Plot Economics

March 9, 2020 By
This entry is part 11 of 15 in the series Psychohistory

For the fourth time in my adult memory, humanity has collectively, visibly lost the plot at a global level. My criteria are fairly restrictive: The dotcom bust and the 2007 crash don’t make my list for instance, and neither do previous recent epidemics like SARS or Ebola. Global narrative collapse is a fairly severe condition, but apparently no longer as rare as it once was. Here’s my shortlist:

  1. Fall of Berlin Wall (1989, I was 14)
  2. 9/11 (2001, I was 27)
  3. Trump election (2016, I was 42)
  4. Coronavirus (2020, I am 45)

It always seems to happen relatively suddenly (but is not always entirely black-swan-level unanticipated; it is typically a gray swan), and in each of the first three cases, by my estimate, it took humanity 1-2 years to reorient. I expect this one will take about 18 months, unless a bigger gray or black swan eats this one (one I’m watching out for is Trump losing in 2020 and refusing to honor the electoral verdict). We will find the plot again after the first vaccines are administered at a large scale, presumably during the 2021 southern hemisphere flu season. We will learn how effective the vaccines are, and the markets will decide how to reprice modern pandemic risks correctly.

So what do we do in the meantime?

[Read more…]

The Age of Diffraction

May 30, 2019 By

There’s a state of mind that’s been increasingly common for me lately, which I can only describe as a sense of being outdoors in time during inclement temporal weather. I’ve been searching for the right metaphor to describe this feeling, and I think it is the feeling of being diffracted. Like being a hapless, innocent electron being tortured through the famous double-slit experiment. Here’s a cool animation I found on Wikipedia (physics would have been so much more fun if these sorts of animations had been available when I was learning this stuff).

Animation by Jean-Christophe BENOIST at French Wikipedia. [CC BY-SA 3.0]

If your state of mind is normally like that of a particle — you are here and now, thinking about this, doing that, with some uncertainty around it all — being diffracted is feeling like a wave. Like you’re in multiple states at once, with those states interfering with each other in ways that creates subjective dyschronia or timelexia.

[Read more…]

Weirding Diary: 7

April 8, 2019 By
This entry is part 7 of 11 in the series Weirding Diary

The lament that the United States is turning into a third-world country is at once too pessimistic and too optimistic. What is actually happening is that a patchwork of post-industrial first and fourth-world conditions is emerging against a second-world backdrop.

Here are my definitions:

  • First world: Small, rich European countries. Islands of gentrified urbanism in the US.
  • Second world: Suburban/small-town America, parts of larger European countries, small Asian countries, parts of the Soviet Union before it collapsed, parts of China today.
  • Third world: Countries in global south that began modernizing a century later than Europe, and still have relatively intact pre-modern societal structures to backstop the shortcomings of incomplete industrial development.
  • Fourth world: Parts of the developed world that have collapsed past third-world conditions because industrial safety nets have simultaneously withered from neglect/underfunding, and are being overwhelmed by demand, but where pre-modern societal structures don’t exist as backstops anymore.

The fourth world emerges when large numbers of people fall through the cracks of presumed-complete development, and find themselves in worse-than-third-world conditions: More socially disconnected, more vulnerable to mental illness and drug addiction, with fewer economic opportunities due to the regulation of low-level commerce, and less able to stabilize a pattern of life.

Schemes like LBJ’s Great Society failed to fulfill their promises, but still prevent those facing impoverishment from fending for themselves. The fourth world is the worst of all worlds; an artifact of failed authoritarian high-modernism. A condition of pervasive dependency on non-dependable systems that eliminate old alternatives and limit the growth of new ones. The underbelly of zombie monopolistic safety nets that lack the autopoietic potential to endure through political and economic cycles as living social systems. The functionality withers away, but the negative externalities don’t.

The Great Weirding is revealing that modernization and development are not the same thing. It is a mistake to govern under the presumption that entire populations must necessarily arrive at stable 100% first-world conditions after a transient “development” period. Modernization is the evolution of both wealth and poverty into newer technological forms.

Systems designed for the lowest strata must not assume those strata will eventually go away.

Weirding Diary: 6

April 1, 2019 By
This entry is part 6 of 11 in the series Weirding Diary

Weirding is related to uncanniness, as in uncanny valley: a near-subconscious sense of map-territory misregistration. I think there are two varieties, A and B.

Type A uncanniness, which Sarah Perry explored, evokes an “emotion of eeriness, spookiness, creepiness” that you notice instantly, but cannot immediately isolate or explain. Here’s an example:

Human lookalike robot Repliee 2, detail from image by BradBeattie, CC BY-SA 3.0

Type B uncanniness, which Sarah Constantin explored, does not necessarily evoke those emotions, but may provoke a double take. Here are examples from an article on recognizing AI fakes.

