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All these examples tell us that increased efficiency is good, and that removing friction increases efficiency. But the financial crisis, along with the activities of the Occupy movement and the criticism being leveled at Mr. Romney, suggests that maybe there can be too much of a good thing. If loans weren’t securitized, bankers might have taken the time to assess the creditworthiness of each applicant. If homeowners had to apply for loans to improve their houses or buy new cars, instead of writing checks against home equity, they might have thought harder before making weighty financial commitments. If people actually had to go into a bank and stand in line to withdraw cash, they might spend a little less and save a little mor

Finding the “mean” isn’t easy, even when we try to. It is sometimes said that the only way to figure out how much is enough is by experiencing too much. But the challenge is even greater when we’re talking about companies, because companies aren’t even trying to find the “mean.” For an individual company and its shareholders, there is no such thing as too much efficiency. The price of too much efficiency is not paid by the company. It is what economists call a negative externality, paid by the people who lose their jobs and the communities that suffer from job loss. Thus, we can’t expect the free market to find the level of efficiency that keeps firms competitive, provides quality goods at affordable prices and sustains workers and their communities. If we are to find the balance, we must consider stakeholders and not just shareholders. Companies by themselves won’t do this. Sensible regulation might.

So the real criticism embodied by current attacks on Bain Capital is not a criticism of capitalism. It is a criticism of unbridled, single-minded capitalism. Capitalism needn’t be either of those things. It isn’t in other societies with high standards of living, and it hadn’t been historically in the United States. Perhaps we can use the current criticism of Bain Capital as an opportunity to bring a little friction back into our lives. One way to do this is to use regulation to rekindle certain social norms that serve to slow us down. For example, if people thought about their homes less as investments and more as places to live, full of the friction of kids, dogs, friends, neighbors and community organizations attached, there might be less speculation with an eye toward house-flipping. And if companies thought of themselves, at least partly, as caretakers of their communities, they might look differently at streamlining their operations.

We’d all like a car that gets 100 miles to the gallon. The forces of friction that slow us down are an expensive annoyance. But when we’re driving a car, we know where we’re going and we’re in control. Fast is good, though even here, a little bit of friction can forestall disaster when you encounter an icy road. Life is not as predictable as driving. We don’t always know where we’re going. We’re not always in control. Black ice is everywhere. A little something to slow us down in the uncertain world we inhabit may be a lifesaver.

The effectiveness of this process is so great that human brain is able to accurately identify words and whole phrases from a noisy background. This power of analysis brings to minds the great similarity between the brain and powerful supercomputers.

Functional imaging of the brain revealed that activated brain parts are different between native and non-native speakers. The superior temporal gyrus is an important brain region involved in language learning. For a native speaker this part is responsible for automated processing of lexical retrieval and the build of phrase structure. In native speakers this zone is much more activated than in non-native ones.

infants begin their lives with a very flexible brain that allows them to acquire virtually any language they are exposed to. Moreover, they can learn a language words almost equally by listening or by visual coding. This brain plasticity is the motor drive of the children capability of “cracking the speech code” of a language. With time, this ability is dramatically decreased and adults find it harder to acquire a new language.

clearly demonstrated that there are anatomical brain differences between fast and slow learners of foreign languages. By analyzing a group of people having a homogenous language background, scientists found that differences in specific brain regions can predict the capacity of a person to learn a second language.

Until the last decade few studies compared the language acquisition in adults and children. Thanks to modern imaging and electroencephalography we are now able to address this question.

Language acquisition is a long-term process by which information are stored in the brain unconsciously making them appropriate to oral and written usage. In contrast, language learning is a conscious process of knowledge acquisition that needs supervision and control by the person.

Second, Time isn’t really linear

time is really just “your assessment of how long something took.”

Time can also feel faster or slower depending on how we experience it.

“Language doesn’t determine how you think, but it can determine how you think about things.”

Defining snow with such specific language grants it multiple meanings, and those multiple meanings increase its significance within the culture of the people using the language.

sees beyond the linear bounds of time

The research that Dr. Fredrickson and others have done demonstrates that the extent to which we can generate positive emotions from even everyday activities can determine who flourishes and who doesn’t.

Clearly, there are times and situations that naturally result in negative feelings in the most upbeat of individuals. Worry, sadness, anger and other such “downers” have their place in any normal life.

Negative feelings activate a region of the brain called the amygdala, which is involved in processing fear and anxiety and other emotions.

Both he and Dr. Fredrickson and their colleagues have demonstrated that the brain is “plastic,” or capable of generating new cells and pathways, and it is possible to train the circuitry in the brain to promote more positive responses.

reinforce positivity

Practice mindfulness. Ruminating on past problems or future difficulties drains mental resources and steals attention from current pleasures.

“Underneath her image are very traditional values,” said Dai Linjia, a communications consultant. “Her family is almost like a dynasty.”

Many younger Chinese will be watching this week’s meeting between Mr. Trump and Mr. Xi for signs of Ms. Trump.

DJ: Of the basic values of French liberalism—liberty, equality, and fraternity—the last, fraternity, always seems to get short shrift. Your book, by contrast, argues that religious tolerance and liberalism in general can only flourish if people cultivate active respect, civility, and civic friendship with their fellow citizens. If this is so crucial, why do traditional liberals fail to make it more central to their program?

MN: I think liberals associate the cultivation of public emotion with fascism and other illiberal ideologies. But if they study history more closely they will find many instances in which emotions are deliberately cultivated in the service of liberal ideals. My next book, Political Emotions, will study all of this in great detail. Any political principles that ask people to go beyond their own self-interest for the sake of justice requires the cultivation of emotion.

we should confront sexism by argument and persuasion, and that to render all practices that objectify women illegal would be both too difficult (who would judge?) and too tyrannical.

critics of the burqa typically look at the practices of others and find sexism and “objectification” of women there, while failing to look at the practices of the dominant culture, which are certainly suffused with sexism and objectification. I was one of the feminist philosophers who wrote about objectification as a fundamental problem, and what we were talking about was the portrayal of women as commodities for male use and control in violent pornography, in a great deal of our media culture, and in other cultural practices, such as plastic surgery. I would say that this type of objectification is not on the retreat but may even be growing. Go to a high school dance—even at a high-brow school such as the John Dewey Laboratory School on our campus [at the University of Chicago]—and you will see highly individual and intelligent teenage girls marketing themselves for male consumption in indistinguishable microskirts, prior to engaging in a form of group dancing that mimes sex, and effaces their individuality. (Boys wear regular and not particularly sexy clothing.)

