All Commentary
Tuesday, December 30, 2014

6 Reasons We Don’t Know How Good We Have It

2014 was the best "worst year" ever

If you've gotten online or turned on the TV lately, you've probably been bombarded with “news” that the world is falling apart.

We’re running out of resources. The national debt will enslave future generations. Climate change will flood Manhattan. Income inequality is on the rise. Cops are killing innocent kids. Crime rates are skyrocketing. Millions are in danger of dying from Ebola. Immigrants are turning the United States into a third world country. Women can’t walk down the street without being catcalled incessantly. Black Friday is a shameful orgy of materialism. Society is on the brink of collapse.

This rundown of global problems sounds like it’s right out of the comedy This Is the End, but these are the stories that have been dominating our recent news cycles. It’s true that the world is not perfect and that there are serious social, economic, and political concerns that must be approached head on. But acknowledging these problems doesn’t mean we need to be pessimistic about the present or the future.

In fact, modern America (and the world as a whole) is experiencing an era of unprecedented freedom and prosperity. Deirdre McCloskey, author of The Bourgeois Dignity, found that the average person in the year 1800 spent about $3 per day. Today, the average person spends about $100. Matt Ridley, author of The Rational Optimist, finds that compared to 1955, the average person today earns three times as much money, consumes one-third more calories, and is expected to live one-third longer, in addition to being freer than ever before. The United Nations estimates that poverty had declined more in the last 50 years than in the previous 500. It seems that Martin Luther King was correct when he echoed Theodore Parker in stating, “The arc of the moral universe is long, but it bends towards justice.”

Why, then, is our society paralyzed by pessimism? Here are six possible explanations.

  1. People are hardwired to fixate on negativity. Harvard Professor of Psychology Steven Pinker identifies the cognitive and emotional biases humans have to be pessimistic. Research shows that the negative reaction we feel from losing $10 is stronger than the positive reaction we have from gaining $10. Similarly, criticism hurts more than praise flatters. Economist Bryan Caplan points out that people dwell on problems, failures, and tragedies and take solutions, successes, and triumphs for granted. Additionally, confirmation bias ensures that if we think bad things are happening, we focus on the facts that substantiate that mindset and overlook facts that would challenge it. We trick ourselves into cementing the pessimistic worldview.
  2. The news is inherently biased toward tragic events. Adam Langford in The Myth of Martyrdom jokes that the only guaranteed path to fame over the next week is to kill a lot of innocent people. News networks report death, destruction, and freak scenarios because that’s what sells. Reporters have no incentive to report on a shooting that did not take place or the more mundane dangers like electrocutions, falls, and drownings that are often responsible for accidental deaths. Instead, we disproportionately hear about plane crashes, shark attacks, and terrorist bombings.
  3. Real-time reporting exacerbates public hysteria. The introduction of two billion smartphones around the world has made everyone a potential news reporter who can document trauma and violence instantly by publishing photos and videos on social networks. Instead of reading about a bogus bomb threat the next day, people can now sit and stress over five hours of breaking news coverage on CNN before learning that everything is actually fine. This occurrence lends itself to what psychologists Daniel Kahneman and Amos Tversky termed the “availability heuristic.” The two discovered in a 1974 study that people estimate probability according to how easily they can recall examples from memory. If we can remember an example of something happening, we believe it to be more probable than something we can’t remember. So when news coverage constantly tells us about recent murders, rapes, fires, and wars, we deceive ourselves into thinking the incidence of such crimes and disasters is on the rise, regardless of actual trends. But memorability does not equal probability, and confusing the two gives us a skewed view of what actually happens in the world.
  4. Nonprofits employ doom-and-gloom rhetoric. The marketing strategies of nonprofit organizations (NPOs) contribute further to the widespread negativity. Most of these groups rely on contributions from individuals and foundations to continue their operations. However, with over 1.5 million NPOs trying to cure cancer, end poverty, educate students, fund music programs, and more, breaking through the noise is nearly impossible. To justify their existence and raise money, NPOs must impart a sense of urgency, resulting in fundraising letters and events that are deliberately doom-laden in their messaging and that can exacerbate our sense of the problems plaguing the world. But without them, would you donate? Pinker writes, “No one ever attracted observers, advocates and donors by saying things just seem to be getting better and better.” (By emphasizing how freedom is making the world a better place, the Foundation for Economic Education is challenging the established wisdom on this issue.)
  5. People lack economic understanding. Many of the hyperbolic narratives about the end of life as we know it are based on profound misunderstandings of the market process, which economist Julian Simon sought to correct. It’s easy to be pessimistic when one doesn’t understand economics or that the innovative nature of the human mind is the ultimate resource. The incentives and price system inherent in the market process ensure that innovation will continue to improve our world. But Simon wrote that two things were certain: first, “humanity's condition will improve in just about every material way”; second, “humans will continue to sit around complaining about everything getting worse.''
  6. We misremember the “good old days.” In addition to having a misguided perception of the present, most people are seriously confused in how they remember the past. Psychologists Richard P. Eibach, Lisa K. Libby, and Thomas D. Gilovich argue in a 2003 study that people confuse changes in themselves with changes in the world. They explain that people feel nostalgic about a simpler world that existed when they were younger and had less responsibility, exercised less vigilance, and were less intelligent. People also begin to feel threatened as they grow older and have difficulty keeping up with the changing times. We see this pattern in every generation when older folks complain about “kids these days” without any serious evidence to substantiate their concerns.

The truth is, humanity has never been better off. Most people currently living have the highest standard of living of all people who have ever lived. Travel, electronics, food, sanitation systems, health care, and leisure activities are of higher quality and often cheaper compared to even those of the last generation. Think about the phone you use today versus the one your parents used at your age.

As we focus on the year ahead, we should take a step back from the fear mongering surrounding current events and look instead at long-term trends. When we do, we arrive at a beautiful picture of the modern world that leaves us delighted, not disillusioned.

This New Year’s, consider making your resolution to appreciate all the positive aspects of the world we live in. Pessimism is so last year. 

  • Matthew La Corte is a Research Associate at the Niskanen Center where he focuses on immigration policy.

  • Monica Lucas is the campus coordinator program associate at the international nonprofit Students For Liberty. A 2013 graduate of Hiram College, she is based in Washington, DC, and blogs about libertarianism and emotion.