The Rational Optimist (P.S.)

by Matt Ridley

The French sociologist Gabriel Tarde wrote in 1888: ‘We may call it social evolution when an invention quietly spreads through imitation.’ The Austrian economist Friedrich Hayek wrote in the 1960s that in social evolution the decisive factor is ‘selection by imitation of successful institutions and habits’. The evolutionary biologist Richard Dawkins in 1976 coined the term ‘meme’ for a unit of cultural imitation. The economist Richard Nelson in the 1980s proposed that whole economies evolve by natural selection.

The answer, I believe, is that at some point in human history, ideas began to meet and mate, to have sex with each other.

Specialisation encouraged innovation, because it encouraged the investment of time in a tool-making tool. That saved time, and prosperity is simply time saved, which is proportional to the division of labour.

This book dares the human race to embrace change, to be rationally optimistic and thereby to strive for the betterment of humankind and the world it inhabits.

This is what prosperity is: the increase in the amount of goods or services you can earn with the same amount of work.

If you choose to spend that spare time consuming somebody else’s production then you can enrich him in turn; if you choose to spend it producing for his consumption then you have also further enriched yourself.

If economic growth does not produce happiness, said the new wisdom, then there was no point in striving for prosperity and the world economy should be brought to a soft landing at a reasonable level of income. Or, as one economist put it: ‘The hippies were right all along’.

psychologists find people to have fairly constant levels of happiness to which they return after elation or disaster. Besides, a million years of natural selection shaped human nature to be ambitious to rear successful children, not to settle for contentment: people are programmed to desire, not to appreciate.

Getting richer is not the only or even the best way of getting happier. Social and political liberation is far more effective, says the political scientist Ronald Ingleheart: the big gains in happiness come from living in a society that frees you to make choices about your lifestyle – about where to live, who to marry, how to express your sexuality and so on. It is the increase in free choice since 1981 that has been responsible for the increase in happiness recorded since then in forty-five out of fifty-two countries. Ruut Veenhoven finds that ‘the more individualized the nation, the more citizens enjoy their life.’

The banking system makes it possible for people to borrow and consume when they are young and to save and lend when they are old, smoothing their family living standards over the decades.

Somebody, somewhere, is still tweaking a piece of software, testing a new material, or transferring a gene that will make your and my life easier in the future.

This is the diagnostic feature of modern life, the very definition of a high standard of living: diverse consumption, simplified production. Make one thing, use lots.

So this is what poverty means. You are poor to the extent that you cannot afford to sell your time for sufficient price to buy the services you need, and rich to the extent that you can afford to buy not just the services you need but also those you crave.

Prosperity, or growth, has been synonymous with moving from self-sufficiency to interdependence, transforming the family from a unit of laborious, slow and diverse production to a unit of easy, fast and diverse consumption paid for by a burst of specialised production.

What this implies is that far from being merely materialist, human consumption is already driven by a sort of pseudo-spiritualism that seeks love, heroism and admiration.

The cumulative accretion of knowledge by specialists that allows us each to consume more and more different things by each producing fewer and fewer is, I submit, the central story of humanity.

Without trade, innovation just does not happen. Exchange is to technology as sex is to evolution. It stimulates novelty.

If you are not self-sufficient, but are working for other people, too, then it pays you to spend some time and effort to improve your technology and it pays you to specialise.

As a broad generalisation, the more people trust each other in a society, the more prosperous that society is, and trust growth seems to precede income growth.

The internet, in other words, may be the best forum for crime, but it is also the best forum for free and fair exchange the world has ever seen.

The characteristic signature of prosperity is increasing specialisation. The characteristic signature of poverty is a return to self-sufficiency.

the theme of specialised production/diversified consumption turns out to be the key to prosperity.

‘The chaos will prevail in the end, but it is our mission to postpone that day for as long as we can and to push things in the opposite direction with all the ingenuity and determination we can muster. Energy isn’t the problem. Energy is the solution.’

The more you prosper, the more you can prosper. The more you invent, the more inventions become possible. How can this be possible? The world of things – of pecans or power stations – is indeed often subject to diminishing returns. But the world of ideas is not. The more knowledge you generate, the more you can generate. And the engine that is driving prosperity in the modern world is the accelerating generation of useful knowledge.

