On information

So I was thinking about what I could write about, because I still want to be a novelist, and I believe I have the skills, but what I lack is a story that is engaging enough for me to be confident that others will want to read it. That doesn't mean that I don't have stories that you will want to read. We are talking about a deeper degree of confidence. I'm pretty sure I'd be harder to convince than you are. I don't want to be second best. (I fear that that may have its end in my never writing anything, simply because I conclude that second best is all I'm capable of. And while I'm aware that second best would be pretty good, it's not good enough for me. Without a clear outside incentive -- such as, for instance, making a living -- I've never seen much point in pursuing anything just to be mediocre at it. Which probably explains why I don't pursue anything at all these days, not music, not art, nothing, even though some of the things I could just be no good at I enjoyed doing for their own sake.)

And it struck me -- I realise this is a roundabout way of getting to the point, but it's how I got to it -- that wealth is acquired by those who have an advantage in information, and that has been true throughout history. How did I get there from musing on what I could write? Well, it's simple, really: I realised that because I have a fairly dull life, I feel like I have no information advantage over most readers. What else is a story but something I know and you don't? If I feel that what I know and you don't isn't worth telling, then obviously I don't feel advantaged enough to profit from it.

I came to this conclusion when thinking about the Huns and the other horseborne invaders of Dark Ages Europe. Keegan, in his History of Warfare, is musing on how the Mongols managed to conquer where other similar groups of horsemen did not. He doesn't really come to a conclusion, and I don't know the answer to that question, but thinking about it led me to the realisation that the horse archers of northeast Asia were advantaged in many ways over the settled peoples they pillaged, but above all by their information advantage. What did they know that the settled peoples didn't? Several things. They knew that valour is worthless. They knew that mobility defeats power in warfare. They had a huge advantage in skill (and this should not be undervalued in warfare: the British "thin red line" did not win against the odds just because it had rifles but because it had an enormous tactical advantage over its enemies -- curiously, it succeeded for many of the same reasons as the horse archers: those who specialise in attacking at long range can basically mince those who specialise in war at close order, simply because the latter cannot use its skills. For the same reason, and for another that the Mongols could take advantage of -- having less need of supplies because they were more hardy than their enemies -- Rome could not overcome Parthia.) They also knew where their enemies were.

This cannot be understated as an advantage. The Huns could appear from nowhere, catching settlements unawares, just like human locusts, but the settlements could not sneak up on the Huns. No one could threaten the Huns' own settlements because they were so distant from the point of action, and those who fought them did not anyway know where they were. The Huns seemed to drop from the skies. When they had lived in places where their homes were more vulnerable, they had been driven out, but in later times, when they seemed rootless, homeless, they were close to invincible (and it was basically only betrayal, at Chalons, that saw them defeated, and then only by an enemy, in Aetius, who had learned to be as flexible and mobile as they were).

Note that the Huns did not create wealth. They were wealthy, and the Mongols became even wealthier, but they did not create anything. They took value from the settled people. Here is history in a nutshell: the ordinary people create value, wealth, whatever we call it, and people who have an information advantage steal it from them.

We often hear that rich people have worked hard to acquire their wealth, and I'm sure they do, but they are not wealthy because they worked hard. If they were, Stakhanov would have been a millionaire and my dad would too. I have often thought about Roman Abramovich, a very wealthy man who has never worked at all that I know of, let alone hard. He made his billions by knowing the right people. That too is an information advantage. He has created nothing. He made his money from the natural wealth of Siberia, and simply sat at the apex of corporations that extracted that wealth. Sure, he would have made decisions, but to be honest, in business most decisions make themselves, and all you have to do to profit from them is be in the right place at the right time.

Being in the right place at the right time is a skill in itself though. Realising which things, or which people, you know can make you money is the key to making money. I mean, I'm a smart and capable person, and given the opportunity, I'd be rich. But I have no information that I can turn into dollars bar a knowledge of how English works, and that just isn't as valuable as knowing an oligarch.

