Rider and the Institutions

Walter White, from the popular series Breaking Bad, said, "I was alive." What essentially drove him to build a Drug Empire was entrepreneurship, that excitement of feeling alive. It was not about providing for the family. Being alive is about being in direct contact with reality — absorbing and processing external signals. It demands constant awareness – processing stimuli, gauging situations, and adapting accordingly. In that sense, being alive is also a lot about being human. What separates us from animals, at least most of us, is the ability to not just instinctively react, but instead employ higher levels of cognition. Having that widespread opportunity to develop higher levels of thinking through individual ownership and responsibility deserves some acknowledgment. For most of human history, this was a privilege reserved for the few.

Being alive is quintessential Americana; few civilizations have managed to formally encode this at scale into a political Constitution and broader social fabric. Devising a layered framework to limit the collective while defending individual volition at this scale is unique because arguments for such a framework run counter to intuition.

Channeling essential English liberties and the Scottish Enlightenment, American Framers executed something different in terms of impact and scale. They made a well-reasoned argument for Federalism and achieved a democratic consensus. A sufficiently intricate argument was framed, communicated to the broader population, and executed as an institutional change. Selling an idea this sophisticated is not easy – usually complex ideas find agreement among a limited minority, and then the results motivate slow widespread adoption. But the American framers abstracted the underlying principles of the existing society to a higher level – to that of a union of states and drove mass consensus from there. Being able to execute something like this without corrupting those core ideas through demagoguery or personal agendas is uncommon. In fact, popular support of ideas that refuse to pander to baser instincts is an unusually rare phenomenon.

There is an interesting scientific aspect to this. Being part of a collective is comforting. Whether it's politics, sports or music, we tend to seek out that tribal identity. It's probably our hunter-gatherer instincts, constantly pushing us to belong. In that sense, American institutions elevated the overall social order by channeling tribalism as a check. To paraphrase F.A. Hayek — 'man got civilized despite his best efforts'.

James Madison quite presciently stated in defense of Federalism — "the society itself will be broken into so many parts, interests, and classes of citizens, that the rights of individuals, or of the minority, will be in little danger from interested combinations of the majority". Instead of enforcing compliance through centralized mechanisms, American framers accepted reality as it exists and attempted to work within those constraints. It simply grounded republicanism in a more realistic understanding of human nature.

While many societies enforced conformity through top-down control and directed purpose, American framers showed unusual practical prudence. They allowed civil society, order, and purposes to emerge through peaceful coexistence. From that perspective, American Federalism created a framework of incentives favorable to the formation of civil society. A society where individual volition can survive, where coexistence was the path of least resistance, and, more importantly, where an individual could feel alive.

Even though, at a more basic level, riding a motorcycle is also a lot about being alive, and probably more about staying alive too. For starters, you are always in touch with the realities of the environment. You're expected to be responsible for your own safety. You're not protected by the collective, their seat belts, or air bags. You must be aware of the lifted truck with no visibility or minivan with a driver busily sifting through critical social media reels. You simply need to adapt your path to steer clear of them, or any other potential threats, social media-driven or otherwise. But the flip side is, when you are riding, all the other travails blend into the background. So plugged in to that sublime present, there are no cognitive resources to think about an uncertain future or that disappointing past. In that sense, you feel alive, but in a different mode of engagement with reality. But, there's a prerequisite for encouraging that feel-alive-individualism – equality before the law.

Recently, I had to replace the motorcycle tires, as they were well past their tread life. These off-road Duro tires are made in Taiwan; in fact, they are commonly used on the lesser-known Russian Ural motorcycles. These tires are known to be puncture-resistant — more significantly, they look pretty good on a Triumph. My side mirrors are from CRG, handlebars from British Customs, and engine/crash guard from SW-MOTECH. All this illustrates freedom of choice.

Making choices for customizing motorcycles is not so different from general life decisions. We select vendors and parts that are ideal for our purposes and aesthetic preferences. Just as we pick our grocery stores, restaurants, or investment plans. We build life and systems around us based on our preferences; those who make better decisions build better systems. That freedom deserves a bit of appreciation.

