As this extraordinary year ends you get news stories like this:
Investors are preparing to close out the last three trading days of 2008, a year in which Wall Street has logged its worst performance since Herbert Hoover was president.
The ongoing recession and global economic shock pummeled stocks this year, with the Dow Jones industrial average slumping 36.2 percent. That’s the biggest drop since 1931 when the Great Depression sent stocks reeling 40.6 percent. …
No one is hiding it any longer, saying this is just a recession like others we have had every decade or so. It’s not like the dot-com bubble thing, or any other downturn, save one. Herbert Hoover comes up a lot.
There is the argument that this is much like 1873, where, due to what was essentially a real estate bubble, the fundamentals of the world’s financial system collapsed:
As the panic deepened, ordinary Americans suffered terribly. A cigar maker named Samuel Gompers who was young in 1873 later recalled that with the panic, “economic organization crumbled with some primeval upheaval.” Between 1873 and 1877, as many smaller factories and workshops shuttered their doors, tens of thousands of workers – many former Civil War soldiers – became transients. The terms “tramp” and “bum,” both indirect references to former soldiers, became commonplace American terms. Relief rolls exploded in major cities, with 25-percent unemployment (100,000 workers) in New York City alone. Unemployed workers demonstrated in Boston, Chicago, and New York in the winter of 1873-74 demanding public work. In New York’s Tompkins Square in 1874, police entered the crowd with clubs and beat up thousands of men and women. The most violent strikes in American history followed the panic, including by the secret labor group known as the Molly Maguires in Pennsylvania’s coal fields in 1875, when masked workmen exchanged gunfire with the “Coal and Iron Police,” a private force commissioned by the state. A nationwide railroad strike followed in 1877, in which mobs destroyed railway hubs in Pittsburgh, Chicago, and Cumberland, Md.
In Central and Eastern Europe, times were even harder. Many political analysts blamed the crisis on a combination of foreign banks and Jews. Nationalistic political leaders (or agents of the Russian czar) embraced a new, sophisticated brand of anti-Semitism that proved appealing to thousands who had lost their livelihoods in the panic. Anti-Jewish pogroms followed in the 1880s, particularly in Russia and Ukraine. Heartland communities large and small had found a scapegoat: aliens in their own midst.
Well, no good came of that – although try as he might, CNN’s Lou Dobbs keeps maintaining all of what happened this time around was caused by those aliens in our midst, those shiftless Mexicans who keep crossing our border illegally and looking for work here. They are the problem – except they’ve stopped coming here, as there’s not much work to be had. He doesn’t talk about that much. That only confuses things.
Dobbs may seem a crackpot to many – an angry populist with his own agenda, and of course a popular television personality in search of solid ratings that will keep him living in the style to which he has become accustomed.
But there may be more to it than that. As people lose their homes and their jobs, and the lucky just lose their nest eggs and cannot send the kids to college, the truth may be sinking in. Unless you invested with Bernie Madoff, and thus lost everything you ever had, there really is no one in particular to blame – not the UAW, or an array of specific hedge fund managers, or a conspiracy of greedy executives (they’re not that competent, as you well know), or the lack of rules or too many rules, or this specific law or that one policy, or this politician or that, even George Bush. Everyone played a part, but no one masterminded this. You might blame Allen Greenspan or Milton Freidman – but that’s a bit abstract, as you’re blaming an economic theory. That’s not very satisfying – you want a villain.
But there seems to be no one villain, and Dobbs seems foolish, sputtering away, demanding we build a big wall from Corpus Christi to San Diego. Well, building that wall would put people to work – but that’s not his argument. And his ratings may drop as people see villains everywhere, and nowhere. He got stuck on his personal hobbyhorse – no one is listening to him now. It’s just not that simple.
But the worst thing about all this is that with no one villain there’s no one thing to do to fix things – you cannot send someone to jail, undo that one person’s actions, and have everything be all better. So we do other things. We’ve thrown massive amounts of money at the banks, to little effect, and we’ll bail out Detroit, which may not do much good other than keeping three to five million folks employed while we figure out what we should really do, and the new Obama administration seems heading toward spending almost a trillion dollars on stimulus programs – public works to rebuild our fast-crumbling infrastructure – but that’s just to provide jobs and the salaries that come with those jobs, to fend off the prospect of the whole economy stopping dead cold. That’s not so much a fix as it is life-support, like using a respirator until the patient can breathe on his own again.
The issue is a lack of control. On the personal level there’s not much you can control – spend what money you still have on only what is absolutely necessary and be the best ass-kisser at work, even if that won’t help when the whole company goes under. Everything else is out of your control.
But in terms of public policy this gets more complicated. Should we control spending, or spend like mad to get things humming again? Deciding which it will be has a great deal to do with defining the problem – the villains and their actions and the counters to those actions. But things are so out of control and complex that defining the problem is baffling the best minds. And so we get nonsense. Think of it as Lou Dobbs, squared.
