The debt ceiling; in 1575

One of the reasons I find economic history so interesting is because I think it’s often more illuminating that some contemporary economic theory. Take the issue of the US debt ceiling, for instance. Apparently, a similar game has played out before

The explanation could have been a little clearer, but it was an intriguing example of a debt ceiling, a default, and a political game of chicken. 


Aliens and consciousness – Karl Schroeder’s ‘Permanence’

Karl Schroeder’s Permanence has some intriguing ideas – it gets to different evolutionary strategies (generalists vs. adapting to niches), and how consciousness ties in to all of that. But unfortunately the writing’s choppy and superficial, and doesn’t quite do the ideas justice.

One of the questions at the centre of Permanence is this question about how evolution happens in the very, very long run. And whether consciousness is actually useful in the very long run, or only in the medium term. I actually ended up reading Permanence because it was mentioned by another fiction author writing about consciousness, Peter Watts.

But whereas Watts’ writing is taut, and his ideas are rich, Permanence just doesn’t get to the same level. There’s something superficial about the novel, the writing – it feels a little like something that got cranked out over nanowrimo, and tidied up without ever being really re-written. And because the writing isn’t quite polished, it detracts from the novel; it’s a little harder to lose yourself in a story when clunky writing reminds you semi-constantly that this is fiction.

At points Schroeder’s characters seem to step out from the page, to become a little ’rounder’. Rue is a protagonist who’s very easy to like, and her enthusiasm helps carry the story. But often the writing gets bogged down in detailed descriptions that felt more like manuals than part of a story, and plot points felt unnecessarily convoluted; as though the narrative was mapped to meet a set of specific technical points, without any regard for a story-teller’s needs.

The question Schroeder gets at is interesting, but it’s really not that complex a question – what are the evolutionary advantages of niche specialisation vs. generalisation (the ability to adapt flexibly, but less efficiently, to multiple environments)? And he takes it to interesting places, but without giving it the emotional depth that it would need to make a compelling story.

So it was fun at points, but probably not worth it unless you’re very into sci-fi.

Consciousness: What is it good for?

I’ve been enjoying Karl Schroeder’s Permanence, particularly after reading Peter Watt’s Blindsight. Both books ask some really interesting questions about consciousness, although from very different starting points.

SPOILER ALERT: What follows is central to at least the plot conclusion of Blindsight [and possibly Permanence, although I’m not finished yet]. Read on if you don’t mind plot points from either being discussed.

 Space! from Flickr

Blindsight features consciousness as an evolutionary dead end, a strange system that happens to turn up that isn’t really that useful. Watts even describes it as parasitic at one point. His conception of consciousness sees it as baggage, something not that useful, extra cognitive load that takes up energy but doesn’t improve our probability of survival.

Permanence approaches the issue from a different angle. It follows an archaeologist of alien species, who’s been looking at the ruins of different space-faring civilisations for years. As he joins the story, he’s facing the question – why can’t humans find another space-faring species they can get along with? Why did they all die out?

He posits consciousness as useful, but only in a limited way. It’s consciousness (as he describes it*) that lets us solve new and difficult problems; that ability to step back and deal with a new set of conditions; mould them to our own frames. Creating submarines, spaceships, and air conditioning; new technologies that can take us, as humans, safely into extremely different and hostile environments. But, in the very very long run, those species that adapt to the local environment are the most effective. Which, includes getting rid of consciousness – because once an organism is perfectly adapted, it no longer needs it – it’s fitted, suited, able to function without processing problems.

It’s interesting that both Watt and Schroeder end up at similar conclusions, if not exactly the same one. Consciousness as at best a tool that’s only marginally useful; at worst an outright drag. I think there is something to that perspective – our brains expend a lot of energy, and are expensive to maintain.

But I think you can make a plausible case for consciousness as connected to (it not a necessary part of) a theory of mind; and I think it’s pretty easy to link a theory of mind into the broader competition that occurs between members of the same species.

Deep in my bones

The invasion of commercial messages into previously untouched parts of our lives is a pretty steady progression – but I thought this piece on bone advertising was particularly interesting. Mainly because I hadn’t thought of it before, that you could even use that kind of technology. It’s a reminder, I suppose, of how precious (or how much of a privilege) private space can be. 

