Why People Stop Believing What They Believe

In yesterday’s Markets and Money we promised to tell you today why people stop believing what they believe. We believe what we’re going to show is bound to offend you, or at least some of you. But it’s a big, bad world and a challenging idea never hurt anyone’s feelings. Or if it did, that’s too bad. The free world is a rough and tumble place, and you don’t have the right to not be offended.

First let’s start with Egypt, it’s becoming a great example of one of our newest ideas: elections shouldn’t matter. The country could vote on a new draft constitution as soon as December 15th. Or the two-year old revolution that ousted American-backed strongman Hosni Mubarak could fail to produce a new constitution everyone can agree on. You’d have a second revolution.

There are several issues in play here. First, the draft Constitution has been put together mostly by allies of President Mohamed Morsi. Morsi is a member of the Muslim Brotherhood and the Constitution reflects that. It has over 230 articles, which makes it complicated. It also blurs the line between secular and religious authority in Egypt. For example, early language said that Sharia law would be ‘the’ basis for the Constitution rather than ‘a’ basis. Unelected Islamic judges will have the power to settle some Constitutional disputes. And civilians could be tried by military courts, according to some reports.

Mind you, how Egypt chooses to govern or constitute itself is absolutely none of our business. We’re merely pointing out that elections only really matter when you’re trying to fundamentally transform the relationship between the People and the State. Egypt has secular parties and political liberals who want a constitution that creates some checks and balances on authority and puts the basis of the law’s authority on the consent of the governed, not the word of God, or belief in it.

It’s a pretty fascinating institutional contest of wills. In late November, President Morsi issued a decree exempting his decrees from judicial review. He did so, he claims, because Egypt’s Supreme Constitutional Court could try and dissolve the constituent assembly writing the constitution on technical grounds, like it did before. It would be as if the Court is conducting a kind of legal insurgency against the revolution, in defence of vested interests who are trying to hold on to power for as long as they can. The Court, for its part, says the decree gives one man dictatorial power, which can hardly be the point of a democratic revolution.

But just what is a democratic revolution? Is it a revolution that results in an election where people are free to choose how they’re governed and who governs them? Most revolutions, despite the term, are not popular. Revolutionary leaders tend to come from middle class backgrounds. They manage to stir up enough agitation at the margin that the middle class is dragged into the streets to force a capitulation by the old regime.

Our point is that these changes only happen when the relationship between the People and the State is fundamentally changing. It’s not always for the better, either. If a revolution results in clear, simple rules, defining the exact limits of the power of the State and preserving all the liberties of the people who consent to be governed, you can bottle the optimism of change.

But democratic revolutions are equally capable of voting for tyranny. It’s not the voting that makes for good government. It’s not even democracy. It’s simple, clear rules that protect liberty and define the relationship between institutions that are important to civil society.

However, the Rule of Law is only important if you want to live in a civil society where individual liberty and political freedom are the highest values. There are many other values in life, including religious or political values. And in many places, individual liberty is not the highest value. It will be interesting to see how things turn out in Egypt.

And for what it’s worth, we believe the entire world is plunging into a new order of fascism – whether it’s secular, religious, or just plain pathological. We’ll save that argument for later though. For now, when do people stop believing what they believe? When we asked the question yesterday, it was in the context of the financial markets: how long will people persist in believing things that are untrue, like the idea that any of these huge government debts will ever be paid off, or that they really don’t matter?

Well, when in doubt, we always like to look at the inexplicable in terms of the useful. That is, if a behaviour persists in human beings, it must do so because it is either useful, or isn’t harmful enough to damage your chance of surviving. A simpler way to put it would be this: behaviours and beliefs exist and persist because they promote survival.

The idea of belief itself – ‘confidence in the trust or existence of something not immediately susceptible to rigorous proof,’ according the Webster’s – must be useful to promoting human survival, or else it wouldn’t persist in all human cultures over time. Belief allows you to take the existence of something – say the value of a dollar – at face value. That belief allows you to make plans for the future.

