Optimism and false hope
By Hanna Oldsman
In Voltaire’s Candide, the title character wanders through a life of brutal executions and natural disasters and angry mobs, and yet believes that he lives in the best of all possible worlds. When I think of misguided optimism, I think of those who are disinclined to do anything to change the world or their lives because (a) they believe all things serve some greater good, or (b) they optimistically and passively wait for their god(s), or the people around them, to change their lives for the better. I thus approached Roger Scruton’s book The Uses of Pessimism: And the Danger of False Hope with interest. Perhaps, I hoped, he might skewer the blindly optimistic patriotism espoused by so many Americans, or the distasteful optimism of the Candides and Panglosses of the modern world who fail to acknowledge the horrors around them.
Scruton’s objections to optimism, though, run in a curiously different direction. The optimists he finds most dangerous aren’t those who sit and wait as they contemplate their half-full glasses, but those who believe in quick-fixes to society’s problems. He argues that optimism, unchecked, has led to many of civilization’s failures, and that a dose of pessimism is necessary to dash unfounded hope. The “credit crunch,” for example, he attributes to the “best case fallacy”–the same illusion that prompts gamblers to recklessly risk their money:
Many factors conspired to produce this crisis. But we do not need to look far to discover the best case fallacy at the heart of it. The first stirring can be perceived in the Community Reinvestment Act, signed into law by America’s President Carter in 1977. This requires banks and other lenders to offer mortgages in a way that addresses ‘the credit needs of the communities’ in which they work, and in particular the needs of low-income and minority households. In short, it requires them to set aside the normal reasoning of lenders concerning the security of a debt, and to offer credit as part of social policy and not as a business deal. The reasoning behind the act was an impeccable piece of optimism, beginning from the best case scenario, according to which otherwise disadvantaged groups would be lifted into the realm of home-ownership, so taking their first step towards the American dream. Everyone would benefit from this, and no one more than the banks who had helped their communities to flourish. In the event, of course, the banks who had been pressured into ignoring the demands of prudence, and who had been forbidden by law to consult the worst case scenario, ended with a steadily growing accumulation of bad debts, leading eventually to the ‘subprime mortgage crisis’ of 2008.
Others, meanwhile, had begun to trade in these debts. After all, the best case scenario tells us that a mortgage, being secured on a home and therefore on the one thing in which every borrower has the greatest investment, cannot fail to pay interest. And a fixed rate mortgage can be sold at a profit, when interest rates fall below the rate agreed. The worst case scenario–so obvious that nobody bothered to check it out–tells us that, when interest rates fall, money loses its value, and fixed rates become harder to pay. The good debt becomes bad, however much was invested in the home that secures it.
According to Scruton at his most pessimistic, “the argument of [his] book is entirely futile” for the indefatigable optimists among us. I agree that pessimism is entirely necessary. But I think we would not be where we are today if some starry-eyed optimists had not acted on their visions of the future–and I’m talking about issues such as civil rights. Had we allowed things to change organically (glacially), had nobody spoken of their optimistic dreams of a better world, would our schools still be racially segregated by law? Would women have the right to vote? Would Europe still be governed by kings and queens? Changes that once seemed radical have now come to pass. What do you think?
Roger Scruton is Resident Fellow at the American Enterprise Institute and Visiting Professor of Philosophy at Oxford University. He is the author of more than 30 books, including Beauty and Death-Devoted Heart.