And on the topic of bones, a somewhat melancholy but much more beautiful thought: Sometimes I can hear my bones straining under the weight of all the lives I’m not living. (Jonathan Safran Foer).


Why I stopped halfway through ‘Currency Wars’

Basically, because it was ‘economics lite’. Fluffy, and perhaps worth buying if you couldn’t find anything else in the airport bookshop, but without the depth to really engage with some of the important topics it touches on. 

There were some parts I found interesting. The history of the gold standard, and the mechanics around the Bretton-Wood system are something I don’t know much about at all, so I found that interesting. A much better read, though, is Lords of Finance, by Liaquat Ahamed – even though it doesn’t delve much into the mechanics of the gold standard (or much more than Currency Wars), it’s a much better book. 

But there are several points where Currency Wars is disappointingly shallow. I’ve read enough pop-economics books that by now I’m heartily sick of hearing simple stories about ‘the one equation that brought down Wall St’ (for Rickards, its’ VaR); and I was intensely annoyed by the condescension in his explanation of a normal curve. Yes, we get it, the normal curve isn’t an appropriate model for return distributions; it’d be nice if an author went a little further than that. 

But as well as the obvious over-simplifications, there were areas where I have a decent understanding of the material; and the way the book skims through (in some cases erroneously), makes me suspicious about the other material (where my knowledge isn’t as strong). 

Take for example his treatment of Kahneman and Tversky’s work (because of course, there’s the obligatory mention of behavioural economics). 

In the most famous set of experiments, Kahneman and Tversky showed that subjects, given the choice between two monetary outcomes, would select the one with the greater certainty of being received even though it did not have the highest expected return. A typical version of this is to offer a subject the prospect of winning money structured as a choice between: A) $4,000 with an 80 per cent probability of winning, or B) $3,000 with a 100 per cent probability of winning. For supporters of efficient market theory, this is a trivial problem. Winning $4,000 with a probability of 80 percent has an expected value of $3,200 (or $4,000 x .80). Since $3,200 is greater than the alternative choice of $3,000, a rational wealth-maximizing actor would chose A. Yet in one version of this, 80 per cent of the participants chose B. Clearly the participants had a preference for the “sure thing” even if its theoretical value was lower. In some ways, this is just a formal statistical version of the old saying “A bird in the hand is worth two in the bush.” Yet the results were revolutionary – a direct assault on the cornerstone of financial economics. 

Ugh. It’s been a while since I read Judgement under uncertainty or Choices, values and frames, but I don’t remember there being an experiment that simple (although it may have been one condition of several in their demonstration of framing). 

Because in fact you can get that level of risk aversion under fairly obvious economic models – basically, you just assume that the agent has a diminishing marginal value for money. Voila – risk aversion

But where prospect theory added something to the mix was in highlighting that the reference point in assessing utility is context dependent; that is, the shape of the curve shifts in response to your context. So that the shape of your utility curve (and, in turn, how risk averse you are) can shift from decision to decision, in response to your context and environment. So that, in fact, contestants who’ve just gone from a winning to a losing position on Deal or No Deal are likely to be less risk-averse than contestants going from a poor to a strong position (there’s this paper by Post, van den Assem, Baltussen and Thaler, although I’m pretty sure there are others). 

Which is an important point, and it adds something quite rich to the discussion of how people make decisions. But that’s a much more nuanced point than the simple fact that people are risk-averse, which is even more blindingly obvious, and you could demonstrate with a simpler model than the context dependent one that prospect theory gives you. 

Rickard’s treatment of behavioural economics was disappointing enough (in conjunction with the poor writing and superficial treatment of several other issues) that I’m not going to bother finishing the book. Currency valuation, and the mechanisms involved and how they connect to geo-politics are an important set of issues; but this book isn’t the one to read. 

Vampires! Action! Intriguing reflections on the nature of consciousness!

Peter Watt’s Blindsight is a great novel. It has scary, scary aliens (don’t read it in the dark), some pretty great action scenes, and some really cool sci-fi. 

