Positively Misguided: The Myths and Mistakes of the Positive Thinking Movement

[Pale Blue Dot]

Lately I've been dismayed by a lack of serious skeptical analysis of claims made by all sides in the debate over the current economic crisis. I see this as an area in which rationalism, realism and critical thinking are desperately needed, yet very few skeptics seem to want to talk about it. I think that there is a great deal to be skeptical of in current economic discussions.

First, let me make it clear what my bias is: I believe that this crisis is much worse than most people think. I see complete collapse looming in the near future, with very little that can be done to stop it. This thread is not meant (yet) to articulate my reasons for believing this, but let me assure you that my beliefs are based on data and analysis. I keep up with several economic blogs daily, as well as the Stock Market Watch thread and the Economics forum on DU. (Chris Martenson's Crash Course is an excellent, data-driven overview of our economic problems.) Because of that knowledge and analysis, I correctly predicted, several years ago, the severe downturn that we are experiencing now. I am not claiming that this means I am right about everything that's going to happen, or that my data and analysis can't be wrong. I'm simply saying that my predictions are not based on emotion, or because I "want the economy to fail" (as I have been accused of here on DU), but on actual data, logic and critical thinking.

One of the main arguments that's used against those of us who are economic "pessimists" is that what's causing the downturn is negativity. If Americans would simply believe in the economy again, the logic goes, the recovery would start right away. An assistant at the Treasury Department said as much a few weeks ago when he said that "What we really need now is a little optimism." The press has been spinning very bad economic news as positive ever since.

For instance, take yesterday's announcement about initial jobless claims. Analysts predicted that this weeks number would be 660K - 660,000 new people applying for jobless benefits. The actual number from the government was 654K. The press, and many on DU, breathlessly claimed that unemployment was "better than expected." Because of this number, there is a renewed sense of optimism. However, those reporting this story missed 3 important facts:

1. 654K is still an awful, awful number, by any historical measure;

2. The previous month's numbers were revised UP by 5K. If that 5K had been added to yesterday's release, the number would have come in almost exactly at what analysts had expected;

3. The number of continuing jobless claims (in other words, people collecting unemployment who have yet to find a job) ROSE to a brand new record.

It is in this context that I read with interest Steve Salerno's article in the latest issue of Skeptic magazine called "Positively Misguided: The Myths and Mistakes of the Positive Thinking Movement". Unfortunately, Skeptic has not reprinted the article on their website, but I'll type out so excerpts here, and I encourage you to pick up this issue at your local book store:

For the record, studies of the alleged link between positivity and productivity hardly show a straight-line correlation. Though surveys do show that American workers are both highly productive and relatively upbeat, one cannot posit a causal relationship without adjusting for the myriad ambient variables that make American life so much more uplifting to begin with. History's most rigorous studies, like the bellwether 1985 effort by occupation psychologists Hackett and Guion, cast doubt on even the most basic correlations you'd expect to find- for example, between job satisfaction and low absenteeism. It should be noted that in Japan, the very well-spring of "5S" and other vaunted productivity programs currently overspreading Fortune 500 America, employees aren't exactly giddy. According to a 2002 study by Andrew Oswald, and economics professor at University of Warwick, UK, just 30% of japanese workers describe themselves as "happy" on the job.

In the end, there's scant reliable evidence that a positive attitude has much to do with the result of any objectively measurable enterprise. There is, in fact, modest but intriguing evidence that a positive outlook may be bad for business. Last year a university of Alberta psychology team studied multiple groups of workers assembling printed circuits and deemed the crankier employees superior to their upbeat counterparts. The cheerful people were too invested in their cheerfulness and devoted significant energy to perpetuating it. their grimacing co-workers simply threw themselves into their work - and did it better: Malcontents made half as many mistakes. (Nor for that matter, should we dismiss the role played by undue optimism in the recent mortgage/housing meltdown - on the part of lenders and borrowers alike.)

Much of the economic information in the press and on DU is skewed because we have so much invested in perpetuating the myth that everything's going to be all right. If we can just remain positive, then surely we will find a way out of this mess. Obama's campaign and presidency, likewise, has been built on the themes of "hope" and "yes we can".

Salerno ends the article by suggesting that perhaps what we need is to have "the willingness to accept failure." I believe that a realistic, data-based analysis of the economic data suggests that the American economy has failed. We need to accept that failure and move on from there, rather than perpetuating the idea that hope and positive thinking can save us.

