“I’m so bored. I hate my life.” - Britney Spears

Das Langweilige ist interessant geworden, weil das Interessante angefangen hat langweilig zu werden. – Thomas Mann

"Never for money/always for love" - The Talking Heads

Friday, November 01, 2002

Remora

LI rather trailed off on our post before the last post -- as you might have noticed, LI is an incorrigible meanderer. This is, we suppose, a vice, but surely one of the salient differences between weblogging and real commentary, such as is published in a newspaper, is that the endings aren't so neat. The topics, too, are a bit more variegated. For instance, I imagine the local rag would not publish an op ed piece that begins with a consideration of Bishop Butler's Analogy. Yes, they are warned about such things by the marketing department.

In any case, we were talking about Diane Coyle's exhibition of the deficiencies of common sense and the excellencies of economics -- which exhibition, we claimed, was marred by a severe misconstrual of categories, and a parochial vision of economics. (Coyle's comments, on the Financial Times website, has now been closed off to non-subscribers). Ms. Coyle is a great one for tearing down tariffs and promoting the benefits of free trade. It is, in fact, her grand solution to the chronic problem of poverty. She explains this in an essay in the Guardian, the premise of which is that the anti-globalizers have it all wrong. Protestors should be out there demanding more free trade, liberalization on an international scale, rather than supporting the multitudinous corruptions of protectionism.

"If the moral outrage at the extent of poverty, hunger and disease in the world, and the political momentum for change generated by the campaign movement of recent years, are to achieve anything worthwhile, outrage will need to be informed by evidence on the economic effects of globalization. In many developing countries the best response to the problems that emerge because of globalization is hardly ever a retreat from global integration.

On the contrary, this would often harm growth and make the problems of poverty harder to solve.In our report we address the charges that command widespread support among anti-globalization protestors. A commonly held belief is that globalization has caused extensive poverty. While it is true that 1.3 billion people currently live on less than $1 a day, this number has not changed much since 1950 and has actually fallen sharply as proportion of the world population to 24% from 55%. The recent era of rapid globalization has improved the living standards of many of the poorest, not worsened it."

There are many things to say about the above paragraph. One of them is to ask about the absolute fetishization of the $1 a day standard. This is not a good standard for what the world population could live on. It skews the conversation about poverty and inequality to the cases on the bottom, and their miserable, incremental improvements, rather than to the cases on the top, and their baroque, excessive expropriation of resources.

But leaving that aside, we should note that that all the measures of world poverty are subject, at the moment, to heated debate, which tends to get very technical. The International Monetary Fund hosted a debate on the question of whether world inegality is rising between the left, middle and right which has been posted here. The neutral observer's first reaction to it is that much of the debate degenerates into much mumbo jumbo about methodologies. The right wing is represented by an Indian economist, Surjit Bhalla. Bhalla will surely be touted by rightwingers the way Bjorn Limborg achieved celebrity. Bhalla says, at one point, that the issue of inequality is basically driven by envy. This is the essence of the right wing polemical position. It is rather stupid, since the essence of the right wing polemical position about capitalism is that greed is good. The latter is a position that goes back a long way, in economic literature, to Mandeville's Fable of the Bees -- our individual vices are woven, by the mysterious work of the Invisible Hand, into public goods. Well, envy is as good an individual vice as any. More seriously, Bhalla contends that all around the world -- except for Sub-Saharan Africa -- the figures point to this conclusion:

"Essentially, regarding growth, what we find is that the developing countries grew at about one percentage point lower than the developed countries during 1960 to 1980, and the numbers are 2.1 and 3.3, respectively. But during 1980 to 2000, the developing countries far exceeded the growth rate of the industrialized West and grew at 3.6 percent rather than 2 percent for the West.So first piece of evidence, and these are national accounts data, which is what the World Bank uses, the IMF uses, the countries themselves use, that growth rates of the poor countries far exceeded the growth rates of the West during the so-called globalization period. So that's evidence number one.

