Scott Sumner's amusing philosophy
He posts here andhere. Lots of peculiar things.
(I)
There's no _objective _reason to view your or my political views as being superior to those of any other person.
There is no objective reason. Period. Reasons are always held by a person, hence subjective. My reason to write this post is mine and no one else's.
What Sumner appears to want there is 'something that forces someone to believe in something'. But there are no such things. Arguments can be more or less persuasive, but as far as I know, there are no universally working arguments, because every argument relies on premises, and premises differ among people. This is not to say premises can't change, they can.
But by this standard, there is no objective reason in virtue of which Science works better than wizardry. Argueably, it is too high of a standard.
Nonetheless, there is no objective reason for me to assume that just because I inhabit Scott Sumner's body, my ideas are somehow special. I just do my job.
This contradicts his next post
There was some confusion about my recent denial of personal identity. Most people believe there is a "you" that possesses a brain, and a "you" that possesses a body. I don't, I believe there's merely a brain and a body, no "you". This confusion shows up in discussions of free will.
If there is no 'you', what is the 'I' in the previous sentence referring to? Who is this Scott Sumner that inhabits a body?
Additionally, this debate (personal identity) has little do do, prima facie, with free will. You can have a self with or without it.
While I tend to agree that small government is best, I also know that there is nothing special about my opinion. I'm not smarter than lots of economists with different views. It's not my job to decide whether future Americans should be predisposed to prefer my views on economics or Krugman's.
This is also contradictory with his earlier paragraph:
Then why do I aggressively promote my views in the blogosphere? Because that's my job. I am a small worker ant in a vast intellectual edifice called "economics." It's my job to study the issues and report what I believe to be true.
The mere fact that Sumner is blogging (and doing his job) does marginally predispose future Americans to prefer his economic views. If there were no Sumner, there would be no effect. If he were a terrible writer, his writings could make his position less respected, but this is not the case.
Thus I should not take political inclinations into account when deciding on which groups should be allowed to immigrate to the US.
But he does! Saying that the government has a right to regulate inmigration is a political inclination. On which basis does Sumner decide which groups should be allowed into the US? 'Whatever voters say'? And why that? Because voters say so?
I do understand that the illusion of personal identity creates the related illusion that we ourselves are special, and that our precious views of things are special. But we aren't, and they aren't.
Our views of thing are special to us. Reasons, as mentioned earlier, are subjective and individual. When deciding on an issue, and after we have considered the relevant evidence and arguments, we judge it. If it seems to us that P is right, we are then justified in believing that P is right. That does not make P true. The truth of P does not depend on what you think of P (except if P is a subjective fact about yourself). Sumner can then say that it is the case that inmigration has this effect, and others can say that inmigration has that effect, and both can be justified in believing that. Debates can then help bring positions closer and examine shared and unshared assumptions.
Seemingly, he is advocating us to take the consensus view. And that is surely a wise heuristic. But as he then notes,
There is one possible flaw in always marking our beliefs to the market consensus. It's been pointed out that if everyone believed the EMH made it impossible to consistently beat the market, then no one would do the research necessary to make the EMH true. Thus we need lots of individual actors trying to figure out where stocks should be valued, and forming opinions independent of the current market price. Otherwise the EMH does not work. But they should also be wise enough to know that they are nothing special, and hence they should advise their mother to invest in index funds, not their own hedge fund. That's what I mean by realizing that you are nothing special. You are merely a worker ant making the EMH more true.
This is weird. There's a reason why I don't operate a hedge fund, and it is that I don't think I would do better than the market. If I believed that I can beat the market myself, I would start a hedge fund, and I would advise my mother to invest in it once I've taken into account the high likelihood of failure and her low risk preference. (That is, it's unlikely that I would recommend her to invest in my hedge fund. But surely to more risk-friendly investors I would!)
