The December 20 issue of The Economist has an excellent article "Why we are, as we are". It touches on a fascinating theme: "As the 150th anniversary of the publication of 'On The Origin of Species' approaches, the moment has come to ask how Darwin’s insights can be used profitably by policymakers."
Inspired by the article, I started to reflect on how the lessons of Darwinism can be applied to help us understand the fundamental roots of the ongoing global financial crisis. In addition, given my continuing faith in open markets and free trade, my thoughts also turned to my favorite economist - Adam Smith, - whose views I felt would also be quite relevant in helping us make sense of the situation.
Many have said that the underlying cause of the financial crisis is greed - that is, the pursuit of wealth, possessions and power beyond the need of the individual. That is way too simplistic an answer. To a greater or lesser extent, greed is part of the human condition, along with the other seven deadly sins and other vices. Powerful evolutionary forces drive the quest for money and power, as The Economist article observes
"For a Darwinian, life is about two things: survival and reproduction. Of the two, the second is the more significant. To put it crudely, the only Darwinian point of survival is reproduction."
"Girls have always liked a rich man, of course. Darwinians used to think this was due to his ability to provide materially for their children. No doubt that is part of it. But the thinking among evolutionary biologists these days is that what is mainly going on is a competition for genes, not goods. High-status individuals are more likely to have genes that promote health and intelligence, and members of the opposite sex have been honed by evolution to respond accordingly. A high-status man will get more opportunities to mate. A high-status woman can be more choosy about whom she mates with."
"Status, though, is always relative: it is linked to money because it drives the desire to make more of the stuff in order to outdo the competition. This is the ultimate engine of economic growth. Since status is a moving target, there is no such thing as enough money."