"Number two, what happened to inequality? I find that inequality has been on a steady decline�world inequality has been on a steady decline, reversing almost a 200-year trend, peaking in the mid-1970s, and today inequality in the world is at its lowest level for possibly 100 years.What is the counter-evidence to that? There are two or three sets of studies, one which states that basically inequality flattened out during the last 30, 40 years, and another one from the World Bank which states that inequality increased at an absolutely unprecedented pace between 1988 and 1993. I find, as I said, just the opposite. "

Basically, Bhalla is claiming that the golden Keynsian era was a bad time for developing countries, whereas since the mid 70s -- since, that is, the beginning of the conservative rejection of Keynsian liberalism -- developing countries have been catching up. Partly, of course, as you can see from his figures, this stems from the developed countries slowing down -- the 2 percent growth rate for the West is much lower than it was in the 50s.

The transcript of the IMF debate is lively, but often veers off into incomprehensible disagreements about survey results and purchasing power comparisons. LI wants to make a simpler point about what Ms. Coyle has called living standard. I think the living standard, if properly fleshed out, gives us a sense of what is wrong with that version of globalization that emphasizes privitization and tearing down barriers to trade and capital flows.

If you will recall the post before last, we started with a quote from Adam Smith. Smith's idea has been a powerful one in economics. Here it is again:

"The rich only select from the heap what is most precious and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements." This is, by the way, from Smith's A Theory of Moral Sentiments, in Part IV, Of the Effect of Utility upon the Sentiment of Approbation

As Aristotle might put it, there's a sense in which Smith is correct, and there is a sense in which he is incorrect. What Smith meant was that dwelling in a costly pile was merely a highly ornamental way of keeping out of the rain. You can keep out of the rain, as King Lear learned, in a hovel for less cost. Similarly eating peacock's eyes and eating chicken eggs is eating; clothing yourself in silk, or in flannel, is clothing; etc.

However, this absolute way of looking at consumption was suspect even in Smith's day. From, say, the point of view of energy use, the rich consume vastly more than the poor. Smith felt that this was covered by the fact that the consumption of the rich is the employment of the poor -- which still doesn't make his precept true. What made Smith's general point plausible, however, is that, in a relatively technologically primitive society -- and the eighteenth century was still that -- the fine differences between rich and poor are evened out by the gross similarities. The rich in their Georgian mansions were apt to be as bothered by dampness and drafts as the poor in their hovels. They were apt to die of untreatable illnesses, like the poor, with only the advantage that their money hired the best chirugeons and doctors to torture them before that blessed terminal event. The food the nabob ate and the water he drank -- on those rare occasions when gin wasn't available -- was apt to be as contaminated as the beverages and victuals of the poor.

This is no longer the case. Ah, but I am going on and on, here. LI will continue this at some future point.

Thursday, October 31, 2002

Dope

Last night, LI's friend S. came to the door with two pumpkins. S., I think, likes the ritual of carving the pumpkin because of it seems so American to her -- and thus, slightly outlandish, the way American names are outlandish -- all those first names that don't mean anything, unlike Turkish names. It is an American habit to assume that our rituals are self-explanatory, whereas in other cultures the rituals are often all about explanation, are occasions in which memory is culturally ritualized. For Americans, a memory that is transmitted by ritual is, by its very nature, inauthentic. We mourn the lack of the individual rememberer -- we want experience to be located, and we think that location is in the individual.