Be prepared for nonsense. In fact, read Ed Yong at his site Not Exactly Rocket Science (“Science for Everybody”) – always a kick, and seldom if ever political, except when it inadvertently is. It is in this item, Lacking Control Drives False Conclusions, Conspiracy Theories. It a review of some recent social science and this is the key:
Together, this group of experiments shows that the need to feel in control is so powerful that people will resort to psychological solutions that return the world into a predictable state – pulling patterns from noise and causality from randomness.
Ah, that’s what we call political science.
Here’s the deal:
Control and security are vital parts of our psychological well-being and it goes without saying that losing them can feel depressing or scary. As such, people have strategies for trying to regain a sense control even if it’s a tenuous one. Jennifer Whitson and Adam Galinsky from the University of Texas have found that one such strategy is to identify coherent and meaningful relationships between things we observe.
These patterns can help us to make sense of past events and predict future ones, affording us a degree of control over our fates, albeit an indirect one. We can’t change the weather, for example, but if we can tell when it’s going to rain, we can be prepared. At the more extreme end, conspiracy theories can help the bewildered to make sense of otherwise unconnected events. And explaining random events by invoking superstitions or higher beings can help to bring reality’s many possibilities within one’s understanding, if not under one’s heel.
He could be talking about Fox News there. But what’s really talking about is these two in Texas demonstrating “the link between desiring control and seeing patterns through a set of experiments that used a variety of psychological tricks to induce feelings of insecurity among groups of volunteers.”
It’s kind of like watching cable news:
With these tricks, they managed to induce a number of different illusions – increasing the risk of seeing false images, making links between unrelated events, creating conspiracy theories and even accepting superstitious rituals. Superficially, all of these behaviors seem quite different, but they all involve seeing patterns where none exist. They have a common theme and now, this study suggests that they have a common motive too.
The motive is establishing control, even if you have none. Go to the link for a detailed explanation of the experiments, but this one is cool:
The next experiment used a real-life setting that frequently demands the ability to predict inherently unpredictable events – the stock market. Volunteers read statements about the financial performance of two companies after hearing that the stock market was either stable or volatile. Both companies had twice as many positive statements as negative ones, but company A had twice as many statements overall than company B.
During a stable market, the information gap didn’t matter and volunteers were about just as likely to invest in either company. But if volatile conditions were afoot, a mere 25% minority decided to invest in company B and more likely to associate it with the negative information. With less control over the fate of their investments, they were more likely to make a false connection between company B and its negative statements, even though the pros actually outnumbered the cons for both companies.
When you feel out of control you just make up things – connections where there are none. And it’s market theory too. The worst stock market drop since Herbert Hoover was president was generated by illusion.
And consider this:
What happens if you restore control? Will that reduce one’s propensity for seeing false patterns? To find out, Whitson and Galinsky asked volunteers to remember events where they had control or lacked it, and tested their tendency for see shapes in snowy images, and for believing conspiracy theories. This time, however, some of the volunteers were given a chance just before the tasks to complete a questionnaire on a value that was very important to them.
Studies have found that this sort of self-affirming exercise can help to counteract feelings of helplessness of distress, so the duo reasoned that it should go some way toward negating the tendency to see patterns brought on by a lack of control. And that’s exactly what happened – compared to volunteers who went straight into the tasks, those who remembered lacking control but had a chance to affirm their closely-held values were less likely to see patterns in snowy images or conspiracies in everyday events. They behaved in the same way as volunteers who had thought about being in control in the first place.
So FDR was right – we do have nothing to fear but fear itself, and specifically the fear we have no control.
Yeah, yeah – we actually have no control. But it’s nice to think we do, and useful – even remembering what it feels like to have once had control of anything at all keeps us from making up nonsense, and from turning into Lou Dobbs.
Yong adds this at the end, to frame this better:
Obviously, the effect has both good and bad sides that should make for interesting discussions. For a start, an ability to spot patterns isn’t necessarily a bad thing. It could be downright beneficial if it ramps up a person’s skill at spotting subtle trends that are actually real (although future studies need to test whether this actually happens).
Even spotting false patterns could have psychological benefits if it restores a person’s sense of control, increases their confidence or even reduces their risk of depression. Scientists, fond as we are of truth and fact, would typically argue that it’s better to get an accurate picture of the world around you. Whitson and Galinsky agree, but they also take a pragmatic stance, saying that “it may be at times adaptive [to allow] an individual to psychologically engage with rather than withdraw from their environment.”