Last week I was watching this TV series called "The Man in the High Castle". It details an alternate reality in which the Axis powers won the war. And the US is split in half between the Reich and Imperial Japan. The series also introduces the concept of a multiverse — a set of parallel realities with different outcomes. In some universes, the Axis powers rule; in others, it's the Allied forces. In the story, Nazis in one universe realize this and decide to build a machine to travel to alternate realities, obviously to conquer them! More than scary, it felt foolhardy.

Even if by some random stroke of luck, Hitler had won the war in a universe, it's highly unlikely they could hold a candle to the Allied forces from a parallel universe. So, one of the most likely outcomes of such an invasion would be going head-to-head with a more efficient alternate universe — not because of morality or divine verdicts, but simply because of basic science and their ability to make productive choices.

German Reich is forced to make decisions based on criteria that do not prioritize efficiency, while Americans make decisions to build productive systems. While Reich must live within the constraints of their ideology, Americans have incentives to make choices that deliver results. Nazis artificially limit their resource pool, while Americans allow winners to emerge from anywhere. Such systems can produce exceptional results simply because they are not structurally constrained. Over time, it allows the best ideas to emerge and inefficient practices to be discarded; this selection process eventually benefits the group. So, one way to evaluate legislation is by its impact on broadening available options; that may indicate whether it's closer to the Reich or to Americana.

One of the scenes in the series also involves the Reich attempting to copy tech from the alternate universes. Even here, there is a loss of context, stemming from the structure of the available options within the system. The utility of ideas is embedded in the systems where they emerge and operate. Their maximum utilization, maintenance, and evolution demand a complementary ecosystem. When taken into a new context without the presence of dependent assumptions, the power of these same ideas will diminish. Examples of dependent assumptions include the human capital – the inventor, maintainer, engineer who handles the tech; the material capital which supports safe usage and execution; the laws, institutions, and systemic processes which enable all this. Basically, ideas applied out of context fail because of the basic principles of science. Essentially, the Reich stealing hydrogen bombs will likely nuke themselves, because they are artificially restricted from making safe, rational decisions.

Another conceivable possibility is that the Reich successfully adapted borrowed ideas into their own context. Assuming the ideas remain as effective in this new environment, they have at best achieved short-term parity with the Americans. But such a transient unearned parity will soon be lost without the original process that enabled its creation – the ability to make open-ended choices. Those decisions determine not just system capabilities and outcomes, but even their evolutionary trajectory.

Freedom of choice enables uniquely creative contextual adaptations to emerge. This happens within all layers of the system. Building motorcycles is a localized instance within a broader social and technological framework. These on-demand adaptations involve a process of reasoning, implicit and explicit assumptions, and the broader context in which they are executed. Successful creation, execution, and maintenance require a favorable environment. We can safely say — an idea, its manifestation, and the surrounding environment evolve together in lockstep. So, someone borrowing an idea from one context into another will usually learn the hard way. It's not karma — it's simply the reality of system constraints. There is also a historical context for these individual freedoms, the impartial strand of jurisprudence that thrived in England.

A few months ago, I went riding in Eastern Washington, then just hopped over to Idaho and Montana for a full day exploration. I did this loop via Hwy 2 – Troy – Bull Lake, and finally back to Washington via Hwy 200/2. Needless to say, Montana is gorgeous. Had stopped more than a few times for breathtaking views and fuel. Exquisite views to fuel the weary senses and Chevron for the motorcycle. Like many other journeys, this also involved riding through stretches of rustic towns. Even though the area was novel to me, I was just another motorcyclist for the curious onlookers at the gas stations! Just another nameless rider, looking jaded from the journey, but still exhibiting frequent unexplained bursts of enthusiasm to navigate those winding roads, often at uncomfortable speeds.

