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Book Notes
July 6, 2024

Enlightenment Now

(Image: Zen Buddha Silence by Marilyn Barbone.)

March 25, 2018

Pinker quotes Baruch Spinoza:

Those who are governed by reason desire nothing for themselves which they do not also desire for the rest of humankind.

For investors and entrepreneurs, it's important to have the right basic orientation.

(Also quote Buffett on "heaven help them if they actually bet on their dire predictions...") Discuss examples? Endgame. Code Red. Even Reinhart/Rogoff... versus Buffett... [Buffett: wars, recessions, a depression, inflation... America will keep marching forward. "expensive distraction" because even if you know the market is overvalued, that won't help you. The market can change [Graham]. And it's impossible to time...)

Our efforts to materially increase the normalized earnings of Berkshire will be aided – as they have been throughout our managerial tenure – by America's economic dynamism. One word sums up our country'sachievements: miraculous. From a standing start 240 years ago – a span of time less than triple my days on earth – Americans have combined human ingenuity, a market system, a tide of talented and ambitiousimmigrants, and the rule of law to deliver abundance beyond any dreams of our forefathers.

You need not be an economist to understand how well our system has worked. Just look around you. See the 75 million owner-occupied homes, the bountiful farmland, the 260 million vehicles, the hyper-productivefactories, the great medical centers, the talent-filled universities, you name it – they all represent a net gain for Americans from the barren lands, primitive structures and meager output of 1776. Starting from scratch, America has amassed wealth totaling $90 trillion.

It's true, of course, that American owners of homes, autos and other assets have often borrowed heavily to finance their purchases. If an owner defaults, however, his or her asset does not disappear or lose its usefulness. Rather, ownership customarily passes to an American lending institution that then disposes of it to an American buyer. Our nation's wealth remains intact. As Gertrude Stein put it, "Money is always there, but the pockets change."

Above all, it's our market system – an economic traffic cop ably directing capital, brains and labor – that has created America's abundance. This system has also been the primary factor in allocating rewards. Governmental redirection, through federal, state and local taxation, has in addition determined the distribution of a significant portion of the bounty.

America has, for example, decided that those citizens in their productive years should help both the old and the young. Such forms of aid – sometimes enshrined as "entitlements" – are generally thought of as applying to the aged. But don't forget that four million American babies are born each year with an entitlement to a public education. That societal commitment, largely financed at the local level, costs about $150,000 per baby. The annual cost totals more than $600 billion, which is about 3 1â„2% of GDP.

However our wealth may be divided, the mind-boggling amounts you see around you belong almost exclusively to Americans. Foreigners, of course, own or have claims on a modest portion of our wealth. Those holdings, however, are of little importance to our national balance sheet: Our citizens own assets abroad that are roughly comparable in value.

Early Americans, we should emphasize, were neither smarter nor more hard working than those people who toiled century after century before them. But those venturesome pioneers crafted a system that unleashedhuman potential, and their successors built upon it.

This economic creation will deliver increasing wealth to our progeny far into the future. Yes, the build-up of wealth will be interrupted for short periods from time to time. It will not, however, be stopped. I'll repeat what I've both said in the past and expect to say in future years: Babies born in America today are the luckiest crop in history.

*As investors and businesspeople, it's important to see the big picture: progress. Not taking it for granted...

Enlightenment Now: The Case for Reason, Science, Humanism, and Progress.

Outline:

Part I: Enlightenment

  • Chapter 1. Dare to Understand!
  • Chapter 2. Entro, Evo, Info
  • Chapter 3. Counter-Enlightenments

Part II: Progress

  • Chapter 4. Progressophobia
  • Chapter 5. Life
  • Chapter 6. Health
  • Chapter 7. Sustenance
  • Chapter 8. Wealth
  • Chapter 9. Inequality
  • Chapter 10. The Environment
  • Chapter 11. Peace
  • Chapter 12. Safety
  • Chapter 13. Terrorism
  • Chapter 14. Democracy
  • Chapter 15. Equal Rights
  • Chapter 16. Knowledge
  • Chapter 17. Quality of Life
  • Chapter 18. Happiness
  • Chapter 19. Existential Threats
  • Chapter 20. The Future of Progress

Part III. Reason, Science, and Humanism

  • Chapter 21. Reason
  • Chapter 22. Science
  • Chapter 23. Humanism

PART I. ENLIGHTENMENT

Pinker quotes Friedrich Hayek:

If old truths are to retain their hold on men's minds, they must be restated in the language and concepts of successive generations. What at one time are their most effective expressions gradually become so worn with use that they cease to carry a definite meaning. The underlying ideas may be as valid as ever, but the words, even when they refer to problems that are still with us, no longer convey the same conviction.

