I’ve recently been working my way through a long set of 2008 blog posts by Eliezer Yudkowsky. It starts with an attempt to make quantum mechanics seem “normal,” and then branches out into some interesting essays on philosophy and science. I’m nowhere near as smart as Yudkowsky, so I can’t offer any opinion on the science he discusses, but when the posts touched on epistemological issues his views hit home.

Quantum mechanics has a reputation for being somewhat strange and mysterious, partly due to the fact that the original research findings were interpreted in what Yudkowsky convincingly argues is the wrong way. For instance, you may have heard of concepts like “Heisenberg Uncertainty.” The original “Copenhagen interpretation” of QM saw certain events as being fundamentally random, not just random in the sense that we are unable to predict the outcome. In contrast, Yudkowsky subscribes to the increasingly popular “many worlds interpretation” (MWI), which says the universe is fundamentally deterministic, and that seemingly random events involve both possibilities occurring, with the universe actually branching off into two parts, including the observer himself. A multiverse. Each of the two new observers sees one of the two possible outcomes. Hence it looks random, but actually it is (according to the MWI) the case that both outcomes occurred. (I apologize if I botched the explanation.)

As I said, I’m in no position to comment on the science, but here are some related issues that caught my attention:

1. Yudkowsky says that the MWI (splitting universes view) is actually the straightforward interpretation of the model, and that the Copenhagen interpretation adds an unnecessary assumption about wave function collapse. He says this was misunderstood for 30 years for 2 reasons.

2. One reason is that many scientists couldn’t even imagine that they themselves were a part of the model. Their bodies were made of particles that QM also applies to, and hence they split onto two paths along with the particle being analyzed.

3. They misinterpreted Occam’s Razor. Scientists wrongly assumed it meant you should avoid QM explanations that involved the complexity implied by a lot of universes, whereas it actually says you should avoid an explanation that implies extra (unneeded) theoretical complexity. For instance, when astronomers realized that spiral nebula were actually galaxies, it implied billions of times more stars, but is actually a simpler model of the cosmos—lots of spiral galaxies rather than lots of spiral galaxies and lots of spiral gas clouds. Similarly, the MWI is simpler and more straightforward than the Copenhagen interpretation.

Then it occurred to me that there is an analogy to monetary economics. The straightforward interpretation of the 1930s was that tight money caused the Depression. But it didn’t seem like tight money caused the Depression, so it took 30 years before Friedman and Schwartz showed that was the case (in 1963.) Economists were confused by the low interest rates and QE, and thought money was easy. Hence almost everyone blamed financial instability, even though Irving Fisher’s “dance of the dollar” model said it had to be tight money. Even Fisher wavered a bit, and added finance to the model. But finance wasn’t needed! Canada had no banking failures, and had a depression almost as bad as the US.

Yudkowsky frequently seems puzzled and indeed exasperated by the fact that physicists got it so wrong, for so many decades. (And in his view, many still have it wrong.) I am frequently exasperated that the standard Friedman/Bernanke/Mishkin monetary economics of 2003 clearly implies tight money by the Fed caused the Great Recession, but almost no one believes that. These economists (and many others) used to say low interest rates do not mean easy money, nor does rapid growth in the monetary base. All three thought monetary policy remains highly effective at zero rates. Bernanke’s specific criterion for the stance of monetary policy (NGDP growth and inflation) implies that the 5 years after mid-2008 saw the tightest money since the early 1930s. But almost no one believes that, not even Bernanke and Mishkin.

I’m actually a bit more forgiving of physicists than Yudkowsky, perhaps because I find the entire subject to be confusing. I can sort of see how people would overlook an interpretation that involved them splitting in two, and flowing off into multiple universes. In contrast, I’m relatively unforgiving of economists not seeing that the biggest fall in NGDP since the 1930s is tight money. Others might be more forgiving, as the interest rate and monetary base data sure looks like “easy money.”

Yudkowsky says scientists had the right equations, the right formal model, but were thinking about the whole thing in the wrong way. I think economists have pretty good macro models, but often interpret them in the wrong way. For instance:

1. They ask whether the ECB should do more to cure the “lowflation” problem, when they should ask why the ECB caused the lowflation problem.

2. They think if QE did only a faction of what we need, then a much bigger QE would be needed to do what we really need. Even though Nick Rowe’s “Chuck Norris” expectations channel says they could get by with much less, and even though Evan Soltas showed that the Swiss National Bank was able to do less QE, as soon as they shifted to a more expansionary monetary policy (of capping the SF/euro exchange rate.)

3. They think the zero interest rate bound is the problem, whereas the real problem (if it existed, which it doesn’t) would be nothing left for the central bank to buy when NGDP growth expectations were on target, and the actual base was still short of the demand for base money.

I used to have a prejudice against math/physics geniuses. I thought when they were brilliant at high level math and theory; they were likely to have loony opinions on complex social science issues. Conspiracy theories. Or policy views that the government should wave a magic wand and just ban everything bad. Now that I’ve read Robin Hanson, Eliezer Yudkowsky and David Deutsch, I realize that I’ve got it wrong. A substantial number of these geniuses have thought much more deeply about epistemological issues than the average economist.

So when Hanson says we put far too little effort into existential risks, or even lesser but still massive threats like solar flares, and Yudkowsky says cryonics is under-appreciated, or when they say AI (or brain ems) is coming faster than we think and will have far more profound effects than we realize, I’m inclined to take them very seriously. I’m inclined to think we should spend less money on jet fighters and airport security, and more money stockpiling electrical transformers in case a huge solar flare hits us. And I no longer trust the “experts” in government to get this right. I’ve seen how the experts failed us in macroeconomics.

I’m about 90% through the Yudkowsky series. It’s very hard work for someone like me, but well worth reading. It’s not just science, he touches on everything from personal identity to free will to libertarianism (he’s moderately supportive), and invariably has something brilliant to say. Highly recommended.

PS. In order to appease Bryan Caplan I did not mention “common sense” in this post. But . . .

PPS. Evan Soltas was 18 when he wrote the post I linked to. Think back to when you were 18 . . .