prior probability

David Hume finally gets around to miracles in Paragraph 12 of his famous essay on this subject (see here), where he writes: “A miracle is a violation of the laws of nature” (Hume, Of Miracles, para. 12; cf. Voltaire 1764/1901, p. 272). For Hume, the textbook example of a miracle is the resurrection of Lazurus of Bethany in the Gospel of John (see John 11:1–44), or in the immortal words of the Scottish essayist, “… it is a miracle, that a dead man should come to life; because that has never been observed, in any age or country” (para. 12).

But is Hume’s definition a circular one? As my colleagues Timothy McGrew and Robert Larmer explain in their 2010 essay on “Miracles” for The Stanford Encyclopedia of Philosophy (available here), Hume’s miracle definition raises many more difficult questions than it answers. For starters, how many “laws” of nature are there? What do these so-called natural laws consist of? And who is the “lawgiver”, so to speak? If it’s God or some other deity, then why can’t the lawmaker violate his own laws, and what does it mean to “violate” a law of nature anyways? Consider again the resurrection of Lazurus. However remarkable or rare this feat is, which natural law in particular did Jesus violate when he performed this miracle?

In any case, if we have multiple firsthand or eyewitness reports of Jesus raising Lazarus from the dead (direct evidence, not just hearsay!), why should we follow Hume in rejecting this testimony out of hand? That is, why should we assume that a law of nature has been violated whenever something strange, unusual, or unexpected has occurred? As we shall see in my next post, Hume’s answer to these questions is an ingenious one!

The Scottish Enlightenment figure David Hume (pictured above) makes four important preliminary observations about the relationship between evidence and probability in the first part his essay “Of Miracles” (paragraphs 3 to 8). For reference, I will restate Hume’s main points as follows:

• First off, Hume describes belief as a continuous variable, not a binary one, because one’s belief about a “matter of fact” — i.e. the probability that the fact might, or might not, be true — can vary from very high (i.e. near certainty) to very low (i.e. total disbelief), or in the immmortal words of David Hume: “in our reasonings concerning matter of fact, there are all imaginable degrees of assurance, from the highest certainty to the lowest species of moral evidence” (Hume, Of Miracles, para. 3, emphasis added).
• From this fundamental premise (i.e. belief is a continuous variable), Hume concludes that the actual level of your degree of belief about a disputed fact should correspond to the amount of relevant evidence available to you: “A wise man, therefore, proportions his belief to the evidence” (para. 4, emphasis added). And he then illustrates this relationship between belief and evidence with a specific example: “A hundred instances or experiments on one side, and fifty on another, afford a doubtful expectation of any event; though a hundred uniform experiments, with only one that is contradictory, reasonably beget a pretty strong degree of assurance” (ibid.).
• Next, Hume observes that in ordinary life the most common type of evidence we use when making our probability judgments (i.e. when determining how strong or weak our degree of belief should be) are not scientific experiments or clinical trials. The most common forms of evidence we rely on are historical reports and eyewitness testimony: “there is no species of reasoning more common, more useful, and even necessary to human life, than that which is derived from the testimony of men, and the reports of eye-witnesses and spectators” (para. 5).
• Lastly (and most importantly), Hume says that we judge the credibility of such evidence (i.e. historical reports or eyewitness testimony) in light of our own understanding of how the world works: “the ultimate standard, by which we determine all disputes, that may arise concerning them [eyewitnesses testimony], is always derived from experience and observation” (para. 6, emphasis added). In other words, we don’t automatically accept a person’s testimony at face value. Instead, we ask ourselves whether his testimony is consistent with our own personal experience of the world and, I might add, with common sense:

“The reason, why we place any credit in witnesses and historians, is not derived from any connexion, which we perceive à priori, between testimony and reality, but because we are accustomed to find a conformity between them.” (para. 8)

To be continued …

Thus far this week, I have restated Hume’s “hearsay argument” against transubstantiation (see here) and surveyed some possible exceptions to the hearsay rule in law that might be application to the case of transubstantiation (here). But what is my position regarding this controversy? Am I with Hume or Augustine?

To the point, I would apply the “Principle of Indifference” — an idea from the domain of probability theory — to the question of transubstantiation and the theology of Jesus’ Last Supper. This principle, which can be traced back to John Maynard Keynes’s Treatise on Probability (1921, pp. 41-64), applies when two conditions are met: (i) you are considering two or more mutually-exclusive hypotheses, such as the possibility of transubstantiation during the celebration of the Eucharist, but only one of which can be true, and (ii) you have no direct evidence to favor one possibility over the others. In that case, when you have no direct evidence to favor one outcome over another, you should assign equal probability to each hypothesis.

Or in the words of Lord Keynes (ibid., p. 42) himself:

“The Principle of Indifference asserts that if there is no known reason for predicating of our subject one rather than another of several alternatives, then relatively to such knowledge the assertions of each of these alternatives have an equal probability. Thus equal probabilities must be assigned to each of several arguments, if there is an absence of positive ground for assigning unequal ones.”

In closing, although transubstantiation has all the hallmarks of a self-sealing conspiracy theory (e.g., emotional appeal, unfalsifiability, and in-group/out-group dynamics between true believers and heretics), at the same time both of the conditions mentioned above apply to the case at hand, since we have no direct evidence one way or another telling us whether transubstantiation is true or not. Contra Hume, then, I would start any discussion of the Last Supper by assigning a 0.5 probability to the possibility that transubstantiation might be true. Keep this conclusion in mind as we consider Hume’s other arguments against the possibility of miracles … (to be continued)

Previously, I described David Hume’s restatement of John Tillotson’s anti-transubstantiation argument in the form of a logical syllogism. In summary, Hume’s syllogism is this: there is no direct evidence that transubstantiation really occurs during the sacrament of Communion; instead, the only evidence we have that this doctrine might be true are some second-hand statements during the Patristic period, such as the sermons of Saint Augustine. Second-hand hearsay evidence, however, is always weaker or less reliable than direct evidence; therefore, transubstantiation cannot be true. But as I noted at the end of my previous post, this syllogism is incomplete, for Messrs Hume and Tillotson fail to consider any of the standard exceptions to the hearsay rule.

