Peter Emmerson

11. Two examples of damage done by using a-t heuristics: warring and finance

With little help from pure mathematicians, engineers have struggled to develop heuristics capable of modelling figurational processes where rates of change can be volatile.  Of course one major difficulty, if I am right, is that accurate modelling of comparative uncertainties cannot be done by pure mathematicians who after all as formal logicians have habituses structured by supernatural and verbal logical a-t heuristics (s&v a-t heuristics).  Accordingly, we are very likely to continue perpetually deploying traditional, I-oriented, s&v a-t heuristics designed to impose command and control systems on dynamic comparatively uncertain mundanities, and continue neglecting to engineer heuristics capable of investigating figurational processes and synthesizing models of persistent catastrophic problems such as warring.  The cost of using s&v a-t heuristics is that we tend to prolong a manifestly damaging and tragic process such as warring by perceiving and treating it as if it was a ‘thing’ in its own right and beyond human control: from this perspective warring is seen as a fatalistic, even useful Hegelian dialectical inevitability rather than a figurational problem to be engineered.

To develop this point further I want to look at financial processes.  By adopting a-t heuristics as our default position with pure mathematicians as guarantors, we feel safe in thacting with conviction and are prone to over-confidence and an illusion of control: we genuinely think we know what we are doing.  Interdependently, when things start changing quickly or go wrong and control is lost, we are taken by surprise and even panic.  A good example in financial terms concerns our use of ‘stability/instability’.  Stability/instability is a dialectical tool, an a-t heuristic developed by theometaphysicians to exercise control over what is in fact a figurational process that cannot be controlled with our presently available linear heuristical technology such as statistics that is incapable of engaging with volatilities.  Concomitantly, when serious financial volatility emerges we interpret what is an ordinary figurational process in catastrophic terms using concepts such as crash or crisis.  If we did not use such a-t heuristics we would be less complacent and better prepared for financial volatility, knowing that there are only ever differing rates of change.  From my perspective collapses in business confidence come about through gross misinterpretation of expectable fluctuations in business thactivities which at present are managed ineffectively using a-t heuristics such as stability/instability.

Nonetheless, there are financial people who are aware of these tendencies and who are working on alternative concepts which may lead to a more processual approach.  Nassim Taleb (2008) has developed a philosophical idea used by David Hume to explain our inability to use facts as predictors of future events.  A ‘Black Swan’ event according to Taleb, is a catastrophe that will occur whatever we do.  In drawing our attention to such likely occurrences Taleb is emphasizing complexity and change and most importantly, our propensity for delusions of control.  In developing a notion such as ‘Black Swan’ event, Taleb is from my point of view asking economists to reject a-t heuristics such as stability and interdependently, accept our need for processual concepts that correspond with comparatively uncertain mundanities.  If this style of analysis takes off we may be able to engineer our financial problems using non-linear mathematical heuristics that will allow better engagement with dynamic figurational processes.  However, formal economic analysis is at present still heavily influenced by theological and philosophical dogma, hence our continued economic and political infatuation with a-t heuristics such as stability which predispose us to treat economic problems as things rather than figurational processes.  In doing so we create an artificial boundary between economic experiences and those who live them.  Even though Nassim Taleb (Richard Thaler’s work on behavioural economics may also make a contribution) has been influential in arguing for change, we continue to deploy inappropriate concepts from our compendium of discourses on absolute certainty such as instability, crisis or crash as.  These tools are brought to bear on comparatively uncertain mundanities by people whose habitus is structured by a-t heuristics and who deem dynamic processes to be something abnormal.  We are correspondingly far too underprepared for threats and neglectful of developing engineering heuristics.