In the early 1960s, Stanley Milgram conducted an experiment to try and explain why the German people had followed Hitler on such a radical and self-destructive course.

He conducted his experiment by hiring two actors, one of whom he wired up to an electric chair, the type used to execute people. The other actor was a typical alpha male character. Participants were then brought in from the street. 

The experiment was carried out by the alpha male actor asking the actor in the electric chair a question. If the answer was incorrect, the participant brought in from the street would be told to push a button that supposedly delivered an electric charge to the actor in the chair. It was all an act, though, and there was no electricity. 

After each ‘shock’ administered in response to a ‘wrong answer’, a dial was turned up so that the ‘voltage’ was increased incrementally to a maximum of 400v. Records were kept as to whether the participant pushed the ‘electrocution’ button or refused to. The results of the experiment showed that approximately 65% of people pushed the ‘electrocution’ button when told to do so when the ‘voltage’ was at 400v.

The experiment was known as the ‘Behavioural Study of Obedience’ and, according to Milgram, ‘the essence of obedience consists in the fact that a person comes to view himself as the instrument for carrying out another person’s wishes, and he no longer sees himself as responsible for his actions. Once this critical shift of viewpoint has occurred in the person, all of the essential features of obedience follow.’ 

Milgram also pointed out that it was necessary for the participant to believe that the experiment served a desirable end for him to be obedient. In the above experiment the participant was told that they were conducting an experiment on learning and memory.

Wired to obey

A majority of us are hardwired to obey authority. Authority can take many forms, including parents, governments, religious leaders, and even ‘what everyone else is doing.’

Governments are the most obvious form of authority and governments well understand how the average citizen is hardwired. Any government with any sort of agenda has worked out that some measure of control over the media is necessary. 

This makes it possible for governments to spread a narrative that, if believed, creates the environment that allows governments the freedom to do what they originally intended. There are many examples through history, such as the supposed weapons of mass destruction in Iraq that were never found, but provoked the invasion of Iraq. Another example is the supposed two attacks on US ships in the Gulf of Tonkin that resulted in the Vietnam War.

Closer to home, we have been subjected to over a decade of anti-farmer rhetoric from the African National Congress (ANC)-influenced media. This was intended to ensure that South African society would not support farmers when the ANC government started to expropriate farmland without compensation.

In May 2020, the World Economic Forum reported that a worldwide survey of 13 200 participants showed that 67% of people supported government actions to save lives during the Covid-19 pandemic even if it meant damage to the economy. Did this 67% of people analyse the data and come to a rational decision? The paucity of data at the time and the evidence presented by Milgram suggests otherwise.

Religion

Historically, religion has been used to whip people up into a frenzy.  Christianity is no exception – the Crusades are an example. The British Empire showed some aspects of missionary zeal, in bringing Christianity to the heathens. Religious fervour was found also within Christianity; the Bartholomew’s Day massacre in 1572 was a mass killing of French Huguenots (Protestants) in Paris by Catholics. Estimates of the number of dead vary from 5 000 to 30 000, an impressive number for two days’ work.

The Salem witch trial in 1692/3 in New England is another example. A number of children fell ill from a mysterious disease. Some died, and witchcraft was blamed. Witch-hunting was fashionable at the time, a bit like McCarthyism in the 1950s, or racism today. Hundreds of people were put on trial for witchcraft and in the end 19 were executed. Once some time had elapsed and the witch-hunt mania had subsided, letters of apology were written from accusers to those they had accused and compensation was even paid to families of those executed.

Strong incentive

What everyone else is doing is a strong incentive for individuals to act similarly; fashion is a very real element in society. Fashions are fairly obvious but they are best represented in the financial markets.

For example, the daily sentiment index of the S&P500 stock index in 2007 was often in the high ninety percentiles. In other words, the bull market in the US was ongoing and people were optimistic. The high point of the S&P500 was in October of 2007 and the low point of the subsequent bear market was in March 2009, when the daily sentiment index was only 4% – i.e., people were very pessimistic. 

