Humility Also Means Ignoring Input

Humility is a weird concept.  It’s easily associated with things like meekness, deferential behavior, lack of confidence, and wishy-washiness.  But these are not genuine humility.

Humility is the willingness to see yourself as you truly are.

Valuable humility is simply a recognition of your position in the vast universe.  It is a recognition of your identity separate from your roles or relative ranking to others.

Sometimes that means seeing that you are incorrect, and you’re not a big deal.

Of course, you’re not unimportant to you or those around you or even to the world.  But on the cosmic scene what you eat for breakfast isn’t a big deal.  Neither is who you’re dating or what you’re wearing.  But what’s especially unimportant is what others think of you.  Humility reminds you of this.

Sometimes humility means seeing that you are correct, and you are a big deal.

Humility is not about taking everyone else’s view of you seriously or trusting your own ideas less than others.  Paradoxically, that’s pride (in one of the few ways pride can be negative).  It’s pride because it’s concerned with how you appear to others.  It’s concerned with saving face.  It moves the locus of control and the definition of success from you to external forces and slavishly adapts to those.

Pride wants you to please everyone.  Pride wants you to come off looking good.  Pride always looks for an excuse to hide behind.  “I did it because I had to”, or, “I was giving my customers what they wanted”, or, “I was just following the expert’s advice”.

Humility recognizes that you might be wrong and look a fool, but it doesn’t care.  When you see that you’re not that important, being right or looking cool suddenly don’t much matter.

Humility recognizes that you’re sometimes right and other’s advice could be wrong.  It takes humility to ignore advice or common wisdom and do what you know to be true.  You’re exposed.  You have no fallback and no one to blame.

Humility is knowing who you are and owning it when it’s easy and when it’s not.

Don’t fool yourself into thinking you’re practicing the virtue of humility because you’re denying yourself and your ideas and responding to everyone else’s.  That’s fear.

Be humble enough to see yourself as you truly are, both when you are right and when you are wrong.  Be humble enough to take advice when it’s good and ignore it when it’s not.

Capitalism is Humble

Part four in a series of eight on the morality of capitalism.

In a previous post I talked about the honesty of capitalism; people are not angels. A capitalist economy recognizes this fact, and our greed doesn’t ruin the system. Closely related to the honesty about people’s motives is capitalism’s humility about people’s limits. Humans are not all-knowing, and if force is absent, a free-market is what emerges to deal with this fact and spread valuable and coordinating information the best way possible. Markets are a result of our lack of individual knowledge, and a constant reminder of how fallible we are.

Models vs. reality

It has been well documented, especially during the Socialist Calculation Debate that absent a free-market, there is no way to allocate resources effectively. If we believe that people (or at least some group of elite experts) have near perfect knowledge of what resources and finished goods are valued to what extent by whom at what time in what location, then certainly a centrally planned economy would be superior to the messy market with all its profit and loss. Every time an entrepreneur starts a new venture that ends up failing, resources are wasted. His incorrect knowledge about how much people would value his products cause losses. A ruthlessly efficient economy wouldn’t suffer any such waste.

Indeed, the classical (and still standard in most economics textbooks) model of the ideal economy is one in which “perfect competition” is reached. The condition exists when everyone has perfect knowledge of the availability and cost of all resources and the value to consumers of all goods. There is no profit, no loss, no shortages, no surpluses and no speculation in this idealized economy. Everything is in equilibrium.

Seduced by this economic model, many an economist, statesman, do-gooder, social-reformer and power-hungry despot has attempted to achieve it in practice, and with disastrous results as evidenced in places like the former Soviet Union. The model may be a useful tool for testing some economic theories, but only an ill-informed or incredibly arrogant person would see it as a desirable or possible end-state for the real world economy. No one has perfect knowledge. It is impossible to even imagine a world in which they could. Since economic value is subjective and changing all the time, how can anyone know how much another person will value one good compared to another at any given time, let alone millions of people in a constantly changing world?

A process, not an end-state

Capitalism is humble enough to realize our limited knowledge. It relies on the price system—a spontaneous, organic result of billions of free choices—to convey information. It relies on consumers, producers, entrepreneurs and capitalists to act on that information. When they get it right, value is created, and it generates new price signals that encourage more of the same. When they get it wrong, loss results and puts a quick end to the waste of resources and sends a signal telling others not to do the same.

The price system conveys so much information in such a small bundle that I can scarce think of an analogy to show just how valuable it is. It is the most sophisticated communication system the world has ever known. Leonard Read’s famous, “I, Pencil” details the way in which the price system coordinates the actions of thousands of individuals who don’t know each other and might not even speak the same language, to bring an item as simple as a pencil to the market.

Self-knowledge

Beyond merely helping us know the preferences of others, the market system can actually help us discover our own assets and abilities. A professor once told me of a Canadian man who played the bagpipes and made small metal replacement parts for other bagpipe enthusiasts as a hobby. One day he saw an ad in the classifieds for someone who could make small metal parts for an airplane manufacturer. He could use some extra cash, and it sounded similar to his handcrafted bagpipe fittings so he gave it a shot. He ended up making good money producing airplane components—an industry he knew nothing about and never fancied himself skilled enough to enter.

If a central planner was trying to make the best use of all the labor and resources in Canada, he might conduct a survey of the skills possessed by the people there. This man could not have made known his skill in airplane manufacture, because he didn’t even know he had it! The discovery process of the market revealed to him knowledge about a value he could create for others that was previously hidden. If we don’t even know our own economic value, how can we know the values of others?

Greater than the sum

We can’t produce what the capitalist system produces. It is greater than the sum of its parts. It conveys coordinating information that lets us each go about our business and produce end results that are beyond our own abilities and comprehension.

Capitalism’s features—the price system, failure and success, profit and loss, trade, specialization, even the hated speculator, middle man and advertiser—are the result of and cure for our ignorance. We need them to help us choose actions that are valuable to ourselves and others.

A capitalism system does not require perfect knowledge. Through it, we can produce what no planner ever could. This humble, dynamic, trial-and-error approach produces wealth and innovation like no other system. It also keeps us humble on an individual level. When you contemplate the production of a simple pencil, and how far beyond your own skill level it is, it certainly puts things in perspective. It reveals how much we need our fellow man, and how much more we can accomplish when we allow this organic market process to coordinate our activities.

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