Of course, there are instances when making false connections can be downright damaging, especially if they’re used as the basis of bad, or even fatal, decisions. Imagined pharmaceutical conspiracies or implications drawn about medicines from one-off anecdotes could drive people to embrace fruitless or potentially dangerous forms of alternative treatment. People can avoid taking responsibility for, or psychologically coping with, events in their lives if they ascribe them to higher powers or sinister agencies. And seeing too much meaning in the actions of others could lead to paranoia and severed social ties.
Glance at those last two sentences again. Think about the political changes in this country – Karl Rove predicted a permanent Republican majority, and after losing both houses of congress in 2006, they’ve lost the White House. They’ve lost control of the government. In fact, given the current balance in the House and Senate, they not just lost control of things, now they cannot even nudge things one way or the other. So consider these two simple sentences from Tim F. – “Republicans (and Republican bloggers) will spend at least the next two years with about as much political control as a bug in a jar. You can make your own conclusions.”
We’re in for some interesting theories.
In fact, see Digby here on this news item – Condoleezza Rice and Laura Bush are insisting that the administration will be vindicated by history for all the wonderful work it has done around the world. Digby is particularly amused, or bemused, that Rice is intent upon making the case that (1) if the world gets better sometime in the future, (2) Bush will be given the credit for it.
This definition of success would mean that you have to reevaluate Tojo since Japan has since become a prosperous, first world country. After all, if it weren’t for him, the world wouldn’t be where it is today. Hell, where would Western Europe be if it weren’t for that bad man in the mustache – or Eastern Europe if it hadn’t been for Stalin? Hey, even Caligula can be seen to be a hero if you believe that the world is better off today than it was during Roman times.
It’s not that Bush is necessarily as bad as those examples, but the logic behind Rice’s view inexorably leads you to evaluate everyone in history through the lens of human progress – which means that none of the great villains can be held responsible for their deeds and nothing can ever be learned from bad decisions of the past. As long as the world goes on you can always make the case that things will probably turn out ok in the long run. And that’s hardly any comfort – as the old saying goes, in the long run we’ll all be dead.
Of course this is nonsense:
In fact, in the short run a whole lot of Iraqi people are dead because of the United States’ inexplicable decision to invade their country. It is what it is and it’s offensive to compare temporary political resistance to a pragmatic humanitarian policy like The Marshall Plan to the worldwide revulsion at an invasion for reasons that made no sense, as Rice does.
If Iraq becomes a sane and prosperous nation some time from now, it will never render that policy, based on lies and propaganda, to be a good one – and Bush, Cheney and Rice will never get credit for any future progress because of it. They need accept that the best they can hope for is to end up among history’s inept clowns instead of history’s villains. It’s not much, but it’s all they’ve got.
It all comes back to those experiments in Texas. When you know things are out of control, and you don’t even remember what it was like to once have been in control of anything, you turn to nonsense – pulling patterns from noise and causality from randomness.
Digby also notes this:
One of the weirdest things I’ve seen in the past few weeks has been the bizarre, reflexive loathing of FDR crop up again. I hadn’t actually seen anything like it since I was a kid and the old folks would rail against “that man.” It seemed ancient even then, and that was a long time ago. And when I was in school it was taught without any caveat that Roosevelt saved capitalism, period. The historical context of that statement, in the middle of the cold war, was that communism was on the rise during that period and had Roosevelt not been able to get the country through the depression, there may have been revolution or a political overthrow on the order of Germany.
But that’s no longer a given – or perhaps it is, but the rise of conservative media makes the old FDR-hating seem more mainstream then it did back when I was a kid. We are suddenly being bombarded with the convenient revisionism of crackpots like Amity Schlaes and the confident gibberish of Fred Barnes … blithely passing on the popular contrarian fiction that FDR actually made the depression worse. The stuff about how Ronald Reagan saved the world by destroying the air traffic controllers union is especially rich.
It was only with the passage of New Deal efforts – the SEC, the FDIC, the FSLIC – that the mechanisms of private capital began to kick back into gear. Don’t take it from me. Take it from Federal Reserve Chairman Ben Bernanke, who wrote the following in Essays on the Great Depression: “Only with the New Deal’s rehabilitation of the financial system in 1933-35 did the economy begin its slow emergence from the Great Depression.”…
The argument that the New Deal’s efforts “perhaps had prolonged, the Depression,” is a canard. One would be very hard-pressed to find a serious professional historian – I mean a serious historian, not a think-tank wanker, not an economist, not a journalist – who believes that the New Deal prolonged the Depression.
Digby says this:
So, just as we seem to have finally been able to put the Vietnam era behind us (at least for the moment), we’re taking a trip back to the 1930s, and we’re going to have those same stupid arguments all over again.
Plus ça change, plus c’est la même chose, yadda, yadda, yadda. It never really ends.
Yeah, but at least those two social scientists in Texas explained why it never really ends. When you finally figure out you really do have no control any longer, well, you make up all sorts of things.