Things That Don’t Make Sense

By James Kwak

From Sebastian Mallaby’s review of Robert Shiller’s new book:

Psychologists have established that the key to happiness lies not in riches but in social esteem; therefore, Shiller says, financiers face powerful emotional incentives to balance profit seeking with a social conscience. “The futility of conquest in business mirrors the futility of conquest in war,” he writes. Just as it is impossible to extract much wealth from conquered countries, so it is impossible to extract much happiness from wealth earned unscrupulously.

Does anyone actually think that Wall Street traders and Greenwich fund managers, in general, temper their profit seeking because they want to be seen as doing good for society?

(Besides, the first clause above is simply wrong as a matter of fact: psychologists have established that happiness is a complicated thing, and “social esteem” is only one part of it. See Haidt, Kahneman, Gilbert, etc.)

24 thoughts on “Things That Don’t Make Sense

  1. I haven’t heard of the doctorate for wall street trading yet. Lets see one of those bozo’s step up to the plate.

  2. I think the trick is that it is actually “esteem within your (possibly chosen) peer group.” And the kinds of things that raise esteem for bankers within financial fraternities may not actually be the things we seek.

  3. Simple,
    Those folks believe in the theory “private vices, social virtues”. Under this assumption, greed is good for them and for the whole society. So that guy believes what he says. He doesn’t tell the whole story.

    I prefer believe in Santa Claus.

  4. Can there be a public intellectual with a less-deserved radius of influence than Shiller? Entirely based on delectating the obvious for the groundlings.

  5. Ladies and gentlemen, I believe that the folks on Wall Street equate having success and riches with having the biggest “Pecker!” He or she may be the shortest, fattest, baldest or frumpiest, but having the biggest paycheck, means you are top dog. And no matter what damages you left in your wake to get there, you know it was worth it, no matter what the world thinks of you. You have the biggest pecker! Or at least you have plenty of underlings who will tell you that you do.

  6. OK, this is a decent, family blog, and I will refrain from adding to Felix above, but it was pretty darn funny.

  7. I am happy when I dont lose money, actually, Making big profits comes with too much stress, however, knowing that I didnt lose money in the ’07 – ’11 calendar years was a huge emotional rush.

  8. >…..temper their profit seeking because they want to be seen as doing good for society?<<<
    Yes, I am enough of a fool to think so. I am a farmer and farmers have been shamed into being more environmentally conscious and now most embrace it, even though theoretically it costs us money. The beginning of the shaming process on the financial industry has just begun.

    James and Simon, keep it up. You will get somewhere.

  9. Social esteem is a big deal… but it also tends to be localized primarily to the individual’s ‘Dunbars Number’-sized social network…

    Issues in Scaling Civilization: The Altruism Dilemma

    This makes cheating easier… and with sufficient cognitive dissonance can even be seen as ‘God’s work’…by those engaged in it.

    Issues in Scaling Civlization: The Monsters-from-the-Id Dilemma

    And the pathology is self-reinforcing

    Compensation and the Social Network

    Ayn Rand & Alan Greenspan: The Altruism Fly in the Objectivist Ointment

    I’d suggest that its only when money’s intimate connection to decision is recognized… whether we like it or not…

    Decision Technologies: Currencies and the Social Contract

    that we can begin to understand that Keynes was ‘mostly’ right… and that the nature of the distribution of a currency across a population can either inhibit or enhance its capacity to function.

    As repeatedly happens in history… the characteristics of a scaled society… unless attended to (its those scaling issues) will concentrate both money and decision at one end… eventually producing collapse.

    While it has its risks… there is for the first time in history… an opportunity for a very new kind of transaction that may help re-balance this landscape…

    and that’s the political microtransaction… and its utility in networked speech and lobbying and other forms of group organization in large societies.

    When will I have the chance to give this model some air? I contend this neutral utility… never literally even possible to before exist… MUST be built… and soon.

    The Chagora Model: Scaling Speech

    P.S. Pleased to now have author David Brin (The Transparent Society) and Douglas Rushkoff (Program or be Programmed) ready to participate if and when I can get a group together to make this model a reality.