For LI, carving a jack o lantern is the kind of thing associated with childhood's clumsy arts and crafts -- fitting stubby fingers into dull scissors and snipping out circles from orange construction paper (ah, the feel of construction paper! its distinct roughness, its graininess, the crayon box colors it comes in, the way tiny, curved bits of it would escape from the scissors and float down to the linoleum tile floor; the way it would darken around a drop of glue, a dab of paste; the way you sprinkled it with glitter to enliven its stubborn drabness; the way it dominated all other media of art until about the sixth grade! LI, a childless bachelor, alas, wonders if construction paper still exists, somewhere -- if, yesterday, there were third grade classrooms where boys and girls were hunched over their orange and brown and black and red paper, inexpertly scalpeling out the outline of witch's hats and broomsticks and cats and ghosts, some teacher -- there were so many for whom LI's heart, at that age, throbbed, Miss Eberhardt, Miss Smith -- making her way down the aisles, the slight smell of her perfume as she bent over you, commenting on your childish assemblage -- but LI digresses).

So, after fortifying ourselves with margaritas at a Mexican restaurant we returned to my place and fortified our fortifications with vodka, then commenced to serious surgery on the pumpkins with the four knives I was able to round up. LI created one of his wobbly eyed jacks, with a big honker nose, the jumbled mouth, and a few artistic touches -- this year, we tried to inscribe something that looked like a skull and crossbones on a cheek, as though the jack had tatooed himself. S., working on more classic lines (plenty of triangles, well wrought), made a more traditional jack. We named our pumpkins, lit candles and put them inside, and turned out the lights. S. had put on the Moulin Rouge CD, so we toasted our little creations and then sang along to the tango version of Roxanne.
And thus we ushered in another Halloween.

Tuesday, October 29, 2002

Remora

First, a note. LI begged the Enigmatic Mermaid to post about the Lula election. She did so. In Brazil, we believe, the feuilleton is called the cronica. It is a form known to Americans from the translation of Clarice Lispector's cronicas, of which a review is here. Well, we don't want to flatter the mermaid (well, maybe we do, a little), but while we sometimes find Lispector's cronicas a little, shall we say too caught up in their own sentimental intelligence? a bit too self appreciative? we feel that E.M. would rather buy a used Che Guevara bikini than aphorize hollowly.

Although perhaps we are being unfair to Lispector. Someday we are going to do a post about the influence of Jules Renard's writing, especially the journals, on the cronica/personal essay format.

And now for our feature presentation.

"The rich only select from the heap what is most precious and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species." -- Adam Smith


LI was agreeably surprised to see the Arts and Letters website back on-line, thanks to the Chronicle of Higher Education. We've taken a lot of links from that site.



The one we are taking today is to Diane Coyle's column in the Financial Times, which presents a skewed and problematic defense of economics as a science. LI uses problematic in the sense that someone might say, the verticality of the Tower of Pisa is problematic. Or, the election of President Bush is problematic. There�s a telling strain, in other words, between semantics and reality. Coyle�s defense is flawed both in the main line of its attack and in its examples.

As in, primero: Coyle is defending economics against common sense. This is much like a biologist defending biology against the amorous habits of the toad. Common sense, whether deluded or not, shapes organized social behavior. This is, in fact, the whole import behind the work of Kahneman and Tversky, which we have been discussing lately. The resistance to experimental work in economics is quite hard to root out. It isn�t resistance to economics � it is the data to which economics must attend. This is how Coyle puts the issue:



"The trouble with this chasm between the economist and the ordinary person is that when economics and common sense conflict, common sense is almost always wrong. This signals a profound failure in the typical education. Most people - even, I daresay, some readers of the Financial Times - are economic illiterates. Education authorities would do a great service to future generations if they ditched woolly lessons in citizenship or even worthy ones such as geography in favour of economics."



Now, that first sentence is a disaster from every point of view. What Coyle probably means is that conventional assessments of the economic situation at various points in the business cycle are usually wrong -- or at least that is how LI read it, at first. But of course those assessments drive the expectations that create economic activity. Economists are notoriously bad predictors. The Economist annually summarizes the correctness, or lack of it, of the collective predictions of economists, and what they find, usually, is that those predictions are pretty startlingly off. It is for this reason that economics is not considered a real science by, say, your usual physicist. It has the trappings of a science -- that is, it can produce thoroughly mathematized models -- but it can't seem to produce a good model of the real system that it supposedly studies. It is as if we had a science of water that couldn�t explain ice.



