45. Ties That Bind

Note: This post is the forty-fifth in a series. Click here for the full listing of the series.

My guardian-mindset brain is a little tired this week from a frenzy of commercial activity as I've been selling off many of my possession on craigslist in anticipation of moving at the end of the month. Have I mentioned I hate moving? - maybe once ... or twice, or ... well who's counting...

Point being, just a small, mostly incoherent, post this week.

Back in Francis Fukuyama's book 'Trust,' I remember him comparing Chinese society, which in his view resembled a 'tray of sand' to Japanese society which resembled something more solid like a pane of glass (I'd look up what he said exactly but my books are packed!).

Fukuyama's comment reminds me of the comments made by Hans Ritschl in 'Communal Economy and Market Economy,'

"Both the state economy and the free market economy presuppose a group of persons whom the economy encompasses and by whom it is carried. But there is a great difference in the form of social cohesion within these supporting groups. The free market economy rests on an exchange society: the relationship of the individual economic units with each other is merely 'social' in Tonnies' sense. Pictorially, the connection is mechanical rather than organic.

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The principle of cohesion in the State is not that of society, but of community. ... 'All for each and each for all' is the motto of community. But the exchange society's motto is 'Chacun pour soi, Dieu pour nous tous'

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In the principle of cohesion lies the primary fundamental difference between communal economy and market economy"

Ritschl' comments in turn reminded me of something that David Hume said,

"The happiness and prosperity of mankind, arising from the social virtue of benevolence and its subdivisions, may be compared to a wall, built by many hands, which still rises by each stone that is heaped upon it, and receives increase proportional to the diligence and care of each workman. The same happiness, raised by the social virtue of justice and its subdivisions, may be compared to the building of a vault, where each individual stone would, of itself, fall to the ground; nor is the whole fabric supported but by the mutual assistance and combination of its corresponding parts."

The common element in all these quotes is the notion of cohesion, or a whole that is more, or different, than the sum of its parts. A collection of molecules achieves shear strength and solidity, rather than just being a pile of sand. A collection of people forms a community rather than simply being a collection of individuals. A vault stands even though each individual stone would fall to the ground on its own and the vault would fall with the removal of any one stone.

Going back, as always, to the notion of the prisoner's dilemma, the two prisoner's each pursuing their own self-interest and getting heavy sentences after ratting each other out represent the individualistic grains of sand. If the prisoners had an attitude of 'all for one, and one for all' then the scheme by the police to get them to confess would fail. The behaviour of the two prisoners would cease to resemble the behaviour of two distinct individuals but would become indistinguishable from the actions of a single individual with a single will. Note that, by definition, a single individual, with a single will can not be affected by a prisoner's dilemma - only when there are two or more wills in play can a prisoner's dilemma type situation occur.

In the language of economics, classical economic models typically assume 'independent preferences' meaning that I only care about what I care about, and what you care about has no impact on what I care about (i.e. I am unmoved by your tears, or by your joy). But what Fukuyama and Ritschl and Hume were getting at was the notion of interdependent preferences. If I treat your preferences as being of equal weight to my own, and you do the same with me, then my preferences become dependent on yours and vice-versa. And note that this preference pattern will allow us both to act as if we shared a single will (for a more modern reference, think of the parent who asks a child what the other parent said before answering a request).

Ritschl was writing well before the development of game theory or the notion of a 'prisoner's dilemma' but it is clear he understood the point,

"In the exchange society, then, self-interest alone regulates the relations of the members; by contrast, the state economy is characterized by communal spirit within the community. Egotism is replaced by the spirit of sacrifice, loyalty and the communal spirit. In the exchange society, the individual is guided only by personal advantage; here, he thinks, feels and acts as a member of the community. His own interests take second place. The communal spirit is the principle on which rest community and State.

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It is only when the nation is in the most desperate straits that the communal spirit of all merges into one great single will. In everyday political life there are necessarily a good many conceptions of the common weal, and they may combine with group or class interests and become tarnished by them. Yet each party pursues not only its group interest, but the realization of its own conception of the common weal."

The (still needing to be fleshed out) chain of reasoning here is that ethics like 'loyalty' and 'sacrifice' (not to mention respect for hierarchy and obedience) serve to create interdependent preferences that substitute a single will for a collection of individual ones (in marketplace terms think perfect competition replaced with perfect monopoly), and that this will better serve guardian goals.

After all, a group of people pursuing their self-interest (within the ethical guidelines of the commercial syndrome) will achieve an efficient distribution of goods, but following this behaviour in battle will lead to deserting and retreat, not victory (think Han Solo in Star Wars). In a battle, it is typically best for the army to act as if following a single will. Why? - that's a question for another time...