Our Reality Distortion Field

Why progress is counterintuitive.

Risk & Progress explores risk, human progress, and your potential. My mission is to educate, inspire, and invest in concepts that promote a better future for all. Subscriptions are free. Paid subscribers gain access to the full archive and Pathways of Progress.

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The data are clear: life is better than ever for billions of people on this planet. We are better educated, living longer, wealthier, and freer than ever in human history. Yet when asked about the current state of affairs compared to the past, most people believe exactly the opposite. They live in a parallel world that is becoming more impoverished, with more hunger, and more human needs unmet. It’s not difficult to understand why so many live in an alternate reality. The factors of “progress” are counterintuitive to our base instincts. Politicians and the media exploit this fact for their agendas, feeding a “reality distortion field” that surrounds each one of us, and endangering human progress by turning us against the very factors that support it.

Economic theory, an important aspect of our study of human progress, begins from the premise that people are rational decision-makers; that we are all “econs,” carefully weighing our choices with perfect information at all times. Alas, we are “humans,” not “econs.” We have the capacity to reason rationally, but we don’t use this skill as often as we should. In his book, “Thinking Fast and Slow,” Daniel Kahneman suggests that the human brain comprises two distinct “systems.” System 1 operates automatically and quickly, relying on intuition and mental heuristics (shortcuts.) System 2, however, is responsible for thoughts that require our active attention, including reasoning through complex problems. Because the latter uses more mental “bandwidth,” the human brain tries to rely on the former as much as possible. The consequence of an overreliance on System 1, however, is that we are susceptible to many cognitive errors.

Nostalgia Bias

In the human progress realm, nostablia bias plays a unique role. You have probably heard someone say, “Life was better in the good old days,” but even on a good day, we cannot trust our own memories. Our brains have built-in mechanisms that suppress negative memories over time. Thus, the past will almost always be remembered more fondly than it deserves. Case in point, a viral “meme” circulating online features an illustrated image of the “typical” American family circa 1960: a stay-at-home mother, a kid going to college, a house, and a car, all affordable on the income of the sole male breadwinner. The characters in the meme are content and happy, portraying a bygone era, when things used to be “better.”

The world this meme presents, however, exists only in our memories. The idea that two American incomes are needed to buy a life that required just one income then, is false. In 1960, the car ownership rate in America was half of what it is today (2023). The average new home was about 25 percent smaller and lacked basic amenities like garbage disposals, dishwashers, fire alarms, etc., and most people lived in older, smaller homes, lacking air conditioning and washing machines. A university education is certainly more expensive today, but children in the 1960s would likely not have attended anyway.

The fact is, a family can certainly live on a single income today, if that family were content living like the average one did in 1960. That means owning only one car, a small home, 1 television with 3 channels, taking road trips instead of flying…etc. In fact, they would live better today, because they would have access to modern medicine, cheaper clothing, cheaper food, and their car and home would be vastly safer, more energy efficient, and probably have features that would have been unimaginable luxuries in 1960, if they existed at all.

Our long-term memory might fade to rose-color, but what of short-term memories? Here, our reality is further distorted by the fact that while our brains suppress negative memories and feelings over the long term, they amplify them in the moment. Psychological studies conducted across the globe repeatedly illustrate this fact. Like flies drawn to a lightbulb, we give extra attention and more emotional weight to negativity. In one experiment conducted in Canada, participants were told to read a newspaper article while they “waited for the experiment to begin.” Researchers then watched which news articles the unknowing test subjects chose to read. Consistently, they sought out negative stories rather than positive or neutral ones.

This cognitive bias is likely rooted in our natural tendency toward loss aversion. Studies have shown that winning $10, for example, produces far less emotion than losing $10, even if the financial impact is the same. Our brains have evolved to react strongly to negative stimuli, and the media seizes upon this ingrained biological reaction for its benefit. To keep us glued to the television or engaged online, they intentionally flood the airwaves with bad news. A country amid a bloody civil war draws news correspondents; a country prospering in peace does not.

A related bias is the “availability heuristic,” where our brains rely on immediate examples to inform decisions involving the probability of events. Deaths caused by horrific accidents, homicide, or wars, for instance, are erroneously seen as more probable than deaths by diabetes or poor diet because media coverage favors the former. Horrific accidents draw more eyeballs, triggering more reporting, and thus are more “available” than they otherwise should be, so our brains assume they are more common than they truly are.

