. Well, you've got new competition. By far the highest ranked show in our household this week - on for hours a day - is kittens! G loves this and I can hear mrowwrrrrrs and purrs coming from her computer all day, as she checks in on the latest kitten doings.

NBC, you might as well give up now.

 

Knowing how to do versus what to do.

One final word on Maslow. He believes it is important for science not to slide into scientism. He talks about people who mostly focus on ritual and protocol.

Without wishing to create an extreme and unreal dichotomy, it is still possible to point out a difference between those who know only how to do and those who also know what to do. These former individuals, of whom there are always a large number, tend inevitably to become a class of priests in science, authorities on protocol, on procedure, and, so to speak, on ritual and ceremonial. While such people have been no more than a nuisance in the past, now that science becomes a matter of national and international policy, they may become an active danger. p189

The interesting thing is this echoes one of the more famous distinctions between managers and leaders (see this HBR article by John Kotter). Managers make sure things are done right. Leaders think about what is the right thing to do. Managers keep to procedures. Leaders cope with change.

Organizations need both, of course. You need to make sure people get paid on time and inventory is accounted for and taxes get paid. But you also need to adapt to change and reinvent the business model from time to time.

Maslow would prefer to concentrate on answering important problems, rather than method or rigor or quantification. It is not the means that matters, so much as the ends.

Means centering tends strongly to overvalue quantification indiscriminately and as an end in itself... Means -centered scientists tend, in spite of themselves, to fit their problems to their techniques rather than the contrary.

We have discussed over the course of this blog how economics and psychology focused on means and method rather than important questions for much of the last three generations.

And in a larger sense, this is our problem with the economy right now. We have become transfixed on the means - income, formal jobs, monetary transactions - rather than the ends we want. We have highly sophisticated techniques for producing abundance.

But It is also important for us to know what to do. The means have to be related to the ends. Instead, as a society we don't tend to discuss the ends and the purposes.

As I see it, we have had far too much management of economy and far too little leadership on the economy. Our thinking simply hasn't adapted to underlying change.