Lots of bad things are and will remain legal: unkindness, emotional blackmail, selfishness. And though I think the culture of pornographic objectification does great damage to personal relations, I don’t think that legal bans are the answer.

In the history of philosophy this was well understood, and figures as diverse as [Jean-Jacques] Rousseau, [Johann Gottfried von] Herder, [Giuseppe] Mazzini, Auguste Comte, John Stuart Mill, and John Rawls had a lot to say about the issue. In Mill’s case, he set about solving the problem posed by the confluence of liberalism and emotion: how can a society that cultivates emotion to support its political principles also preserve enough space for dissent, critique, and experimentation? My own proposal in the forthcoming book follows the lead of Mill—and, in India, of Rabindranath Tagore—and tries to show how a public culture of emotions, supporting the stability of good political principles, can also be liberal and protective of dissent. Some of the historical figures I study in this regard are Franklin Delano Roosevelt, Martin Luther King, Jr., Gandhi, and Nehru.

the Palin reaction was a whole lot better than the standard reaction in Europe, which is that we should just ban things that we fear. It is really unbelievable, having just lectured on this topic here in Germany: my views, which are pretty mainstream in America, are found “extreme” and even “offensive” in Germany, and all sorts of quite refined people think that Islam poses a unique problem and that the law should be dragged in to protect the culture.

The problem with these Europeans is that they don’t want to ban platform shoes or spike heels either; they just want to ban practices of others which they have never tried to understand.

John McCain has Aeschylated it to “a Greek tragedy.” And he should know from Greek tragedy. “It’s the negative campaigning and the increasingly personal attacks,” he told The Boston Herald, adding, “the likes of which we have never seen.” When a man who was accused of having an illegitimate black child in the 2000 South Carolina primary thinks this is the worst ever, the G.O.P. is really in trouble. The Arizona senator, who’s supporting Romney, grimly noted: “I know he’s going to be the nominee, but I also worry about how much damage has been done.”

Once elected, those presidents curbed the id with the ego, common sense and reason. But now the G.O.P.’s id is unbridled. The horse has thrown the rider; the dark forces are bubbling. Moderates, women, gays, Hispanics and blacks — even the president — are being hunted in this most dangerous game.

Asked in Michigan why he couldn’t excite the base, Romney said he is not willing to make “incendiary comments” or “light my hair on fire.”

moderate Republicans feel passé, Senator Olympia Snowe of Maine shockingly announced her retirement, decrying “ ‘my way or the highway’ ideologies” and a vanishing political center.

The apogee of apathy for Romney was on Friday, when the man who says he’s an expert manager spoke to a mostly empty football stadium in Detroit.

he cited his wife’s two Caddies and his Nascar team-owner pals, and awkwardly mocked the plastic ponchos of Daytona racing fans: “I like those fancy raincoats you bought. Really sprung for the big bucks.”

Mitt was damaged as a contender against Obama when he was forced to admit that he had a 15-percent tax rate (given, as The Huffington Post points out, that Romney averaged $6,400 an hour at Bain Capital while creating lots of jobs with paltry wages).

Now Santorum should forfeit his chance after making a far dumber remark: Kids should beware of college because they’ll get brainwashed.

Pandering to Tea Partiers, Santorum, who has a B.A., M.B.A. and J.D., and who supported higher education in his 2006 senatorial campaign, absurdly turned the American dream inside-out and into sauerkraut.

He called the president “a snob” for encouraging people to get more educated and asserted that Obama only wants Americans to go to college so they can be remade in his image, while being indoctrinated by liberal college professors.

Does he think that defining ambition down and asking kids to give up hope is a good mantra? Even Gov. Bob McDonnell of Virginia, who was trying to mandate that women seeking abortions be shamed with vaginal ultrasounds that Democrats dubbed “legal rape,” thought Santorum went too far.

In an interview with ABC News’s George Stephanopoulos, Santorum offended the Catholics he’s courting by saying that the J.F.K. speech ratifying the separation of church and state made him want “to throw up” because Kennedy had thrown “his faith under the bus.” “I don’t believe in an America where the separation of church and state are absolute,” Sanctorum said.

prescription testosterone doesn’t just give your T level a boost: it may also increase your risk of heart attack. It can add huge numbers of red blood cells to your bloodstream and shrink your testes. In some men, it increases aggression and irritability.

a large study published in the journal PLoS ONE found that, within three months, taking the hormone doubled the rate of heart attacks in men 65 and older, as well as in younger men who had heart disease. The Food and Drug Administration has begun an investigation.

Used clinically since 1937 and approved by the F.D.A. since 1953, testosterone is now administered in at least five forms, including patches, gels and injections

In addition to the cardiac risks, prescription T can mean a permanent shut-off in men’s own, albeit diminished, testosterone production. In other words, once you start, you may well be hooked for life.

men should address the leading cause of the problem. Losing weight is a tried and true way to naturally boost testosterone levels. According to findings presented at the annual meeting of the Endocrine Society in 2012, obese men who lost an average of 17 pounds saw their testosterone levels increase by 15 percent. In general, a man’s waist should be half his height.

At the end of the day, eating more of the right foods and fewer junk foods improves mood and energy — which may be the only fix many men need.

They all had to be the same species.

was not surprising to find that Neanderthals and modern humans interbred, a clear expectation of the biological species concept.

I wonder when the penny will drop: when we have five pieces of a 5,000-piece jigsaw puzzle, every new bit that we add is likely to change the picture.

e identity of the fourth player remains unknown but it was an ancient lineage that had been separate for probably over a million years. H. erectus seems a likely candidate. Whatever the name we choose to give this mystery lineage, what these results show is that gene flow was possible not just among contemporaries but also between ancient and more modern lineages.

cientists succeeded in extracting the most ancient mitochondrial DNA so far, from the Sima de los Huesos site in Atapuerca, Spain.