These innate biases have a tremendous impact on how we perceive reality. In 2016, Dutch researchers asked 26,492 participants how global poverty had changed in the prior 20 years by administering a multiple-choice test. Despite there being a 20 percent chance of randomly choosing the correct answer, only 9 percent of respondents answered correctly that poverty had plunged by over 50 percent. It’s not difficult to see why when the media only reports hunger and layoffs, not harvests and hiring. When our brains compare the past with the present, it compares a negative portrayal of the present in sharp relief with a rose-colored version of the past. Our minds convince us that the present is terrible and the past was better. This creates the illusion of a downward trajectory and leads us to anxiously fear the future.

Zero-Sum Bias

An even more pernicious cognitive bias, however, is our deeply human propensity to subscribe to “zero-sum” thinking. We innately perceive opportunities and resources to be fixed in number; therefore, for me to “win,” you must “lose.” Zero-sum fallacies often arise when discussing global trade or immigration. In trade, zero-sum bias leads us to falsely believe that the “loser” incurs a “deficit” and the “winner” a “surplus.” But countries do not trade with each other; people and companies do. Transactions only take place to the extent that both parties “win.” Trade, as we will discuss, is a positive-sum endeavour. Trade broadens competition, compresses prices, and jump-starts innovation.

Zero-sum bias also plays a significant role in the discourse surrounding immigration or global migration. The arrival of immigrants from abroad, we assume, must “steal jobs” from the “native” population. But economists have long understood this notion to be false, they even have a term for it: the Lump of Labor Fallacy. More immigrants do engender more competition for jobs, but also more demand for jobs. The net effect of inward immigration on jobs or wages is minimal in the short term, but, as we will also discuss, largely net positive in the long term.

Zero-sum thinking appeals to our base instincts because it requires only “System 1” thinking. Once we engage our System 2 reasoning, however, these appeals quickly collapse. A close cousin of zero-sum thinking, Malthusianism, has led many of the brightest minds astray for generations. Malthusianism holds that population/economic growth will inevitably lead to resource depletion. The only solution for this, Malthusians of all stripes claim, is to halt and reverse progress and growth. As we will see, history has shown this to be incorrect. The cornerstone of progress is the ability to do more with less. We grow more food using less land, we produce more goods with fewer people, our cars drive further with less gasoline, our fuels create less pollution with more energy…etc.

Defying our intuition, as the human population has grown, the availability of resources has also grown. In fact, resource abundance has grown faster than the population itself, a concept that Marian L Tupy and Gale Pooley call “Superabundance.” This means that the more mouths we have to feed, counterintuitively, the more food we produce, and then some. Nor does economic growth necessarily imply more pollution or environmental degradation. On the contrary, instead of deforestation ravaging the Earth’s surface, forest cover is spreading as our population and wealth grow. Indeed, instead of spiraling out of control, climate-changing CO2 emissions are falling as nations develop.

Welcome to the Real World

It’s an uphill battle to convince anyone that the world is getting greener, resources are more abundant, poverty is lower, etc. I, too, long fell victim to these cognitive errors and biases. It took years of reading and poring through data to realize that the world I “knew” was distorted by my own cognitive errors, my own “reality distortion field.” In part, this is due to the final boss of cognitive errors, “confirmation bias.”

Confirmation bias is our propensity to seek out information that confirms what we already believe. Because we try not to engage System 2 reasoning, we don’t expend the necessary cognitive resources to impartially evaluate data and arrive at an objective conclusion. Instead, we choose what we believe first and “prove it” afterward by seeking only the information that “confirms” our beliefs. In this process, we often convince ourselves of untruths. This is why television “news” stations are inherently biased, but in different directions. Each station is trying not to compete directly with the other, instead, they feed the confirmation bias of a targeted group. They don’t “report the news” with objective analysis; they confirm their viewers’ pre-established perspective. This ensures they have a steady stream of returning viewers for their advertisers.

Confirmation bias makes it difficult to see reality objectively because it keeps us safe in a bubble of information that confirms our beliefs. This book is meant, in part, to pop that bubble, so we can see the world free of distortion. The case I make in Pathways of Progress is that accelerated progress and growth are the best solutions to humanity’s challenges in the 21st century. I recognize that this proposition runs against popular depictions in media and culture. So I ask that you keep an open mind and together we remain cognisant of our cognitive limitations, lest we fall victim to them. The truth, as they say, is rarely pure and never simple. Our “reality distortion field” makes it difficult to accept that humanity isn’t necessarily circling the drain. For the most part, we are on the correct path and only need to progress faster.

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Progress's First Principles

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Human Progress in 9 Charts