“Envy Is Ignorance, Imitation Suicide”

Peter Thiel has said that Rene Girard is the greatest philosopher since Kant–mainly, I take it, because Girard appears to have been the first to emphasize the self-impoverishing consequences of imitation. The quote above is Emerson’s, but the theory belongs to the Frenchman.

With that in mind, I turn to Eric Falkenstein, who writes:

I argue that people are primarily driven by envy as opposed to greed (see here), so they are mindful of their relative, as opposed to absolute, position, and this leads to doing what others are doing as a mechanism of minimizing risk.

For Falkenstein, it seems envy motivates imitation. His post is on the topic of envy in general, but for his theory to have the explanatory power it claims, it also has to include some account of why envious humans wish to imitate their rivals. That’s a surprising connection, and since that is precisely what Girard’s theory of mimetic desire explains (his book on Dostoevsky was edifying), I’m beginning to see more merit to Thiels’s praise than I at first imagined. This may be the first time in history a French literary theorist has something interesting to say about finance.  And yes, I’m as shocked as you are.

In his book on finance, Falkenstein proposes a “relative-status” theory of envy to explain misguided risk-taking and in his post, he highlights some other anomalous facts explained by this. To chose but a few: people tend to over-invest in their home countries, even though a truly diversified portfolio would have a more international flavor; people gain little happiness in comparing how well-off they are to those living 100 years ago (or to those living in undeveloped nations);  people gain satisfaction in seeing a high status member of the tribe brought down to size, hence the strange support for wealth-destroying redistributive policy, and so on.

But what does this have to do with letting a thousand nations bloom? All political philosophies are rooted in assumptions about human nature. Some gel with human instincts. Others do not. Adam Smith was the first to describe how the pursuit of self-interest can lead to socially desirable outcomes. It is unfortunate, given its prevalence, that envy doesn’t have comparable spill-over effects. Falkenstein writes:

John Adams made sure the USA had many republican features because he worried that “There never was a democracy yet that did not commit suicide”, an opinion first articulated by Thucydides in the fifth century BC. I think this is because mob rule unleashes the envy of the masses, which brings down the best, and in the process the talented tenth, the elites, that drive anything worth cumulating upon in the realm of ideas (and thus, art, science, and technology).

There is a greater place for understanding the role imitation and envy play in political philosophy. If we’re going to re-evaluate the rational actor model, Rene Girard is a good place to start–not the rational pursuit of self-interest, but the irrational pursuit of unenlightened self-enslavement. Demagogues and academic philosophers thrive on creating the illusion that your neighbor’s success comes at the cost of your own and that the prosperity of a country requires tearing that man down. Envy is ignorance, imitation suicide.