Long Live the Hummer!

It is really mesmerizing the different kinds of cars that exist today. And encouraging, we should add. Many of us have gone through the unique experience of purchasing a new car. After we reconcile our transportation needs with our mechanical passions, after we eliminate a shiny and impractical convertible and any other captivating but intolerable model, some of us, full of restraint, intelligence and modesty, will choose the best and most virtuous of the models. It goes from 0 to 60 mph in 6 seconds, it never overheats, in an accident it protects us as though we were made of Baccarat crystal, it smells like new and fine purse, and all at the perfect price. After making the careful and calculated choice, we are convinced that there is no other in the world that could compare. We do not understand how anyone could buy a different car. But once we reach the street, the world confuses us with the amount of bad and incomprehensible cars out there, cars that someone liked and fit them like first communion suits. Amongst the most conspicuous of these machines is the Hummer. An expensive, inefficient, overheating vehicle, that is unusable even in the wars for which it was invented. Superimposed to human confines, it must comfort us to know that bad taste is infinite and that others’ poor decisions allow us to triumph over flashy and powerful contenders.

Furthermore, it is because of others’ poor taste and arbitrariness that we all end up finding couples, friends, shortcuts and businesses that validate our existence and good sense. This all came to my mind when a dear colleague of mine published an arrogant book, full of incomprehensible words, with an ostentatious and promising title but pages devoid of any wisdom; full of famous names and bland statements. “This book is a Hummer!” I said surprised. It will sell a few copies here and there, since the title attributes knowledge of far away places and circumstances to the reader. The Hummers number in the thousands, thank God. If there weren’t that many Hummers, we would have to compete with people that are wiser, harder working, more modest. We might even end up without a job. That said, I think the world would be a better place if Hummers and those people that are their soul mates lived long and intense lives, but always outside our circle of influence, and even better if that place is one where they cannot ruin our natural and intellectual habitats.

Coherent Arbitrariness

The science of economics has taken giant steps in its development over the last 50 years. It has evolved from the socio-philosophical dreams of Rousseau and Marx, which could have been interpreted and improved upon by Freud, to Keynes’ interventionist methods. After Keynes’ discovery of how governments, by means of taxes, inflations, contractions, nationalizations and privatizations, could take from some to give to others, we stumbled upon “monetarists” like Milton Friedman who revived the countervailing wisdom of economic libertarians like von Hayek and Smith. Monetarists, who are rightly confident of the ability of any powerful group to get it all wrong, proved that governments should try to limit themselves to doing right. Doing right entails intervening as little as possible and letting competitors fight it out from time to time, letting the strongest prevail, until they are beaten by their own hubris or someone else. A process akin to having daily elections by consumers, with winners and losers sorting it out in the marketplace.

Today, the science of Economics has discovered that consumers act impulsively, and that their impulses follow a series of rules that are implanted, like tattoos on the arms of sailors, in the most hidden corridors of the brain. We are more “impulsive” than “rational,” and rationality only reaches us by means of punches and beatings. Despite all punishment, some people never grasp any form of rationality. First they develop the taste for punishment than the taste for wisdom and restrain.

One of the greatest discoveries of Behavioral Economics (the name given to this new economic revolution), is that the impulse to stand in line for anything that is free, a freebie, leads us to pay heavily for giveaways. Can you imagine Economists have just discovered what has been discovered by politicians since the first thirst for power appeared in human consciousness? “Please give me promises, not realities,” is a chant most politicians heed to. There is no country in the world in which a politician does not offer something for free, since they know that humans cannot resist freebies. The tragedy is that these freebies end up costing us more than caviar.

When something is missing in an economy it is because someone wants it for free and someone believes they can give it away. The only thing we can give away without any bad consequences is excellence in what we do. Giving away excellence ends up creating durable miracles among societies and human relations.

Anything they offer you for free in exchange for your vote has a cost for everyone that goes beyond what is predictable. Anything for free comes with a costly and deadly trap, and we almost always fall for it because we suffer from “coherent arbitrariness,” which always leads us to accept arbitrary situations and heroes because, those narcissistic, power hungry heroes know how to toss us a freebie.