Pinker writes that he aims to restate the ideals of the Enlightenment using the language and concepts of the twenty-first century. Most of the book uses data to defend these ideals. The Enlightenment, argues Pinker, has worked, which is "perhaps the greatest story seldom told."

When properly appreciated, I will suggest, the ideals of the Enlightenment are in fact stirring, inspiring, noble – a reason to live.

CHAPTER 1. DARE TO UNDERSTAND!

Pinker quotes the physicist David Deutsch's defense of enlightenment inThe Beginning of Infinity:

Optimism (in the sense that I have advocated) is the theory that all failures – all evils – are due to insufficient knowledge... Problems are inevitable, because our knowledge will always be infinitely far from complete. Some problems are hard, but it is a mistake to confuse hard problems with problems unlikely to be solved. Problems are soluble, and each particular evil is a problem that can be solved. An optimistic civilization is open and not afraid to innovate, and is based on traditions of criticism. Its institutions keep improving, and the most important knowledge that they embody is knowledge of how to detect and eliminate errors.

What is enlightenment? is the title of a famous essay by Immanuel Kant. Kant answers that enlightenment is "humankind's emergence from its self-incurred immaturity," its "lazy and cowardly" submission to the "dogmas and formulas" of religious or political authority.

Pinker continues:

The Enlightenment is conventionally placed in the last two-thirds of the 18th century, though it flowed out of the Scientific Revolution and the Age of Reason in the 17th century and spilled into the heyday of classical liberalism of the first half of the 19th... The era was a cornucopia of ideas, some of them contradictory, but four themes tie them together: reason, science, humanism, and progress.

Pinker states that reason is nonnegotiable. To the extent that we make arguments – about what we should live for or anything else – and to the extent we expect others to consider our arguments, we are committed to reason and to holding our beliefs accountable to objective standards. Pinker:

If there's anything the Enlightenment thinkers had in common, it was an insistence that we energetically apply the standard of reason to understanding our world, and not fall back on generators of delusion like faith, dogma, revelation, authority, charisma, mysticism, divination, visions, gut feelings, or the hermeneutic parsing of sacred texts.

Pinker points out that Enlightenment thinkers were certainly not saying that human beings are perfectly rational:

Many writers today confuse the Enlightenment endorsement of reason with the implausible claim that humans are perfectly rational agents. Nothing could be further from historical reality. Thinkers such as Kant, Baruch Spinoza, Thomas Hobbes, David Hume, and Adam Smith were inquisitive psychologists and all too aware of our irrational passions and foibles. They insisted that it was only by calling out the common sources of folly that we could hope to overcome them. The deliberate application of reason was necessary precisely because our common habits of thought are not particularly reasonable.

The second ideal is science, a refinement of reason. Before the Scientific Revolution, educated people believed in witches, werewolves, magic, alchemy, and geocentrism. They believed a rainbow was a sign from God, whereas a comet warned of evil. They believed mice were spontaneously generated from piles of straw. Pinker quotes the sociologist Robert Scott:

Rainstorms, thunder, lightning, wind gusts, solar or lunar eclipses, cold naps, heat waves, dry spells, and earthquakes alike were considered signs and signals of God's displeasure. As a result, the "hobgoblins of fear" inhabited every realm of life. The sea became a satanic realm, and forests were populated with beasts of prey, ogres, witches, demons, and very real thieves and cutthroats... After dark, too, the world was filled with omens portending dangers of every sort: comets, meteors, shooting stars, lunar eclipses, the howls of wild animals.

Enlightenment thinkers realized that conventional wisdom could be very mistaken. Achieving reliable knowledge could be done using the methods of science – skepticism, fallibilism, open debate, and empirical testing. And the scientific study of nature included learning about human nature.

