Class, Status and Slime
I have literally spent years trying to reconcile the benevolent yet disorganized sentiments of socialism with the organized yet exploitative greed of capitalism, all because of a simple mistake made in the 18th Century.
In spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose ... be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society.
Adam Smith's "invisible hand" has been the justification of self-centered theft and acquisition for over two hundred years. The idea that the best way to advance the interests of society is to encourage individuals to follow their greed seems unassailable in modern times. Abandon greed, so the argument goes, and we abandon everything our civilization has achieved. But the argument is flat-out wrong.
Greed is not the only motive that can animate the hand.
I came to this realization by thinking about slime mold. In particular, I had been inspired by this story in the Economist. I don't know anything about slime mold and, as usual, I don't care to look it up. But I liked the pretty picture. I also liked the idea that something very complex (the development of British industry) could be modeled by something presumably simple (the growth of a mold). I don't have the technical skill and resources to model the British rail system. But I could very well have the technical skill and resources to model the growth of a mold. I'm likely to try it over the summer, as my winter schedule unwinds.
Here's my idea for a slime mold simulation. We start with a square grid, with a distribution of a variety of resources. I was planning on using my ecological simulation described here as a basis for the resource distribution. Each cell has a slime mold cell. The mold cell can do only 3 things: consume slime, produce slime and push slime to neighbouring cells. The quantity of slime a cell can produce and push is directly proportional to the "value" of slime the cell consumes. The "value" of slime is the product of the quantities of its constituent resources. In other words, you get a lot of value out of a small amount of "balanced" slime, but rather less value out of a large amount of unbalanced slime. The trouble is that the slime any given cell can produce won't be balanced, because its composition will be biased by the locally available resources. In other words, to get better slime, the cell must trade.
Now the cell can control how much slime it pushes to each of its neighbours, but cannot control the relative proportions of the constituents in the slime. This is problematic for the cell, because it wants to achieve as balanced a slime composition as possible. The mold cell will operate on a simple assumption, that if it gives more slime to one of its neighbours, then that neighbour will reciprocate with proportionally more slime of its own. To some extent this assumption should hold: the more slime a neighbour gets (even if it is low quality slime), the more capacity that neighbour should have to produce and push slime back. Building on this assumption, the mold cell will be able compute the marginal utility (in terms of slime quality) of pushing slime to each neighbour, and of producing its own slime.
Which brings up the "sticky" question of how much slime the cell should consume for itself. The standard greedy answer "as much as it can" isn't very useful, because it requires us to estimate the future costs and rewards of consuming more or less slime. Although the slime knows its own capabilities exactly, it does not know the capabilities of its neighbours, so it would be optimizing an uncertain quantity. But the mold cell can optimize exactly on the "value" of slime it gives to its neighbours. Ultimately, since the cell is unable to produce quality slime all on its own, it depends almost entirely on the health of its neighbours for high-value slime. The best interest of its neighbours is the best interest of the cell.
Which is exactly what Adam Smith et al. have been saying... except backwards. Perfect greed and perfect benevolence* lead to the same result. I hit on this idea three years ago, but missed its profound political implications.
This kind of duality is not unknown in economics. The basic argument against protectionism is that by reducing a partner's ability to sell (by banning the purchase of their product) one reduces that partner's ability to buy (because they aren't making money) thereby killing one's own sales. Restricting foreigners from selling effectively restricts domestic producers from selling... If only protectionism were expressed this way in the halls of government, it would be so obviously insane that it would never see the light of day. Which goes to show that even if buying and selling are really two sides of the same coin in theory there are still practical implications to naming one or the other.
And so it is with the greed/benevolence duality. Although in theory they should lead to the exact same behaviour, in practice they do not. Imagine an insurance company that evaluates its success not by how much profit it makes, but by how much money it pays out on legitimate claims? The company would still have to behave in a very similar way: it would have to assess the risk it was taking on, it would have to invest the funds it held, it would have to investigate claims to discourage fraud. But the nature of its relations with its clients, owners and employees would from a human standpoint be profoundly different. Imagine the factory owner who cares not about how much cash he rakes in, but how much he can give to his employees and customers. The union that bargains to give its employer the best possible workforce, rather than to take the maximum benefits the community can bear.