  10. From a review by Michael J. Thompson in Dissent Magazine of David Harvey’s, “A Brief History of Neoliberalism”:

    ‘in his Grundrisse, Marx explicitly argued that capital is a process that puts into motion all of the other dimensions of modern economic, political, social, and cultural life. It creates the wage system, influences values, goals, and the ethics of individuals, transforms our relation to nature, to ourselves, and to our community, and constantly seeks to mold state imperatives until they are in harmony with its own….

    Neoliberalism, as Harvey tells us, quoting Paul Treanor in the process, ‘values market exchange as “an ethic in itself, capable of acting as a guide to all human action, and substituting for all previously held ethical beliefs,” it emphasises the significance of contractual relations in the marketplace. It holds that the social good will be maximised by maximising the reach and frequency of market transactions, and it seeks to bring all human action into the domain of the market.’’

  11. @filbt – I guess for someone like you who still BELIEVES the world is flat would think Marx is a relevant “economist”.

    Didn’t suck enough blood out from someone today? You always come on here to abuse when you are left thirsty for your daily bread of sadist profit…it’s an obvious pattern after all these years…

  12. Thank you for your serious consideration of my comment.

    But what do you all think of ethics in contemporary USA? Are they informed by a concern for the welfare of those who are injured? Or are ethics informed by wealth, whereby the impoverished are criminalized, and the wealthy are righteous?

    Am I wrong? Are you still prescribing to the ideas of Romney and the ‘culture of poverty’? Or can we start looking at this system?

  13. Annie you SO right about the world being flat, if people actually could open their minds to different cultures, the world might not be such a CRUEL place. But until they do, humans are meant to suffer, welcome to sufferigat city annie, which is really where you belong, I hope you enjoy your stay with your ignorant bliss, there seems to be no shortage of that in your country for the past several moons.

  14. You are the prime example, filbt, why civilization is earned through intelligence and not force. Going straight from being a savage naked in the wilderness into the boardroom via an inheritance just makes you an a–hole.

    Enjoy the “different cultures” that will make up Global Crimes, Inc. – the corp replacement for the USA run by NEOCONS and the rich man’s idiot sons…..we’re leaving in droves now from this god-foresaken country that welcomes ONLY the War/Slave/Drug lords – what HUBRIS to pretend that a Welfare Queen SADIST like you are a “different culture”. ROTFL.

    It’s a JUST WAR.

  15. @phillytravels – don’t be ridiculous. Everyone HATES the neocons with a growing explosive passion and 99% consider all out war worth the price to take them out of power forever,,,,

  16. Do you have any CLUE, you delusional rattlesnake venom “powder” pusher, filbt, how many SUPERIOR, in every way shape and form, USA people consider the entire retinue of the Bush Cabal to be guilty of WAR CRIMES equal to, if not worse, than those paraded out in Nuremberg? And seeing that whole filthy tribe of psychopaths waving their oil dicks, in total depravity like you and Paddy do on the internet, as a way to get back in to the White House is all anyone needs to “join the band”….

    Yeah, not everyone “deserves” a home and health care – especially do they NOT deserve it when they can provide a SUPERIOR level of both for themselves and their CIVILIZED FELLOW COUNTRYMEN.

    The bankster cabal re-tooled the USA economy for perpetual war in the Middle East because that is HOW the Welfare Queen survives – or should I call her THE REAL Whore of Babylon?

    Middle Class economic fortunes have been slammed down below the savage Global War/Drug/Slave Lords – IT IS A full on WAR and it is JUST.

    So my Vegas bet is that neither candidate “wins”….might as well just run that algorithm now instead of on election night and whip out the kabuki Supreme Court theater to conduct the coronation because it ain’t gonna be any more “real” in November as reflective of the Will of We The People than it is today.

    Read the Declaration of Independence – human nature being what it is, it was PROPHET-SIZED that there will be a time to reset things, and that time certainly is now.

    We the People see BOTH candidates as WAR CRIMINALS. Get it?

  17. filbt to Annie – “…I’ll let you know when your timer is up…”

    And where is homeland insecurity when a person is told they will be murdered when the psycho wants to do it….

    I am protesting the RIGHT of filbt to post here.

    Seriously, Kwak and Johnson, what is your story when it comes to a poster like “filbt”?

    Who is HE to tell me he’ll let me know when “your timer is up”….?

    Do I or do I not have the RIGHT TO DEFEND MY LIFE????!!!!

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