We have built a picture of our evolution based on the morphology of fossils and it was wrong.

when we know how plastic - or easily changeable - skull shape is in humans. And our paradigms must also change.

e must abandon, once and for all, views of modern human superiority over archaic (ancient) humans. The terms "archaic" and "modern" lose all meaning as do concepts of modern human replacement of all other lineages.

he deep-rooted shackles that have sought to link human evolution with stone tool-making technological stages - the Stone Ages - even when we have known that these have overlapped with each other for half-a-million years in some instances.

e world of our biological and cultural evolution was far too fluid for us to constrain it into a few stages linked by transitions.

We have to flesh out the genetic information and this is where archaeology comes into the picture.

Rather than focus on differences between modern humans and Neanderthals, what the examples show is the range of possibilities open to humans (Neanderthals included) in different circumstances.

research using new technology on old archaeological sites, as at La Chapelle; and

let him develop the habit of smiling any time he starts feeling rotten. Believe it or not, it works.

“Beauty is perfection, to try to perfect yourself more and more every day,” Ms. Mieles said. “That’s how people see it here.” <img src="http://meter-svc.nytimes.com/meter.gif"/>

when faced with a change that has the potential to make us more likely to survive, some brains are able to adapt more easily than others.

Daniel Amen has studied over 63,000 brains using brain imaging to study blood flow and activity patterns.

One interesting conclusion of his studies is that a healthy brain is much better equipped to make positive changes and stick to them.

The discovery of brain plasticity has proven that you can help people change their brains almost immediately, by providing an environment to support learning

Even a few drinks a week can reduce overall brain function and create areas of reduced brain function.

brain learns better when it is healthy, adopting a healthier lifestyle can help learners develop brains that are more receptive to change and new ideas.

Prolonged exposure to high blood pressure not only restricts blood flow to the brain, but increase the risk of dementia, heart attack and stroke.

a physical pattern, in the form of neural connections, is formed in the brain. Every time we go over this pattern by revisiting this thought, we make the behavior stronger.

Brains with a high degree of new activity tend to stay that way. Brains that are slow to learn new things gradually lose some of their ability to change.

In our sleep-deprived world, the average adult is walking around in a brain-induced fog. The brain uses sleep to rebuild and reorganize. Sleep deprivation can result in lower brain performance and less ability to change.

Counter to previous beliefs, meditation has been shown to activate the cerebral cortex, which is the seat of conscious thought.

But the impacts of learning on one of the most primal portions of the brain have been surprisingly underappreciated, both scientifically and outside the lab. Most of us pay little attention to our motor cortex, which controls how well we can move.

We like watching athletes in action, he said. But most of us make little effort to hone our motor skills in adulthood, and very few of us try to expand them by, for instance, learning a new sport. We could be short-changing our brains. Past neurological studies in people have shown that learning a new physical skill in adulthood, such as juggling, leads to increases in the volume of gray matter in parts of the brain related to movement control.

Even more compelling, a 2014 study with mice found that when the mice were introduced to a complicated type of running wheel, in which the rungs were irregularly spaced so that the animals had to learn a new, stutter-step type of running, their brains changed significantly. Learning to use these new wheels led to increased myelination of neurons in the animals’ motor cortexes. Myelination is the process by which parts of a brain cell are insulated, so that the messages between neurons can proceed more quickly and smoothly.

Scientists once believed that myelination in the brain occurs almost exclusively during infancy and childhood and then slows or halts altogether. But the animals running on the oddball wheels showed notable increases in the myelination of the neurons in their motor cortex even though they were adults.

In other words, learning the new skill had changed the inner workings of the adult animals’ motor cortexes; practicing a well-mastered one had not. “We don’t know” whether comparable changes occur within the brains of grown people who take up a new sport or physical skill, Dr. Krakauer said. But it seems likely, he said. “Motor skills are as cognitively challenging” in their way as traditional brainteasers such as crossword puzzles or brain-training games, he said. So adding a new sport to your repertory should have salutary effects on your brain, and also, unlike computer-based games, provide all the physical benefits of exercise.

he and Dr. Fredrickson and their colleagues have demonstrated that the brain is “plastic,” or capable of generating new cells and pathways, and it is possible to train the circuitry in the brain to promote more positive responses. That is, a person can learn to be more positive by practicing certain skills that foster positivity.

Negative feelings activate a region of the brain called the amygdala, which is involved in processing fear and anxiety and other emotions. Dr. Richard J. Davidson, a neuroscientist and founder of the Center for Healthy Minds at the University of Wisconsin — Madison, has shown that people in whom the amygdala recovers slowly from a threat are at greater risk for a variety of health problems than those in whom it recovers quickly.

Worry, sadness, anger and other such “downers” have their place in any normal life. But chronically viewing the glass as half-empty is detrimental both mentally and physically and inhibits one’s ability to bounce back from life’s inevitable stresses.

In other words, Dr. Davidson said, “well-being can be considered a life skill. If you practice, you can actually get better at it.”

Activities Dr. Fredrickson and others endorse to foster positive emotions include:

Do good things for other people

Appreciate the world around you

Develop and bolster relationships.

Establish goals that can be accomplished.

Learn something new.

Choose to accept yourself, flaws and all.

Practice resilience.

Practice mindfulness

Reich simply points out that this utopian fiction is in danger of collapse because it is not true and because genetic research is increasingly proving it untrue.

“You will sometimes hear that any biological differences among populations are likely to be small, because humans have diverged too recently from common ancestors for substantial differences to have arisen under the pressure of natural selection. This is not true. The ancestors of East Asians, Europeans, West Africans and Australians were, until recently, almost completely isolated from one another for 40,000 years or longer, which is more than sufficient time for the forces of evolution to work.” Which means to say that the differences could be (and actually are) substantial.

If you don’t establish a reasonable forum for debate on this, Reich argues, if you don’t establish the principle is that we do not have to be afraid of any of this, it will be monopolized by truly unreasonable and indeed dangerous racists. And those racists will have the added prestige for their followers of revealing forbidden knowledge.

so there are two arguments against the suppression of this truth and the stigmatization of its defenders: that it’s intellectually dishonest and politically counterproductive.

Klein seems to back a truly extreme position: that only the environment affects IQ scores, and genes play no part in group differences in human intelligence. To this end, he cites the “Flynn effect,” which does indeed show that IQ levels have increased over the years, and are environmentally malleable up to a point. In other words, culture, politics, and economics do matter.