The herd is always wrong at turning points or extremes but if one had done some analysis in March 2009 it would have been clear that one needed to buy stocks when everyone was so bearish.  As in Milgram’s experiment, most people do not do the analysis and think rationally about the situation in which they find themselves, they just sell stocks with everyone else. This is a similar observation to what Daniel Kahneman discusses in his book, Thinking Fast and Slow.

All market booms and busts have the same characteristics, a wild belief in a new age; that everything has changed and the old rules don’t apply.  It was Dot.com companies in 2000, US property and Icelandic hedge funds in 2007. In the bust, the Icelandic politicians were thrown out, the bank managers put in jail and the hedge fund managers went back to fishing.

It is tempting to look at examples of our attitudes in 1572 and discard them as something from a different age and not relevant to today. This would be a mistake; human nature has not changed from these times nor from when Milgram did his experiment. 

The focus of our manias does change over time but the manias continue. If mankind and its history were a patient, it would be difficult for a doctor not to produce a diagnosis of manic-depression.

Good and bad

We’re generally hardwired to act with the herd, obey authority, or to think fast, as Kahneman puts it. This is good and bad. It is good because there just isn’t enough time to analyse every issue that we need to make a decision on and we use a shortcut and trust the decisions of others – the herd. It is bad because it allows us to be manipulated by authority as well as to be led by the herd even when the herd is wrong.

Some decisions aren’t too important, such as whether one should buy a saloon or an SUV when looking for a new car. For the average person, both will do the job fairly adequately. Following the herd or fashion on this decision has little downside risk. Other decisions, though, are more important.

When the ANC is manipulating the public narrative and vilifying farmers in order to confiscate their land by legislation that will allow them to expropriate all private property, then this has potentially substantial downside risk for the average citizen. 

It would be better, here, to not simply swallow the narrative but to do some analysis and perhaps reject it. When the World Economic Forum presents its proposal of ‘stakeholder capitalism’, which is Marxism by another name, and Western politicians start adopting their slogans such as ‘Build Back Better’, the downside risk again is substantial for the average citizen. 

This is made explicitly clear when Klaus Schwab is so blunt as to say ‘by 2030 you will own nothing and be happy’. There are benefits in thinking clearly on the topics du jour of global warming and the Covid-19 pandemic, which are the narratives allowing the introduction of ‘stakeholder capitalism’.

Society has to be informed

To maximise the ability to think fast on unimportant decisions and think slowly on important decisions, society has to be informed and the topic debated. This requires that, first, society has the freedom to discuss such issues – freedom of speech – and, second, that the discussions reach society – via a free press. The internet has reduced to near to zero the cost of publishing an opinion, but this is changing. Twitter, Facebook and YouTube have practised censorship for years now, and this has become even more obvious during the recent US election.  University students used to demand freedom of speech, but they now demand ‘safe spaces’ where certain topics cannot be discussed.

Freedom of speech and freedom of the press are two of the tenets of classical liberalism, which is what the Institute of Race Relations (IRR) has promoted for near on a hundred years. In that time the country has seen political institutions such as the United Party, National Party, and possibly soon the ANC rise and fall. In their time all of these political parties were powerful institutions – but they may soon have been outlived by the IRR. There is good reason for this.  Political parties rely on people thinking fast and voting with their emotions.  It is why you do not receive analysis from politicians, but spin instead. They’re either hunting witches, communists or, these days, racists, as Marcel Gascón recently discussed on the Daily Friend

The hard miles

On the other hand, the IRR does the hard miles and does the analysis from which we benefit. The IRR has survived in the same way that an investor that does the analysis survives, whereas the investor that buys what everyone else is buying falls by the wayside soon enough. 

What Milgram’s experiment tells us is that society is prone to wild flights of fancy, and to being led astray by ulterior motives and a convincing narrative, especially in stressful times. History does not contradict this.  We would do well to guard against these compulsions, and promote the voice of reason by supporting institutions such as the IRR.

The views of the writer are not necessarily the views of the Daily Friend or the IRR

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Image by Barak Broitman from Pixabay


contributor

Humphry Hamilton is a farmer and futures trader.