A Tale of Two Cities: The Modern Soothsayers

Five weeks on from the #GiletsJaunes, managerial elites in London conspire to chain the United Kingdom to ever closer union with the fate of Europe. There is something profoundly emblematic about the sight of Emmanuel Macron facing down the people of his once great nation.

Condescending, Napoleonic, and completely without self-awareness, he is the living embodiment of the vision of the anointed. As French citizens riot because of increases in their fuel taxes, he has been utterly indifferent in telling them to take their thin gruel because the predictive models of his shaman class say so. It is an almost perfect encapsulation of the Rousseauian top-down state versus the people that it subjugates.

Meanwhile, across the channel in London—where, despite their civic and intellectual history, the ruling class have long sought to mimic their Gallic counterparts— the Bank of England’s Mark Carney has been playing a similar game. He has been issuing regular doomsday forecasts based on predictive models by alleged experts. I wonder how much longer people are going to listen to these modern soothsayers. At this point, they are naked lobbyists for entrenched special interests. When reality fails to meet their expectations for the umpteenth time, how long will it take for the prophets to lose their authority in the eyes of the public and their self-appointed gatekeepers in the chattering class?

It has struck me recently just how much of our current political discourse is based on “forecasts.” In 2002, Daniel Kahneman won a Nobel prize for his work on behavioral economics, partly for his career-long demolition of how “experts” convey statistical information:

The idea that the future is unpredictable is undermined every day by the ease with which the past is explained. As Nassim Taleb pointed out in The Black Swan, our tendency to construct and believe coherent narratives of the past makes it difficult to accept the limits of our forecasting ability.…The illusion that we understand the past fosters overconfidence in our ability to predict the future. (Thinking Fast and Slow, p. 218).

When someone deigns to tell you that they can predict the future, make no mistake: They are lying, whether or not they know it. We cannot predict the future, it is the ultimate in human hubris to pretend that we can. Of course, the managerial elites have all read Thinking Fast and Slow at this point, but such is their arrogance it never even occurs to them to imagine that the irrationality might be their own.

The current fetish for using predictive models to enforce political policy choices is no better than a class of priests telling the people “because God said so.” The Divine Right of Kings did not die with absolute monarchy. Democratic regimes that use illusory concepts such as “the social contract” or “the general will” brought about, what Herbert Spencer called in 1884, “the divine right of parliaments” (The Man Versus The State, p. 174)—something the people of both the U.K. and France are now witnessing in plain sight.

What interests me most about the current penchant for rule by predictive modeling is how effectively it disarms those of us who value reason and evidence. I am not a climate scientist and, chances are, neither are you. I am not an IMF “economist” or a statistician for a central bank, and, chances are, neither are you. For most people, the opportunity cost is too great to bridge this knowledge gap, so we must take it on faith alone (see Thomas Sowell, Knowledge and Decisions, pp. 305-38).

To use Aristotle’s terms, logos (reason and evidence) is replaced by ethos, a simple appeal to authority. We are compelled to trust in the expert, which boils down to little more than a character judgement. In rhetorical terms, it is often easier to sway people through ethos, which is mostly emotional and appeals to our heuristic biases, than it is by either reason or evidence which require more deliberative thought. I am reminded of John Calvin’s three solas:

Sola scriptura, “by scripture alone”
Sola fide, “by faith alone”
Sola gratia, “by grace alone”

Most people don’t have time to dig into the specialist literature, so they take the pronouncements of the soothsayers by faith alone and allow the current political elites—as the spokespersons for the diviners— to rule by grace.

—Ludwig von Mises, one of the great economists and liberals of the 20th century, analyzed the unfalsifiable logic of ideologies that use visions of the future to justify using force to allocate resources in the present arguing that it is “useless to argue with mystics and seers.” From his perspectives, Marxists were seers, envisaging a future paradise—

They base their assertions on intuition and are not prepared to submit them to rational examination. The Marxians pretend that what their inner voice proclaims is history’s self-revelation. If other people do not hear this voice, it is only proof that they are not chosen. It is insolence that those groping in darkness dare to contradict the inspired ones. Decency should impel them to creep into a corner and keep silent.…

And fascists, according to Mises, were mystics, attributing a spiritual essence not to a person’s individuality or achievements, but to his or her nationality and blood.

Another group sees society as a biological phenomenon; it is the work of the voice of the blood, the bond uniting the offspring of common ancestors with these ancestors and with one another, and the mystical harmony between the ploughman and the soil he tills.…The voice of the blood, contend the German racists, mysteriously unifies all members of the German people. (Human Action, pp. 83, 166).

Mises was writing in 1949 after seeing one half of Europe devastated by fascism and the other half fall under the evil of socialism. The communist utopia is always around the next corner; the ultimate realization of the Übermensch, one conquest away; the next apocalypse, 12 years away; the next economic disaster, one Brexit away.

In the same book, Mises candidly outlined a cast iron law of politics:

Liberalism realizes that the rulers, who are always a minority, cannot lastingly remain in office if not supported by the consent of the majority of those ruled. Whatever the system of government may be, the foundation upon which it is built and rests is always the opinion of those ruled that to obey and to be loyal to this government better serves their own interests than insurrection and the establishment of another regime. The majority has the power to do away with an unpopular government and uses this power whenever it becomes convinced that its own welfare requires it. In the long run, there is no such thing as an unpopular government. (Human Action, pp. 189, 149-50).

This has never stopped being true, but as the failed predictions pile up, do the current elites in Europe even know? Time will tell, and one day in the future I can look back and pretend I predicted it.