[TZ]

1. Hmm I actually think that attitude *does* effect the economy

If people are scared they aren't going to spend on things...if they feel secure they will...Its why so many politicians say "everything is okay" when clearly its not...Sometimes attitude can be a self fulfilling prophecy. And as for being pessimistic..I'm not sure anybody really understands the whole picture..Here where I live, unemployment is not bad, people are hiring AND real estate values are starting to slowly rise again as house sales are rising on low mortgage rates here.
I personally think that while things are bad...they might just be starting to get better--slowly.

[Warpy]

2. What the article is saying, though, is that the economy is worsened

by the people who point out the facts and would be much better if they simply lied about them.

We know from the last year and a half that this is simply not the case. All the chirpy bobbleheads on the evening news were lying about the economy and suppressing the facts and people, not being completely stupid, reacted to what they saw everyday rather than to the happy talk.

Spending has been decelerating for the last two years. If happy talk worked, nothing would have happened until last October when they could no longer deny the disaster as the stock market lost nearly half its peak value.

This article, as the OP pointed out, is pure twaddle written by a magical thinker.

People will start spending when they see improvements in their daily lives and not before.

FWIW, I actually felt a lot more hopeful when the denial about the economy was discarded, when they admitted we'd been in a recession for a whole year. In order to fix any problem, you first have to admit there is one.

[TZ]

3. No thats true and I agree with you.

I remember when the first Bush talked about how everything was "just fine" during the recession of the early nineties and as a recent college grad then who saw first hand the problems it infuriated me...I actually think that Obama is doing a decent job handling this..he's brutally honest when necessary but will inject cautious optimism when he feels its helpful...

[Silent3]

4. "People will start spending when they see improvements in their daily lives and not before."

I'm not so sure about that. Certainly that's true for people who aren't spending because they've lost their jobs. But there's a lot of reticence to spend on the part of people who are currently doing just fine, but who are afraid that maybe tomorrow they won't be. People who are restraining spending out of fear of facing a personal downturn that hasn't actually happened yet will likely spend more if they start to believe the economy is on the upswing.

To the extent that positive thinking matters to the economy, I think we need to consider two kinds of positive thinking: a feeling of basic economic security, that you'll be able to hold onto your job, your car, and your home, which is a good influence on the economy, and "irrational exuberance", with too many people thinking they're all going to be millionaires and spending as if they already are ahead of time. The latter kind of positive thinking played a big part in getting us into the current mess, the former kind would be helpful for getting us out.

[bluedawg12]

5. Consumer confidence and fear.

The consumer confidence index, as I understand it, is a predictor of how people will spend discretionary cash.

If confidence is low, across the board, then employed and unemployed will will not spend more than they must.

Fear on the other hand is useful as a motivator, to some extent. If our ancestors did not get motivated to run from a saber tooth tiger, then, a saber tooth tiger might be sitting here in my pajamas typing this.

[onager]

6. Purely anecdotal on this topic, but has anyone else noticed this?

As most of you know, I just recently returned from several years in Egypt. So I've had to buy a lot of crap to set up my house again.

Here in the Los Angeles area, I've noticed that stores have STACKS of unsold Blu-Ray players. This is true of the big electronics retailers (Best Buy & Fry's), as well as places like Target and Wal-Mart.

OTOH, a store clerk said they could not keep one regular Toshiba DVD player in stock. (Understandably--it's "DivX certified" so it plays downloaded *.avi files directly, without the tiresome DVD conversion steps). She said those sell out immediately, soon as the store gets them back in stock.

I was curious enough that I did some Googling, but mostly got happy-talk from Blu-Ray marketers and fans. (Some of whom sound eerily like Xian missionaries...) Though over on a video blog, one poster said he knew a couple of people who got Blu-Ray players for Xmas 2008, and took them back. They were irked by the lack of choice in disks, but especially by the disk prices of $20-30 each.

I don't really have strong feelings about Blu-Ray one way or the other. Well, OK, I wouldn't mind if Sony turned out to have another turkey on their hands, for various unimportant personal reasons.

But mostly I just wondered if anyone else had noticed stuff like this in their neighborhood.

[steven johnson]

7. Optimism bias is common among politicians and executives.

It has been shown that natural selection has shaped human cognition to overestimate the risk of rare catastrophes and overestimate the likelihood of good things happening to us. This leads to the 'optimistic pessimist' bias that mark being human. Unfortunately, people don't know the real all of the catastrophes that can occur. See the book 'The Black Swan.' Thus, the anecdotal nature of our knowledge of catastrophes tends to make us inaccurately estimate the likelihood of them occurring. Inaccurate estimates of risk was one of the factors in the credit default swap mess.
Cognitive bias

Facts are also less definitive than often assumed. People who jointly see something should never be wholly confident that the group observed reality. Simultaneous delusion, implicit or explicit social pressure to conform, and cognitive biases that are general (heuristic) or situational (e.g., how good is the evidence that this person died in an automobile collision?) may affect the observation. The problem is even more acute when hazards stem from events so rare or hypothetical that experts must create facts from their judgments to have any evidence. Facts become "strongly held beliefs shared by expert groups. If strongly held risk beliefs that experts label as facts become bound to other expert beliefs about the benefit of a hazardous technology, for example, why should these expert beliefs become facts required for lay support for the same technology? Laypeople's experience can also make them skeptical of expert facts, as with farmers' experience of varied microenvironments and patients' experience of variability in their own or others' metabolisms. Treating these reactions as wrong misconstrues the contingent place of facts in knowledge.

