Thursday, August 13, 2009

The Calculus of Altruism

carnival photo

One of the tricks of modern dialectics is to question the motives of their opponents in a concerted effort to frame the image of small-minded Capitalists motivated by greed facing broadminded Marxists motivated by altruism.

This method is effective in drawing people to the cause. However, the cause does not put people on a path to a better world.

In the physical world, one's actions have a greater impact on wellbeing than images projected by the media or of the virtues and vices that we imagine lie behind the scenes.

Actions are more important than motives. A person motivated by greed to do good things does well. A person motivated by altruism to do evil, does evil.

A doctor who saves lives for money is a lifesaver. A revolutionary who kills to redistribute income is a murderer. The motivation does not define the morality of the act.

It is common for people to feign altruism to demand a redistribution of resources. However, altruism with another person's resources is often but a higher order of greed.

Greed at an individual level rarely does much harm. When a greedy person is restricted to power over his own resources, then he will take to optimizing those resources which benefits society.

Greed only has a negative impact when the greedy person has undo influence over others.

An altruist is a person who wants to do good for others. The altruist's greed is a desire to affect as many people as possible. The altruist often does harm by seeking and gaining undo influence over others. Driven by a desire for power the altruist sets up society for impoverishment by future scoundrels.

It is greed at the societal level that wreaks havoc. It is the greed that leads people to feel that they must dominate that leads to depravity. Claims to altruism are often masks worn by those pusuing this higher level greed.

The question of motivation becomes even more complex when one realizes that the world is multidimensional. An act of altruism within a family might appear as greedy to others in the community. An act that appears greedy to the local community might be seen as altruism to the world.

In the political world, it is common for influence seekers to feign altruism to advance a political career or agenda. The politician's altruism is greed in a different dimension.

It takes an advanced calculus to describe the complexity of motivations that go into insurance, politics, religion or other fields that we associate with altruism or greed.

My last post brought up questions about insurance.

Insurance companies package and sell altruism as a product. They calculate a risk for a population then sell the promise of helping those affected by the risk. For the most part, insurance companies are true to their word.

Well run insurance companies make a profit. They often re-invest that profit to find additional risks to cover. They are driven by a profit motive to find other people to help.

Insurance provides an opening to discuss the complex interplay of greed and altruism at the individual and community level. People seeking protection (greed) created a community based organization to act altruistically. Insurance companies expand by selling altruism as a product.

This all seems well until you realize that there are strange things going on with multiplicity.

There is a many to one relation between individuals and the group. Insured pools often involve hundreds of thousands of in the group.

Participation in such large "altruistic" groups invariably results in a concentration of power and wealth that would not otherwise exist if people invested their own resources and engaged in more direct private altruism.

The calculus of altruism must take into account dimensionality and multiplicity. History is rife with altruistic efforts which accomplished the opposite of the effort.

I believe that far too much is made of motivation in our discussions of politics and the economy. We cannot see into the minds of others. What can see is that some acts lead to prosperity and others to ruin. Adam Smith noted that societies with distributed decision making processes (full of people greedily optimizing their personal resources) tended to optimize their resources better than those with top heavy structures, regardless of the altrustic motives of the people building the top heavy soiety.

The argument for the free market is not that greed is better than altruism. The argument is that a system with distributed decisions making outperforms command and control systems. This is true regardless of motivation. Those who seek to impose command and control systems usually do so with a guise of altruism. Defenders of the free market must defend the greed projected on the individual.

1 comment:

Scott Hinrichs said...

"People seeking protection (greed)....

F.A. Hayek noted in 1944 that the progressives worked to reclassify the term freedom so that it no longer meant liberty from coercive state power, but security. In essence, freedom became equated with financial security---wealth, if you will.

It reminds me of the words on the Ministry of Truth in Orwell's book, 1984: "FREEDOM IS SLAVERY". This is at the very heart of the current altruism sales job.