But Klein does not address the crucial point that even with increases in IQ across all races over time, the racial gap is still frustratingly persistent, that, past a certain level, IQ measurements have actually begun to fall in many developed nations, and that Flynn himself acknowledges that the effect does not account for other genetic influences on intelligence.

In an email exchange with me, in which I sought clarification, Klein stopped short of denying genetic influences altogether, but argued that, given rising levels of IQ, and given how brutal the history of racism against African-Americans has been, we should nonetheless assume “right now” that genes are irrelevant.

My own brilliant conclusion: Group differences in IQ are indeed explicable through both environmental and genetic factors and we don’t yet know quite what the balance is.

We are, in this worldview, alone on the planet, born as blank slates, to be written on solely by culture. All differences between men and women are a function of this social effect; as are all differences between the races. If, in the aggregate, any differences in outcome between groups emerge, it is entirely because of oppression, patriarchy, white supremacy, etc. And it is a matter of great urgency that we use whatever power we have to combat these inequalities.

Liberalism has never promised equality of outcomes, merely equality of rights. It’s a procedural political philosophy rooted in means, not a substantive one justified by achieving certain ends.

A more nuanced understanding of race, genetics, and environment would temper this polarization, and allow for more unifying, practical efforts to improve equality of opportunity, while never guaranteeing or expecting equality of outcomes.

In some ways, this is just a replay of the broader liberal-conservative argument. Leftists tend to believe that all inequality is created; liberals tend to believe we can constantly improve the world in every generation, forever perfecting our societies.

Rightists believe that human nature is utterly unchanging; conservatives tend to see the world as less plastic than liberals, and attempts to remake it wholesale dangerous and often counterproductive.

I think the genius of the West lies in having all these strands in our politics competing with one another.

Where I do draw the line is the attempt to smear legitimate conservative ideas and serious scientific arguments as the equivalent of peddling white supremacy and bigotry. And Klein actively contributes to that stigmatization and demonization. He calls the science of this “race science” as if it were some kind of illicit and illegitimate activity, rather than simply “science.”

He goes on to equate the work of these scientists with the “most ancient justification for bigotry and racial inequality.” He even uses racism to dismiss Murray and Harris: they are, after all, “two white men.

He still refuses to believe that Murray’s views on this are perfectly within the academic mainstream in studies of intelligence, as they were in 1994.

Klein cannot seem to hold the following two thoughts in his brain at the same time: that past racism and sexism are foul, disgusting, and have wrought enormous damage and pain and that unavoidable natural differences between races and genders can still exist.

, it matters that we establish a liberalism that is immune to such genetic revelations, that can strive for equality of opportunity, and can affirm the moral and civic equality of every human being on the planet.

We may even embrace racial discrimination, as in affirmative action, that fuels deeper divides. All of which, it seems to me, is happening — and actively hampering racial progress, as the left defines the most multiracial and multicultural society in human history as simply “white supremacy” unchanged since slavery; and as the right viscerally responds by embracing increasingly racist white identity politics.

liberalism is integral to our future as a free society — and it should not falsely be made contingent on something that can be empirically disproven. It must allow for the truth of genetics to be embraced, while drawing the firmest of lines against any moral or political abuse of it

He tries to break free of narrow specialization and cross the boundaries between scientific disciplines. Expeditions beyond economics’ borders and its connection to history, philosophy, psychology, and ancient myths are not only refreshing, but necessary for understanding the world of the twenty-first century.

Reality is spun from stories, not from material. Zdeněk Neubauer

Before it was emancipated as a field, economics lived happily within subsets of philosophy—ethics, for example—miles away from today’s concept of economics as a mathematical-allocative science that views “soft sciences” with a scorn born from positivistic arrogance. But our thousand-year “education” is built on a deeper, broader, and oftentimes more solid base. It is worth knowing about.

The study of the history of a certain field is not, as is commonly held, a useless display of its blind alleys or a collection of the field’s trials and errors (until we got it right), but history is the fullest possible scope of study of a menu that the given field can offer.

History of thought helps us to get rid of the intellectual brainwashing of the age, to see through the intellectual fashion of the day, and to take a couple of steps back.

“The separation between the history of a science, its philosophy, and the science itself dissolves into thin air, and so does the separation between science and non-science; differences between the scientific and unscientific are vanishing.”

we seek to chart the development of the economic ethos. We ask questions that come before any economic thinking can begin—both philosophically and, to a degree, historically. The area here lies at the very borders of economics—and often beyond. We may refer to this as protoeconomics (to borrow a term from protosociology) or, perhaps more fittingly, metaeconomics (to borrow a term from metaphysics).

stories; Adam Smith believed. As he puts it in The Theory of Moral Sentiments, “the desire of being believed, or the desire of persuading, of leading and directing other people, seems to be one of the strongest of all our natural desires.”

“The human mind is built to think in terms of narratives … in turn, much of human motivation comes from living through a story of our lives, a story that we tell to ourselves and that creates a framework of our motivation. Life could be just ‘one damn thing after another’ if it weren’t for such stories. The same is true for confidence in a nation, a company, or an institution. Great leaders are foremost creators of stories.”

contrary to what our textbooks say, economics is predominantly a normative field. Economics not only describes the world but is frequently about how the world should be (it should be effective, we have an ideal of perfect competition, an ideal of high-GDP growth in low inflation, the effort to achieve high competitiveness …). To this end, we create models, modern parables,

I will try to show that mathematics, models, equations, and statistics are just the tip of the iceberg of economics; that the biggest part of the iceberg of economic knowledge consists of everything else; and that disputes in economics are rather a battle of stories and various metanarratives than anything else.

That is the reason for this book: to look for economic thought in ancient myths and, vice versa, to look for myths in today’s economics.

is a paradox that a field that primarily studies values wants to be value-free. One more paradox is this: A field that believes in the invisible hand of the market wants to be without mysteries.

The History of Animal Spirits: Dreams Never Sleep

The more important elements of a culture or field of inquiry such as economics are found in fundamental assumptions that adherents of all the various systems within the epoch unconsciously presuppose. Such assumptions appear so obvious that people do not know what they are assuming, because no other way of putting things has ever occurred to them, as the philosopher Alfred Whitehead notes in Adventures of Ideas.

I argue that economic questions were with mankind long before Adam Smith. I argue that the search for values in economics did not start with Adam Smith but culminated with him.