However, LI's first reading of Coyle's paragraph was wrong � it isn�t the economic errors of businessmen to which Coyle is pointing, but to the opponents of free trade between nations. Let�s grant Coyle this much: there are reasons to think that this is the core of economics -- after all, Adam Smith's book was about the wealth of "nations" -- but Coyle's example shows a peculiar blindness to variability of models. It is, in fact, an excellent proof that economics, divorced from common sense, is blind.



"Take one area where common sense and economics often clash: international trade. To the economist, the point of trade is imports. The more of them, the cheaper they are, the better for the nation's welfare. Exports are simply what the country has to do to pay for imports, just as work is what the individual has to do to pay for food and clothes. Thus unilaterally reducing tariffs on imports, even if no other country reciprocates, can be a sensible policy.



To the earthling, though, the point of trade is exports: national strength rather than the welfare of citizens. As Paul Krugman has so often and so eloquently pointed out, most discussions of trade policy even fail to acknowledge that the balance of payments has to balance (so that one country cannot be simultaneously swamped with cheap imports and exporting its jobs to sweatshops abroad)."



Well, yes, reducing tariffs can be a good policy. But Coyle's argument is, I think, fundamentally flawed for a common-sensical reason -- she assumes that the economic constitution of nations is scale invariant. In other words, what works for the United States should, pari passu, work for Argentina. This simply isn't true, as any objective survey of nations would show you. No other nation could maintain both a crushing trade deficit and a high currency as the U.S. does -- and the reason for that is that the US economy is of a much larger scale than the Argentine economy, for instance. General laws still apply -- eventually, the dollar will crash in value, all things being equal -- but because general laws apply more slowly in the case of the dollar, it is always possible that the US can leverage its scale to prevent an abrupt crash of the value of the dollar, or even pre-empt it. It is hard to see how any other country at the present time could do that.

These are the factors that make the unilateral decision to drop trade barriers at all times in all places (or, its equivalent, the decision to cancel governmental supports of national industries and agriculture) a bad policy. It can lead to a quick boom and a deep 'recession" -- as we now call what we used to call, with more sense, a depression. Argentina is a wonderful example of how liberalizing an economy can lead to disaster. You will notice that no economist is urging the Argentine government to run a deficit in order to get out of its current horrible situation. You will also notice that economists of both the left and right are urging the U.S. to run a deficit in order to get out of its current pretty bad situation. The reality is, IMF strictures on the American economy, if structured along the lines of Coyle�s scale invariant model, would lead to a global depression.

So, are there positive reason to have tariffs, or to have the government support industries and agriculture? Yes, there are. The reason is similar to the reason governments allow inventors to monopolize an idea for a certain period of time. Tariffs allow indigenous industries, and agriculture, a zone of inefficiency within which they can innovate, in the same way that monopoly allows inventors a zone of inefficiency in which they can get a fair return on their investment. One has to remember that all economic events happen along some time-line. Argentina, by liberalizing the economy in the way the hotshot, neo-liberal ministers did, ignored the patterns endemic to that time-line � that is, the unavailability of deficit spending in times of business retraction, which is, after all, inevitable. Economists from America, always on hand to advise governments to privatize, consistently ignore the time-line, and the conditions inhering on small scale national economies in times of recession. In fact, they are like gamblers who think they have devised a system that will guarantee a permanent lucky streak. Which is why a pattern has been established that seems to have escaped Ms. Coyle�s attention: advisor from Harvard or MIT or Chicago goes to Third World Country x; advisor gets president of x to liberalize the economy; a boom follows liberalization, greatly increasing spending power of the top ten percent of the population; a devaluation of the currency follows, as the boom proves to be shallow and unsustainable; advisor, from tenured position at Harvard, et. al., writes op ed in Business Week or Forbes listing reasons liberalization didn�t go far enough, and blames collapse on these reasons.

