Great Brains (I)

The New York Times' David Brooks reminds us that the rational, Keynesian model of economics hardly explains the current financial crisis. As Brooks puts it, how is it that “so many people could be so stupid, incompetent and self-destructive all at once”? Brooks points to new thinking about how the mind works—irrationally. He writes:

each person’s mind contains a panoply of instincts, strategies, intuitions, emotions, memories and habits, which vie for supremacy. An. . . unconscious process determines which of these internal players. . . control[s]

Brooks sources the work of Andrew Lo of M.I.T., who found that if stock traders make a series of apparently good picks, “the dopamine released into their brains creates a stupor that causes them to underperceive danger ahead.” People pick out those bits of data that make them feel good because the data confirms their prejudices.

Yet by contrast, in another piece published four days later on politics not economics, Brooks leans the other way, longing for the rational old days of Kennedy, when it was believed “Keynesian models would . . . scientifically regulate the economy.” Brooks brings back Daniel Bell’s The End of Ideology, published in 1962, to show how Obama is seeking to undo the ideological politics since the late 1960’s that have weakened social norms and produced fierce battles ever since, as groups vied to create new standards. As Brooks writes, “Personal became political. Groups fought over basic patterns of morality.”

Brooks says Obama’s challenge will be to translate the social repair we have seen over the past decade (lower crime, less divorce) into political and governing repair. According to Brooks, Obama sees himself as “a pragmatist, an empiricist,” someone “tackling the issues that require joint sacrifice — like reducing deficits, fixing Medicare and Social Security and reforming health care.”

Almost exactly Obama’s age (a week younger) and therefore unable to remember Kennedy’s “Camalot,” Brooks started out as a liberal, likely attracted to Keynesian rationality, Bell’s end of ideology; the Kennedy era’s “best and brightest.” Just like Obama.