We should go beyond economics and study what beliefs are “behind the scenes,” ideas that have often become the dominant yet unspoken assumptions in our theories. Economics is surprisingly full of tautologies that economists are predominantly unaware of. I

argue that economics should seek, discover, and talk about its own values, although we have been taught that economics is a value-free science. I argue that none of this is true and that there is more religion, myth, and archetype in economics than there is mathematics.

In a way, this is a study of the evolution of both homo economicus and, more importantly, the history of the animal spirits within him. This book tries to study the evolution of the rational as well as the emotional and irrational side of human beings.

I argue that his most influential contribution to economics was ethical. His other thoughts had been clearly expressed long before him, whether on specialization, or on the principle of the invisible hand of the market. I try to show that the principle of the invisible hand of the market is much more ancient and developed long before Adam Smith. Traces of it appear even in the Epic of Gilgamesh, Hebrew thought, and in Christianity, and it is expressly stated by Aristophanes and Thomas Aquinas.

This is not a book on the thorough history of economic thought. The author aims instead to supplement certain chapters on the history of economic thought with a broader perspective and analysis of the influences that often escape the notice of economists and the wider public.

Progress (Naturalness and Civilization)

The Economy of Good and Evil

from his beginnings, man has been marked as a naturally unnatural creature, who for unique reasons surrounds himself with external possessions. Insatiability, both material and spiritual, are basic human metacharacteristics, which appear as early as the oldest myths and stories.

the Hebrews, with linear time, and later the Christians gave us the ideal (or amplified the Hebrew ideal) we now embrace. Then the classical economists secularized progress. How did we come to today’s progression of progress, and growth for growth’s sake?

The Need for Greed: The History of Consumption and Labor

Metamathematics From where did economics get the concept of numbers as the very foundation of the world?

mathematics at the core of economics, or is it just the icing of the cake, the tip of the iceberg of our field’s inquiry?

idea that we can manage to utilize our natural egoism, and that this evil is good for something, is an ancient philosophical and mythical concept. We will also look into the development of the ethos of homo economicus, the birth of “economic man.”

All of economics is, in the end, economics of good and evil. It is the telling of stories by people of people to people. Even the most sophisticated mathematical model is, de facto, a story, a parable, our effort to (rationally) grasp the world around us.

Masters of the Truth

Originally, truth was a domain of poems and stories, but today we perceive truth as something much more scientific, mathematical. Where does one go (to shop) for the truth? And who “has the truth” in our epoch?

Our animal spirits (something of a counterpart to rationality) are influenced by the archetype of the hero and our concept of what is good.

The entire history of ethics has been ruled by an effort to create a formula for the ethical rules of behavior. In the final chapter we will show the tautology of Max Utility, and we will discuss the concept of Max Good.

The History of the Invisible Hand of the Market and Homo Economicus

We understand “economics” to mean a broader field than just the production, distribution, and consumption of goods and services. We consider economics to be the study of human relations that are sometimes expressible in numbers, a study that deals with tradables, but one that also deals with nontradables (friendship, freedom, efficiency, growth).

When we mention economics in this book, we mean the mainstream perception of it, perhaps as best represented by Paul Samuelson.

By the term homo economicus, we mean the primary concept of economic anthropology. It comes from the concept of a rational individual, who, led by narrowly egotistical motives, sets out to maximize his benefit.

the Epic of Gilgamesh bears witness to the opposite—despite the fact that the first written clay fragments (such as notes and bookkeeping) of our ancestors may have been about business and war, the first written story is mainly about great friendship and adventure.

is a story of nature and civilization, of heroism, defiance, and the battle against the gods, and evil; an epic about wisdom, immortality, and also futility.

Even today we live in Gilgamesh’s vision that human relations—and therefore humanity itself—are a disturbance to work and efficiency; that people would perform better if they did not “waste” their time and energy on nonproductive things.

But it is in friendship where—often by-the-way, as a side product, an externality—ideas and deeds are frequently performed or created that together can altogether change the face of society.19 Friendship can go against an ingrained system in places where an individual does not have the courage to do so himself or herself.

started with Babylonians—rural nature becomes just a supplier of raw materials, resources (and humans the source of human resources). Nature is not the garden in which humans were created and placed, which they should care for and which they should reside in, but becomes a mere reservoir for natural (re)sources.

To be human seems to be somewhere in between, or both of these two. We

The entire history of culture is dominated by an effort to become as independent as possible from the whims of nature.39 The more developed a civilization is, the more an individual is protected from nature and natural influences and knows how to create around him a constant or controllable environment to his liking.

The epic captures one of the greatest leaps in the development of the division of labor. Uruk itself is one of the oldest cities of all, and in the epic it reflects a historic step forward in specialization—in the direction of a new social city arrangement. Because of the city wall, people in the city can devote themselves to things other than worrying about their own safety, and they can continue to specialize more deeply.

“The chief thing which the common-sense individual wants is not satisfactions for the wants he had, but more, and better wants.”47

If a consumer buys something, theoretically it should rid him of one of his needs—and the aggregate of things they need should be decreased by one item. In reality, though, the aggregate of “I want to have” expands together with the growing aggregate of “I have.”

the Old Testament, this relationship is perceived completely differently. Man (humanity) is created in nature, in a garden. Man was supposed to care for the Garden of Eden and live in harmony with nature and the animals. Soon after creation, man walks naked and is not ashamed, de facto the same as the animals. What is characteristic is that man dresses (the natural state of creation itself is not enough for him), and he (literally and figuratively) covers52 himself—in shame after the fall.53

Nature is where one goes to hunt, collect crops, or gather the harvest. It is perceived as the saturator of our needs and nothing more. One goes back to the city to sleep and be “human.” On the contrary, evil resides in nature. Humbaba lives in the cedar forest, which also happens to be the reason to completely eradicate it.

Symbolically, then, we can view the entire issue from the standpoint of the epic in the following way: Our nature is insufficient, bad, evil, and good (humane) occurs only after emancipation from nature (from naturalness), through culturing and education. Humanity is considered as being in civilization.

The city was frequently (at least in older Jewish writings) a symbol of sin, degeneration, and decadence—nonhumanity. The Hebrews were originally a nomadic nation, one that avoided cities. It is no accident that the first important city57 mentioned in the Bible is proud Babylon,58 which God later turns to dust.

is enough, for example, to read the Book of Revelation to see how the vision of paradise developed from the deep Old Testament period, when paradise was a garden. John describes his vision of heaven as a city—paradise is in New Jerusalem, a city where the dimensions of the walls(!) are described in detail, as are the golden streets and gates of pearl.