Differences in scale also lead to deviations between the measure of income inequality and the measure of inequality in real purchasing power. Tomorrow, LI is going to expand on this little thought with regards to Coyle�s remarks in the Guardian.

Monday, October 28, 2002

Remora

There's an election day coming up -- which fills LI with about as much enthusiasm as an arachnophobe contemplating a new species of tarantula. The election process this year has been particularly grim, seemingly run by the utterly braindead for the utterly braindead, and processed by the utterly smarmy. In the meantime, the electorate is completely left out. DC decides what is important -- the war with Iraq, for instance --and decides how people should feel about it, and then gets all surprised when they don't feel that way. Wellstone, before he died, was pulling ahead of his opponent partly because of the war issue -- Wellstone voted against it. Now, to you and me, that might mean he'd tapped into ambiguity, to say the least, about the upcoming war. But not for the press. No, that was about Wellstone being kinkily independent, and people voting for him expressing himself, in spite of their own limitless enthusiasm for what DC decided about Iraq. For the DC line is that the war is wildly popular. Any evidence to the contrary is, well, a problem with the country. Just as the country had this wierd problem with impeaching Clinton -- DC decided this was just the thing to do, and just the thing to obsess about, and the country, for some reason, had other problems.

On the smarmy front, we have William Saletan -- the man who proclaimed Bush "toast' in the last election. Impeturbably pompous, a man who has the cleverness of that college room-mate that freshmen learn to dread -- you know, the one who just talks on and on, mostly about his own magnificent accomplishments -- this is the man is gracing Arkansas this week for Slate. Of course, it is an effort for a man of Saletan's rare sensibilities to have to encounter the gross flesh of Arkansas. He discovers a man missing teeth in a diner, as well as a man who is unshaven. He goes to hear Hutcheson, the Republican incumbent, make a speech:

"I do want to introduce my wife Randi. She's right over here," he says. With a giant whoosh, every head in the room turns. This is no ordinary political wife. This is the former staffer Hutchinson married a year after divorcing his wife in 1999. Around the room, dozens of people stare at the new Mrs. Hutchinson and mentally subtract 50 rosaries from the senator's penance. She isn't the bimbo they expected. She's pale and bulky with a weak chin. She's wearing almost as much makeup as the Fox News correspondent. She looks older than her age. "How old was his first wife?" one reporter asks. "Older," says another."

Wearing too much makeup, is she? Bulky, is she? Ah, not up to the exacting standards of our ace reporter! Poor Saletan, who sees the stye in his neighbor's eye, but doesn't see the redwod tree sized log in his own!

LI is reminded of what George Bernanos's says about imbeciles in Les Grands Cimetieres sous la lune, the book in which he decisively broke with the far right over the Spanish Civil War. It is 1937, and Bernanos had been very close to Action Francais, the proto-fascist group. But as he watched the right drift into supporting Mussolini and Hitler, he begins to rethink his position -- which was always based on a very Pascalian Christianity. He remarks that, in a previous book, he had vowed to move the reader, "to anger or to affection, I didn't care." Now, he says, moving the reader, at least to anger, tires him out:

"The anger of imbeciles has always filled me with sadness, but now it fills me with horror. The whole world echoes with this anger. What else? They like nothing better than understand nothing at all, and they will even gather themselves in groups to do that, for the last thing man is capable of is being stupid and mean all alone, a mysterious condition reserved, no doubt, for the damned. Understanding nothing they assemble together, sorted not by their particular affinities, which are feeble, but after the modest function they hold from birth or chance, which entirely absorbs their little life. For the middle classes are the only ones to furnish forth the imbecile; the superior classes monopolize the fop, a genre of useless stupidity, while the inferior classes only suceed in manufacturing sketches of a gross and sometimes even admirable animality."