Information advantages shift with time, of course. Mongols today are not rich, and before Genghis Khan they were not rich either. Most horse peoples lived very hard lives before they realised they could just steal wealth from the settled peoples. Most never realised their advantage. Currently, the West has a rapidly eroding information headstart (I guess that is the right term), which has made us rich. Anyone who has read Guns, germs and steel cannot help but be impressed with the power of its thesis. Europe conquered the world because it knew more than the world. The reasons for its information advantage are probably less interesting than the power of the advantage itself, but Diamond shows how it came into being. He stresses, and it should be stressed, that there is no inherent advantage in being a white European. If we had came to be in Africa, and Africans in Europe, we would have seen millions of whites enslaved. Racial supremacy is as foolish a notion as you can sign up to. It's all about what you know, not what colour your skin is.

Not all information is valuable, and judging what is and isn't can be very difficult. But the rich do not on the whole acquire their wealth by being good judges of information, but by being fortunate enough to uncover it or to be born as custodians of it. (That's not to say that you cannot create an information advantage and profit from it: that's precisely what you do when you learn to be a doctor, and what I'm seeking to do by learning how to win at poker.) It's not even a question of skill, but of the right skill. The Zulus were incredibly skilled, among the greatest, if not the greatest, exponents of weapons handling at close quarters. But they were still heavily defeated by the British, because we knew how to make and use guns. You need to think it through carefully to understand that what counted was not how skilful each was, but how applicable that skill was. A Hun with a composite bow could kill the best swordsman their enemies could field without that swordsman even being able to see his features.

What counts here is, in part, perspective. A Roman soldier had a huge advantage over other fighters at close quarters. For centuries, the Roman advantage was in knowing that cohesiveness and discipline could overcome personal skill. Then they met the Huns, whose personal skill crushed them. For Romans, for a millennium, war had consisted of getting close to enemies and then slicing them to ribbons. Suddenly, or fairly suddenly, they were facing an enemy whose chief advantage consisted in knowing that war could also consist of murdering standing targets at long range. The same is true of all the settled peoples that the horse archers destroyed. Each was set up to fight other similar peoples, and none could step outside their war paradigm (or was not skilled enough in other paradigms) to defend themselves well against the horsemen.

Information is not just the key to wealth, nor is it merely the key to human relations. It is the answer to life, the universe and everything. We exist because of an information differential, and all of life is a struggle to obtain and profit from information differentials. What makes life, and its highways and byways, maddeningly hard to understand is the difficulty in knowing which information is most valuable. In principle, each unit of information should have the same value (in the same way that each electron is the same electron), and in the bigger scheme of things, that is so. But down here, on the human level, it is different.

I think a lot about equity, and for whatever reason, I'm a true believer in it. At base, it's because I think we have equal value, and because our lives are so short and fragile, I have never been able to conceptualise them as anything other than deeply precious. I feel strongly that injustice is born in unevenness of information, and I feel that ways to diminish its importance should be emphasised if we believe in equity. I note that Rawls, even if he didn't think in these terms, was able to see that the only way to ensure justice was to remove information from our consideration of what is just. He asked that we should make decisions about justice from beneath a veil of ignorance. I would insist that we cannot be just unless we are willing to forget what we know.

Which is not easy. How can it be easy to give up your advantage over others, when you know that they suffer so greatly from lacking what you have? We are all, or at best nearly all who read this, gainers from a huge information gap between us and them. Understanding that you do not have merit, just luck, is extremely hard.

Okay, I'm drunk and can't continue just now. But I have more to say. Among other things, of course I am saying that the rich do not deserve it but are simply using a temporary information gap, and more importantly for most of us, that education, conceived in a broad sense, is the only hope of the disadvantaged, our only road to acquisition of wealth.

posted by Dr Zen @ 7:02 pm