The Danger of Fiat — nested purpose.

If you consider the purpose of a tree seed, you may say that its purpose is to grow a new tree.

If you consider the purpose of that tree, you may find it exists to grow new seeds.

When you place these two causes and effects together, you get a system.

But what is the purpose of this system? Not to create trees, as that is merely a component of the system. Its purpose is also not to spread more seeds, as that is also a component of the system.

What is the purpose of this tree/seed combo system, then? Well, this system constitutes all trees and all seeds. An ecosystem of trees removes carbon from the atmosphere and releases oxygen; it also contributes to the chemical makeup of the soil and provides a habitat for thousands of other creatures — including humans.

Humans have co-evolved with the forest; some theories suggest that humans are only bipedal because of trees, and were it not for trees**,** it’s unlikely that humans would have evolved as they did, if at all.

Thus, it could be said that one purpose of the system is to create humans.

To say that the purpose of the seed is to make more trees or that the purpose of the trees is to spread more seeds is correct. Both are correct statements — at one level of analysis.

When you are at a very low level of analysis, things can often get paradoxical or circular like this. The scope of analysis is limited, so the set of potential conclusions is too, and you soon circle back on yourself. It’s not until you zoom out to another level of analysis that you can find a greater truth.

A greater truth will always accommodate a lesser truth.

The greater truth, at the higher level of analysis, which says that the purpose of the tree system is to create humans (among other things), sees the purpose of the tree seed the same way. It sees that the purpose of the tree seed is to create humans, but does not discount the lesser truth that it is also to create more trees.

If a is to achieve b, and b is to achieve c, then a is to achieve c, but achieving b is still a nested purpose.

Now, let’s apply the same lens to free market economics.

Free market economics — levels of analysis.

Just as the seed is at the core of the tree system, the sale is at the core of the free market system.

The purpose of a sale, from the seller’s perspective, is to acquire money.

From the buyer’s perspective, the sale’s purpose was to acquire goods.

If these are the purposes of the components (selling, buying) — hence the somewhat paradoxical/circular reasoning — what is the purpose of the system in totum? The purpose of the system of buying and selling in totum is hard to pinpoint, just as the purpose of the ecosystem of trees in totum is hard to pinpoint, because both have a wide array of consequences.

Still, we can elucidate some.

When a population with infinite wants and desires is placed in a world with scarce resources, they either kill each other or learn to share.

But what do they share? The resources? Well, yes… but also the responsibility.

The burden of responsibility for managing scarce resources falls on the heads of all people, but no person in particular.

Let’s separate resources and responsibility for clarity.

Resources: Resources are the raw materials, goods and services that exist within the economy. Think water, coffee, mechanics, cars etc…

Responsibility: The responsibilities have more to do with goals; how do we want to restructure the world, and upon whom does that responsibility fall?

Think direction, momentum, trend, desire.

Effectively managing the scarcity of resources is fundamentally a task of prioritisation.

Prioritisation regulates attention.

Attention restructures the world.

The execution of a sale is a statement of prioritisation by both parties.

When a farmer sells his apples, he states he values currency > apples, and vice versa.

When large amounts of money chase large amounts of resources, those resources will be distributed according to how the human species prioritises things. In fact, it will elucidate that prioritisation.

Air conditioning units flow into the United Kingdom at a much slower rate than they flow into Brazil, because people in the cold of the UK do not prioritise internal cooling.

Sure, we could stack every home in the UK with top-of-the-range air conditioning units, but this would increase the total demand for air conditioning, thus raising their prices and reducing their accessibility to those in hotter climates who get the most value from the resource.

This would reduce the thermodynamic efficiency of the species in totum.

The free market allows the priorities of the population to be reflected in the distribution of resources worldwide.

From the other side of the equation, when finite amounts of attention are chasing a finite amount of money, the money (which reflects the species’ priorities) becomes the mechanism that mediates the attention.

With these two forces in play, the world begins auto-poetically discovering what is most important to humans and their goal of… what?

At one level of analysis, a seed’s goal is to grow a tree, and at the same level of analysis, a human’s goal is to procreate.

But what about the level of analysis that discovered the integral role that trees play in the evolution of humans?

What should this lens find if we look at the free market through it?

We prioritise according to an end goal, and the free market constantly prioritises some endeavours over others. However, since the free market is the product of the distributed cognition of all of its participants (us), how can we, as components of the system, claim to know the purpose of the whole system?

If you ask a tree what its goal is, it may say that it wishes to spread more seeds, but if you were to ask the entire ecosystem of trees what its goal is, it might tell you it wishes to facilitate the evolution of humans, among other things.

If we look at the effects of the free market, we see that it doesn’t merely get resources into the hands that need them most but also computes the best attack vector on entropy for the human species. It directs our attention and resources towards an end goal that is not known to any single component of the system (person).

So, what happens when you introduce fiat into this system of influence?

Fiat

Fiat means ‘by decree’ or ‘because I said so’.

When a population establishes pockets of centralised control from which fiat decree precipitates, you have an entity resembling cancer — a single point from which influence spreads without balance or co-regulation from the rest of the system.

When a biological organism gets cancer, it dies.

When a societal organism gets cancer, it also dies. There have been many books written on the various ways that fiat entities have routinely led to the demise of the strongest nations and pockets of human organisation in history.

For instance, the most dangerous form of fiat is fiat money: a centralised pocket of human organisation from which power over the public ledger has been unilaterally seized.

Every time society allows this to occur, those with control over the public ledger interfere too heavily with the free market’s attention regulation mechanism and directly lead the nation to its demise.

It seems that no single tree can decide by fiat which seeds come to grow or where.

However, some humans decide which seeds of influence come to materialise in the economy based purely on the hubristic convictions they have in their minds and models.

Could it be possible that the amalgamated, skin-in-the-game priorities of all humans within the system may be a better metric than the fallible mind of a single node in that network when determining the direction in which total human influence shall restructure the world?

I don’t know, but fiat people have more faith in their perspective of the world than they have in the amalgamation of collective human intelligence, despite all historical evidence pointing towards not just the futility but the destructive reliability of that approach.