Craving Certainty – Social Evolution

20151104_145251Yuval Noah Harari is a historian and his book Sapiens provides an excellent brief history of humankind and poses some very challenging questions about both the past and the future. It is also, I think, a very good illustration of the socially constructed nature of our world without ever mentioning the term!

Why a historian and certainty?

Harari outlines some similar things as Elias in terms of the social process of large groups living together. Again, he points out the need for social certainty in order for these groups to function together and as well that there was very little conscious or individual thought required for this social certainty to emerge.

Harari adds a component that I think is important. After looking at the ancient history and evolution of humankind he outlines what has happened relatively recently in human history. This being a belief in the certainty of the future. In order to have this belief we must imagine this certain future. It is therefore an act of imagination to believe in a certain future and yet this act of imagination is typically not seen as imagination. From the book Sapiens:

‘When the Agricultural Revolution opened opportunities for the creation of crowded cities and mighty empires, people invented stories about great gods, motherlands, and joint stock companies to provide the needed social links. While human evolution was crawling at its usual snail’s pace, the human imagination was building astounding networks of mass cooperation, unlike any other ever seen on earth.’ (Sapiens – pg. 103)

We rarely think of things like a stock market, a religion, laws and institutions as acts of imagination but these things have all emerged, without any conscious big picture or strategic thinking through social interaction.

This phenomenon of an imagined and certain future is quite recent in human history but is now so much a part of our experience (our left loop) that it seems very natural and normal. Below is a simple, economic story/example that Harari noted that I think illustrates in a very real way how much this drive for certainty has become needed and entrenched in today’s societies.

Example of belief in an imagined, certain future (Sapiens – pg. 305 – 307):

Samuel Greedy, a shrewd financier, founds a bank in El Dorado, California.

A. A. Stone and up-and-coming contractor in El Dorado, finishes his first big job, receiving payment in cash to the tune of $1 million. He deposits this sum in Mr. Greedy’s bank. The bank now has $1 million in capital.

In the meantime, Jane McDoughnut, an experienced but impecunious El Dorado chef, thinks she sees a business opportunity – there’s no really good bakery in her part of town. But she doesn’t have enough money of her own to buy a proper facility complete with industrial ovens, sinks knives and pots. She goes to the bank, presents her business plan to Greedy, and persuades him that it’s a worthwhile investment. He issues her a $1 million loan, by crediting her account in the bank with that sum.

McDoughnut now hires Stone, the contractor, to build and finish her bakery. His price is $1,000,000.

When she pays him, with a cheque drawn on her account, Stone deposits it in his account in the Greedy bank.

So how much money doe Stone have in his bank account? Right, $2 million.

How much money, cash, is actually located in the bank’s safe? Yes, $1 million.

It doesn’t stop there. As contractors are wont to do, two months into the job Stone informs McDoughnut that, due to unforeseen problems and expenses, the bill for constructing the bakery will actually be $2 million. Mrs. McDoughnut is not pleased, but she can hardly stop the job in the middle. So she pays another visit to the bank, convinces Mr. Greedy to give her the additional loan, and he puts another $1 million in her account. She transfers the money to the contractor’s account.

How much money does Stone have in his account now? He’s got $3 million.

But how much money is actually sitting in the bank? Still just $1 million. In fact, the same $1 million that’s been in the bank all along.

Current US banking law permits the bank to repeat this exercise seven more times. The contractor would eventually have $10 million in his account, even though the bank still has but $1 million in its vaults. Banks are allowed to loan $10 for every dollar they actually posses, which means that 90% of all the money in our bank accounts is not covered by actual coins and notes. If all the account holders at Barclays Bank suddenly demanded their money, Barclays will promptly collapse (unless the government steps in to save it). The same is true of Lloyds, Deutsche Bank, Citibank, and all other banks in the world.

The above sounds pretty normal in the financial world but the only way this can be normal is for us to believe in the certainty of an imagined future. In this case, that the bakery will be a success. And since it now imperative to believe in this imagined future certainty for our societies to  function we believe in other imagined things that we have come to assume will help create that certainty. Things like business plans, projections, strategic plans, people’s appetite for baked goods etc. As Harari notes:

‘It sounds like a giant Ponzi scheme, doesn’t it? But if it’s a fraud, then the entire modern economy is a fraud. The fact is, it’s not a deception, but rather a tribute to the amazing abilities of the human imagination. What enables banks – and the entire economy – to survive and flourish is our trust in the future.’

We need certainty in our imagined futures for current society to exist.

So with a very cursory look at three perspectives; that of biology, that of social process and that of social evolution it seems the drive for certainty is a normal and natural occurrence for us humans. I have said that it is a drive for certainty that is the primary cause of OUCH! in organizations.

So is OUCH! normal and natural as well? I don’t think so; at least the type of OUCH! I am focusing on.

I think the OUCH! I am focusing on is not normal and natural. Let’s look at why and then what we might try to reduce it.

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