Friday, February 13, 2015

Human Nature, Religion and Economics

Christianity/Judeo religions have spread a dangerous morality, that, believer or not, most of westerners grew with.

The deep belief that human nature is not perfect, living in sins. And that for protecting against such imperfection, something bigger than a mere human has to restrain its nature.
Such sins are identified by the moral code of the religion.
The implementation details of this morality takes different forms. God, kings, governments, society or experts, pick your choice.

But if you take time to understand why an individual is doing an harmful action, you start seeing a repeatable pattern : he acted because of economic incentives to do it.

Very few people are born mentally ill, most of them are acting rationally according to their own incentives.
Economic incentives of humans do not limit to money and material abundance (external incentives), but also and mainly to their moral code (internal incentives). When one acts against his own moral code, a penalty is paid. The price of such penalty is known as guilt. Guilt is the name of the incoherence between one's moral code and actions.
The process of the redemption of guilt, called purification in religion, takes different forms depending the moral code. It goes from sacrifice, through slavery or plain monetary payment (donation and charity), to prayer.

The problem with westerners is that the Christian morality is still present unconsciously in the minds of people, but since people are not recognizing as such, they can't ask redemption of their guilt. Which ultimately manifest itself in form of neurosis, depression, aggressiveness, self-hatred, lack of confidence and other mental illness.

I have traveled to muslim countries and noticed that practicer had a better peace of mind with the world and themselves. Practicing religion is liberating.

However, in sect and religions, priests can only live on the guilt of its practicer, selling their redemption services at the high price. (be it charity, prestige, or real payment)
There is an underlying economic incentive for religion to make believers guilty for the sake of the priests.
Priests being the one helping to interpret the message of god, it is in their power and interest to spark the sentiment of guilt to their believers.

The Buddhist approach is different. Buddhism never consider anything as bad and good.
Because the moral code of Buddhism is the individual is responsible to find its own.
Buddhist do not blame humans, they see guilt as an incoherence between one's action with his moral code. Redemption is fixed by analyzing what provoked such disruption, making the individual either refine his moral code either correct the incentive that provoked the guilt.
 By this process of self improvement, we discover that it is in our own interest to work in the interest of the community. With individualism and self improvement, compassion is reached, through the realization that the most economical way of functioning in human society is by creating value for others.
Guilt is a tool of self improvement.

In Christian/Judeo religion you heal your guilt by practicing.
In Buddhism you heal guilt by either fixing the internal incentives (moral code), or fixing the external incentives.
Buddhists shift the responsibility of healthiness on the shoulder of the individual.
Even if guilt is provoked by external incentives, it is the individual's mission to understand the cause of the external incentives and either refine his moral code, or change the root cause. In this way future guilt is prevented, and current one is healed.

The concept of Good and Bad have only a meaning in a christian/judeo mindset that separate hell from heaven, according if you act according to the moral code of the religion.

As a Buddhist, someone violating your moral code only means that he has a different moral code or different external incentives. In summary, Buddhists starts from the postulate that human nature is not bad but act rationally against inside incentives  and outside ones.
Guilt should be a temporary state fixed by conscious effort of self improvement.

Economics do not limit to the study of external incentives, but of internal ones.
Micro economics is the study of individual behaviors, so the moral code can't be ignored. No individual is irrational, any irrationality is just a mistake on the evaluation of the individual's morality.
Macro economics is more predictable since internal incentives can be considered constant on a large group of people.
Macro economics can make appear human nature as immoral, because it really is. When you average all those diverse morality, you end up seeing that humans, as an aggregate, only act accordingly to external economic stimulus. However this is not the case of individuals.

A popular myth is thinking that it is possible to fix the immoral aspect of human nature in macro economics by right external stimulus medicated by government, and let micro economics left to the free market.

However, we have seen that external stimulus affect decisions at the individual level.

Let's take a typical example of when the Swiss National Bank (SNB) removed the peg between euro and swiss franc (chf), this can be considered a "macro economic move".
The consequence is that the president of an export company has seen overnight his company from being profitable, to being in deficit. Overnight, employees will be fired, contracts will be ruptured, promises will be broken.
It is easy to put the blame on the free market for the consequences and blames capitalist greeds.
This is putting the blame on the moral code of people (internal incentives) instead of the external incentives.

The goal of such blame is mostly to justify the moral duty of government of taking control of the micro economics realms. Which is no different of abolishing private property, freedom of collaboration between people, and spreading a unique moral code.

Macro and micro economics can't be decoupled. Since one affect the other, giving the power over macro economics will inevitably slip into the abolition of private property. There is no compromise, only evolution to such state. The only way out is a real crisis where people can't get anymore what they have supposed as given, and start valuating private property again. (either by revolution or via the black market)
There is no alternatives.