European Insights


The limitations of information

05 November, 2019

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Not everything that counts can be counted and not everything that can be counted counts.
Albert Einstein

The first principle is that you must not fool yourself, and you are the easiest person to fool.
Richard Feynman

The first story in a recent collection by Ted Chiang, 'Stories of Your Life and Others', is called 'The Tower of Babylon.'  The Tower has managed to touch the granite vault of heaven and miners from another place are called in to dig through it. Their journey to the top of the tower takes many days. This archetype of human overreach is taken in another direction by Chiang and, without revealing too much of the story, it is fair to say we are instead introduced to the idea that the world is a seal cylinder; the notion that each action or conversation circles round to finish where it started, like the motion of a planet. The story is beautifully rendered and almost impossible to dismiss from the mind once read.
Another man who dwelt on such issues was the great Jesuit priest Athanasius Kircher, who lived in the late 17th Century. He was gifted with a quick mind, limitless curiosity and a demented kind of energy that enabled him to turn his hand to many things; historians have credited him with the distinction of being the 'first global scholar.' Two major pre-occupations guided his interest. The first was the patronage he received from the Holy Roman Emperor Ferdinand III, for whom he engraved an obelisk with flattering hieroglyphs that turned out to be completely wrong.

His other interest was a broader concern for the Jesuits in general; the desire to prove the literal truth of the Bible. Here Kircher championed an empirical approach.  His Ark, superbly draughted, was precisely divided in order to carry all living things and allow for their care, feeding, selection and embarkation.  Even with the precision employed not all the animals could be catered for and this is where Kircher's imaginative genius came into play. Through observation of the animal kingdom he came to the conclusion that it was possible that many animal were in fact hybrids, the result of postdiluvian mating across species. Giraffes were clearly the product of the meeting of a panther and a camel and armadillos had to be a combination of hedgehog and tortoise. With this remarkable sleight of hand the Ark was able to fulfil the description in the Bible.

Perhaps his most ambitious project, however, and the one that employed facets of the scientific method most clearly, was his Tower of Babel. The drawings of this remarkable building hum with a meticulous intelligence. In a couple of major elements he was willing to forego the need for supporting facts; he decided the Tower was built by the great-grandson of Noah; and he also happily concluded that it reached the moon, presumably because the measurement of the distance to heaven was more difficult to estimate. Having done this work, it began to occur to him that the project was impossible. It would require 374,731,250,000,000 bricks and, as far as he could calculate, the earth did not contain enough material for this to be done. A further intractable problem was that the horses needed to hoist the bricks to the top would, at a gallop, take eight hundred years to reach it.

It is tempting to look at Kircher in a patronising way and to dwell solely on how far we have come without admitting to the continuities in human behaviour. This thinking is somewhat in the same vein as that employed by people who travelled from Europe to far-flung places at the end of the 19th Century. One of the founders of modern anthropology stated in 1910 that in such places 'everything is a miracle, or nothing is: and therefore everything is credible and there is either nothing impossible or absurd.' Then as now, such a view demonstrates a lack of insight on the part of the commentator rather than the reviewed. Knowledge accumulates but is sometimes used unwisely or even built upon foundations that are simply wrong. As the historian Felipe Fernandez-Armesto says '… all human communities have the same mental equipment , accumulated over the same amount of time; they think different things, but all in principle are equally likely to think clearly, to perceive truth or to fall into error.' Things may have changed, but not as much as we like to think.

Two very recent events demonstrate that, many years after the birth of reason, we can still come to silly conclusions. In both cases technology, its use and the expectations it generated, was central to the problem. The TMT bubble of the late 1990s witnessed remarkably sophisticated models, employing new and substantial computing power, being utilised not to check realities but instead to prop up unrealistic assumptions and valuations. The digital world allowed us to measure 'eyeballs' and 'clicks' and 'website stickiness' but not, for the most part, in the search of truth. Instead they were used to generate a bubble of substantial proportions. Traditional insights about valuation were cast aside in the excitement generated by new technologies.

Only shortly afterwards our burgeoning ability to collect and manipulate data was used to build products that were intended to reduce risk but ended up creating the systemic shocks of the global financial crisis. Along the way, the simple problems associated with leverage and the controls formerly imposed, were dismissed because of the notion that the clever use of information could simply solve the problem of unexpected outcomes.
So, in a sense, we have followed the planetary path and returned to the start of the conversation. We are trapped in the sealed cylinder. It is true that we understand much more than we did in the 17th Century and much of this is due to our collection and use of information. This power has been understood and celebrated whilst the fact that there is an ever-greater need to tether it to sensible deductions has not. The rigour of the scientific method is especially difficult to apply in the abstraction of the social sciences, and falsification can be very complex. As our technologies become more powerful they will bring fundamental benefits, but there is also a greater risk that their tidal pull will unmoor us from sensible assumptions. We must therefore work to remain humble and limit our ambitions, especially in the difficult fields of finance and economics.

We can protect ourselves from folly by employing a sceptical mind-set, ridding ourselves of ideology and, wherever possible, submitting what we do and how we do it to rigorous testing. Kircher was wrong about almost everything, but science and the modern era has not made him irrelevant. He was much more than a fool; he was a warning. Freed of his Jesuit need to literalise the Bible and planted in the modern world, his rare genius and profound ambition may well have propelled him into the fascinating field of financial economics, possibly with disastrous results.

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