Friday, 22 February 2008

Obama and politics of hope

Senator Obama’s campaign to be the nominee of the Democratic Party for the US Presidential elections in November this year has been criticised of lacking in substance.

Senator Clinton has claimed that being president is not about producing good speeches but about delivering good policies.

Obama repsonded to the message by being very explicit about his policies in his last speech, delivered in Houston, Texas (after winning the Wisconsin primary) and during his debate with Hillary Clinton yesterday.

The question: is the message of hope that Obama tries to transmit positive or negative?

In my post Recession, money, thinking and confidence, I concluded:

“A healthy economy is one in which the aggregate confidence of people matches their aggregate skills. More confidence than skills is as bad as less confidence than skills.”

If there is more confidence than skills, bankers lend money, consumers spend money, but since there is a shortage of skills, productivity does not match the spending; this leads to inflation. If there is less confidence than skills, bankers lend less money, consumers spend less; thus resulting in lower demand and consequently unemployment would rise and skilled human resources are not fully employed (i.e., recession).

This analysis calls for realistic optimism rather than blind hope. However, hope and confidence that is not matched by current level of skills could still be a good strategy if it is used with intelligence. In other words, if hope motivates people to improve their skills, the aggregate skills of the population will eventually match the level of hope.

People that have hope and are confident about their future, spend time improving their skills. For example, an 18-year old who is confident about his/her future may decide to take out a bank loan to go to university rather than settling for an unqualified job. (Of course, the bank manager must also be confident that the university graduate will repay the loan). Tertiary education will improve the skills of this young person and the more people doing the same the more it would increase the aggregate skills of the society and its productivity.

A case in which hope would be damaging for the country is when a person has blind hope about his/her future situation, starts borrowing money to spend and does not do anything to improve his/her skills.
To conclude, if hope is used to mobilise resources to a good cause, it is positive. On the other hand, if hope is used to indulge, it is negative. Given that Obama also asks people for commitment, his politics of hope are positive for the US.

Labels: , ,


Tuesday, 19 February 2008

Society functions because we have jobs

This is a translation from Spanish of an excerpt of my book Pensamiento Organizado: Una psicotecnología para ser feliz, eficiente y colaborar inteligentemente [Organised Thinking: A psychotechnology to be happy, efficient and to collaborate with intelligence].
Human societies survive as a result of what human beings do. We, human beings, produce objects (buildings, pavement, bridges, automobiles, etc.) and provide services (health, education, communications, justice, etc.). If we do not carry out these activities society would soon collapse. People naturally wish the society in which they live survives. Hence, they should contribute to society by working.

So you see that our jobs are not merely tasks we do in order to get paid, but our contribution to the proper functioning of the society we live in. Consequently, a small group of producitve people will not be sufficient to support the entire society. If there is an insufficient number of productive people contributing to society, the society will eventually collaspe.
However, it is not entirely true that people who work contribute positively to society because not all jobs are useful to the society we live in. For example, production of tobacco, psychoactive drugs, weapons, etc., are harmful to society. Moreover, useful jobs could be done with varying degree of efficiency. The more efficient we are at our jobs, the more we contribute to society. If everyone follows this concept, charity would be almost unnecessary. This is the Organised Thinking’s concept of intelligent collaboration.

Organised Thinking proposes that we should be responsible citizens, that we think of our behaviours as having effects over others, and that we aim at acquiring knowledge so we, as members of a society, could improve on the quality of good and services we provide to others.
Society needs our production and benefits when we improve our skills and knowledge. Through our production and improvement, we build a better society to live in. Hence, to be a responsible citizen is not only beneficial to others, but also to ourselves.

Labels: , ,


Monday, 11 February 2008

Recession, money, thinking and confidence

Many economists advocate that US economy is heading into recession. But few of them explain the reasons with the clarity of Charles McMillion, President and chief economist of MBG Information Services in Washington, D.C.

His article, “The Economic State of the Union 2008”, posted yesterday by itulip, explains that the US economy is heading into recession because the Bush administration borrowed heavily in order to favour the Finance, Insurance and Real Estate (FIRE) sector. This combined with a dramatic increase in war spending and a lack of interest in stimulating the industry and research is increasing the deficit and decreasing productivity.

The explanation is simple. If the government encourages private spending (for example, by cutting taxes) without stimulating productivity there will be an increase of prices. That is, if there is more money in the market and there is the same amount of goods to buy, then the money will loose its value and the prices of goods will go up.

This is happening with house prices. The Federal Reserve reduced interest rates; hence banks offer cheap money to buy properties (i.e., mortgages with low interest rate). This leads to an increase in borrowing, so more people started buying houses. If there are no incentives to build more houses, then the price of houses goes up. An increase in demand without a matching increase in supply generates an increase in prices.

In “Organised Thinking” I am interested in the thinking process of the banker that lends money and that of the buyer that borrows money. Why the banker takes the risk of not being repaid? Why the buyer takes the risk of not being able to repay the mortgage and loose his/her property?

The bankers’ thinking process is easy to infer. They think that lending money for an interest is their business. The best case scenario is that everything goes well; the borrower pays capital plus interest. The worst case scenario is that the borrower cannot repay. This risk is contemplated: banks will keep the property. Although selling properties is not the business of bankers and they try to avoid this situation, the benefits are higher than the costs; therefore, they lend as much money as the borrowers are willing to borrow. Moreover, bankers are organized and powerful; they can lobby to obtain compensation from the government if there are many foreclosures.

