Sunday , May 16 2021
Home / Economy / Reflecting on stupidity

Reflecting on stupidity

Voiced by Amazon Polly

The 2009 docudrama, The Age of Stupid, is set in a post-apocalyptic 2055 where narrator Pete Postlethwaite is the sole survivor of the ravages of climate change.  London is under water.  Sydney is permanently ablaze.  Las Vegas has all but disappeared beneath the desert sands.  The Alps no longer witness snowfall.  India is marred by the ashes of nuclear war. Postlethwaite, the guardian of the last library of human knowledge, guides us through our collective mistakes as we failed to halt the rising global temperature.  The belief that we are living through an Age of Stupid has gathered pace since the movie was made.  The collapse of the political centre across Europe, the rise and fall of Donald Trump, Brexit and the botched response to the pandemic, and the march of nationalist populism across the world, all seem to point to a civilisation that has lost its mind.  For this reason, perhaps, there has been a recent revisiting of Carlo M. Cipolla’s 1976 book, The Basic Laws of Human Stupidity; a semi-satirical examination of what it means to be stupid.

Cipolla’s five basic laws of stupidity are:

  1. Always and inevitably, each of us underestimates the number of stupid individuals in the world
  2. The probability that a certain person is stupid is independent of any other characteristic of the same person
  3. A stupid person is one who causes harm to another person or group without at the same time obtaining a benefit for himself or even damaging himself
  4. Non-stupid people always underestimate the harmful potential of stupid people
  5. The stupid person is the most dangerous person that exists.

There is a superficial attractiveness to these laws.  Anyone who uses social media, for example, cannot but agree with the first law.  The sheer volume of examples of wretched stupidity never ceases to both amaze and depress the observer.  As for the second law, we have all encountered people who may be extremely gifted in their own trade or speciality, but turn out to be seriously stupid when they stray outside their discipline (or in the case of economists, even when they remain within their chosen pseudoscience).

It is the third law of stupidity, however, that is central to Cipolla’s thinking, since stupidity is not presented as an opposite to being clever, but rather as a relationship to other people.  In Cipolla’s model, people fall into one of four broad groups according to the impact of their actions:

The reason these “laws” appear to work of course, is that we – the readers – are cast in the non-stupid group.  Even when we do foolish things – as we are all wont to do at some time in our lives – we will apply some retrospective justification for why we acted.  With others however, it is clear to see that plain stupidity is the only explanation.

But Cipolla’s model fails to pass even a cursory examination.  In a sense, this is because the system we operate within – neoliberal capitalism – obliges the vast majority to be helpless; working for a wage which will always be lower than the value they help create.  On the opposite side of the coin, those at the top – tech godzillionaires, corporate CEOs, the historical elites, etc. – are obliged to operate as bandits; irrespective of whether they are genuine psychopaths.  The CEO who fails to deliver growing profits rapidly becomes an ex-CEO.

Meanwhile, within the system, forms of apparent stupidity are lauded.  How else do we view someone who calls on government to increase their taxes in the vain hope that the money will be spent on such things as public health or wind turbines?  History is littered with martyrs who gave up their lives in the forlorn hope that something might change; and occasionally it did, although mostly these acts were futile.  Less dramatically, every worker who goes on strike faces great loss with little chance of benefitting themselves or society at large.  In the 1970s – when mass trade unions were still a powerful force – the maxim was that if a strike was not won within a week, it would not be won at all.  Yes, there are occasions when the point at issue was finally conceded; but only at the cost of economic hardship for both the strikers and their employer.  Such pyrrhic victories would surely count as examples of stupidity.

There may though, be a deeper reason why people have begun to revisit Cipolla and to ask whether we might genuinely be living through an age of stupid.  Cipolla’s book was written just at the point when the first rumblings of the energy and resource crisis were being felt.  Those growing up in the aftermath of World War Two, along with many who had lived through it, had enjoyed one of the most benign economic periods in human history.  At a time when there were just two billion humans on the planet, and when a handful of developed states enjoyed easy access to a wealth of energy and mineral resources, exponential economic growth came to be taken for granted.  As historian Paul Kennedy explained:

“The accumulated world industrial output between 1953 and 1973 was comparable in volume to that of the entire century and a half which separated 1953 from 1800.  The recovery of war-damaged economies, the development of new technologies, the continued shift from agriculture to industry, the harnessing of national resources within ‘planned economies,’ and the spread of industrialization to the Third World all helped to effect this dramatic change.  In an even more emphatic way, and for much the same reasons, the volume of world trade also grew spectacularly after 1945…”

This was a period in which the relative share of productivity gains shifted dramatically in favour of workers.  The growth of the suburbs being the visible consequence of the additional real value workers’ wages were returning.  Where their parents had lived in rooms in tenements and back-to-backs in the polluted city centres, the post-war generation could move out to where the grass was green and the air was clean; picking up new cars along the way, to take advantage of the new age of oil.  By the end of the 1960s, the average semi-skilled – usually male – worker could afford to buy a house, raise a family, run a car and pay for an annual holiday.

Why does Kennedy’s boom period end at 1973?  Because that is the year in which the largely artificial oil shock brought the party to an end.  The cheap, land-based oil deposits in the USA had peaked in 1970; and with the peak came the end of the Texas Railroad Commission’s ability to fix global oil prices.  Sensing US weakness, and in part responding to the Arab-Israeli War, the OPEC cartel took the opportunity to force the world economy to eat higher oil prices.  One consequence – given that almost everything in the economy was either made from, made with, or transported using oil – was a generalised increase in prices.  Less obviously, the additional energy cost of energy whittled away the productivity gains which had previously provided North American and European workers with access to the suburban lifestyle.

