What do you get when you put a Harvard psychologist on stage at the same Hollywood venue where they hold the Academy Awards?
The answer is one gigantic dose of feel good. That was my takeaway last Wednesday night after attending a discussion given by Harvard University Professor Steven Pinker, a psychologist and best-selling author who just released a new book, “Enlightenment Now: The Case for Reason, Science, Humanism, and Progress.”
The central thesis of this work is that by nearly every metric that matters — health, lifespan, inequality, environment, knowledge, safety, quality of life, happiness and especially wealth — the world has never been better than it is right now.
The cause of this human progress, argued Pinker, is the embrace of enlightenment values, chiefly reason and science, and the real-world application of these principles toward enhancing human existence.
In one truly dramatic chart from the book, Pinker shows the rise of Gross World Product from the year 1 through 2015. Here’s a snapshot of that chart that I took from my own copy.
As you can see, up until the late 1800s, the world made little-to-no progress in terms of economic growth.
Then, the graph goes parabolic, as the rise of capitalism, the industrial revolution and the growth of cities creates an undeniable and stunningly dramatic surge in economic flourishing.
It is charts like this one, some 75 of them, that make this book so beautiful, and so uplifting.
It is not often that you get to see how great human beings are, and how well we’ve done with our world. And despite all our Shakespearean flaws, bellicose urges and tribal tendencies, we’ve managed to continually improve, enhance and recreate our societies in an onward march toward more human flourishing.
Yes, there are some things we haven’t got right along the way (two world wars in the 20th century, for example). But the evidence of progress is undeniable, and it’s presented brilliantly in this must-read work.
So, in the spirit of Professor Pinker’s work, consider that over the past 12 months, the Dow is up more than 20% while the S&P 500 is up nearly 17%. The NASDAQ Composite has surged some 27.5%.
Looking further back, the Dow is up 72% over the last five years while the S&P 500 is up 77%. The NASDAQ Composite is up 129% in that span.
I could go back further, and the results would be even better, but I’ll stop here for now as I suspect you get my point.
The thing to realize here is that while there is no guarantee that human progress, and equity market progress, will continue in an upward trajectory, history clearly shows we’ve done a stellar job of making fools of the purveyors of doom and gloom.
Keep this in mind whenever you hear from those warning about the next devastating market crash.