Pinker:

The idea of a universal human nature brings us to a third theme, humanism. The thinkers of the Age of Reason and the Enlightenment saw an urgent need for a secular foundation for morality, because thy were haunted by a historical of centuries of religious carnage: the Crusades, the Inquisition, witch hunts, the European wars of religion. They laid that foundation in what we now call humanism, which privileges the well-being of individual men, women, and children over the glory of the tribe, race, nation, or religion. It is individuals, not groups, who aresentient– who fell pleasure and pain, fulfillment and anguish. Whether it is framed as the goal of providing the greatest happiness for the greatest number or as a categorical imperative to treat people as ends rather than means, it was the universal capacity of a person to suffer and flourish, they said, that called on our moral concern.

Our capacity for sympathy – also called benevolence, pity, and commiseration – can be a foundation for humanism. Pinker:

Given that we are equipped with the capacity to sympathize with others, nothing can prevent the circle of sympathy from expanding from the family and tribe to embrace all of humankind, particularly as reason goads us into realizing that there can be nothing uniquely deserving about ourselves or any of the groups to which we belong.

Humanism led Enlightenment thinkers not only to condemn religious violence, but also secular cruelties– including slavery, despotism, executions for frivolous offenses such as shoplifting and poaching, and sadistic punishments such as flogging, amputation, impalement, disembowlment, breaking on the wheel, and burning at the stake. Pinker:

If the abolition of slavery and cruel punishment is not progress, nothing is, which brings us to the fourth Enlightenment ideal. With our understanding of the world advanced by science and our circle of sympathy expanded through reason and cosmopolitanism, humanity could make intellectual and moral progress. It need not resign itself to the miseries and irrationalities of the present, nor try to turn back the clock to a lost golden age.

Pinker observes that progress mostly involves ordinary and incremental improvements:

The Enlightenment belief in progress should not be confused with the 19th-century Romantic belief in mystical forces, laws, dialectics, struggles, unfoldings, destinies, ages of man, and evolutionary forces that propel mankind ever upward toward utopia... If we keep track of how our laws and manners are doing, think up ways to improve them, try them out, and keep the ones that make people better off, we can gradually make the world a better place. Science itself creeps forward through this cycle of theory and experimentation, and its ceaseless headway, superimposed on local setbacks and reversals, shows how progress is possible.

Pinker notes that the Enlightenment hope for progress was concentrated on human institutions – like governments, laws, schools, markets, and international bodies.

Government is a human invention, based on a social contract, aimed at improving human welfare through coordinated action and by discouraging selfish acts "that may be tempting to every individual but leave everyone worse off."Governments derive their just powers from the consent of the governed.

The Enlightenment, writes Pinker, also saw the first rational analysis of prosperity– with a focus on how wealth is created. It depends on a network of specialists. As long as specialists can exchange goods and services, such exchange was a positive-sum game that made everyone better off. Pinker adds that exchange not only increased overall wealth, but also tended to make people nicer because in a well-functioning market it is cheaper to buy things than to steal them and other people are more valuable alive than dead. Pinker:

This brings us to another Enlightenment ideal, peace. War was so common in history that it was natural to see it as a permanent part of the human condition and to think peace could come only in a messianic age. But now war was no longer thought of as a divine punishment to be endured and deplored, or a glorious contest to be won and celebrated, but a practical problem to be mitigated and someday solved.

Pinker concludes the chapter by commenting that the Enlightenment thinkers were wrong about many things, and that they would have been the first to admit it. They lived too soon to appreciate the best science and the best thinking that exist today.

CHAPTER 2. ENTRO, EVO, INFO

The Second Law of Thermodynamics– put in its current form by the physicist Ludwig Boltzmann– states that in an isolated system, entropy never decreases. (The First Law is that energy is conserved, while the Third Law is that a temperature of absolute zero is unreachable.) Pinker:

Closed systems inexorably become less structured, less organized, less able to accomplish interesting and useful outcomes, until they slide into an equilibrium of gray, tepid, homogeneous monotony and stay there.