Advancing Understanding of Knowledge's Role in Lay Risk Perception

One of the most hazardous areas of cognitive bias is in war:

An article in Foreign Policy, “Why Hawks Win,” by Daniel Kahneman... argues that people proposing the use of military force tend to win arguments over government policy because of fundamental psychological predispositions. As the two put it, “These psychological impulses—only a few of which we discuss here—incline national leaders to exaggerate the evil intentions of adversaries, to misjudge how adversaries perceive them, to be overly sanguine when hostilities start, and overly reluctant to make necessary concessions in negotiations. In short, these biases have the effect of making wars more likely to begin and more difficult to end.” Political leaders are on this account “receptive to advisors who offer highly favorable estimates of the outcomes of war.” The evidence Kahneman and Renshon cite is necessarily historical evidence, since while our propensity to overestimate our abilities as drivers of automobiles is the sort of thing that can be tested in a lab, that quirk is not what interests them here. They are interested in war and foreign policy, and propositions about those fields can only be tested historically, if at all.

...“the optimistic bias and the illusion of control are particularly rampant in the run-up to conflict. A hawk’s preference for military action over diplomatic measures is often built upon the assumption that victory will come easily and swiftly. Predictions that the Iraq war would be a ‘cakewalk,’ offered up by some supporters of that conflict, are just the latest in a long string of bad hawkish predictions. After all, Washington elites treated the first major battle of the Civil War as a social outing, so sure were they that federal troops would rout rebel forces.”

Optimism in War

Economic manias and mass delusions are a close second.

[CanSocDem]

8. Good points.

I've tried to add public health and professional sports to the list but apparently "cognitive bias" doesn't exist around here.

.

[Silent3]

9. There is, of course, no "optimism bias" in believing disease is cured...

...simply by thinking good thoughts and tuning out bad ones, bad thoughts like those terrible self-serving myths that germs cause disease, one of the myths tied to that clever con game known as "medicine".

[mr blur]

10. Please...

[cosmik debris]

12. And don't forget to alert

Even the rule we have prohibit disruptive posts. We really don't need a new mission statement as long as he continues to break the rules we already have.

[CanSocDem]

11. Guess what...???

An "optimist" probably wouldn't get the 'disease'. They don't see all the germs you do and, interestingly, are less affected, as in the earlier post.


But hey....you and the terminally distressed around here can believe what you want.

.

[Silent3]

13. There is a small correlation between optimism...

...and improved health, but it's not so strong that it's a major determinant of health, and as for the "create your own reality" BS, everything I've heard about the effect of optimism leads me to think that optimists who believe the germ theory of disease are going to be marginally healthier than pessimists who think fear of germs is just a big scam.

My grandparent who lived the longest was the one who complained every day for a couple of decades about how bad she felt, and my father, who I remember constantly going on with "someday son, when I'm not here" talk when he was in his forties is still alive, while my far more optimistic mother died much younger several years ago.

[TZ]

15. Hey doofus

I've probably had one of the most stressful months in my entire life yet my platelet count went down from 1.3 million to 500,00..why? BECAUSE I DOUBLED MY INTERFERON DOSE.
While stress does play a PART in disease. There are true BIOCHEMICAL/BIOLOGICAL/ORGANIC reasons for disease. But since you don't even have elementary school level scientific education you wouldn't know that.
BTW, if I were Canada I would never admit to having you as a public school student. You prove that their educational system is just as flawed as anywhere. You didn't learn ANYTHING>

Sorry guys. But some things are just too easy to pass up..:rofl:
I want to hear how it wasn't REALLY the interferon that worked..:popcorn:

[CanSocDem]

16. Like I said....

.... the terminally distressed around here can believe what (they) want.


Having a irony-deficiency day, are we...????

[TZ]

17. nevermind

I'll be sure to tell my doctor at Mayo to give you a big hello when I go for my checkup next month..give me a break from all the scientificy stuff he has to tell me...I'm sure he'll appreciate all the help (not) you've given me..:rofl:

[TZ]

14. Yes it does.

Look in the mirror.