Hebrews later also chose a king (despite the unanimous opposition of God’s prophets) and settled in cities, where they eventually founded the Lord’s Tabernacle and built a temple for Him. The city of Jerusalem later gained an illustrious position in all of religion.

this time Christianity (as well as the influence of the Greeks) does not consider human naturalness to be an unambiguous good, and it does not have such an idyllic relationship to nature as the Old Testament prophets.

If a tendency toward good is not naturally endowed in people, it must be imputed from above through violence or at least the threat of violence.

If we were to look at human naturalness as a good, then collective social actions need a much weaker ruling hand. If people themselves have a natural tendency (propensity) toward good, this role does not have to be supplied by the state, ruler, or, if you wish, Leviathan.

How does this affect economics?

us return for the last time to the humanization of the wild Enkidu, which is a process we can perceive with a bit of imagination as the first seed of the principle of the market’s invisible hand, and therefore the parallels with one of the central schematics of economic thinking.

Sometimes it is better to “harness the devil to the plow” than to fight with him. Instead of summoning up enormous energy in the fight against evil, it is better to use its own energy to reach a goal we desire; setting up a mill on the turbulent river instead of futile efforts to remove the current. This is also how Saint Prokop approached it in one of the oldest Czech legends.

Enkidu caused damage and it was impossible to fight against him. But with the help of a trap, trick, this evil was transformed into something that greatly benefited civilization.

By culturing and “domesticating” Enkidu, humanity tamed the uncontrollable wild and chaotic evil

Enkidu devastated the doings (the external, outside-the-walls) of the city. But he was later harnessed and fights at the side of civilization against nature, naturalness, the natural state of things.

A similar story (reforming something animally wild and uncultivated in civilizational achievement) is used by Thomas Aquinas in his teachings. Several centuries later, this idea is fully emancipated in the hands of Bernard Mandeville and his Fable of the Bees: or, Private Vices, Publick Benefits. The economic and political aspects of this idea are—often incorrectly—ascribed to Adam Smith.

Here the individual does not try anymore to maximize his goods or profits, but what is important is writing his name in human memory in the form of heroic acts or deeds.

immortality, one connected with letters and the cult of the word: A name and especially a written name survives the body.”77

After this disappointment, he comes to the edge of the sea, where the innkeeper Siduri lives. As tonic for his sorrow, she offers him the garden of bliss, a sort of hedonistic fortress of carpe diem, where a person comes to terms with his mortality and at least in the course of the end of his life maximizes earthly pleasures, or earthly utility.

In the second stage, after finding his friend Enkidu, Gilgamesh abandons the wall and sets out beyond the city to maximalize heroism. “In his (…) search of immortal life, Gilgamesh

The hero refuses hedonism in the sense of maximizing terrestrial pleasure and throws himself into things that will exceed his life. In the blink of an eye, the epic turns on its head the entire utility maximization role that mainstream economics has tirelessly tried to sew on people as a part of their nature.81

today remember Gilgamesh for his story of heroic friendship with Enkidu, not for his wall, which no longer reaches monumental heights.

the eleventh and final tablet, Gilgamesh again loses what he sought. Like Sisyphus, he misses his goal just before the climax

The very existence of questions similar to today’s economic ones can be considered as the first observation. The first written considerations of the people of that time were not so different from those today. In other words: The epic is understandable for us, and we can identify with it.

We have also been witnesses to the very beginnings of man’s culturing—a great drama based on a liberation and then a distancing from the natural state.

Let us take this as a memento in the direction of our restlessness, our inherited dissatisfaction and the volatility connected to it. Considering that they have lasted five thousand years and to this day we find ourselves in harmony with a certain feeling of futility, perhaps these characteristics are inherent in man.

with the phenomenon of the creation of the city, we have seen how specialization and the accumulation of wealth was born, how holy nature was transformed into a secular supplier of resources, and also how humans’ individualistic ego was emancipated.

For small acts (hunting together, work in a factory), small love is enough: Camaraderie. For great acts, however, great love is necessary, real love: Friendship. Friendship that eludes the economic understanding of quid pro quo. Friendship gives. One friend gives (fully) for the other. That is friendship for life and death,

less a civilized, city person is dependent on nature, the more he or she is dependent on the rest of society. Like Enkidu, we have exchanged nature for society; harmony with (incalculable) nature for harmony with (incalculable) man.

human nature good or evil? To this day these questions are key for economic policy: If we believe that man is evil in his nature, therefore that a person himself is dog eat dog (animal), then the hard hand of a ruler is called for. If we believe that people in and of themselves, in their nature, gravitate toward good, then it is possible to loosen up the reins and live in a society that is more laissez-faire.

For a concept of historical progress, for the undeification of heroes, rulers, and nature, mankind had to wait for the Hebrews.

Because nature is not undeified, it is beyond consideration to explore it, let alone intervene in it (unless a person was a two-thirds god like Gilgamesh). It

As early as the “dark” ages, the Jews commonly used economic tools that were in many ways ahead of their time and that later became key elements of the modern economy:

Gilgamesh’s story ends where it began. There is a consistency in this with Greek myths and fables: At the end of the story, no progress occurs, no essential historic change; the story is set in indefinite time, something of a temporal limbo.

For a nation originally based on nomadism, where did this Jewish business ethos come from? And can the Hebrews truly be considered as the architects of the values that set the direction of our civilization’s economic thought?

PROGRESS: A SECULARIZED RELIGION One of the things the writers of the Old Testament gave to mankind is the idea and notion of progress. The Old Testament stories have their development; they change the history of the Jewish nation and tie in to each other. The Jewish understanding of time is linear—it has a beginning and an end.

The observance of God’s Commandments in Judaism leads not to some ethereal other world, but to an abundance of material goods (Genesis 49:25–26, Leviticus 26:3–13, Deuteronomy 28:1–13) (…) There are no accusing fingers pointed at

There are no echoes of asceticism nor for the cleansing and spiritual effect of poverty. It is fitting therefore, that the founders of Judaism, the Patriarchs Abraham, Isaac and Jacob, were all wealthy men.12

about due to a linear understanding of history. If history has a beginning as well as an end, and they are not the same point, then exploration suddenly makes sense in areas where the fruits are borne only in the next generation.

however, the idea of progress itself underwent major changes, and today we perceive it very differently. As opposed to the original spiritual conceptions, today we perceive progress almost exclusively in an economic or scientific-technological sense.

Because care for the soul has today been replaced by care for external things,

This is why we must constantly grow, because we (deep down and often implicitly) believe that we are headed toward an (economic) paradise on Earth.

Only since the period of scientific-technological revolution (and at a time when economics was born as an independent field) is material progress automatically assumed.

Jewish thought is the most grounded, most realistic school of thought of all those that have influenced our culture.17 An abstract world of ideas was unknown to the Jews. To this day it is still forbidden to even depict God, people, and animals in symbols, paintings, statues, and drawings.

economists have become key figures of great importance in our time (Kacířské eseje o filosofii dějin [Heretical Essays in the Philosophy of History]). They are expected to perform interpretations of reality, give prophetic services (macroeconomic forecasts), reshape reality (mitigate the impacts of the crisis, speed up growth), and, in the long run, provide leadership on the way to the Promised Land—paradise on Earth.

REALISM AND ANTIASCETICISM Aside from ideas of progress, the Hebrews brought another very fundamental contribution to our culture: The desacralization of heroes, nature, and rulers.

Voltaire writes: “It certain fact is, that in his public laws he [Moses] never so much as once made mention of a life to come, limiting all punishments and all rewards to the present life.”21

As opposed to Christianity, the concept of an extraterrestrial paradise or heaven was not developed much in Hebrew thought.19 The paradise of the Israelites—Eden—was originally placed on Earth at a given place in Mesopotamia20 and at a given time,

The Hebrews consider the world to be real—not just a shadow reflection of a better world somewhere in the cloud of ideas, something the usual interpretation of history ascribes to Plato. The soul does not struggle against the body and is not its prisoner, as Augustine would write later.

The land, the world, the body, and material reality are for Jews the paramount setting for divine history, the pinnacle of creation. This idea is the conditio sine qua non of the development of economics, something of an utterly earthly making,

The mythology of the hero-king was strongly developed in that period, which Claire Lalouette summarizes into these basic characteristics: Beauty (a perfect face, on which it is “pleasant to look upon,” but also “beauty,” expressed in the Egyptian word nefer, not only means aesthetics, but contains moral qualities as well),

THE HERO AND HIS UNDEIFICATION: THE DREAM NEVER SLEEPS The concept of the hero is more important than it might appear. It may be the remote origin of Keynes’s animal spirits, or the desire to follow a kind of internal archetype that a given individual accepts as his own and that society values.

This internal animator of ours, our internal mover, this dream, never sleeps and it influences our behavior—including economic behavior—more than we want to realize.

Anthropology knows several archetypes of heroes. The Polish-born American anthropologist Paul Radin examined the myths of North American Indians and, for example, in his most influential book, The Trickster, he describes their four basic archetypes of heroes.

The Torah’s heroes (if that term can be used at all) frequently make mistakes and their mistakes are carefully recorded in the Bible—maybe precisely so that none of them could be deified.32

the Hebrew heroes correspond most to the Tricksters, the Culture Bearers, and the Twins. The divine muscleman, that dominant symbol we think of when we say hero, is absent here.

Undeification, however, does not mean a call to pillage or desecration; man was put here to take care of nature (see the story of the Garden of Eden or the symbolism of the naming of the animals). This protection and care of nature is also related to the idea of progress

For the heroes who moved our civilization to where it is today, the heroic archetypes of the cunning trickster, culture bearer, and sufferer are rather more appropriate.

the Old Testament strongly emphasizes the undeification of nature.37 Nature is God’s creation, which speaks of divinity but is not the domain of moody gods

in an Old Testament context, the pharaoh was a mere man (whom one could disagree with, and who could be resisted!).

RULERS ARE MERE MEN In a similar historical context, the Old Testament teachings carried out a similar desacralization of rulers, the so-called bearers of economic policy.

Ultimately the entire idea of a political ruler stood against the Lord’s will, which is explicitly presented in the Torah. The Lord unequivocally preferred the judge as the highest form of rule—an

The needs of future generations will have to be considered; after all humankind are the guardians of God’s world. Waste of natural resources, whether privately owned or nationally owned is forbidden.”39

Politics lost its character of divine infallibility, and political issues were subject to questioning. Economic policy could become a subject of examination.

44 God first creates with the word and then on individual days He divides light from darkness, water from dry land, day from night, and so forth—and He gives order to things.45 The world is created orderly— it is wisely, reasonably put together. The way of the world is put together at least partially46 decipherably by any other wise and reasonable being who honors rational rules.

THE PRAISE OF ORDER AND WISDOM: MAN AS A PERFECTER OF CREATION The created world has an order of sorts, an order recognizable by us as people,

From the very beginning, when God distances Himself from the entire idea, there is an anticipation that there is nothing holy, let alone divine, in politics. Rulers make mistakes, and it is possible to subject them to tough criticism—which frequently occurs indiscriminately through the prophets in the Old Testament.

Hebrew culture laid the foundations for the scientific examination of the world.

Examining the world is therefore an absolutely legitimate activity, and one that is even requested by God—it is a kind of participation in the Creator’s work.51 Man is called on to understand himself and his surroundings and to use his knowledge for good.

The Book of Proverbs emphasizes specifically several times that it was wisdom that was present at the creation of the world. Wisdom personified calls out:

The last act, final stroke of the brush of creation, naming of the animals—this act is given to a human, it is not done by God, as one would expect. Man was given the task of completing the act of creation that the Lord began:

MAN AS A FINISHER OF CREATION The creation of the world, as it is explained in Jewish teachings, is described in the Book of Genesis. Here God (i) creates, (ii) separates, and (iii) names [my emphasis]:

Naming is a symbolic expression. In Jewish culture (and also in our culture to this day), the right to name meant sovereign rights and belonged, for example, to explorers (new places), inventors (new principles), or parents (children)—that is, to those who were there at the genesis, at the origin. This right was handed over by God to mankind.