‘People don’t like change,’ Michael Crichton once told me, ‘and the notion that technology is exciting is true for only a handful of people. The rest are depressed or annoyed by the changes.’ Pity the inventor’s lot then. He is the source of society’s enrichment and yet nobody likes what he does. ‘When a new invention is first propounded,’ said William Petty in 1679, ‘in the beginning every man objects and the poor inventor runs the gauntloop of all petulant wits.’

The twentieth century, too, is replete with technologies that owe just as little to philosophy and to universities as the cotton industry did: flight, solid-state electronics, software. To which scientist would you give credit for the mobile telephone or the search engine or the blog? In a lecture on serendipity in 2007, the Cambridge physicist Sir Richard Friend, citing the example of high-temperature superconductivity – which was stumbled upon in the 1980s and explained afterwards – admitted that even today scientists’ job is really to come along and explain the empirical findings of technological tinkerers after they have discovered something.

exchange. It is the ever-increasing exchange of ideas that causes the ever-increasing rate of innovation in the modern world.

Technologies reproduce, and they do so sexually.

Robert Solow had concluded that innovation accounted for growth that could not be explained by an increase in labour, land or capital, but he saw innovation as an external force, a slice of luck that some economies had more of than others – his was Mill’s theory with calculus. Things like climate, geography and political institutions determined the rate of innovation – which is bad luck for land-locked tropical dictatorships – and not much could be done about them. Romer saw that innovation itself was an item of investment, that new, applied knowledge was itself a product.

The wonderful thing about knowledge is that it is genuinely limitless. There is not even a theoretical possibility of exhausting the supply of ideas, discoveries and inventions. This is the biggest cause of all for my optimism.

I have observed that not the man who hopes when others despair, but the man who despairs when others hope, is admired by a large class of persons as a sage.

Today, the drumbeat has become a cacophony. The generation that has experienced more peace, freedom, leisure time, education, medicine, travel, movies, mobile phones and massages than any generation in history is lapping up gloom at every opportunity. In an airport bookshop recently, I paused at the Current Affairs section and looked down the shelves. There were books by Noam Chomsky, Barbara Ehrenreich, Al Franken, Al Gore, John Gray, Naomi Klein, George Monbiot and Michael Moore, which all argued to a greater or lesser degree that (a) the world is a terrible place; (b) it’s getting worse; (c) it’s mostly the fault of commerce; and (d) a turning point has been reached. I did not see a single optimistic book.

It resonates well in the academic seminar, causing heads to nod in agreement, but it is sheer garbage in the real world. When I go into the local superstore, I never see people driven to misery by the impossibility of choice. I see people choosing.

The endless modern laments about how texting and emails are shortening the attention span go back to Plato, who deplored writing as a destroyer of memorising. The ‘youth of today’ are shallow, selfish, spoiled, feral good-for-nothings full of rampant narcissism and trained to have ephemeral attention spans, says one commentator. They spend too long in cyberspace, says another, where their grey matter is being ‘scalded and defoliated by a kind of cognitive Agent Orange, depriving them of moral agency, imagination and awareness of consequences’.

Pessimism has always been big box office. It plays into what Greg Easterbrook calls ‘the collective refusal to believe that life is getting better’. People do not apply this to their own lives, interestingly: they tend to assume that they will live longer, stay married longer and travel more than they do. Some 19 per cent of Americans believe themselves to be in the top 1 per cent of income earners. Yet surveys consistently reveal individuals to be personally optimistic yet socially pessimistic. Dane Stangler calls this ‘a non-burdensome form of cognitive dissonance we all walk around with’. About the future of society and the human race people are naturally gloomy. It goes with the fact that they are risk-averse: a large literature confirms that people much more viscerally dislike losing a sum of money than they like winning the same sum. And it seems that pessimism genes might quite literally be commoner than optimism genes: only about 20 per cent of people are homozygous for the long version of the serotonin transporter gene, which possibly endows them with a genetic tendency to look on the bright side.