Thursday, June 9, 2011

Gerry Eckhoff: The Age of Reason

It could be argued that the turmoil in the Middle East is a sign that the “age of reason” has finally reached those countries. The Arab nations are demanding their political, religious and personal freedoms from the Ayatollahs and the Mullahs. They appear to understand that their economic security will come with personal freedom.

The original “age of reason” refers to the period around the 1750s onward when the population refused to continue to accept the teachings of authority – namely the church who at that time preached the doctrine that the hereafter was all ‘ordinary’ people could look forward to. Myths and superstition were replaced with freedom and the pursuit of knowledge and happiness. As the age of enlightenment took over, any challenge to the conventional wisdom of the day, no longer earned a citizen the title of heretic before being burned at the stake - supposedly to cleanse the body and soul of impurities before entering the after- life.

We in NZ accept that our personal freedom is (to some degree) secure but what of our economic freedom and security that currently lies in the hands of offshore financiers.

Any public comment or suggestion that our current policies are inadequate to deal with a decade of economic largess is greeted with emotive and spurious argument that a return to applying economic reason to NZ is unnecessary and would cause too much short term pain for too many people now reliant on the state.

Given the timorous nature of the recent budget and the Governments futile attempts to stem the tide of NZs systemic impoverishment, it is clear the age of (economic) reason has yet to reach our very own political Mullahs.

Not so very long ago another National Party Prime Minister - Sir Robert Muldoon thought he could stop NZs economic decline by borrowing vast sums of money and investing in infrastructure, just as John key is doing today. There were those who challenged Sir Robert at the time such as his cabinet Minister Derek Quigley. Quigley was branded a heretic and was discarded which was and still is the modern day equivalent of being burnt at the political stake. History tells us that Quigley was right and all Muldoon did was prolong NZs economic recovery with his ‘borrow and hope’ economic policies. Our current policies are similar.

Helen Clarks grasp on the economic “age of reason” was equally as tenuous. Clark’s decision to build the civil service to unparalleled levels had the effect of diverting resources away from building resilience into the economy. That ensured that the potential growth in our collective wealth never occurred. Neither our current Government nor the past Labour Government understand that the very policies that brought about a 4% growth rate in our economy are the very policies that must be continued if our nation is to prosper. There are no hushed voices who advocate a return to farm subsidies today yet the Government appears willing to subsidize people rather than sectors of our economy.

Had that Muldoon’s policies not been overturned in the 1980s our nation would totally impoverished. Greece, Portugal and Spain would be wealthy by comparison but stand today as the worst performing economies in the OECD because they ignored the need for economic reason.

There are those who attempt to warn this nation that we cannot continue to borrow $300+ million a week just to pay the nations equivalent of the grocery bill. Such people are vilified in and by the media, possibly to curtail debate of current policies and or to prolong the power base of those who studiously refuse to enter “the age of reason”.

Thomas Paine, who wrote the Age of Reason, was told by Benjamin Franklin in 1757
“I would advise you…. not to attempt unchaining the Tyger, but to burn this piece before it is seen by any other person, whereby you will save yourself a great deal of mortification from the enemies it may raise against you and perhaps a good deal of regret and repentance.

Thomas Paine also wrote that the most formidable weapon against error of every kind is reason. Reason is defined as the ability to form and operate upon concepts in abstraction – without emotion. That unique ability also allows us to recognize that there are those amongst us who through no fault of their own are in need of sustained help from within our communities but it also commands that waste and failed policies are exposed.

The rich irony is that just as the Middle East (hopefully) enters their own age of enlightenment, we in NZ appear to withdraw from reality and reason as we find new reverse gears for our economy that - at best- stall or neutralize the future for our young. We ignore that time (which was not so long ago), when we as a nation led the world into a true ‘age of reason and enlightenment’ that so many countries admired and followed.

We now subsidize the middle class.


DONRO said...
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Objectivist Ethics describes Reason as the faculty that identifies and integrates the material provided by man's senses.

And wider still: Reason integrates man's perceptions by means of forming abstractions or conceptions, thus raising man's knowledge from the perceptual level, which he shares with animals, to the conceptual level, which he alone can reach. The method which reason employs in this process is logic - and logic is the art of non-contradictory identification.

Taken from: The Ayn Rand Lexicon under the heading, REASON.Repair to Google.

Anonymous said...
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Excellent piece, but how do we unwind the damage successive politicians have done? All the actions you write of, Gerry, are trapdoor ones: once made, they are very hard to reverse. Sacking bureaucrats damages the economy, albeit temporarily, and so alienates a significant number of voters. In a democracy this is bad politics, even if it is good economics. Reducing waste in the welfare budget brings strident opposition from those who do not seem to care about economic realities.
Key has wasted a good crisis when he could have made fundamental reforms with the electorate's blessing. Now he has committed a fatal trapdoor error - he has reassured us that all is well just when the dollar is about to collapse and inflation is looming. Interest rates will rise, posing a threat to the large number of under-capitalised dairy farms, thus threatening our most successful exports, and receipts will be less. Domestic budgets will be stressed, perhaps to breaking point. Manufacturing is already weak and tourism is unlikely to be able to make up the slack as it always was a flaky business, heavily reliant on infrastructure it doesn't contribute to, and very dependent on foreigner having spare cash, which they may not after the effects of the US quantitative easing have to be paid for.
Have you any thoughts as to what has to be done?

Anonymous said...
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Even F A Hayek in "The Road to Serfdom", says:

"...It was men's submission to the impersonal forces of the market that in the past has made possible the growth of a civilization which without this could not have developed; it is by thus submitting that we are every day helping to build something that is greater than any one of us can fully comprehend. It does not matter whether men in the past did submit from beliefs which some now regard as superstitious........The crucial point is that it is infinitely more difficult rationally to comprehend the necessity of submitting to forces whose operation we cannot follow in detail, than to do so out of the humble awe which religion..... did inspire....."

In other words, free markets possibly only came about and succeeded because the most people submitted to impersonal forces on the understanding that they were "the will of God"; not because they were rationally convinced that it was the best thing to do on the grounds of economic theory. And furthermore, it is far more difficult to achieve this rational comprehension than it is to have people submit on humble religious grounds.

Anonymous said...
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Good luck building a better world based on "reason" rather than on a religion that has been proven to work. Jacobinism, Communism, and Naziism, all won the day on the battleground of "reason". The famous French historian Elie Halevy wrote early in the 20th century; "If economic facts explain the course taken by the human race, the England of the nineteenth century was surely, above all other countries, destined to revolution, both politically and religiously." Neither the British constitution nor the Established Church was strong enough to hold the country together. He found the answer in religious nonconformity: "Methodism was the antidote to Jacobinism."

The economist Everett Hagen made a remarkable study, in the book "On the Theory of Social Change; How Economic Growth Begins", of the introducers of industrial innovations in late 18th-century England, a critical period of economic growth. Almost all, he found, were of "dissenting" religions; that is, Protestants who nevertheless rejected the established Church of England. Hagen attempted to explain this correlation, all the more remarkable because of the numerical minority of the dissenters, in terms of the kind of mind that would both dissent and be inventive. But this misses a vital point. History has not lacked dissenting minds, what it had lacked up till the Reformation, was Christian faith freed from the constraints of the "established" church, which always represented an earthly despot far more than it represented "Christianity".

The Anglican church today is the last place one would go for true Christian teaching; a logical consequence of its nature as an earthly and political "establishment".

Anonymous said...
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It is one of the biggest lies in the world, that we owe our current blessed condition to "the enlightenment". We owe it to the long, incremental process known as "the Reformation" - it never really stopped. John Locke's "The Reasonableness of Christianity", and Edmund Burke on "The Dialectics of Divine Providence" are really the vital "reasonable" intellectual landmarks, not Thomas Paine or Voltaire.

Everywhere we look today - where is "reason" actually prevailing? In climate science? In crime, policing and justice? In social policy? On nuclear energy? On mining? On urban growth? On economics?

The future of Western Civilisation now belongs to heartland/southern/bible belt USA. "Secular" society based on "reason" is nothing more than a suicide pact. "Reason" will not save the Islamic nations. Christianity would. Matthew Parris' "As an Atheist, I Honestly Believe Africa Needs God", is an good example of "reason" today.

Anonymous said...
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Perhaps a corollary to that: if one was able to reason, then one was also aware of consequences of actions.

Back in the 1960's you could find recipe's for gunpowder in encyclopedia; the inherent assumption was that knowledge was power and if you used that knowledge you did so wisely or suffer consequences such as lost or damaged limbs. You did not sue the suppliers of the information or providers of the goods; you did not claim ACC or act like a victim. You took information about the chemistry of elements and used it unwisely and bore the consequences of your actions. After one or two unwise choices you either listened to the advice you were given or asked if you were unsure (this used to be called common sense).

The advisory systems (in science and elsewhere) are rife with cronyism and nepotism and the effieciencies that were supposed to materialize with "user-pays", do not appear to me to have eventuated.

I doubt these days that a panel bsed on merit alone could get funding to assess the real value of health changes to the "client population". For example, if one looked at the distribution of salaries/wages at a hospital in the 1960's and the key indicators of population health (say deaths per 1000 population by 5 year increments) in the 2000's, has the increased skewness of the salary distribution resulted in better or worse performance in hospital KPI's. Has having well paid, (hopefully) excellent executive staff resulted in more strategic and better chices of money spend ? If not, why not ? If the older system resulted in the same outcome but better social equity for hospital staff, why not return to it ? Who is asking if the emperor really DOES have clothes on and would they get funding to ask and investigate that question ?

To return to the opening corollary: what are the consequences of NZ's and Middle Eastern reasoning ? Are they measured and if so how and by whom ?

Is there any room for a merit-based state where good people get to lead in their areas of expertise moderated by those with sound political (an oxy-moron?), ethical and religious sense ? No 1984's or "Animal Farms" please Mr Orwell.

Anonymous said...
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The greater irony is that the age of reason also gave birth to fascists and communists.

That the middle class is being subsidized is because they have seen the rich being subsidized and want help now that they are sliding into poverty. That Shona Twains farm has never made a profit just shows who is being subsidized.

Reason is also the hand that drives the things you hate like the anti smacking act and can also give you a fair justice system that ACT opposes.

Reason built the hadron collider and Guantanamo bay.

In the end we can not say we have lived in an age of reason ask any one who has supported drug law reform. Reason is only bought up if it supports the moral or economic view of the person imposing their will on others.

Reason is only as good as the person doing the reasoning.