Yes, Saletan is an exemplar of this imbecility, right down to the faux Mencken attitude. Multiply this attitude by his cohorts and fellow travellers -- the media, the political consultants, the politicians themselves -- and you have a perfect machine for destroying the motive to vote. To vote is a contract, a way of sealing a pact with the nation. It is, after all, our nation -- that is the story. But the idea that the average voter is a species of dog to whom galvanic shocks are administered every six years, via tv ads, to get him to salivate in the voting booth -- this is the entire attitude of DC. Look at the funny dental work! Look at the makeup! Am I funny now?

Disgust, disgust, disgust -- the great enemy of vision. The Saletans of the world really do fill me with horror.






Sunday, October 27, 2002

Dope

LI moves slowly but surely � admittedly, sometimes we go off the track all together, but it is all in the interest of the Grand Plan. Not to worry, gents and ladies. Our consideration of Bishop Butler, in the next to the last post, was meant to tie in to the our criticism of Christopher Hitchens � hard as that may be to see.

What Butler�s Analogy has to do with the upcoming war in Iraq, or at least the arguments that are being made about it in the American and English press, will become clear in good time.

Let�s go back to the Butler quote, with its play on likelihood. What Butler is doing here is at the heart of one of the great controversies about probability. Is probability about events themselves, or is it a measure of the observer�s consciousness of events? Is it true that, in some non-subjective sense, tomorrow�s sunrise will be like today�s � insofar as it is a sunrise? Are conditions of identity dependent on a likeness of events in nature, or is this likeness merely the impression of an observer that is unconsciously projected onto nature? The latter question is complicated by the slight bias infiltrated into the problem by the word �nature� � as if the consciousness itself were somehow extra-natural. Let�s naturalize the consciousness � by fiat � and make it this question: is there something in the consciousness that makes likenesses, or does it make sense to say that even for sunsets that are not observed, one is like the other?

This is the question posed by the work of Kahneman and Amos Tversky. In 1998, when Tversky died, the editors of Cognitive Psychology brought together a special issue in his honor, that has some interesting essays � although not, alas, available on the web. We�d especially recommend Eldar Shafir�s overview of Tversky�s work. He introduces it adducing four axioms of probability theory:

�The normative approach to probabilistic reasoning is constrained by the
same rules that govern the classical, set-theoretic conception of probability.
Probability judgments are said to be �coherent�, if and only if they satisfy
some simple conditions: (1) no probabilities are negative, (2) the probability
of a tautology is 1, (3) the probability of a disjunction of two logically exclusive
statements equals the sum of their respective probabilities, and (4) the
probability of a conjunction of two statements equals the probability of the
first assuming that the second is satisfied, times the probability of the second.�

The reason the emphasis is on normativity, here, is that Kahneman and Tversky were concerned with how closely the assumptions of utility theory, which depend upon judgments of probability in order to calculate the maximum benefits attendent upon actions, correlate to what we know about how human beings really do form Bishop Butler�s likenesses. This, in turn, provides a nice twist in the debate between the psychological school of probability and the realist school. What Kahneman and Tversky demonstrated is that people make judgments of probability based on the way the likeness situation is framed. Here�s how Shafir puts it:

�Consider a set of propositions each of which a person judges to be
true with a probability of .90. If the person is right about 90% of these, then
the person is said to be well calibrated. If she is right less or more than 90%,
then she is said to be overconfident or underconfident, respectively.
A great deal of empirical work initiated by Tversky and Kahneman has
documented systematic discrepancies between the normative requirements
of probabilistic reasoning and the ways in which people reason about frequencies
and likelihoods. In settings where the relevance of simple probabilistic
rules is made transparent, subjects often reveal appropriate statistical
intuitions. Thus, for example, when a sealed description is pulled at random
out of an urn that is known to contain the descriptions of 30 lawyers and
70 engineers, people estimate the probability that the description belongs to
a lawyer at .30, in line with prior probability. In richer contexts, however,
people often rely on judgmental heuristics that do not obey and can distract
from simple formal considerations and these can lead to judgments that con-
flict with normative requirements.�

