The worth of Earth and the human brain are a bad match. Sure, some humans don’t want the total known. But also, brains aren’t fully conscious.
Chapter 2
Denial ain’t just a river in Egypt.
– Mark Twain, humorist, author, proto-geonomist
Somethings right in front of you, you don’t easily detect.
If you’re bouncing a basketball, you might miss a gorilla.
If you’ve never seen a ship before, you might miss Columbus on the horizon.
And if you no longer need to know, you forget. Probably you can’t track a deer even though your ancestors could. Nor do you register “socially-generated surplus” even though your descendants will.
Because Eskimos have different words for different kinds of snow, they can instantly recognize each kind. Yet people in temperate climes don’t notice the different types. Even if an Eskimo pointed out the differences, others could not easily detect them.
How many people speak Chinese? Zero. Just like zero speak European. Neither exists. People who speak Mandarin don’t understand Cantonese and vice versa. We Westerners over-bundle.
Normally bundling’s not fatal. Except when a picker does not differentiate between mushrooms and toadstools, the latter being poisonous. Our bundling of spending for land with spending for human-made stuff isn’t fatal—just harmful.
Sometimes we don’t know because we can’t, or can’t easily know. We have a blind spot.
Since we can’t know something about everything, our brains are inherently conservative. Yet as Walter Lippmann, who coined “Cold War” and “stereotype” and won two Pulitzers, said a century ago, “Where all think alike, no one thinks very much.”
Then we turn to a specialist. However, doing so gives officials the leeway to make claims that don’t hold up and yet become widely accepted. Thus we think of homebuyers who’re deeply in debt to banks as “owners,” not as “owers.” We joke about paying rent to banks and banks being the actual owners, so we know about the relationship. But the variant we automatically, unconsciously use is “owner.”
Meanwhile, the environment – natural and social – constantly throws up challenges to our problem-solving ability. What do we do about unaffordable housing? Any idea? Most of us learn only new facts that fit in old frames. If we have no category for a fact, we dismiss it. Like kinds of snow, or tracks of deer.
Yet closing our minds shuts out solutions. Long ago, blind-spotted Europeans used a plow that caused them much backbreaking labor. However, Chinese farmers curved the blade differently so it would glide much easier – and increased their harvest.
Not knowing a fact differs from not acknowledging one. If you’re unfamiliar with an issue, you cannot easily judge it on its merits. Hence lone voices in the wilderness are often ignored.
However, doubt can be irrational, too. For instance, superiors more sensitive to cost than to science may doubt underlings. Recall the engineer who warned everyone the O-ring would fail, as it did, killing the astronauts aboard the Challenger. But there were other priorities.
Human brains are hardwired such that both knowing and not knowing please them. Somethings we just don’t want to know; then we choose to be in denial. Via denial and blind spots we cheat ourselves of knowing parts of reality – consequences be damned.
Society’s critics routinely reveal all sorts of facts and fancies about corporations, dynastic families, and government cover-ups. Yet our watchdogs don’t bark at the oldest “unearned income” (unearned by an individual owner but earned by some entity)—rent for land. Their blind spot keeps them from sounding an alarm.
Most can not see land but only what’s on it—unaffordable housing—missing:
what rises in value is not housing—already built—but land. Further …
who does the raising are not sellers and landlords but buyers and tenants with more money to spend on locations.
Paying for the never-produced – versus actual products – is a phenomenon that’s invisible to most of us. As Eskimos have several words for snow, English has many words for financial transactions – buy, sell, lease, rent, hire, pay, etc. But without a unique meaning for “rent,” we don’t see how it’s special.
Most economists go AWOL when it comes to assessing rent. These academics don’t request aggregates from public bureaucrats. And statisticians don’t feel inspired to tabulate the total on their own. In the absence of measurements, the non-measured thing disappears – and with it a great indicator.
“Across markets, price-to-income ratios peaked in 226 of 382 metro areas between 2005 and 2009 (with 99 of those metros peaking in 2006).”
– Alexander Hermann, Harvard Joint Center for Housing Studies “Price-to-Income Rations Are Nearing Historic Highs,”
September 13, 2018
What followed, of course, was recession.
Long after the dust settles, a Johnny-come-lately may note how rising rent culminates in collapse. This observation, coming a decade late, does most people no good, leaving savers and investors, not to mention governments, to fend for themselves. That most bureaucrats and academics ignore the danger, might that be an act of negligence worth a watchdog’s bark?
Blocked by politics and blindness, new ideas often don’t fare well with old ways of thinking. Yet obstacles can be surmounted, history shows. Then new knowledge can, as they say, set us free.