Socialism doesn't work. Two large-scale forced experiments, the Soviet and Maoist, failed. Many lesser socialist states have gone bankrupt. These experiments in institutionalized goodness failed because we humans are born selfish. We glorify equality, but down deep we want nothing more than to outshine the others. We deplore poverty and misery, but when the lotto win falls our way, we don't distribute it to unfortunates.
Rubin, a micro-economist, has written a resounding defence of capitalism understood as the system of production and exchange that optimizes the trade-off between selfishness and large-scale social interaction through a win-win system whose participation inducement is reward rather than deterrence. The dazzle of rewards unleashes the flow of human capital that generates economic growth and multiplication of public goods. The core value of the system is individual freedom and autonomy. Rubin undertakes to explain capitalism's evolutionary origin and the psychology that sustains it. He appropriates game theory to explain how the basic psychology of cooperation, including specific traits such as intelligence, might have evolved under selection pressures generated by the evolutionary `arms race'. This abstract computation is given flesh by suppositions drawn from primatology and anthropology. The result is then projected back to the late Pleistocene when the hominid line speciated as sapiens. There is no remedy for this speculative procedure because there is no direct evidence, apart from hand axes, about human behaviour and psychology in `the state of nature'. However, hominid palaeontology is a dynamic field invigorated especially by new findings from China. Homo sapiens continued to evolve after speciation put the large brained biped in place. Racial differentiation occurred; subtle but important behavioural and psychological differentiation may also have occurred. This caveat assumes critical importance because of what happens next--nothing much, until agricultural settlements appeared about 10,000 years ago, which in turn precipitated the gallop to the initial founding of states in Mesopotamia 4,000 years later. This very peculiar pattern calls for explanation, but the author passes it by in silence. For Rubin the entry into political association is positive, in that it commences the advance to capitalism, but it is negative in that it was purchased at the high cost of supplanting the original hunter-gatherer freedom and autonomy for subordination to autocratic rule-a blight eliminated only in the recent past, and then only by Europeans and nations of European descent. The current situation is that the free market/personal freedom combination remains largely European. The Middle East, Central Asia, Asia, Southeast Asia and Latin America display a rainbow of free market-autocracy hybrids. In Sub-Saharan Africa political structures are insecure against tribal dynamics. Since that's five-sixths of world population, let's await to see if capitalism really is the culmination of human evolution.
The center-piece of the book is Rubin's game theoretic analysis of the mechanism of cooperation, using Prisoner's Dilemma as the defining matrix. He brings ingenuity and flare to the task, and I enjoyed reading his interpretation. But I'm not satisfied that his analysis advances the art. The first problem is the misfit between evolutionary assumptions about behaviour and PD. On the evolutionary scenario, behaviour optimizes inclusive rather than individual fitness, whereas PD constrains choice to single episodes of individual advantage. Critics have observed that PD is implicitly modelled on exchanges between non-reproductive males who are strangers. A different matrix would be required to model the choices of reproductive males, and a different one again for reproductive females. Secondly, Rubin does not press his analysis forward to collective action decision making. There is a large literature (Olson, Hecter, Taylor, Elster, &c), and any proposed rational choice theory explanation of large scale exchange must cover this territory. Rubin does not. Finally, the standard objection--But what if humans don't choose rationally? Rubin takes note of Kahneman and Tversky's extensive empirical studies which show exactly that. He responds by placing Gigerenzer's Simple Heuristics that Make Us Smart on the scale as somehow rescuing rational choice from the demolition. For me that's too little too late. Rubin seems indirectly to acknowledge as much when he expresses puzzlement at the persistence of irrational religious belief, and the irrationality of intellectual elites who reprobate immoral capitalism and espouse government welfare structures (i.e., socialism) to soften it.
Rubin's essay prompted me to pull together my diverse arguments against an evolutionary explanation of capitalism, and for that I am grateful. I close with a telling point that Rubin makes himself. Speaking of the linkage between birth rates below replacement value and burgeoning individualism in leading capitalist nations, he says that `for many people (perhaps most people), biological fitness is not itself a goal' (p. 49). Now hear this: when the freedom and autonomy that he attributes to our species in the late Pleistocene comes to full flower, it supports not fitness but extinction! On that basis his claim that freedom is a basic human desire evaporates. There is a further implication. The importation of labor to make up for the unborn locals has created large immigrant minorities, which, thanks to their high birth rate, will become the majority in the United States and Britain in four or five decades, and a large minority in France, Germany, and Italy. These immigrants insert religious conviction and strong ethnic identity into a capitalist system unfriendly to both. Add to this scenario the possibility that the global warming alarm is real, and the future of capitalism doesn't look so bright. The `end of history' may well be nigh, but in a sense opposite to Darwin's, and Francis Fukuyama's, best of possible worlds forecast.