Unlike cars, there is a degree of anonymity to motorcycles – a real yet romantic anonymity. It doesn't matter where you live or what you do; during those long journeys, your identity turns into that of a rider. It's sort of like John Rawls' famous veil of ignorance, the unique life circumstances of a motorcyclist hidden beneath the protective gear. There is also a degree of comfort in that anonymity. It's like you're admired or derided or just ignored, mostly for your riding, and maybe a bit for the riding gear, but not for other factors like class, ethnicity, etc. There is a relative sense of justice in that evaluation. The essence of such an objective evaluation has larger consequences when it's institutionalized.

The two main motivations for the larger inquiry in this essay are lived experience and curiosity. Together, they led to analytical hymns of motorcycling woven into several things uniquely American. My dad and great-grandfather also rode motorcycles, so that obsession I'd attribute to inherited tendencies. But curiosity about Americana and, in general, Western civilization is acquired. That curiosity led to a cross-disciplinary inquiry involving history, economics, sociology, and philosophy. This helped connect all the relevant theories and causes for prosperity into a coherent system of ideas. One such identified critical cause of that prosperity is the objective evaluation of individuals.

If it isn't already obvious, most parts of the world are in a constant state of tension. It varies in degree, but people are, in general, deadlocked in various forms of bickering. Often, these inter-group disputes are hundreds of years old and may even have been inflicted by unknown individuals. Generations are continually born into baggage and their minds shaped by these artifacts of the past. Without reconciling these disputes, there is no peace or path to prosperity. Even if someone manages a truce, it is often fleeting, and the mischief inevitably reemerges.

Thanks to some fortunate accidents in history, the reconciling cultural strand from England survived, and often thrived. From common law jurisprudence and related institutions to its more evolved American Federalism, for hundreds of years, there has been a recurring theme of attempting to reconcile divergent views. This framework is designed to resolve disputes without taking sides or enforcing collective goals. An exceptionally strong 1st Amendment right is a perfect illustration of this tendency. Even when many countries emulated Constitutionalism and its surrounding institutions, they often adopted a variant devoid of that impartial reconciliatory strand.

Impartial justice demands applying the law to factual circumstances, without being unduly biased by broader historical context. Consistent application of this impartial principle to disputes leads to harmony – it shapes social processes where peaceful coexistence becomes the path of least resistance. Strong protection of free speech did not change human nature, but it created conditions where peaceful persuasion was the path of least resistance. Societies burdened by historical baggage will find this harder to execute. To paraphrase F. A. Hayek, civilization advanced when we invented an unbiased justice based on the rule of law, rather than the rule of status derived from historical context like class, occupation, ethnicity, race, tribe, etc.

Not just in individual dispute resolution, peace through reconciliation is evident in all the functioning layers of the English political system. Whether it's reconciling the majority views with minority opinions, the legislature with the judiciary, pure democracy with Constitutional law, or states' rights with Federal government — English tradition constantly steered towards that simple goal of reconciliation.

The process evolved over a few centuries, from reconciling the goals of nobles with those of royalty through Magna Carta, to a sophisticated adaptive common law jurisprudence. Consistently reinforcing an institutional pattern of conflict resolution through trade-offs – justice through discovering the acceptable social truth and norms. These institutions evolved in lockstep with larger society and culture, so the specifics changed across time, but the goal of peace through reconciliation remained.

But the mere goal of peaceful coexistence led to lofty outcomes of stability and prosperity. This happened because peace allowed channeling individual energies to higher goals. In short, while simple goals lead to elevated outcomes, numerous political systems striving for explicitly high ideals often collapse into disarray. So, for the next Thanksgiving, we have one more idea to be thankful for — the rarely acknowledged reconciling institutional strand. One critical consequence of impartial rule of law, peace, and general freedom is entrepreneurship – the driver of social architecture through inventions.

