Shouldn’t the Wisdom of Crowds lead to better politicians?

Rui Alou asks a great question in response to my recent post on aggregating individual wisdom, wondering why, if the Wisdom of Crowds is valid, do we continue to elect poor politicians? Presumably, voting in a democracy is aggregating individual wisdom, because each person has their own individual views and an equal vote. (and presumably, there are good politicians out there just waiting to be voted in).

The answer to this question is why the Wisdom of Crowds is a counter-intuitive, dangerous and powerful idea. In reality our democracy does not harness the Wisdom of Crowds effectively, because it does not recreate the three conditions that are needed in order to do so.

What are these three conditions? The requirements are diversity, independence, and decentralization.

• Diversity
  Diversity, or large variation in ideas, is crucial to being able to extract wisdom from the crowd. We need liberal, conservative, crazy, hair-brained, logical, rational, irrational, and all ideas in between. The reason why we need such diversity is probability. The more diversity in the ideas that we include, the higher the probability that one of those ideas is the *right* one. Because sometimes it just happens to be that one hair-brained idea that leads us down the right path.

  In the case of U.S. politics, we rarely have more than two competing ideas, one each from conservatives and liberals. All conservatives marshall themselves around the same ideas, and all liberals do the same. This is exactly the opposite of diversity.

  Interestingly, the best ideas often come from individuals who have a unique view of the world. Think Darwin, Da Vinci, Einstein, Joan of Arc. These individuals changed history by having ideas that nobody else had (or could articulate). By including as many diverse individuals as possible, there is a higher chance that wisdom will prevail. Including another set of the same old ideas won’t lead to anything new, just more of the same.

  In addition, it doesn’t take a genius to have a unique idea. Only to articulate it.

• Independence
  In addition to a diversity of ideas from which to choose, we need the quality of not imitating the first idea that comes along (even if it is diverse). Instead, we need to hold to our own ideas, if possible, to come up with our own conclusions. That’s not to say that we won’t agree with other people, but each of us has our own set of knowledge, and holding to that set of knowledge will keep our thought independent. Independence is about how we react to ideas as they are presented to us.

  Again, the two-party system kills most independent thought. Each side has their “candidate”, and party members tend to follow that candidate. It’s not that voters can’t have their own, nuanced view, but holding to that view and voting independently will rarely get your obscure candidate elected. The game we’re playing is that we would rather vote for the candidate whose views are closer to our own than to vote for the candidate whose views are farther away. That’s the only way to optimize our vote in a two-party system. Unfortunately, it doesn’t represent our independence of mind very well.

• Decentralization
  Most of us tend to generalize ideas so as to make them applicable to other situations. This, however, might not be the best way to tackle problems in order to extract the wisdom of crowds. According to Surowieki, a better way might be to attack problems individually, in a decentralized manner, so that those people closest to the problem are the ones who solve it, not somebody from on high. Decentralization is crucial to tacit knowledge, that sort of knowledge that is hard to communicate to others, and is often vital to solving the problem at hand.

  A lack of decentralization hurts big time when someone in Washington is making decisions that affect people everywhere else. For example, the Bush White House has consistently made decisions that favor big business over the environment. This is probably because all of the problems that the White House sees are the ones in Washington, dutifully lobbied by oil companies and the like. Meanwhile, those people closest to the problems of the environment, the ecologists, biologists, hikers, and outdoor enthusiasts are out where their problems lie…not in Washington. And the same goes for all localized problems…if people in Washington can’t see (or refuse to acknowledge) what’s going on elsewhere, how can they make any reasonable decisions about it? They can’t.

In general, I think we sense that these conditions are correct when we say things like “Don’t be a sheep”, or “Keeping up with the Joneses”. We don’t like follow the leader, and we have more respect for those people who go out on their own and live by their own standard, even if we don’t agree with it. That’s what makes Thoreau so inviting, that he’s saying “to hell with all ideas except those in my head”.

But when we talk politics (at least in the U.S.), it’s always follow the leader, or follow the party. We’ve broken the game, and now the only way to win is to choose one of two sides. And it’s one step away from the opposite of diversity, which would be totalitarian rule.