Belief is essentially hopeful. It’s the assumption that tomorrow and tomorrow and tomorrow are worth planning for because some things will remain true and constant, even if you can’t be logically certain. It’s also modest. You don’t really know if things will be the same. Maybe the Mayans will be right and the world will end. But if you believed that, would you bother getting up out of bed to begin with?

Of course we’re skirting around a big issue: belief in what? But let’s avoid that. It’s tricky. And besides, the more interesting question is why people believing anything at all that can’t be proved. Our answer is simple: because belief is useful in promoting survival. So when will people stop believing in the financial status quo? When that belief no longer promotes their survival. More on this idea tomorrow.


Dan Denning
for Markets and Money

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The Aussie Dollar Dilemma
16-11-2012 – Dan Denning

Dan Denning
Dan Denning examines the geopolitical and economic events that can affect your investments domestically. He raises the questions you need to answer, in order to survive financially in these turbulent times.

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8 Comments on "Why People Stop Believing What They Believe"

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The US has invested in the MB on the Islamist side and ElBaradei on the secular side. Narrative like “its Egypt’s business” comes cheap.


What could possibly go wrong when we execute such a slam dunk plan?

Silly Rupert appears to be lacking in the “keep the faith” department with Assassin-In-Chief Obama as reflected in this tweet of his which might have twisted his worry bead thumb as he executed it while Israel was pounding Gaza:

“Can’t Obama stop his friends in Egypt shelling Israel?”

Sometimes people are confronted with proof that their beliefs are flawed. Then they envisage a world without that reality and they experience fear and doubt. Maybe then they decide to live in false hope or denial instead. Belief may be hopeful when it is at least possibly true, but also beliefs can be insincere (not really beliefs at all but a lie/denial) when the person only continues to assert them because they lack courage to walk forward in truth. This is not conducive to survival in a sense. Just the opposite. This is how Bills zombies are born. Mr Bonner… Read more »
“Leon Festinger (1957) proposed cognitive dissonance theory, which states that a powerful motive to maintain cognitive consistency can give rise to irrational and sometimes maladaptive behavior. According to Festinger, we hold many cognitions about the world and ourselves; when they clash, a discrepancy is evoked, resulting in a state of tension known as cognitive dissonance. As the experience of dissonance is unpleasant, we are motivated to reduce or eliminate it, and achieve consonance (i.e. agreement).” “Cognitive dissonance was first investigated by Leon Festinger, arising out of a participant observation study of a cult which believed that the earth was going… Read more »
Lachlan, for the nihilist elite it is rational; for the footsoldier it is a pragmatic clipping of the ticket; for the plebian it is both as you say above, Abrahamic intolerance saturated culture, and the “authority effect”. The authority effect was demonstrated by US experts controlled experiments on civilians and those that they believed were wired for electric torture. In the experiment the civvies were given the control to the instrument of torture, they then mostly proceeded to use them to their maximum whenever their non interventionist supervisor wore a white coat in the belief that they were serving him,… Read more »

the idea that a belief needs to serve a purpose to survive is false, if you understand the concepts of memes. The purpose of the belief is to replicate itself; it doesnt care about the health or survival of the underlying carrier (ie the humans/culture)


@paul, the meme units as a noun are probably self evidential. That they are encompassing I dispute. Truths are something there and we seek them out like Aristotle when we are at our best. Here is something to make us think a little deeper about our existential selves:


Memes being immeasurable they are perfectly suitable for all sorts of narrative quackery. Beliefs also get slaughtered and this underlies the Darwinism and social Darwinism that hangs around memes conceptually.


Well done Ross.

I have also used Smedley’s material myself. Seems an efficient way to evoke denial also if you know what I mean.

truth and integrity
Considering time as a basis for conditioning the meme, there is no greater proponent than Methuselah. He knew Adam for 243 years and Noah for 600 years. Moses knew this when he wrote Genesis and also knew that his father Enoch walked with God. They all had many years to know wisdom and instruction, to perceive the words of understanding and then to know what they believed. We’ve seen Pharaohs and Babylon fall + every great empire since. Today very few people sit having a meal at a dining table discussing religion, sex and politics. No wonder individuals are self… Read more »
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