I found myself pausing at one or two points to look up particular phrases or ideas, but for the most part Watts manages to weave in explanations without being too obvious or clunky, but still not making it too hard for the reader. The action’s fast, and he tells a good story. 

Some of his ideas on consciousness I don’t agree with entirely, but he told a good story about them, and it was just a really fun read. [For reasons why you might think consciousness is adapted, I’d recommend starting somewhere near here, but that’s a whole other post]. 



Solaris: aliens and a theory of mind

I’ve just finished reading Lem Stanislaw’s Solaris. Which is an excellent book, and I highly recommend it, although not if you’re having a rough day or are in an empty house, because parts of it are depressing and scary. But still, a beautiful book.

Stanislaw does a lot of excellent in writing in creating a context, a history (a little clunky at times), and a set of questions that baffle us. And I’m particularly impressed, given that I’ve just discovered the original English version was not only double translated (Polish to French to English), but is also apparently an abridgement, although apparently the current Kindle version is the full one (translated by Johnson). CC some restrictions Image from Bill Saturno, some rights reserved

But what I’m interested in at the moment is how it deals with the human/alien interface, or ‘contact’. One of the underlying themes to Solaris is the difficulty of human to alien contact; how frustratingly incomprehensible the encounter might be for humans. One way that happens [SPOILER ALERT: from here on out it centres on a plot point that doesn’t happen till half-way in. You’ve been warned] is through human replicas, created by this vast, oceanic intelligence the explorers are unable to communicate with.

These replicas are fully functioning humans – beating hearts and warm bodies – yet the soles of their feet aren’t worn and calloused the way a normal adult’s are. They’re drawn from the minds of the explorers – they are the fragments of memory that have been locked away in the minds, the subconscious minds, of their ‘Adams’ (this book fails deeply at gender equity, doesn’t pass the Bechdel test, and in fact has no real female characters). So these replicas (plural, although we only meet one, and see shadows of others) are deeply emotional experiences for their Adams, replicas of people who are enormously significant to them. They start with out much memory, although they do seem to have some factual information that’s imbedded in their Adams’ minds. From there they grow, and change, and develop; albeit with some limitations, they are effectively human beings, and making autonomous decisions and functioning independently.

But one of the novel’s central ideas is that this enormous, alive ocean that is clearly deeply intelligent (it creates structures that are the solutions in three dimensional geometry to enormously difficult mathematical problems) fundamentally can’t communicate with the humans.

Now, I suppose there are a few ways to take this. One is that the ocean is far more intelligent than humans could begin to grasp – it’s light years ahead, and thinking in dimensions and ways that humans can’t process. Which is fine – I think that’s an interesting story, as far as it goes, and it’s a useful counterpoint to a lot of reflexively anthropomorphic science fiction. But another central idea in the novel is that the ocean can’t understand humans. Which, on its own, could be true too – it’s easy enough, at some level, to imagine an enormous planetary slime mould that was super-powered, but couldn’t understand minuscule humans walking on its surface.

And what I couldn’t get my head around was the idea of this planetary intelligence being smart enough to somehow extract from a human’s mind, the set of ideas they carry around about a long lost loved one, yet not smart enough to understand what a human is.

I flipped through my copy of The Intentional Stance trying to find a quote that would support the argument, but there’s nothing that quite cuts to the heart of it, so I’ll have a go myself:

A) The replicas created are drawn from the memories in their Adams’ minds. Effectively, their existence depends on the ability of this oceanic intelligence to interpret how information is encoded at a neuronal level, and extract it in an incredibly effective way.

B) The physical creation of the replicas depends on the ability of the oceanic intelligence to create something that physically resembles humans down to the molecular level (there’s more detail in the novel, but take that as a given).

C) The oceanic intelligence, at least according to one interpretation of the novel, simply can’t comprehend human beings.

I think that the kind of intelligence needed for A) (and partially for B, although that’s less crucial) is fundamentally incompatible with C – an ocean that can’t comprehend humans. I know there’s a point where you’re just poking holes at what is just a novel, and a very beautiful one at that – but this bothered me. Perhaps it’s part of the mystery of it, but I think it was also partially a reification on Stanislaw’s part of how memory and information work, that elides key points about how information is processed, accessed, and used.