Pages

Monday, July 11, 2011

"...we like explanations."

STATS.org, the website of the non-profit, non-partisan Statistical Assessment Service (STATS), explores the difference between causation and correlation.  After making the case for not mistaking an event that is correlated with, or happens at the same time as, another with one that causes another, STATS makes two simple, yet insightful, observations:


1)  "When the stakes are high, people are much more likely to jump to causal conclusions."
2)  "In general, we should all be wary of our own bias; we like explanations."


The state of the American economy is obviously an important topic, and the numerous challenges faced cause a wide range of diagnoses and prescriptions to be made.  In China vs. America:  Which is the Developing Country?, Robert Herbold describes the "highly effective," "autocratic" leadership of the Chinese government and the resulting tendency to "get things done fast," and contrasts these characteristics with the American system, where the government fails to make "big improvements," and "issues get polarized."

The American economy is employing far fewer citizens than it was several years ago, and the Chinese economy is growing relatively rapidly.  But the same "polarized" political climate that Herbold blames for America's current economic problems has prevailed since the time of our country's founding.  For the great majority of the past 235 years, America and its polarized (free) society has consistently distinguished itself economically from societies governed in a more autocratic manner.  To believe that today's troubles are caused by the existence and the political relevance of our citizens' diverse views and opinions, we must ignore our economic history.  Our free society, however polarized, has fostered the free markets that have allowed our citizens to reach the highest standards of living on the planet.

If freedom of expression, even the kind that denies a government the ability to "get things done fast," were the cause of economic stagnation, the solution would be simple:  Deny all but a few the authority to make decisions.  If history had proven this prescription to be the path to prosperity and fulfillment, our citizens may have embraced it by now.  But our history has proven the opposite.  Freedom makes things more complicated, but it also yields superior results.  China's supposed "new way" will have to pass the test of time before it becomes the "best way."

1 comment: