Since this site is dedicated to higher level analysis of Macropolitical Markets we will occasionally comment and point the reader to interesting works in such fields as psychology, physics, philosophy, and cosmology among other areas. This may seem quite far afield from what one might expect in a site trying to teach key concepts for investing, politics, and economics, but in fact it is highly important. It’s not by accident that Warren Buffet’s partner Charles Munger recommended a broad liberal arts education for investing or even more to the point that George Soros called his famous hedge fund the Quantum Fund or that Jim Simons the founder of the most successful hedge fund of all time Renaissance was also one of the top theoretical mathematicians in the world. When I make arguments in these areas they may or may not be entirely new to you, but it’s one of the great things about our age that a serious internet search and a little hard work should get you to understand the material I’m referencing when I do this. As always in these cases I will be painting in broad brush strokes so please don’t quibble about a few trees here and there but consider the forest.
Roddier’s essay on evolution and thermodynamics is a great book and it’s available in English translation and you can learn much from it, although I have serious issues with some of his conclusions. Considering some of his key points and why I think he’s wrong in certain ways I believe is highly instructive. I want to discuss three of his key conclusions:
First, he suggests that human behavior is incredibly complex and difficult to predict . He’s absolutely right about that which is one reason the narrative about AI which acts as if it gives some incredible ability to manipulate human behavior is debatable as I have argued elsewhere. AI is in some ways an excellent thing giving to the public what certainly governments have already had for a while now, but the behavioralist dream of a social science that can predict and control humanity and of an omnipotent AI may not work the way stockbroker’s selling customers stocks hype up and try to convince everyone of.
Second, he makes a brilliant argument which you should consider that for humans the storing of information and knowledge crucial to adaptation changes from being genetic to cultural. He does this in a highly scientific manner which is interesting to see since most these arguments are made by culturalists not advanced hardcore scientists. The implications of this point he makes are extremely important.
Third, he argues that energy is crucial and the key to all civilization and evolution. Evolution itself in his view is based on a continual increase in the capacity for the dispersal of energy and our current civilization is dependent on fossil fuels at its core in order to retain its complex nature. This is another superb point and I recommend studying this argument he makes in detail. Like Tainter’s work which he cites and I’ve written notes on elsewhere this is important.
So all these points are worth looking at, and some of these issues I’ve already discussed in other posts. But I want here to briefly zero-in on the implications of the two latter points and some of his omissions in these areas. Educationally I believe where he makes a mistake is in when he takes these points at the end of an otherwise excellent book to broad conclusions about the future of human society.
Where he gets into trouble and this is an incredibly common mistake with vast implications in our current era is in trying to use a particular area of science to understand all of knowledge and the world. Plato in one of his dialogues makes the point that Socrates went around Athens trying to find out how much people knew. He found the politicians, e.g., were good at cultural narrative but often had no idea what they were actually saying–all form and no substance. The carpenters on the other hand really knew what they were talking about when it came to carpentry in the real world, but made the mistake of assuming that every area of knowledge was like carpentry. This is the mistake that scientists especially in some of the hard sciences make and in this case Roddier makes of assuming the most important philosophical questions regarding humanity can be reduced to the important but narrow field of thermodynamics. You might think this is unimportant but much of the current doomsday narrative in politics is actually heavily influenced by this scientific field.
Let me try to explain why this is a big deal. If as Roddier argues the storing of knowledge itself changes from genetics to culture and this is the key adaptive advantage of mankind as a species, then in fact this means that humans break free in part from the normal rules of matter into a non-determinative space in which the determinism of even science ceases to hold total sway. There exists a spiritual, transcendent cultural realm which is central to human evolution. To reduce this realm to what are actually earlier states of evolutionary development defined exclusively by principles of even such things as thermodynamics is a kind of millenarianism of the sort discussed by Eric Vogelin in his New Science of Politics and Norman Cohn in his Pursuit of the Millenium in which the distinction between higher and lower are collapsed.. There are as the great philosopher St. Augustine argues two realms if you will and the higher post-cultural realm cannot be fully understood by the lower more determined pre-cultural realm.
This concept is so difficult that let me just quickly jump to the conclusion since it would take months to fully extrapolate the key issues involved. Roddier argues that despite the power of culture and this higher non-determined realm civilization will ultimately be forced back because of thermodynamics to a primitive state once the era of fossil fuels ends. It is amazing how many scientists when they turn to fields that they really don’t know such as politics, philosophy, and culture turn as apocalytic as a medieval millenialist convinced the world will soon end. Now don’t get me wrong his arguments about the dispersal and centrality of energy and even evolution do matter. They do reflect certain key aspects of reality that cannot be ignored. Culture cannot ignore this lower actual realm like some political rhetorician. Both the higher cultural in part non determinative realm and a reality principal about the dispersal of energy need to be taken seriously.
However, his argument actually suggests contrary to his own conclusions that because of culture humanity should be able to create its way out of these problems he warns about. This is actually, if as I’ve argued elsewhere in other notes, we do so in a highly reflective way allowing for a gradual longer term transition from fossil fuels. The era of fossil fuels can actually last much longer than he believes. But he acknowledges that nuclear power could make up for this decrease when it occurs but even faced with societal collapse we will not take that path and use all are abilities to make it work. Why not? Why would a culturally reflective, highly adaptive society not maintain fossil fuels and simply as necessary increase nuclear power usage? If as Tainter argues and Roddier agrees our very civilization depends on energy why would we not reflectively and gradually transition from fossil fuels to nuclear, natural gas, and sustainable energy. The reason is because in Roddier’s perspective apparently we know a lot about thermodynamics but are so culturally unsophisticated as to not be able to at a deeper spiritual level preserve what is of so much value the higher realm of civilization itself through reflective planning.
What all this means for investing is at the present time under the carpentry like too narrow perspective of science applied to all humanity the investment in traditional energy sources and this includes both fossil fuels and nuclear is being long term way undervalued. It also means that a position in energy of some sort should perhaps be a key foundation of any reflective investors portfolio. given its fundamental importance. It also means that in addition to this category of investing more non-determined cultural innovation might also be a way undervalued long term position trade which various “carpentry” approaches are underestimating.
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