The World is not so bad

It only takes a few minutes of watching the news to get the feeling that the world is heading into a tailspin.

Endless images of natural disasters, car crashes, Game of Thrones behaviour in Canberra and Royal Commissions into the ethically bankrupt fill the airwaves on a daily basis. It’s upsetting – but also certainly captivating for the average viewer.

In fact, the news cycle thrives on fear and violence, so mainstream networks find a way to fill up 99% of programming with these singular events. It’s addicting and sometimes anger-inducing, but is it representative of what’s really going on in the world?  Should we all just give up and become pessimists about the present and future?

Professor Martin Seligman, of the University of Pennsylvania, is a founder of the positive psychology school and an expert on optimism and hope.  Whilst it is easy to be a pessimist in today’s world, he says that optimism "causes better resistance to depression when bad events strike, better performance at work, particularly in challenging jobs, and better physical health".

Other research has shown that individuals who profess pessimistic explanations for life events have poorer physical health, are prone to depression, have a less adequately functioning immune system and are more frequent users of medical and mental healthcare.

A study by Toshihiko Maruta and others at the Mayo Clinic, which followed almost 450 patients over 30 years, found that optimists lived longer than pessimists and reported better physical and mental health. Wellness is attitudinal, not just physical.

Which is not to say optimism is rational or realistic. It isn't. Martin Seligman defines optimism as a style of explaining life events.

Pessimists think the bad things that happen to them are permanent ("the boss is a bastard") whereas optimists think they're temporary ("the boss is in a bad mood").

Pessimists think the good things that happen to them are temporary ("my lucky day") whereas optimists think they're permanent ("I'm always lucky").

Pessimists have universal explanations for their failures ("I'm repulsive") whereas optimists have specific explanations ("I'm repulsive to him").

But don't knock self-deluding optimism. It's a motivating force for innovation and entrepreneurial endeavour and it keeps the capitalist system turning.

Business people invent new gismos and launch new products because they're convinced the new thing will be hugely successful, making their name and fortune.

Few succeed. Most do their dough. But the ones who do succeed make us more prosperous than we were. Then they try again.

We need the optimists because natural selection has caused us to be people with strong negative emotions such as fear and anxiety because these alerted us to danger, thereby helping us to survive and propagate.

Jonathan Haidt, an associate professor of psychology at the University of Virginia, says an important principle of design by evolution is that bad is stronger than good. "Responses to threats and unpleasantness are faster, stronger and harder to inhibit than responses to opportunities and pleasures."

Our brains have been hard wired to emphasise the negative. But here's the trick: we are people living in the space age with Stone Age minds. We've spent 99% of our history as hunter-gatherers.

It was a mere 10,000 years ago that humans first began farming and only 5,000 years ago that half the world's population stopped being hunter-gatherers. But 10,000 years - 500 generations - is far too short a time for our brains to have evolved in response to our changed environment.

But ever intensifying competition has prompted the media to go over the top in their search for the big and bad.  It leads some investors to think that the opportunities for good returns from their investment portfolios are less than they were in the past.

However economist Max Roser of Our World of Data has produced some graphs that highlight six megatrends that show our world continues to drastically improve in slow and incremental ways, and that these long-term trends still have some way to run.

Extreme Poverty

The portion of people in extreme poverty – making less than $1.90 per day – has dropped like a rock over the years. Back in 1940, about 75% of the world was in extreme poverty – today, that number is 10%.

The most potent recent example of this is China, where access to free markets has enabled 700 million people to be lifted out of poverty in just over 20 years.

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Basic Education

In 1820, only a privileged few were able to get basic schooling. Since then, millions of classrooms and schools have been added around the globe, and the numbers are staggering. In relative terms, we’ve gone from 17% of people having a basic education to 86% today.  Here’s a more detailed breakdown of this from Our World in Data:

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Literacy

Following a similar trend line as basic education, literacy has risen from 12% to 85% over roughly 200 years. In absolute terms, these numbers are even more impressive. In the 1820s, there were only about 100 million people that could read that were 15 years or older. Today, the number stands at 4.6 billion.

Democracy

While the world has been having some short-term setbacks when it comes to freedom and democracy, the overall trend line is still impressive over the long run.  In 1900, only 1 in 100 people worldwide lived in a democracy – and today, the majority (56 in 100) can say they live in a country with free and fair elections.

Child Mortality

Even as recently as 1920, it used to be that over 30% of infants would die before they hit their 5th birthday.  Since then, developments in housing, sanitation, science, and medicine have made it so that death is a much rarer occurrence for the youngest people in our society. Today, on a global basis, child mortality has been reduced to 4%.

Each family lifted out of poverty and each classroom that gets built may not seem significant on a scale of billions of people – but over decades, these gains add up to create a richer, more educated, and healthier world and a very powerful statistical story. 

So whilst fear and greed will remain the hallmarks of the financial media, remember that long-term trends like those above help to unleash the incredible potential of humanity and provide the foundation for the new industries and businesses of the future.  So beyond the benefits to your health, there is genuine cause to be an optimist in today’s world.

Rick Walker