The beauty of benevolence is that it doesn't break capitalism. Everything still works, it just works subtly differently. Yes, the fact that we don't perfectly know each-others needs and capabilities will lead to inefficiencies; just as greed-driven capitalism drives individuals to lie, also creating inefficiencies. Inequality will not vanish from the system. It will remain, though possibly to a lesser degree, and in different forms.
Socialists have long looked to democracy as a method of reigning in capital. But rule by committee is not ideal in all circumstances, and can stifle innovation. This is particularly true if it is a "competitive" democracy, still operating on a paradigm of greed. Moreover, increasing democracy in the system requires a serious overhaul of our society, perhaps even a revolution.
Introducing benevolence as the guiding motive for capitalist production does not require a revolution. We could start teaching our kids tomorrow that greed and benevolence both produce efficient and healthy societies. The two motives can very likely even co-exist without either having enough of an edge to stamp out the other. An incremental change in capitalism is possible, and it is simple. The theories don't need to change, the factories don't need to be rebuilt, the rich don't need to be eviscerated and strung-up as criminals. We just need to re-write one 250 year-old paragraph:
In spite of their natural benevolence and generosity, though they mean only the conveniency of their fellows, though the sole end which they propose ... be the gratification of the needs and desires of others, they build upon their own improvements. They are led by an invisible hand to consume nearly the same necessaries of life, which they would have, had the earth been divided through competition among all its inhabitants, and thus without intending it, without knowing it, advance their own interest as well as that of society.
* Note that this is not a blind benevolence. It is a benevolence towards friends. It is a "help those who help you" benevolence, because your own capacity to help others depends on others helping you. The difference comes when answering the question: how much do I keep for myself? The greedy answer is: as much as I can. The benevolent answer is: as much as I need.
In spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose ... be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society.
Adam Smith's "invisible hand" has been the justification of self-centered theft and acquisition for over two hundred years. The idea that the best way to advance the interests of society is to encourage individuals to follow their greed seems unassailable in modern times. Abandon greed, so the argument goes, and we abandon everything our civilization has achieved. But the argument is flat-out wrong.
Greed is not the only motive that can animate the hand.
I came to this realization by thinking about slime mold. In particular, I had been inspired by this story in the Economist. I don't know anything about slime mold and, as usual, I don't care to look it up. But I liked the pretty picture. I also liked the idea that something very complex (the development of British industry) could be modeled by something presumably simple (the growth of a mold). I don't have the technical skill and resources to model the British rail system. But I could very well have the technical skill and resources to model the growth of a mold. I'm likely to try it over the summer, as my winter schedule unwinds.
Here's my idea for a slime mold simulation. We start with a square grid, with a distribution of a variety of resources. I was planning on using my ecological simulation described here as a basis for the resource distribution. Each cell has a slime mold cell. The mold cell can do only 3 things: consume slime, produce slime and push slime to neighbouring cells. The quantity of slime a cell can produce and push is directly proportional to the "value" of slime the cell consumes. The "value" of slime is the product of the quantities of its constituent resources. In other words, you get a lot of value out of a small amount of "balanced" slime, but rather less value out of a large amount of unbalanced slime. The trouble is that the slime any given cell can produce won't be balanced, because its composition will be biased by the locally available resources. In other words, to get better slime, the cell must trade.
Now the cell can control how much slime it pushes to each of its neighbours, but cannot control the relative proportions of the constituents in the slime. This is problematic for the cell, because it wants to achieve as balanced a slime composition as possible. The mold cell will operate on a simple assumption, that if it gives more slime to one of its neighbours, then that neighbour will reciprocate with proportionally more slime of its own. To some extent this assumption should hold: the more slime a neighbour gets (even if it is low quality slime), the more capacity that neighbour should have to produce and push slime back. Building on this assumption, the mold cell will be able compute the marginal utility (in terms of slime quality) of pushing slime to each neighbour, and of producing its own slime.