One of the most famous of the TK abnormalities has to do with conjunction, and the almost universal tendency to make wobbly judgements about the conjunction of probabilities. In a Discovery Magazine article that lists seven problems with probability judgments (which LI has found on a site that does not cite the author of the article � naughty, naughty � it was by Kevin McKean,) they quote the most famous confusing instance of this:

1. Linda is 31, single, outspoken, and very bright. She majored in philosophy in college. As a student, she was deeply concerned with discrimination and other social issues, and participated in anti-nuclear demonstrations. Which statement is more likely:
2. a. Linda is a bank teller
3. b. Linda is a bank teller and
4. active in the feminist movement.

Most people give a higher probability to the fourth statement than the third statement, even though, if you analyze it, you can see that it has to be less probable � insofar as the set of bank tellers is larger than the set of bank tellers active in the feminist movement. In other words, conjunction here, unlike addition, narrows the set, instead of expanding it. It is hard to get this through one�s head, however. The additional information about Linda moves us to suppose that, if she is a bank teller, surely she is a bank teller in the feminist movement. There�s an essay by Stephan Jay Gould, which, in the course of explaining the miraculousness of Joe Dimaggio's hitting streak, explains how Tversky showed that streaks, or �hot hands,� in baseball or basketball don�t exist � or at least not the way we think they exist. Here's how Gould makes the point about our perception of streaks, and what it says about our perception of the probable and the improbable, using the Linda example.

"Amos Tversky, who studied "hot hands," has performed a series of elegant psychological experiments with Daniel Kahneman.[5] These long-term studies have provided our finest insight into "natural reasoning" and its curious departure from logical truth. To cite an example, they construct a fictional description of a young woman: "Linda is thirty-one years old, single, outspoken, and very bright. She majored in philosophy. As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in anti-nuclear demonstrations." Subjects are then given a list of hypothetical statements about Linda: they must rank these in order of presumed likelihood, most to least probable. Tversky and Kahneman list eight statements, but five are a blind, and only three make up the true experiment:
Linda is active in the feminist movement;
Linda is a bank teller;
Linda is a bank teller and is active in the feminist movement.
Now it simply must be true that the third statement is least likely, since any conjunction has to be less probable than either of its parts considered separately. Everybody can understand this when the principle is explained explicitly and patiently. But all groups of subjects, sophisticated students who ought to understand logic and probability as well as folks off the street corner, rank the last statement as more probable than the second. (I am particularly fond of this example because I know that the third statement is least probable, yet a little homunculus in my head continues to jump up and down, shouting at me�"but she can't just be a bank teller; read the description.")"

Gould also gives a nice summary of Kahneman and Tversky�s conclusions about �natural reasoning.� Gould, of course, like the counter-intuitive feel of the experiment, because he was always, famously, on the lookout for false patterns. Like Gould, LI has read more than his share of Karl Marx, so we have an abiding suspicion of the ulitilitarian definition of rationality and the systems built upon it. TK gives one the feeling that, finally, here's proof that the whole neo-classical economic thing is a hoax. Well, that, too, is a misprision of a pattern. But to continue with Gould:

�Why do we so consistently make this simple logical error? Tversky and Kahneman argue, correctly I think, that our minds are not built (for whatever reason) to work by the rules of probability, though these rules clearly govern our universe. We do something else that usually serves us well, but fails in crucial instances: we "match to type." We abstract what we consider the "essence" of an entity, and then arrange our judgments by their degree of similarity to this assumed type. Since we are given a "type" for Linda that implies feminism, but definitely not a bank job, we rank any statement matching the type as more probable than another that only contains material contrary to the type. This propensity may help us to understand an entire range of human preferences, from Plato's theory of form to modern stereotyping of race or gender.�

Tomorrow we will finally get around to why we think this almost instinctual process of matching to type explains the way the pro-war faction is framing our choices about Iraq.