Economics and Cosmology

I was reading this week of the excess positron findings reported from the detector on the International Space Station and it made me think of economics.  Not in the usual, “how much did you say that blasted contraption costs?” way, but more in the way of an “aha moment” it provided about a fundamental problem I have with standard economic thinking.  The positron findings have the cosmological physicists all excited because they might, they’re not certain yet, provide insights into the nature and extent of dark matter, which in turn could lead to understanding of the fundamental physical characteristics of the whole universe; the cost of the contraption is well worth it.  But one article reported as an aside that the detector was laboriously mapping the entire sky to produce a complete description of the gravitational interaction between masses all the way back to the Big Bang.  A continuing gravitational tussle is going on between ordinary matter and dark matter, and the net gravitational result determines the location of every particle in the universe.  That’s when the “aha” hit me: But we still fly!  Gravity is the most powerful physical force in the universe and determines everything, but we conquer it daily to go from the bottom to the top floor to Peoria to Mars.

What a wonderful metaphor that creates for explaining the problem I have with economic determinism and “the invisible hand of the market.”  Economists love to exclaim TANSTAAFL!, “There aint no such thing as a free lunch.”  They mean that economic relationships determine all our other relationships, and they make a powerful case for their point of view.  There is an element of economic self-interest even in our choice of who we love and what religion we follow. The invisible hand is at work everywhere; economic determinism is indeed a fact that we live with.  But the economists stop there. They act as if Economic Man is a complete description of all humanity and inescapably explains everything. And that’s like saying that gravity is so powerful, it’s not even worth the effort to attempt jumping.  It’s as if, following Newton’s discovery, we’d just sighed and given up.  If we had the same attitude about physics as economists do about economics, we’d still be hiding in caves.

Humanity has worked thousands of years to overcome gravity, from the invention of the inclined plane and the cart and the ladder to the design of the space rocket.  We’ve done it because there were worthwhile things that needed being done, that just couldn’t be done by accepting the inexorable victory of gravity. So we found ways, and continue to do so every day.  No one person did it; it’s been a joint effort for humanity over millennia.

The reason physicists search so hard for understandings about dark matter, stuff that isn’t even directly detectable by any scientific instrument, is that there is significantly more of it in the universe than there is ordinary matter.  Seeking, for example, to understand the structure and motion of galaxies using only calculations including ordinary matter leads to completely erroneous results.  Stretching that metaphor even farther, limiting our understanding of the possibilities for human behavior to behavioral  calculations involving only Economic Man is like calculating gravitational effects ignoring dark matter.  The dark matter of humanity is all the other stuff, from altruism to anger to kinship ties, that go together to define our full humanity.  It cannot be ignored.

So, what I’m trying to say is that yes, economic determinism is a legitimate fact of life to be dealt with. It too cannot be ignored.  Neither can the other components of our behavior. The problem arises when we organize our behavior around purely economic institutions and concepts, around corporations and rates of return on investment and self interest, and the invisible hand of the market becomes the scapegoat for behaviors that represent the worst, not the best, of our nature. As we have labored over millennia to elude the limits of gravity, and succeeded, so we need to work on social arrangements and institutions, from government regulation of unconscionable behaviors to “social markets” that take into account just pricing and needs.  The focus of our behavior needs to include achieving our best, not just our most profitable outcomes.  We will not understand or actualize our own universe within, or help the world around us become a better place, until we have learned to do so.