Which brings up the "sticky" question of how much slime the cell should consume for itself. The standard greedy answer "as much as it can" isn't very useful, because it requires us to estimate the future costs and rewards of consuming more or less slime. Although the slime knows its own capabilities exactly, it does not know the capabilities of its neighbours, so it would be optimizing an uncertain quantity. But the mold cell can optimize exactly on the "value" of slime it gives to its neighbours. Ultimately, since the cell is unable to produce quality slime all on its own, it depends almost entirely on the health of its neighbours for high-value slime. The best interest of its neighbours is the best interest of the cell.
Which is exactly what Adam Smith et al. have been saying... except backwards. Perfect greed and perfect benevolence* lead to the same result. I hit on this idea three years ago, but missed its profound political implications.
This kind of duality is not unknown in economics. The basic argument against protectionism is that by reducing a partner's ability to sell (by banning the purchase of their product) one reduces that partner's ability to buy (because they aren't making money) thereby killing one's own sales. Restricting foreigners from selling effectively restricts domestic producers from selling... If only protectionism were expressed this way in the halls of government, it would be so obviously insane that it would never see the light of day. Which goes to show that even if buying and selling are really two sides of the same coin in theory there are still practical implications to naming one or the other.
And so it is with the greed/benevolence duality. Although in theory they should lead to the exact same behaviour, in practice they do not. Imagine an insurance company that evaluates its success not by how much profit it makes, but by how much money it pays out on legitimate claims? The company would still have to behave in a very similar way: it would have to assess the risk it was taking on, it would have to invest the funds it held, it would have to investigate claims to discourage fraud. But the nature of its relations with its clients, owners and employees would from a human standpoint be profoundly different. Imagine the factory owner who cares not about how much cash he rakes in, but how much he can give to his employees and customers. The union that bargains to give its employer the best possible workforce, rather than to take the maximum benefits the community can bear.
The beauty of benevolence is that it doesn't break capitalism. Everything still works, it just works subtly differently. Yes, the fact that we don't perfectly know each-others needs and capabilities will lead to inefficiencies; just as greed-driven capitalism drives individuals to lie, also creating inefficiencies. Inequality will not vanish from the system. It will remain, though possibly to a lesser degree, and in different forms.
Socialists have long looked to democracy as a method of reigning in capital. But rule by committee is not ideal in all circumstances, and can stifle innovation. This is particularly true if it is a "competitive" democracy, still operating on a paradigm of greed. Moreover, increasing democracy in the system requires a serious overhaul of our society, perhaps even a revolution.
Introducing benevolence as the guiding motive for capitalist production does not require a revolution. We could start teaching our kids tomorrow that greed and benevolence both produce efficient and healthy societies. The two motives can very likely even co-exist without either having enough of an edge to stamp out the other. An incremental change in capitalism is possible, and it is simple. The theories don't need to change, the factories don't need to be rebuilt, the rich don't need to be eviscerated and strung-up as criminals. We just need to re-write one 250 year-old paragraph:
In spite of their natural benevolence and generosity, though they mean only the conveniency of their fellows, though the sole end which they propose ... be the gratification of the needs and desires of others, they build upon their own improvements. They are led by an invisible hand to consume nearly the same necessaries of life, which they would have, had the earth been divided through competition among all its inhabitants, and thus without intending it, without knowing it, advance their own interest as well as that of society.
* Note that this is not a blind benevolence. It is a benevolence towards friends. It is a "help those who help you" benevolence, because your own capacity to help others depends on others helping you. The difference comes when answering the question: how much do I keep for myself? The greedy answer is: as much as I can. The benevolent answer is: as much as I need.