The Researcher Who Discovered the Heart of Capitalism

13.10.2016 • The Economy

From Nick O’Connor – Capital and Conflict (Great Britain)-

If there was a red button on the table in front of you now that would stop the clock on your body’s ageing for the next twenty years, would you push it?

How about fifty years – fifty years without ageing whatsoever? Or what about forever?

Offering you an infinite lifespan of good health is beyond the power of our humble e-letter. And perhaps it’s a daft question. Who wouldn’t want to stop their body ageing, to freeze time and expand their lifespan? Maybe you consider yourself too old to want to stop the clock. In which case, think about how you would have answered that question thirty years ago.

I think most people would push the button. But will the button ever exist?

We may be getting there.

Nobel Prize winner figures out how to stop your body “eating itself”

 

Earlier this month the Nobel Prize committee awarded the 2016 prize for Physiology or Medicine to the Japanese professor Yoshinori Ohsumi. Ohsumi’s work centred around the process of autophagy – the means by which cells’ unnecessary components are destroyed and recycled (when parts of the cell that aren’t needed are “eaten” and reused by autophagosomes).

Research suggests it’s vital to everything from dealing with starvation and infection, to the process of cell death itself.

As the Nobel committee put it in its announcement (added emphasis is mine):

We now know that autophagy controls important physiological functions where cellular components need to be degraded and recycled.

Autophagy can rapidly provide fuel for energy and building blocks for renewal of cellular components, and is therefore essential for the cellular response to starvation and other types of stress. After infection, autophagy can eliminate invading intracellular bacteria and viruses.

Autophagy contributes to embryo development and cell differentiation. Cells also use autophagy to eliminate damaged proteins and organelles, a quality-control mechanism that is critical for counteracting the negative consequences of aging.

The award of the Prize is recognition of another step towards understanding how and why our bodies age. The step after understanding is action: figuring out how to use that knowledge to reverse or freeze the ageing process. It won’t happen overnight. But as Bill Gates famously said, we often overestimate the amount of change we’ll see in the next two years, while dramatically underestimating the change over ten.

The idea of dramatically increasing the average human’s lifespan, perhaps even figuring out the secret to immortality itself, doesn’t seem quite so far-fetched today as it once did.

The best way to get there, though, is to try and eliminate the diseases and ailments that kill people young. Knowing you’ll get eighty-or-ninety-odd good, disease free years on this planet would be enough for most people today.

The road to dramatic life extension starts with figuring out how to keep more people alive and well for longer. Autophagy research could play a key role there: Oshumi’s work is particularly applicable to cancer and Alzheimer’s disease. But it’s not alone: gene editing, immunotherapy, nanotechnology and personalised medicine will all play their part in fighting disease and extending the human lifespan.

But in time ageing itself will come to be treated as another disease, to be understood, taken on and overcome. In fact you could argue that immortality is the logical final outcome to capitalism.

Inherent to the idea of capitalism is that human innovation and ingenuity can overcome any limit. The ceaseless growth of capital requires us to constantly push the limits of possibility and find new markets, new ideas, new ways of creating wealth and adding value.

That means the very idea of capitalism requires constant, ever growing innovation and expansion. It requires ambition and human ingenuity to constantly push at the frontier of the possible. Often that’s literally the opening up a new market – a new nation added to the global economy, a new source of labour, a new product.

What is death but another limit to be overcome?

The dismal science’s Nobel Prize

That’s the real science out of the way. Economics is not a science, of course. It’s closer to philosophy – a way of trying to understand the world through observation and thought.

At least it should be. Unfortunately, the modern day economics industry has convinced the world that it is somehow rooted in science and not guesswork. It is perhaps the greatest con job of all time. And it allows certain economists to endow themselves with extraordinary power and control.

Here’s the difference between science and economics. A scientist can operate in a controlled environment and test their thesis against a control group. Heat water to 100 degrees at sea level and it will boil. Hold another beaker nearby without a flame below it and it won’t boil. It doesn’t matter how many times you run the experiment, it’ll always have the same outcome.

In economics there is no second beaker. There is no control group. You cannot ever know if your actions truly influenced the world in the way you think, because you can’t know what would have happened had you not acted. Economics is NOT a science!

Anyway, that all doesn’t stop the Nobel Prize committee handing out a prize for economics, which earlier this month handed the 2016 gong to British-born Oliver Hart and Finland-born Bengt Holmström, for their work on contract theory.

Their work is complex and touches on a whole series of different topics, so I’ll return to it in a future issue. But today I wanted to highlight a paper the Hart and Holmström wrote in 2015 concerning the banks. The Wall Street Journal summed the paper up like this:

In a 2015 paper, the two said that in the case of a large shock to the banking system, a better response would be “to help people, not banks.” They suggest that governments could offer help to individuals who suddenly find themselves illiquid, rather than financial institutions themselves.

The idea being, of course, that in a free market capitalist economy if a business makes a mistake – and the banks did – they should be punished, not saved. The system is self-correcting in that way. In the same way suffering a hangover after drinking too much should teach you moderation, the banks should have been allowed to suffer the consequences of their actions. But in the financial system, we live in a world without consequences now.

Whether bailing out depositors and not banks would have worked is hard to know. Again, there’s no control group. We can’t run the test again and see if we get a different outcome. I’ve no idea whether it would have “worked” or not.

“Nagasakis everywhere”

Ah, from the sublime (immortality) to the ridiculous (the economic profession) to the absurd (US politics).

Last night a Russian politician named Vladimir Zhirinovsky weighed in on the US election, claiming that Americans should vote for Donald Trump as it’s a vote for peace on planet earth:

Relations between Russia and the United States can’t get any worse. The only way they can get worse is if a war starts. Americans voting for a president on Nov. 8 must realize that they are voting for peace on Planet Earth if they vote for Trump. But if they vote for Hillary it’s war. It will be a short movie. There will be Hiroshimas and Nagasakis everywhere.

No one who flippantly references the death of hundreds of thousands of people like that deserves your respect. But it’s certainly going to be interesting to see how either a Trump or Clinton presidency will affect the geopolitical balance of the world. Whoever gets elected will be weak – neither The Donald or Hillary are likely to be elected with a huge mandate. If you were looking for a time to test America’s geopolitical mettle, you’re probably going to get it in the next year.

Idea: when we crack immortality, let’s put every politician on the planet at the back of the queue.

-Read more at www.capitalandconflict.com (English)-

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