The Naming itself (the capital N is appropriate) traditionally belongs to the crowning act of the Creator and represents a kind of grand finale of creation, the last move of the brush to complete the picture—a signature of the master.

Without naming, reality does not exist; it is created together with language. Wittgenstein tightly names this in his tractatus—the limits of our language are the limits of our world.53

Reality is not a given; it is not passive. Perceiving reality and “facts” requires man’s active participation. It is man who must take the last step, an act (and we

A real-ization act on our part represents the creation of a construct, the imputation of sense and order (which is beautifully expressed by the biblical act of naming, or categorization, sorting, ordering).

God connects man with the task of guarding and protecting the Garden of Eden, and thus man actually cocreates the cultural landscape. The Czech philosopher Zdeněk Neubauer also describes this: “Such is reality, and it is so deep that it willingly crystallizes into worlds. Therefore I profess that reality is a creation and not a place of occurrence for objectively given phenomena.”61

The Jews believed the exact opposite. The world is created by a good God, and evil appears in it as a result of immoral human acts. Evil, therefore, is induced by man.66 History unwinds according to the morality of human acts.

GOOD AND EVIL IN US: A MORAL EXPLANATION OF WELL-BEING We have seen that in the Epic of Gilgamesh, good and evil are not yet addressed systematically on a moral level.

the epic, good and evil are not envisaged morally—they are not the result of an (a)moral act. Evil was not associated with free moral action or individual will.

Hebrew thought, on the other hand, deals intensively with moral good and evil. A moral dimension touches the core of its stories.65

discrepancy between savings and investment, and others are convinced of the monetary essence

The entire history of the Jewish nation is interpreted and perceived in terms of morality. Morality has become, so to speak, a mover and shaker of Hebrew history.

sunspots. The Hebrews came up with the idea that morals were behind good and bad years, behind the economic cycle. But we would be getting ahead of ourselves. Pharaoh’s Dream: Joseph and the First Business Cycle To

It is the Pharaoh’s well-known dream of seven fat and seven lean cows, which he told to Joseph, the son of Jacob. Joseph interpreted the dream as a macroeconomic prediction of sorts: Seven years of abundance were to be followed by seven years of poverty, famine, and misery.

Self-Contradicting Prophecy Here, let’s make several observations on this: Through taxation74 on the level of one-fifth of a crop75 in good years to save the crop and then open granaries in bad years, the prophecy was de facto prevented (prosperous years were limited and hunger averted—through a predecessor of fiscal stabilization).

The Old Testament prophesies therefore were not any deterministic look into the future, but warnings and strategic variations of the possible, which demanded some kind of reaction. If the reaction was adequate, what was prophesied would frequently not occur at all.

If the threat is anticipated, it is possible to totally or at least partially avoid it. Neither Joseph nor the pharaoh had the power to avoid bounty or crop failure (in this the dream interpretation was true and the appearance of the future mystical), but they avoided the impacts and implications of the prophecy (in this the interpretation of the dream was “false”)—famine did not ultimately occur in Egypt, and this was due to the application of reasonable and very intuitive economic policy.

Let us further note that the first “macroeconomic forecast” appears in a dream.

back to Torah: Later in this story we will notice that there is no reason offered as to why the cycle occurs (that will come later). Fat years will simply come, and then lean years after them.

Moral Explanation of a Business Cycle That is fundamentally different from later Hebrew interpretations, when the Jewish nation tries to offer reasons why the nation fared well or poorly. And those reasons are moral.

Only in recent times have some currents of economics again become aware of the importance of morals and trust in the form of measuring the quality of institutions, the level of justice, business ethics, corruption, and so forth, and examining their influence on the economy,

it is not within the scope of this book to answer that question; justice has been done to the question if it manages to sketch out the main contours of possible searches for answers.

THE ECONOMICS OF GOOD AND EVIL: DOES GOOD PAY OFF? This is probably the most difficult moral problem we could ask.

Inquiring about the economics of good and evil, however, is not that easy. Where would Kant’s “moral dimension of ethics” go if ethics paid? If we do good for profit, the question of ethics becomes a mere question of rationality.

He remains righteous, even if his only reward is death. What economic advantage could he have from that?

morals cannot be considered in the economic dimension of productivity and calculus. The role of the Hebrews was to do good, whether it paid off or not. If good (outgoing) is rewarded by incoming goodness, it is a bonus,99 not a reason to do outgoing good. Good and reward do not correlate to each other.

This reasoning takes on a dimension of its own in the Old Testament. Good (incoming) has already happened to us. We must do good (outgoing) out of gratitude for the good (incoming) shown to us in the past.

So why do good? After all, suffering is the fate of many biblical figures. The answer can only be: For good itself. Good has the power to be its own reward. In this sense, goodness gets its reward, which may or may not take on a material dimension.

the Hebrews offered an interesting compromise between the teachings of the Stoics and Epicureans. We will go into it in detail later, so only briefly

constraint. It calls for bounded optimalization (with limits). A kind of symbiosis existed between the legitimate search for one’s own utility (or enjoyment of life) and maintaining rules, which are not negotiable and which are not subject to optimalization.

In other words, clear (exogenously given) rules exist that must be observed and cannot be contravened. But within these borders it is absolutely possible, and even recommended, to increase utility.

To Love the Law The Jews not only had to observe the law (perhaps the word covenant would be more appropriate), but they were to love it because it was good.

the principle of doing good (outgoing) on the basis of a priori demonstrated good (incoming) was also taken over by the New Testament. Atonement itself is based on an a priori principle; all our acts are preceded by good.

THE SHACKLES OF THE CITY Owing to the Hebrew’s liberation from Egyptian slavery, freedom and responsibility become the key values of Jewish thought.

Laws given by God are binding for Jews, and God is the absolute source of all values,

The Hebrew ideal is represented by the paradise of the Garden of Eden, not a city.116 The despised city civilization or the tendency to see in it a sinful and shackling way of life appears in glimpses and allusions in many places in the Old Testament.

The nomadic Jewish ethos is frequently derived from Abraham, who left the Chaldean city of Ur on the basis of a command:

This way of life had understandably immense economic impacts. First, such a society lived in much more connected relationships, where there was no doubt that everyone mutually depended on each other. Second, their frequent wanderings meant the inability to own more than they could carry; the gathering up of material assets did not have great weight—precisely because the physical weight (mass) of things was tied to one place.