Sample faces generated by a GAN, from How to recognize fake AI-generated images by Kyle McDonald

Two increasingly important domains — markets and AI — exhibit both kinds. Free markets and deep learning AIs generate more Type B uncanniness. Markets distorted by regulation, and GOFAI (including humanoid robots) generate more Type A uncanniness.

Kahnemann’s System 1/System 2 model is useful here.

Type A uncanniness is pattern wrongness, detected by System 1, evoking an immediate emotional reaction. If you aren’t fleeing, a slower System 2 response might kick in and supply a satisfactory explanation, and possibly creepiness relief.

Type B uncanniness is logical wrongness (unexpected facial asymmetry or incoherent grammar for example), prompting the double take (and possibly a delayed creeped-out reaction). You have to re-engage System 1 to reconstruct a narrative around the actual prevailing logic rather than the assumed one.

Too-symmetric faces are Type A uncanny. Mismatched earrings on a face are Type B.

Drug prices shooting up 10x suddenly is Type A. Bond markets defying “normal” logic is possibly Type B (I need a better example).

Markets are eating the world, and AIs are eating software. In both, we’re seeing a shift from Type A to Type B. Less creepy, more double-takey. It’s easier to get used to creepy patterns than unexpected logics.

Markets Are Eating The World

February 28, 2019 By

For the last hundred years, individuals have worked for firms, and, by historical standards, large ones.

That many of us live in suburbs and drive our cars into the city to go to work at a large office building is so normal that it seems like it has always been this way. Of course, it hasn’t. In 1870, almost 50 percent of the U.S. population was employed in agriculture.[1] As of 2008, less than 2 percent of the population is directly employed in agriculture, but many people worked for these relatively new things called “corporations.”[2]

Many internet pioneers in the 90’s believed that the internet would start to break up corporations by letting people communicate and organize over a vast, open network. This reality has sort-of played out: the “gig economy” and rise in freelancing are persistent, if not explosive, trends. With the re-emergence of blockchain technology, talk of “the death of the firm” has returned. Is there reason to think this time will be different?

[Read more…]

Weirding Diary: 1

January 24, 2019 By
This entry is part 1 of 11 in the series Weirding Diary

I did a little poll asking people the extent to which they are treating the current zeitgeist as a temporary weirding (TW) versus a permanent new normal (NN).

The results got me thinking: what is the difference between the two? I think the answer is societal fun levels. A situation is a normal situation if inhabiting it is a matter of going on with your sustainable survival/existence habits, and expecting the situation to persist indefinitely. The mark of normalcy is the allocation of surplus energy to fun, after you’ve taken care of necessary present and future-oriented behaviors.

A situation is temporarily weird if you either can’t, or don’t want to, adapt to it using sustainable habits. In the former case, you cut back sharply on fun, minimize use of resources to survive, and save as much as you can for post-weirding normalcy. In the latter case, you try and exit the situation.

Wartime is the archetypal temporary weirding. Wartime civilian behaviors are sharply constrained survival behaviors. There is a limited ration of fun available to keep up morale, but in general, the wartime psyche does not incline to fun. You expect the war to end at some point, and a return to normalcy. Even if it is a new kind of normalcy that forces you to drop some old habits and form new ones.

When the situation is ambiguous, as it is around the world today, we cannot estimate the proportions of transient weirdness, new normal, and temporarily depressed old normal in the mix. In terms of an investing metaphor, we don’t know whether to go long on the zeitgeist by buying into new cultural stocks, hold on to old cultural stocks that we hope will regain their old value, or short the zeitgeist somehow.

I’m trying out a new format for exploring themes long-term. This is the first entry in my weirding diary.

Stack Luck

January 17, 2019 By

Last year, I sensed my luck changing. It felt like a streak of good fortune, stretching back at least three decades, was gently but firmly coming to an end. But not because of anything I personally did or didn’t do, and not limited to me. Rather it was the luck equivalent of a big, slow earthquake deep down in the stack of civilizational infrastructure upon which my life, and the lives of people like me (information economy global urban elites, let’s say) depends. I call this kind of luck stack luck, an unreasonableness in the nature of the world working for or against you, creating either serendipity or zemblanity in your life. The best description of stack luck I have found is a passage in Joseph Heller’s Catch 22:

“I really can’t believe it,” Clevinger exclaimed to Yossarian in a voice rising and falling in protest and wonder. “It’s a complete reversion to primitive superstition. They’re confusing cause and effect. It makes as much sense as knocking on wood or crossing your fingers. They really believe that we wouldn’t have to fly that mission tomorrow if someone would only tiptoe up to the map in the middle of the night and move the bomb line over Bologna. Can you imagine? You and I must be the only rational ones left.”