The EMH is an emergent property of markets, not a physical law. If you are reading through balance sheets and detect a very good opportunity, you can go and think "Surely someone else would have thought about this first if it were actually that good" and let it go. But sometimes, you can think that you are the first one, that the idea is good, and that you are special for realising that. Not everyone will be right about their guesses, of course. This is why you should also weight the judgement of the rest against your own: a weak form of EMH is still true.
Note that if the very-strong EMH were true, entrepreneurship would suffer from the same problem (If a business plan is that good, how is it that no one has thought of it before?).
If we are made dictator, we should implement the consensus view of optimal policy, not our own. People have trouble with this, as it implies two levels of belief about what is true. The view from inside our mind, and the view from 20,000 miles out in space, where I see there is no objective reason to favor my view over Krugman's.
Again, no objective reasons at all. He's asking for something that cannot in principle be provided. But there is a reason to favour his view over Krugman's: that it is_his._ Own beliefs can ground justification. Other beliefs aren't. If it seems to me that X is true, and I have no reasons to believe that X is not true, I ought to believe X. In fact, Sumner says what he says about specialness and identity and the rest because it seems that way to him. Note that he is going against the consensus (How many people or even philosophers say there is no self, or that we are not special in the sense defended here, or that you should follow the consensus in the way he says ) by espousing his views, thus contradicting them.
In the Middle Ages, people believed their own religion was the one true faith, and used public policy to try to make most of society adhere to this one faith. They could not understand the concept of the view from 20,000 miles out. In the enlightenment (after Copernicus), philosophers realized that we have no privileged position to decide the one true faith, and that public policy should not favor any one religion.
No they didn't. There is no view from 20,000 miles out. Just individual views. Public policy does not favour any one religion, true indeed. But it does favour many other things (everything the law upholds, and not everything in that had or has majoritarian approval, nor it would be a good idea for it to be so)
I also believe that public policy should not try to reshape our population more along Republican or Democratic lines, as we don't know which party's views are correct. Thus immigration policy should be neutral, except about characteristics for which there is a broad consensus that they are desirable or undesirable. (Say Nazi views, or totalitarian communist views, which are clearly wrong.)
What does a 'neutral inmigration policy' even mean? He really means 'consensus inmigration policy'. Consensus of whom? Voters? World citizenry? Economists? Philosophers? For any of those groups, you may get a different result. And then, to choose which consensus is relevant, to what do you appeal? Which consensus does decide which consensus is the one that gets its view implemented? Because if we go as far as saying that every majoritarian decision in a polity ought to be implemented, we are endorsing long refuted views of political authority. It'd be interesting to see Sumner arguing for them, though.
I do not believe that the Fed should set interest rates where Janet Yellen thinks is appropriate, or where John Taylor thinks is appropriate, or where I think is appropriate. Rather interest rates should be set where the market thinks they are most likely to lead to good macroeconomic outcomes. Yellen and Taylor (and me?) do have an important role to play in figuring out what "good macroeconomic outcomes" means.
What happens if you include his own name there? "I don't believe that the Fed should set rates where Scott Sumner think is appropriate". Scott Sumner thinks using the market is appropriate. Hence, (apparently) he doesn't believe in using markets(!).
(II)
What is Sumner really saying here? It becomes clearer after reading this comment.
Again, you are confusing two levels of belief. Recall my analogy with the stock investor. At one level he things his hedge fund is best, but at a higher level he thinks him mom should buy index funds. At one level I might think a 3.5% fed funds rate is best, but at another level I defer to the market view of where interest rates should be. I am merely one person in that market.
Does this make sense? Let us suppose Sumner is the only person in the world. Then, whatever he thinks is the consensus, so both levels coincide.
But imagine Sumner and I are the only people in the world and we are arguing about whether he should be my slave. Assume I'm the kind of person who would enslave another (I'm actually nice, I promise!). In this situation, he wouldn't want to be my slave and and I would want to. There is no consensus on the issue. What policy do we follow? On his account, none. But there is no 'none'. Either you become my slave or you don't. What would happen is that I would consider imposing my policy on you, and you would try to impose your policy on me (Resisting being enslaved) (Both would think each of us is justified in our respective policies). Doing this is precisely what my theory predicts!