It has been almost a month since it rained, so it feels like the Pacific Northwest is going through a serious drought. Quite sure the Seattle natives are reminded of that arid 2017 summer — the region endured two full months without rain. To make matters worse, last month had a heat wave weekend. I know exactly where I was when Seattle broke temperature records – on a motorcycle, right outside the city, on the scorching I5 tarmac. Can confirm it takes at least 2 days to recover from moderate dehydration.

Less rain also translates to more riding on the weekends. It's sort of comforting to know we have that choice to work, make a living, and invest our spare time as we wish. Even if it's something extreme like motorcycling at 105° F. The investment in motorcycling is my choice while also working within the reality of various personal constraints. Drawing an extreme parallel, the private sector space race can also be considered an adventure driven by entrepreneurial choices. Both belong to the same class of problem, differing only in degree. Enduring the 105°F I-5 furnace or launching ourselves to space are both choices that divert valuable resources from alternate uses.

A critique of prioritization in most cases will defy the first principles of the relatively successful market system we have. In fact, a comprehension of the market system will make us realize it's a machine to discover and reconcile emergent priorities. That goal is necessary because prioritization is unknown. Costs are a critical input to prioritization; they are unknown as well. Hence, imposing unaligned external goals will disrupt internal consistency.

To share a larger perspective — this choice to work and earn a living, at the standards we see in the Western world, is a luxury and unprecedented in human history. Even now in several parts of the world, an individual does not have that option. But unlike the past, material poverty shouldn't be immediately considered the default state. Even when it's a consequence of various historical accidents stemming from pre-market social orders of strife and plunder, attempts can still be made to address it through institutional changes.

Eventually, every choice can be voluntary or involuntary. Someone remaining in poverty for personal or religious reasons is voluntary. Some belief systems just promote simple living. The unfortunate involuntary state is the one that needs explanation – situations in which the individuals are explicitly constrained. They manifest in several forms, but all their incarnations come down to restrictions on the use of life and property. Systems built on such restrictions tend to inhibit adaptations that lead to wealth creation. This is discovered through trial-and-error hindsight, yet it provides a coherent explanation.

Institutional frameworks that allowed prosperity to emerge were never engineered for this goal. Instead, they were meant to simply protect property and life. But that simple goal introduced a motivational strand encouraging voluntary exchanges. Now transactions create mutual value; it is no longer a life of zero-sum or negative-sum exchanges anymore. The goal was the protection of the universal right to property, but the unintended consequence was prosperity. General system architecture and its internal dynamics are the reasons for this outcome.

Architecture determines the arrangement of various building blocks in the system, and this in turn shapes information flows. Rapid adaptation depends on efficient flows – just like how signal integrity between sensory neurons and the spinal cord determines our reflex time. At the most granular level, if sensory neurons weren't built for efficient response to stimuli, then reflexes wouldn't function as expected. Generalizing this — if all the building blocks do not play their role efficiently, then the organism suffers.

Individuals are the building blocks in a social order, and freedom with property rights provides the incentives to voluntarily respond to external needs. Rewarding ownership is the ideal approach to incentivizing the use of resources to solve a problem. This includes cognitive resources as well. That means, in the long term, self-interest tends to maximize employment of individual effort. Also, based on the general goals of a social order, psychological implications of ownership always beat something like a top-down command-style design. To emphasize, when the general goal is internal coordination of building blocks, a system will need multidirectional information flows. This information-based order requires individuals to be motivated to efficiently process and respond to external stimuli.

The need for multidirectional flows and why prosperity cannot be engineered are related. Specifications for general prosperity, or the specs of various available building blocks, aren't known to any one person or group. In other words, no one knows what everyone wants, nor the optimal way to achieve it. So, this demands a trial-and-error discovery process. The system is expected to adapt to emerging dispersed needs by reorganizing itself in optimal ways.

A simplified view of this multidirectional flow would be top-down information reconciled with bottom-up data — top-down provides dispersed consumer needs, and bottom-up signals the available building blocks and possible arrangements of those blocks. Friedrich Hayek famously said, "It is a problem of the utilization of knowledge which is not given to anyone in its totality." For example, consider a top-down need for a motorcycle spare part; the bottom-up information to be discovered is the economically viable fabrication model for such a part.

