[FRIAM] Philosophy, Ethics, Academia (PEA)

[David Eric Smith]

Glen,

I like the fact that you word the following so as to suggest it’s impossible by tautology:

> How can there *ever* be any form of capitalism that's NOT "crony"? If there's a state, the state will be ... [cough] ... leveraged to gain asymmetric power.

I like it because the implication that something looks impossible makes us take seriously that it is at least hard.


Can I propose that this is a good starting point for defining some aspects of democracy in aspirational terms, as a performance criterion for which one then seeks solutions.

There are many things that look intuitively like they should be impossible by tautology, and which turn out to have useful solutions that took work to find or build.

1. How can there be securities markets with large scope for autonomous action but that are strongly effective in blunting the exercise of power by wealthy actors to manipulate prices, extract information about counterparties, or otherwise go outside the domain of contract?  But the whole Fama-French efficiency assertion (which is wrong, but for more subtle reasons) gives a good quantification of how many such actions the design of securities markets does blunt.

2. How can there be a cognitive discipline built around the moral of the Emperors New Clothes (the aspiration of science).  Anyone should be able to overturn a position no matter how firmly held, by providing evidence of its error, and ballot-stuffing should not be strong enough to overcome that lever.  To the extent that scientific claims are taken to have a reliability that is different from just whoever’s opinion about whatever, they measure whether this has been achieved.

3. How can there be an encryption algorithm that provides easy encryption in public but effectively unaffordable decryption by the same agents?  How can there be proofs of identity that are cheaply verifiable but effectively unspoofable?  Etc.  The world that was opened by 1-way algorithms.


I am comfortable taking as a starting framing that the problem with the traditional formalization of economics is as the study of problems of allocation in the arena where power is excluded from operating.  Mathematically one can put some constructions behind that, but then to what areas of life do we think the absence of power is at all an adequate approximation?  (Your question above, but I think there are some for which the cartoon is quite helpful; auction design is a nice example of a problem with many good solutions, arrived at technically.)

That leaves to Political Science (or whatever mash of disciplines) the study of power, its uses, consequences, nature, or whatever.  

The two are then bound, in a formalism Shubik used to use enough times that it is tattooed in my traces — the Economy exists within the Polity and the Society.

So we can ask:  to what extent can rules of governance be designed to have a 1-way character in blunting certain forms of the exercise of power, enough to make the polity a safe holder of power that can constrain its use by other actors?  Are there 1-way aspirations that are provably unreachable?  By trying to prove nonexistence theorems that aren’t true, do we gain insights that might lead to the discovery of 1-way algorithms we aren’t currently using?  People seem to think the Magna Carta and the US Constitution were significant contributions (to several aims, but I think that was one).  I take your posts on the communities looking at constitutional reform and redesign as efforts to find more.

This all seems a good framing to me.

Eric