After scientists realized that a difference in temperature between two bodies was due to a difference in the average speeds of the molecules making up those two bodies, entropy could be stated more generally. Order could be explained in terms of all the distinct states of a system– all the positions and speeds of the molecules making up the system. But statistically, there are far more ways for a system to be disordered than to be ordered. It follows, based on probability, that disturbances of the system will gradually make the system more disordered over time. Pinker:

How is entropy relevant to human affairs? Life and happiness depend on an infinitesimal sliver of orderly arrangements of matter amid the astronomical number of possibilities. Our bodies are improbable assemblies of molecules, and their maintain that order with the help of other improbabilities: the few substances that can nourish us, the few materials in the few shapes that can clothe us, shelter us, and move things around to our liking. Far more of the arrangements of matter found on Earth are of no worldly use to us, so when things change without a human agent directing the change, they are likely to change for the worse.

Pinker then highlights two kinds of orderliness. First, there is self-organization:

When energy is poured into a system, and the system dissipates that energy in its slide toward entropy, it can become poised in an orderly, indeed beautiful, configuration– a sphere, spiral, starburst, whirlpool, ripple, crystal, or fractal. The fact that we find these configurations beautiful, incidentally, suggests that beauty may not just be in the eye of the beholder. The brain's aesthetic response may be a receptiveness to the counter-entropic patterns that can spring forth from nature.

Second, there is a design that results from evolution:

The customary illustration of biological design is the eye, but I will make the point with my second-favorite sense organ. The human ear contains an elastic drumhead that vibrates in response to the slightest puff of air, a bony lever that multiplies the vibration's force, a piston that impressed the vibration into the fluid in a long tunnel (conveniently coiled to fit insider the wall of the skull), a tapering membrane that runs down the length of the tunnel and physically separates the waveform into its harmonics, and an array of cells with tiny hairs that are flexed back and forth by the vibrating membrane, sending a train of electrical impulses to the brain. It is impossible to explain why these membranes and bones and fluids and hairs are arranged in that improbable way without noting that this configuration allows the brain to register patterned sound.

Pinker remarks that before Charles Darwin and Alfred Russel Wallace provided an explanation, it was reasonable to think that improbable configurations – like eyes and ears– resulted from intelligent design. Pinker:

Once self-organizing processes of physics and chemistry gave rise to a configuration of matter that could replicate itself, the copies would make copies, which would make copies of the copies, and so on, in an exponential explosion. The replicating systems would compete for the material to make their copies and the energy to power the replication. Since no copying process is perfect– the Law of Entropy sees to that– errors will crop up, and those most of these mutations will degrade the replicator (entropy again), occasionally dumb luck will throw one up that's more effective at replicating, and its descendants will swamp the competition. As copying errors that enhance stability and replication accumulate over the generations, the replicating system– we call it an organization–will appear to have been engineered for survival and reproduction in the future, though it only preserved the copying errors that led to survival and reproduction in the past.

After entropy and evolution, Pinker says that the third keystone in understanding the human condition isinformation. The human brain has evolved to preserve and transform information. Pinker:

A momentous discovery of 20th-century theoretical neuroscience is that networks of neurons not only can preserve information but can transform it in ways that allow us to explain how brains can beintelligent. Two input neurons can be connected to an output neuron in such a way that their firing patterns correspond to logical relations such as AND, OR, and NOT, or to a statistical decision that depends on the weight of the incoming evidence. That gives neural networks the power to engage in information processing or computation. Given a large enough network built out of these logical and statistical circuits (and with billions of neurons, the brain has room for plenty), a brain can compute complex functions, the prerequisite for intelligence. It can transform the information about the world that it receives from the sense organs in a way the mirrors the laws governing the world, which in turns allows it to make useful inferences and predictions. Internal representations that reliably correlate with states of the world, and that participate in inferences that tend to derive true implications from true premises, may be called knowledge.

The invention of farming increased calories available for people. This led to larger cities, a scholarly and priestly class, and more focus on long-term well-being rather than just short-term survival.

BOOLE MICROCAP FUND

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There are roughly 10-20 positions in the portfolio. The size of each position is determined by its rank. Typically the largest position is 15-20% (at cost), while the average position is 8-10% (at cost). Positions are held for 3 to 5 years unless a stock approachesintrinsic value sooner or an error has been discovered.

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If you are interested in finding out more, please e-mail me or leave a comment.

My e-mail: jb@boolefund.com

Disclosures: Past performance is not a guarantee or a reliable indicator of future results. All investments contain risk and may lose value. This material is distributed for informational purposes only. Forecasts, estimates, and certain information contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this article may be reproduced in any form, or referred to in any other publication, without express written permission of Boole Capital, LLC.

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