Most things can be engineered in several different ways, so entrepreneurial motivations are expected to discover this information and align it with top-down demands. If a spare part is not viable within the price constraints, then the top-down spec will need to be revisited. It's a constantly running process of adjustment to the best-known means and arrangements possible. Discovering this information is expensive, and property ownership and profit are integral motivational factors for keeping this process alive. To summarize, the system exists to reconcile dispersed needs with dispersed options to satisfy those needs. A continuous multidirectional information flow is needed to discover this alignment across time.

This means both consumers and entrepreneurs have the autonomy to make choices. Facing the consequences of their own choices, both good and bad, is the price everyone pays. This also means the system can generate decisions that may not align with the majority, because that, on its own, is not the criterion for the choice calculus involved.

In fact, both consumers and entrepreneurs can make unpopular choices. For example, the majority of consumers may not enjoy motorcycling, but that does not stop entrepreneurs from selling to the minority. The same applies to space exploration – common pushbacks include: Why go to space when we don't have universal healthcare, or we still have hunger, or when there isn't world peace yet. But if everything were decided through popularity votes, Nikola Tesla would have found it difficult to invent and establish AC current, Benz would have found it difficult to design automobiles, and, for that matter, anyone attempting something not perceived as valuable by 50% of the population would have found it difficult.

Consumer choices are typically attributed to personal decisions, but entrepreneurial choices can sometimes roil the masses. An effective critique of entrepreneurs would analyze the incentives that caused this unacceptable choice. For example, a subsidy for space exploration or a tax write-off for space travel R&D are possible variables that were factored into this private sector space race. Such an analysis is more scientific – it accounts for the rules and constraints of the system, provides visibility into actual trade-offs, and, more importantly, it might just improve consistency of the framework. Eventually, preservation of this system also demands cultural support and a compatible institutional order.

Recently, I went riding around the North Cascades. To the west of this wilderness is a set of towns hemming the US-Canada border. You can ride straight up to the boundary, and there are these twin roads separated by international lines. Speed limits are posted in miles/hr on one side and km/hr on the other. But unlike the southern border wall, this resembled a neighborhood fence. There were also strikingly similar ranches and farms on both sides. Folks sitting across the border fence, with beers, their trucks, and weathered denims. One stark difference — properties in the US had quite a few Trump/Biden signs. One of the reasons for the presidential election's popularity could be attributed to its parallels to reality shows.

The rhetoric, general decorum, and electoral discussions were closer to a TV show than to elections. But all this drama is not uniquely American; it's quite common in all democracies. Much-celebrated electoral processes are known to quickly devolve into tribal politics, and it's only human to fall for it. Framers knew about this aspect of the masses, so they rightly engineered some institutional checks. In that sense, from a Constitutional perspective, moving beyond baser instincts is something that makes Americans relatively unique. The underlying rules that shaped the Constitution and the Bill of Rights were non-partisan pragmatism. It's not partisan in a way that it avoids specific agendas, and pragmatic in the sense of being inclusive, abstract, and goal-independent.

In that sense, a non-partisan individual minding their own business can be seen as more aligned with the essential enlightened ideas behind the Constitution. That means wearing no signs is more aligned to Americana compared to explicit political signaling like Black or Blue Lives Matter badges. Both illustrate how partisan opinions about complex topics tend to get elevated into dogmas. Similarly, waving or even burning the flag lacks that same refinement and precision. Again, it's constitutionally protected and an acceptable form of symbolism, but the act still pales in comparison to the pragmatism of the American Constitutional principles. Whether it's worshiping political idols, celebrating defense, or law enforcement, these are commonplace human tendencies. While acknowledging human nature, we can also say Americana is designed to be beyond these trappings.