Understanding the buyers’ thinking process is a bit more difficult. The main component of their thinking process is confidence. Buyers are confident that they would maintain their current incomes, so they would be able to pay. In this case, there is no problem at all. However, there are many persons that borrow more money than they can afford. Not only have they borrowed money to buy a property but also to buy a plasma TV, a videogame console, a laptop, etc. At some point these people cannot afford to pay any more and they start borrowing to pay debts. In a continuously growing economy this may last for the lifetime of the borrowers. However, if the productivity of the economy does not grow, the bubble will burst at some point and lenders would not lend more money.
In psychological terms, recession is lack of confidence. While there is confidence bankers lend money, consumers borrow money and, most importantly, producers invest to increase their production and their productivity. A healthy economy is one in which the aggregate confidence of people matches their aggregate skills. More confidence than skills is as bad as less confidence than skills. In the case that people are more confident than what they should be, there is a high probability that there will be inflation, whereas when people are less confident than their skills there would be recession.

Labels: , , ,


Friday, 8 February 2008

Do we think with our body?

The Situationist is an interesting blog created by Jon Hanson –Professor of Law at Harvard Law School- and Michael McCann –Assistant Professor at Mississippi College School of Law. This blog is associated with The Project on Law and Mind Sciences at Harvard Law School. This project

is devoted to identifying, inventorying, archiving, blogging, and otherwise promoting research, writing, conferences, colloquia, and presentations directed toward understanding the implications of social psychology, social cognition, and other related mind sciences for law, policymaking, and legal theory.

In February 7th they posted the article “A (situationist) body of thought”. This article is a commentary on another article published in The Boston Globe by Drake Bennett on January. The latter was titled “Don’t just stand there, think” and is a summary of a number of scientific papers that advocate that the body and its interaction with the environment have an important role in high-level cognitive processes such as thinking.

This approach is called “embodied cognition” and is against the traditional view in cognitive sciences in which mind is investigated independently of the body. The separation between mind and body in current cognitive sciences is reminiscence from Descartes conception of an immaterial mind separated from the material body. In a controversial book “Philosophical foundations of neuroscience”, published in 2003, Hacker and Bennett avowed that cognitive neuroscientists –despite rejecting Descartes’ mind-body dualism– use a new version of that dualism: brain-body dualism. Instead of ascribing mysterious powers to an immaterial mind, cognitive neuroscientists (mistakenly) ascribe the same powers to the brain.

Antonio Damasio, in his book “Descartes error” published in 1994, had already pointed out that neuroscientists do not pay attention to the role of the body in high-level cognitive processes such as decision making.

My view

I accept the embodied cognition view that the role of the whole body (not only the brain), the characteristics of the environment, and the idiosyncratic interaction of the whole body with the environment are part of cognition. I also accept that the theories of several neuroscientists and cognitive psychologists do not take into account the role of the whole body and its interaction with the environment.

However, this view is not entirely new. For example, Herbert Simon –one of the founders of traditional cognitive science– was a strong advocate of the influence of the interaction of the cognitive system with the environment in the way experts solve problems.

Furthermore, Piaget’s theory of the development of intelligence published in 1950s is an embodied theory of cognition.

What is new, then, in the embodied cognition approach?

In fact, although I am sympathetic to this approach, there is nothing new. Until some researcher does not develop a general theory of psychology that incorporates embodied cognition views, this approach is just gaining some space in academic psychology because media finds it attractive.

Drake Bennett’s article in The Boston Globe presents a number of new evidence that favours the embodied cognition approach. However, all the evidence showed, could be interpreted in a different way. (I will write about the role of evidence in psychology in a future post).

Embodied cognition is not a good approach to cognitive sciences because there is new evidence that favours it. It is a good approach because it is obvious that the body and the environment are essential aspects of cognition.

First, even if we only use the brain to think, since the brain is part of the body, we use our bodies to think. There is no immaterial mind doing the thinking; it is, obviously, the body that does it.

Second, just observe a scientist thinking of a theory. Most probably, the nervous system is consuming a lot of the energy, but in the process of thinking, the scientist takes notes, looks at the notes, stands up, goes for a walk (this may help him/her seeing things from a different perspective), drinks a cup of coffee, types the keyboard of the computer, draws graphs, etc. It is an experience in which the whole body is participating, not only the brain.

Third, the dissection of the human body in a number of systems (nervous system, digestive system, musculoskeletal system, immune system, etc.) is only convenient, it is not necessary. In other words, the human body is a whole, we sometimes observe at different parts of it, but the separation in systems is absolutely arbitrary.

Almost all of us started counting with our fingers. So, we used muscle cells (cells of the musculoskeletal system) of the fingers. But we also used neurons (cells of the nervous system) connected to the muscle cells. When we stop using our fingers to count (if we ever stop, that is!), we are probably still using the same neurons connected to the muscle cells of the fingers when we count. The only difference between a group of cells (motor cells) and the other (brain cells) is that the former are connected to parts of the body that are in contact with the environment and the latter are only indirectly connected to those parts of the body.

Summing up, the human body is more connected than modular; therefore, when we think we may use more or less parts of our body depending on the situation. Sometimes we may use mainly our brain; sometimes, we may use the brain plus other parts of the body. One thing is sure: our brain is part of our body, so we always think with our body. We do not need any new evidence to affirm this. v

Labels: , ,