Sumner's meta-rule is not 'follow the consensus', though. It's more like 'Others should guide their decisions by the consensus, I should guide mine by my own beliefs'.
(III)
Why not set your own beliefs to be that of the consensus, then? Because that leads us to the paradox ackowledged by him. In a country of travel agents, no one ever travels.
The obvious solution, for me and probably most of the people (the consensus!), is to have one set of beliefs, and use "The consensus is usually right" as a heuristic that informs my actions. Sumner could go third order meta and have a 1st order belief that P is the case, a second order belief that 'If the consensus says that P is the case, then I should set 1st order belief to P, unless I carefully assess it myself' and a third order belief 'Follow the consensus is a rule that tends to work' to justify the second order belief. Note that we always end up with a belief that is accepted because it's commonsensical.
But Sumner's solution lead us to peculiar paradoxes:
Me: Scott, I heard you are going to start a hedge fund
Scott: Yeah, I have a few good investing ideas
Me: That's great! Have you told your friends about it? I mean, your investor friends who might like investing.
Scott: Well, no. I recommended them to invest in an ETF.
Me: Why is so? Is it better to invest in an ETF or in your hedge fund?
Scott: In an ETF, as is implied by the EMH
Me: But then, you are going to, probably, lose money. You expect your hedge fund to do better than the market, right?
Scott: Yeah
Me: But if you expect your hedge fund to beat the market, why not tell them?
Scott: I'm not special, people should follow the consensus.
Me: Why not follow the consensus yourself then?
Scott: I'm a worker ant, I know that if I do this, the EMH will be true (And the market will work better that way, and that's good)
Me: So your hedge fund is more of a public service? You expect to lose money so that the market becomes more efficient?
Scott: Well, you know... we know that if people behave individually like I am, things will work very well. So I get to have personal beliefs and act on them, but at the same time I give others advice based on consensus to avoid propagating my possible mistakes.
Me: But you know that the system will work basically the same if you just go for the ETF and forget your hedge fund, right?
Scott: I'm a utilitarian, I don't think my preferences are special, and I act in such a way as to make it good for everyone.
Me: Oh, well. Here's another policy for you: Tell others to invest in your hedge fund. Have just a first order belief. Tell them about why you think it's a good idea, and why it might be a bad idea. Tell them about the EMH. Then, let them decide. But I think that you are not really doing it out of charity. When you do research in economics, you think what you are doing has some grain of truth.
Scott: I don't know if that would work best. What you are saying is like betting against a prediction market.
Me: Yes, indeed! In certain cases, prediction markets are beatable. Especially when we are talking about obscure assets you want to invest in like the ones you are planning to invest in. How many people have really considered what you are considering now?
(IV)
Suppose you have a belief–say, the belief that it is raining. And suppose that you come to reflect explicitly on whether your belief constitutes knowledge. What conclusion might you come to? You must either conclude that you know that it is raining, or withhold judgment about whether you know this, or conclude that you do not know it. If you conclude that you do not know it, then it seems that there will be a kind of tension between your first-order belief that it is raining, and your second-order belief about that first-order belief. If you hold on to your first-order belief while simultaneously denying that it constitutes knowledge, then, I think, you are guilty of some sort of irrationality. This is suggested by the fact that, were you to express your attitudes in words, you would utter a Moore-paradoxical sentence along the lines of, ‘‘It is raining, but I don’t know whether it is raining.’ (Huemer, 2011)
Sumner seems to be in a similar position. He believes things, but he doesn't know if they are true. Which is nonsense.
He further says that process X (Science, public deliberation, etc...) delivers truth/good policy, even though no individual participant can claim to have to be right. But over and over again, Science has changed, and public policy has been horrible, and people have said so, and been right.
In the current case, however, it doesn't seem to be the case. Sumner should default to the consensus, as there are good reasons for it: trust your reasoned judgement over the rest of the world's.