Wall Street Greed or the Free Market at Work?

In the February, 1970 issue of Playboy magazine (yes, the one with Linda Forsythe as the Playmate of the Month) a sociologist wrote an article about the psychological impact of technological innovation and rapid change.  He introduced the term, “information overload” and told us that too much change over too short a period of time led to stress and wide-spread social discord.  The article was so well received that the author went on to expand the think piece into a book.  It was a best seller.  The author was Alvin Toffler and the title of both the article and the book was Future Shock.  

Ten years earlier, economist, John F. Muth first proposed a neo-classical theory of economics called Rational Expectations.  This theory, later developed by Robert E. Lucas, would eventually win Lucas the 1995 Nobel Prize in Economics.  While Toffler was certain that the overload of information in a technologically rich world would confound and overcome the citizenry, Rational Expectation Theorists were sure that perfect information would lead to perfect allocation of resources in a free market economy.  More specifically, they contended that governmental monetary policies would be ineffectual in fine-tuning an economy because the citizenry, armed with the tools of modern technology, would be aware of such manipulations, and would react accordingly.

Toffler and Lucas offered two conflicting predictions of what the future held.  Chaos or prescience?  Stress or confidence?   Confusion or stability?  Shock or awe?

Not withstanding my inherent suspicion of sociologists—it is a too soft a science for someone with a degree in economics—experience has shown me that our society has adapted to the information age.  Technological progress has been a given in societal evolution since the human species first began manipulating its environment for its own good.  The prehistoric hominid who readily accepted improvements in a difficult life lived longer, lived stronger, and had more little hominids all with their parents’ propensity for adaptation.  We are hard-wired to not just live with technology, but to thrive under it. 

Technology is simple in conception, complex in execution, and monetarily constrained in application.  But it is, by definition, within the realm of logic, analysis and production.  Technological problems deal only with the constraints of physical reality, not the dynamics of human interaction.  It is the difference between specific and infinite variables.  Inventing the wheel was evidently easier than creating an enduring republic, just look at the time table for each.   But in both cases, there were both intrinsic and specific rewards. 

Technology has matched our imaginations.  We have moved relentlessly forward and our biggest problems have been finding work for the scriveners and buggy whip makers who have been rendered useless by the march of progress.   In each case a technologically weak business is replaced by an economically stronger one.  We are more likely to use new and better resources to enhance our position in the world than to be stymied by them.  When I see protesters complaining that the tools of progress and innovation are enriching some and denying income to others I wonder if they are complaining about progress or their share of the pie?  What is wrong with people getting rich from the work of their minds?  Is imagination and risk taking less worthy of reward than physical labor? 

Jealousy is a small and ugly emotion.  Anarchists are lazy and spoiled people.  Instead of protesting against corporate greed, why not improve the system?  It could make you rich. 

We know the truth, and the truth has set us free, use it to keep the faith.