In the middle of the night Yossarian knocked on wood, crossed his fingers, and tiptoed out of his tent to move the bomb line up over Bologna.

The kicker of course, is that the next morning, the map is mistaken for the territory and effect turns into cause. The commanding officers assume that Bologna has been captured, and cancel the bombing run. Contrary to the rational expectations of Clevinger, a Harvard graduate who believes in the fundamental reasonableness of the world he inhabits, action driven by superstition works in the crazy environment of the World War 2 bureaucracy. The course of events is changed by a self-validating superstition. And if you think this sort of thing can only happen in fiction, you haven’t lived enough.

[Read more…]

Think Entangled, Act Spooky

September 11, 2018 By
This entry is part 8 of 15 in the series Psychohistory

I like the concept of the Anthropocene. It finesses or postpones at least some of the conflict around the idea of climate change, broadens the conversation to include all human impact on the environment, and grounds thinking in geological (heh!) time without overloading it with burdensome sentiments like guilt or fear. The term leaves the future open to both positive and negative possibilities. It acknowledges human agency as the most powerful force currently reshaping the planet without getting too judgmental about what that means.

The Ash Yggdrasil by Friedrich Wilhelm Heine (Wikimedia Commons, Public Domain)

I find existing definitions of the Anthropocene unsatisfying though. Most of them, reasonably enough, focus on planet-scale external markers, ranging from the birth of agriculture to the first nuclear tests and climate change. But this seems too open narrative arbitrariness and not open enough to insight. If we turn inward though, there is a rather natural and fertile definition that immediately suggests itself:

The Anthropocene begins when survival in the built environment is as cognitively demanding as survival in the natural environment of evolutionary adaptation.

Note that “as cognitively demanding” is not the same thing as “as hard across the board”. It means you you have to think as hard for the same survival probability, but many other things might get easier.

A good illustration of this is life in a major city versus life in a small town. The former is more cognitively demanding but many things besides thinking become a lot easier. Nobody ever moved to a bigger city in search of a simpler life. A less emotionally stressful life, perhaps. A less impoverished life, perhaps. A more comfortable and convenient life, perhaps. But not a simpler one.

Now let’s apply that reasoning at civilizational history scale.

[Read more…]

Refactor Camp 2018: Cryptoeconomics and Blockchain Weirding Post-Mortem

August 16, 2018 By

refactor camp 2018

Refactor Camp: Cryptoeconomics and Blockchain Weirding was a 2-day conference held in Austin Texas on May 12-13th 2018. The event featured talks, workshops, and breakout sessions focused on blockchain technology, the sociology of blockchains, and whatever other weird nonsense the speakers could come up with.

Our hope with this event was to “stretch the Overton window” a bit in terms of thinking about the implications and elements of blockchain technology and, in the Ribbonfarm tradition, facilitate some more speculative thinking and discussions than what happens at other cryptocurrency events.

Topics covered included:

  • Blockchain as Metaphor – Take some feature of a mature blockchain ecosystem and map it into another domain (e.g. Decentralization in urban infrastructure or.)
  • Sociology of Blockchain Geopolitical implications of blockchain
  • Magic, Ritual & Blockchain
  • Blockchain as an International / Multicultural Phenomenon
  • Crypto Econophysics

We were able to record most of the talks and have uploaded them to Youtube as well as embedding them below. Special thank you to all the speakers who took the time to prepare a talk. [Read more…]

A Quick (Battle) Field Guide to the New Culture Wars

March 6, 2018 By

I am basically a pacifist, inclined to what in India is sometimes derisively referred to as Gandhigiri (loosely “LARPing Gandhi”). If I don’t check the tendency, I naturally retreat from, and go into denial about, unpleasant and violent realities. But it’s time to admit it: the United States is in the middle of the worst culture wars I’ve seen in my life, either in my 20 years in the US, or in the previous 20 years in India (which in the 90s saw equally ferocious, but less digitally mediated, culture wars). And for once, you can’t blame Trump. He’s more consequence than cause.

To endure through a war without either retreating from the fray, or developing crippling PTSD from losing too many poorly picked battles, you need a good map of the battlefield, a sense of the movements of various combatant groups, their objectives, tactics and strategies, awareness of recent battles and their outcomes, current live battles, and emerging flashpoints. Here’s my first draft attempt.

I’ve used the popular politics 2×2 meme (left versus right, authoritarian versus libertarian) as a basic canvas for this map. Let’s start with the numbered key to the conflicts before launching into some commentary.

[Read more…]