In the market, information is key. How each actor in the market acts is the result of processing multiple strains of thought and information which may be complete, incomplete, inaccurate or fraudulent. The more complete and accurate the information, the more likely the actor is to be successful in their trading endeavors. Any actors who can obtain an edge in information will make a profit if they are able to accurately interpret this information (the very act of doing so is affected by other information inputs.) So, for example, let us imagine an analyst called X who trades on the fortunes of the car industry and decides to utilise drones to take aerial photos of the various delivery car lots of the major car producers to gauge their current demands. By doing so X is orientating himself and collecting information within his current system to operate more effectively vis a vis other actors to gain a monetary reward (finding out which companies share will increase or decrease when the companies financials are published, before they are published.)

We see the primacy of information in all things related to the market. Another easy to understand example is in the area of yield requirements. Yield requirements (how much investor X wants to receive from an investment, also known as a required rate of return) are dictated by a number of factors. The first factor is the risk free rate. The risk free rate is the default amount investor X needs from the investment, based on the idea that he could invest the money in something else with zero (or negligible) risk. The standard risk free benchmark is the US T Bill. So investor X needs the investment to at least give him what he would get for investing in a T bill over the time of the investment, let us say this is 0.5% over a year. So we have the first part of our required yield 0.5%. The next part is the difficult part, there are at least four more components which are factored in – inflation premium, liquidity premium, default risk and maturity premium. The details of the additional aspects of the yield requirement are fairly technical, and for the purposes of this post it will suffice to merely note that they are a reflection of the risk related to the investment.

So, having calculated all of the relevant aspects of the yield requirement, investor X decides they need a 10% yield on investment Z. This decision has been the result of researching information and processing information. This may sound ridiculously obvious, almost infantile, but the centrality of the aspect of information processing is often overlooked to a criminal degree.

Now, let us assume that while investor X has decided on a 10% yield, investor Y has come to the conclusion that 5% is a more accurate yield. This discrepancy will be the result of either the investors having differing information, or the investor processing the information differently. This could be due to a multitude of reasons such as a differing demand for yield, or faulty information, either way information is key to the whole process.

The significance of this when the process is used to analyse the social interaction of human beings is that they are in effect fundamentally information receiving, and information processing beings.  So it would at first blush appear that utilising Game Theory in relation to spontaneous order would be acceptable, but unfortunately this is brushing over some very deep seated issues. This paper covers the issues at stake quite excellently so I will not merely repeat it on this post, but I will extract the points for their value in relation to nRX.

The first major point is the issue of rationality which has differing meanings in both areas. For Hayek and the Austrian school it is not a question of if people are acting rationality or irrationally at any given point, because within spontaneous order they are always acting rationally as rationality is the process of deciphering and creating norms. For the proponents of Game Theory, a person may act rationally or irrationally in relation to the decided utility maximisation.  So for example, taking the prisoner dilemma as the key example, the decided maximum utility barometer by which the participants are acting is in reducing their prison sentence, failing to make a decision which achieves the minimum sentence is deemed irrational.  This definition of rational is determined by the observer and is deeply subjective. It also fails to take into account whether the participant in the dilemma has other motivations and influences outside of reducing their prison sentence. Hayekian spontaneous order however, understands that even if a person’s actions do not maximise a specific utility (by not moving to reduce their prison sentence as much as possible in this example), this is not an irrational act. The person may have different motives and impetus then reducing the prison sentence (The person may be moved by extreme hostility to legal co-operation, may be seeking to make a political point by being imprisoned etc.) What is rational to the participant in the given situation, and with the participants given available information and motivations is intrinsically rational.

Another aspect of this difference is that game theory assumes that all actors’ actions are conditioned by an understanding of an eventual outcome which has been pre-determined and is then pursued (reducing the prison sentence) which then conditions a predictable order. In simple games, this is tolerable, but in a complex system, each individuals goals are not clear to themselves and especially to others, as such the overall direction of the system is spontaneous in that it is the results of immeasurable interactions and counter interactions which tends towards an order which is not, and cannot be, accurately predefined in its entirety. To make this even more complicated, an individual will have multiple goals at any given moment – we do not approach each and every decision in a vacuum.

Game theory’s base understanding of rationalism can be placed firmly in the Hayekian rational constructivist frame. This framework neoreactionaries will recognise as being that which has blighted mankind in the western world since the Enlightenment. It is the belief that man can rationally decipher a given outcome using reason alone, and act to construct this given outcome.