Tying all this to some of the timeless principles, the American application of the Enlightenment is rooted in the underlying realities, while not getting distracted by symbols or personalities. It's about seeing subtle, often harsh realities and acknowledging them. Realizing the world is more complex than we can comprehend, and being aware that actions, even with good intentions, can have negative consequences. There is no prerequisite to study extensive literature to be an American, nor is there a need to be a Constitutional expert. In general, just being a decent, responsible individual with some common sense automatically makes you a model citizen. Being a real American is not that difficult, but it's still uncommon, mostly because it's hard to live up to the exceptionalism of American institutions. The impact of these institutions also extended beyond the borders, shaping and influencing geopolitics.

I was on another ferry ride to the San Juan Islands, that last frontier before Alaska. In fact, at various points on those islands, we can gaze at the Canadian shores across the water. Most of my previous rides were during the colder months of autumn and spring, so I was almost always the lone motorcyclist on the ferry. This time it was a summer group ride, and there were several other unknown motorcyclists waiting at the terminal for the ferry back to Anacortes.

Among those riders was this older gentleman riding a 500cc Royal Enfield. The signature classic look and that inimitable thump, even though muffled by the newer pipes, were instantly discernible. I walked over to him and mentioned how much I had enjoyed touring on these motorcycles, but of course, it was over a decade ago, and it was also the older 350cc variant. Interestingly, he knew exactly what I was talking about. Even though a Westerner, he has evidently been living in Nepal for a while and has done extensive touring of the Indian subcontinent. The more I spoke with him, the more I realized how well-versed he was about the machine's quirks, subcontinent geography, and the motorcycle culture there.

Just to put all this in perspective – my conversation is with an American several generations older than me, riding a 100-year-old motorcycle brand originally invented in Britain, now Indian-engineered and exported to the US. While I am on a British-designed Triumph, which was most likely manufactured in Thailand. We are having this impromptu talk at a ferry terminal, in a corner so distant from England, Thailand, or India. Even in our near past, the possibility of this happening would have been low. But not anymore, it seems like both humans and the products we engineer travel the world.

Even though the conversation itself wasn't about the US, this situation might just be another silent illustration of the American global role. It might sound like a leap, but we are in a more cohesive, connected world because of the early American Federalists. That causal chain from the formation of an experimental republic to the current world is long, tortuous, and involves several complex factors. But, beneath all the layers, the prototype for globalized order emerged from Americana — traced to the framing of the Constitution.

American Federalism unintentionally created a large open market where a set of States were forced to play well with each other, mostly through the Commerce Clause in the Constitution. While most of the world kept creating protectionist barriers to growth, Americans ended up leveraging a large open domestic market to expand. It's a quintessential illustration of Adam Ferguson's "the result of human action, but not the execution of any human design". It wasn't engineered, but it manifested because of the structural incentives created by US Federalism. With access to a large market and with the right institutional incentives, American enterprise and innovation expanded.

Most human history is riddled with strife, with brief periods of peace. But the American situation was a unique convergence of industrialization with refined institutional design executed at scale, along with some geographical advantage. None of these attributes is unprecedented, but historical accidents rarely allowed such a confluence of multiple favorable factors.

That convergence allowed peace, followed by prosperity. But nothing happens in isolation — interconnected systems influence each other. A positive feedback loop through markets channeled into geopolitics, eventually enabling the global expansion of American firms into foreign markets. Market institutions are wired to politics because one relies on the framework provided by the other. They are essentially co-developed and co-dependent systems. The ideas, the learnings, and the overall state of the market will shape policy through various channels. The reverse is also true. When healthy, they keep each other in check, and the overall system evolves in beneficial ways. Such an American expansion extended several best practices to the rest of the world – including the idea that everyone should play well with each other.

The formation of one of the most consequential republics, their role in World War II, and the reshaping of global institutions through those learnings created a new world order. At its core, this order, with all its flaws, is a rough blueprint of the contractual union of several republics – all retaining their political identity but coexisting without cultural and economic barriers. With the risk of sounding rhetorical, this reflects Alexander Hamilton-James Madison Americana.