By the time Cipolla’s book was published, western economies were engaged in an unwinnable conflict over who should and who should not enjoy the fruits of increasingly unproductive industries.  In the years immediately after 1945, government currency printing, such as the USA’s Marshall Aid programme, had allowed victors and vanquished alike to rebuild their war-torn infrastructure.  And especially in Europe, currency printing allowed the switch from a largely coal-based to an oil-based economy.  The erroneous lesson that economists and politicians drew from this was currency printing was the route out economic crises.  I say “erroneous” rather than plain wrong, because the trick works in certain circumstances.  Specifically, where there is excess capacity within the system as a result of access to cheap energy, resources and unemployed workers, currency printing can bring those resources into productive use at a time when private investors are reluctant to invest. 

Had the politicians and economists paid a bit more attention in their history classes, however, they might have known more about the European timber shortages of the sixteenth century; and what happened to the Hapsburgs when they injected a massive volume of Central American gold and silver into their resource-starved economies.  One consequence of the timber shortage can still be seen in British town centres.  Prior to the shortage – which was a consequence of economic and population growth during the recovery from the Black Death – most town centre buildings were timber framed.  Even today, houses – including my own – are built in a “mock Tudor” style.  But in the course of the Tudors time on the English throne, things changed rapidly.  During Elizabeth’s reign (1533 to 1603) a previously expensive and ornamental building material – brick – began to overtake timber in the construction of everything from small houses to large palaces.  Elizabeth’s successor James Stewart is reputed to have complained that the story of Christ could not have taken place in his native Edinburgh because there were no trees from which to fashion a cross or for Judas to hang himself from.  Historian Clive Ponting documents some of the impacts of the timber shortage across Europe:

“A timber shortage was first noticed in Europe in specialised areas such as shipbuilding… In the 1580s when Philip II of Spain built the armada to sail against England and the Dutch had to import timber from Poland… Local sources of wood and charcoal were becoming exhausted – given the poor state of communications and the costs involved it was impossible to move supplies very far.  As early as 1560 the iron foundries of Slovakia were forced to cut back production as charcoal supplies began to dry up.  Thirty years later the bakers of Montpellier in the South of France had to cut down bushes to heat their ovens because there was no timber left in their town…”

It was into this energy and resource deprived economy that the Spanish Hapsburgs deposited their plundered gold and silver in the belief they were ushering in a glorious age.  What they got instead was inflation.  One reason why men of the period are portrayed with beards is because the price of a shave rose beyond anything ordinary people could afford.  And escaping the inflation was one of the drivers behind European migration to the Americas.  For those left behind, the inflation fed into rebellion and war as everyone sought to make someone else bare the economic losses.

Currency printing during a supply-side shock is an incredibly risky thing to do, since it can create “stagflation” – a situation in which prices are rising even though large numbers of former workers are unemployed.  This is precisely the crisis which unfolded across North America and Europe in the aftermath of the oil shock, as governments tried to print their way back to prosperity.  This was what was unfolding across the developed states just as Cipolla was writing his book. And it must have seemed to him that examples of stupidity were popping up everywhere as ever fewer people engaged in “intelligent” win-win behaviour, while more and more seemed to engage in actions that resulted in a loss for themselves and for others.

Eventually a combination of high interest rates, mass unemployment, financial deregulation and offshoring – crucially, coupled to the development of new and more expensive oil reserves – paved the way for the debt-based bubble economy of the 1990s and early 2000s.  And just for a while it seemed like the stupidity of the 1970s was behind us… that is, until we discovered that the bankers had been engaging in a long-game version of stupid of their own.

In the aftermath of the 2008 crash, that semi-skilled worker who used to be able to buy a house, run a car, raise a family and pay for an annual holiday, was lucky to afford a bedsit or a room in a shared house in one of the less desirable city districts.  Buying a house is beyond them and even running a car leaves them teetering on the edge of financial ruin.  Raising a family is out of the question.  Only with both partners working and expenditure cut to bare essentials is family life possible.

In the post peak economy in which we now find ourselves, the lack of surplus energy and resources mean that the number of intelligent, win-win situations is falling rapidly.  From climate change to resource depletion and food shortages, our ability to respond intelligently and positively, diminishes with each passing day.  At the same time, banditry – the psychopathy of the elites – has become the only means of increasing the wealth of those at the top in what is fast becoming a zero-sum game.  This, perhaps, is why the mass of humanity appears to fit into Cipolla’s “helpless” category – forced to sell their time to ever less generous bandits.  It is also why so many seem driven to take what at face value are stupid courses of action like buying lottery tickets, responding to emails from Nigerian princes, voting to leave the European Union or expecting nationalist populist leaders to make their countries great again.  As prosperity collapses, the appearance of stupidity is the one thing that we can reliably bet will keep on rising.

As you made it to the end…

you might consider supporting The Consciousness of Sheep.  There are five ways in which you could help me continue my work.  First – and easiest by far – please share and like this article on social media.  Second follow my page on FacebookThird, sign up for my monthly e-mail digest to ensure you do not miss my posts, and to stay up to date with news about Energy, Environment and Economy more broadly.  Fourth, if you enjoy reading my work and feel able, please leave a tip. Fifth, buy one or more of my publications

Check Also

The everything pin

A dangerous misunderstanding

How much money should there be in the world?  It is an interesting question; to …