This issue of the game theory’s constructivist rationalists base understanding of the concept of rational, versus the  Austrian Spontaneous order’s definition of rational is one which can be seen at work in this post by Scott Alexander, which I have only just gotten around to reading (h/t Proff Zaius). At play at all times within this ‘Meditation on Moloch’ is the rationality of the constructivist rationalist.

Of even more interest is that it is not only Scott Alexander that is exhibiting what looks like the constructivist frame of thought, but also a neoreactionary in the form of Nyan Sandwich, who express a number of thoughts which are strongly neoreactionary. I mean, what are we to make of the statement that –

“Instead of the destructive free reign of evolution and the sexual market, we would be better off with deliberate and conservative patriarchy and eugenics driven by the judgement of man within the constraints set by Gnon. Instead of a “marketplace of ideas” that more resembles a festering petri-dish breeding superbugs, a rational theocracy. Instead of unhinged techno-commercial exploitation or naive neglect of economics, a careful bottling of the productive economic dynamic and planning for a controlled techno-singularity. Instead of politics and chaos, a strong hierarchical order with martial sovereignty. These things are not to be construed as complete proposals; we don’t really know how to accomplish any of this. They are better understood as goals to be worked towards. This post concerns itself with the “what” and “why”, rather than the “how”.”

Is this rational constructivism? Has Nyan used his reason to decipher an end goal which he thinks is then possible to construct? On the surface this would seem so, and as a result Scott Alexander seems to be drawn to it, but there is more to it than that.

So what has Nyan, and by extension, neoreaction done? As far as I can tell, neoreaction engages in what I can only describe as teleological rationalism, a term which seems to have little usage, but which seems to be useful given that it routes around some of the issues present in spontaneous order as outlined by Hayek, the primary one being the tension between constructed synthetic order and the overall spontaneous order. This is where neoreaction takes Hayekian spontaneous order and drags it away from libertarianism by making a very clear assertion – the government is not the people, and the people are not the government. In addition to this, there is a latent understanding among neoreactionaries that active and aggressive creation of institutions and organisations is needed, and will be needed in the future, and that these will be along a synthetic order line which has been pre-determined to a large degree. The key ways in which this is separate from constructivist rationalism is that the process is tempered by an understanding that the final result of this end point is uncertain, and that any eventual results will be conditioned by reality.

Teleological rationalism can therefore be defined as a belief in the ability of man to shape his future through rational means with the extreme proviso that the eventual ends of this process are firmly rooted in reality linked to biorealism, real politik and devoid of utopianism, which is in essence a Humean anti-rationalist position.  It seems that Nick Land and Moldbug have also already intellectually been down this avenue.

To unpack this a little further, teleological rationalism is extremely differentiated from constructivist rationalism in that a strong stress is placed on an analysis of the teleology of the reasoning. This cannot be overly highlighted. One of the key areas in which neoreation attempts to do so is by tempering any proposed structure by reference to what humanity and humans are biologically capable of, and also by reference to previous successful forms of social organisation from which a guide is sought. In comparison, the constructivist rationalist will concoct pre-conceived dreamed utopias based on deductions of how the world should be, and will then propose changes without recourse to any solid examples of how the proposed societal structure will actually successfully function because there are no previous examples, nor has there been a utopia created from any of the revolutions since the Enlightenment (thankfully the no true Scotsman is an always willing servant.) Of course, this criticism can also be directed at neoreaction given that a tech comm society has never been created, nor has a 16^th century monarchy in the current technological environment, however, in the concept of patchwork, the understanding of the need to account for failures is inbuilt, and the characteristic of paying homage to reality of teleological rationality is conserved. We do not know any neoreactionary ideas will work with 100% certainty; this is an assumption which is unrealistic. Constructivist rationalist in contrast assume their deduced utopias will work while not seeking evidence, and then proceed to demand a universalisation of their concept with no experimentation.

By embracing rationalism to such a degree, neoreaction also differentiates itself to a lesser degree from libertarianism. Spontaneous order is maintained by the acknowledgement that any proposed structure will need to harness spontaneous order given that complete control and knowledge of all information is impossible. Neoreaction also acknowledges that for society (and spontaneous order) to flourish, a clear acknowledgement of, and security of, private property is fundamental. To this end, synthetic structures designed to maintain security are to be created.

Added: post rationalism appears to be heading full steam toward teleological rationalism. (h/t Scientism)