By way of illustration, the Federal Rules of Evidence (see here or here) recognize no less than 23 exceptions to the hearsay rule, including excited utterances, business records, and death-bed or dying declarations. Do any of these hearsay exceptions apply to the problem of transubstantiation? As it happens, there are at least three exceptions to the hearsay rule that might be applicable to the case at hand: statements in ancient documents; market reports and commercial publications; and statements in learned treatises, periodicals, and pamphlets. (For reference, see Rules 803(16), 803(17), and 803(18) of the Federal Rules of Evidence.)

Consider, for example, the collection of sermons of Saint Augustine of Hippo (pictured below) published under the title “Sermons 230-270B on the Liturgical Seasons.” Specifically, in Sermon 234 (418 A.D.) Saint Augustine declares, without citing any supporting evidence, that the bread consecrated in the Eucharist becomes the body of Christ: “The faithful know what I’m talking about; they know Christ in the breaking of bread. It isn’t every loaf of bread, you see, but the one receiving Christ’s blessing, that becomes the body of Christ.” Is Augustine speaking metaphorically here, or is he being literal? Either way, along with Ambrose (AD 340–397), Jerome (347–420), and Pope Gregory I (540–604), Augustine (354–430) is considered one of the Great Church Fathers, so this sermon could easily fall under the exception for an ancient document or a learned treatise — or perhaps even a commercial publication!

But that said, just because a particular piece of evidence regarding transubstantiation — such as a statement in an ancient sermon by a Church father — would be admissible in a court of law under one of the exceptions to the hearsay rule does not by itself mean that transubstantiation is true. We still have to weigh the evidence (i.e. decide how trustworthy it is), draw reasonable inferences from it, and make up our own minds. In my next post, I will turn to another religious figure, the Rev Thomas Bayes (!), and explain why we should (contra Hume and Tillotson) start any discussion of transubstantiation by assigning a 0.5 probability to the possibility that this doctrine might be true.

We spent most of the month of February surveying Adam Smith’s analysis of tariffs in Book IV, Chapter 2 of The Wealth of Nations. This month, I want to explore the work of another great Scottish Enlightenment figure: David Hume and his famous essay “Of Miracles“. So, without further ado, let’s dive right in, shall we? Hume begins by invoking the work of a scholar who is little remembered today:

“There is, in Dr. Tillotson‘s writings, an argument against the real presence, which is as concise, and elegant, and strong as any argument can possibly be supposed against a doctrine, so little worthy of a serious refutation.” (Hume, Of Miracles, Para. 1, emphasis added)

Here, Hume is referring to a controversial work written by one John Tillotson (pictured below), who was the Archbishop of Canterbury from 1691 to 1694. (He was also elected a fellow of the Royal Society in 1672, the same year as Sir Isaac Newton!) Tillotson’s pamphlet is titled A Discourse Against Transubstantiation (available here) and was first published in 1684. (In brief, “transubstantiation” refers to belief that the bread and wine used in Communion become the actual body and blood of Jesus.) After noting that Tillotson’s critique of transubstantiation — or what Hume refers to as “real presence” — is “concise, and elegant, and strong”, Hume then spells out Tillotson’s argument step-by-step in the form of a logical syllogism:

• Minor premise: Religion is based on direct historical evidence consisting of primary sources, such as the eyewitness testimony of Jesus’ apostles, or in the immortal words of Hume: “… the authority, either of the scripture or of tradition, is founded merely in the testimony of the apostles, who were eye-witnesses to those miracles of our Saviour, by which he proved his divine mission” (Hume, Of Miracles, Para. 1);
• Major premise: Secondary or after-the-fact hearsay evidence of a historical event is less reliable than direct evidence of that same event: “Our evidence, then, for the truth of [the doctrine of transubstantiation] is less than the evidence for the truth of our senses …” (ibid.). Furthermore, secondary or after-the-fact hearsay evidence becomes less reliable over time: “… it [i.e. the direct evidence recorded by Jesus’ apostles] must diminish in passing from them to their disciples; nor can any one rest such confidence in their testimony, as in the immediate object of his senses” (ibid.);
• Conclusion: Hearsay evidence cannot be used to refute direct evidence because hearsay evidence is weaker than direct evidence: “But a weaker evidence can never destroy a stronger; and therefore, were the doctrine of the real presence [transubstantiation] ever so clearly revealed in scripture, it were directly contrary to the rules of just reasoning to give our assent to it” (ibid.).

In other words, Hume begins his essay by throwing some hard punches, so to speak, for what Tillotson (as reported by Hume) is saying here is that transubstantiation or “real presence” during Mass cannot be true because this doctrine is nowhere mentioned in the Holy Bible nor by any of Jesus’ own apostles, and in the absence of any primary or direct evidence (such as eyewitness reports by Jesus’ apostles), we cannot use secondary or hearsay evidence to ground the truth of the doctrine of transubstantiation.

Hume’s eloquent and lawyerly restatement of Tillotson’s anti-transubstantiation syllogism looks like a secular slam dunk against taking the words of Jesus during the Last Supper–“this [bread] is my body”–too literally. Why? Because the earliest accounts of Jesus’ life and ministry, including the four canonical gospels, began circulating within 75 years of Jesus’ death, so the closest historical sources we have of the Last Supper are secondary sources. The gospels report Jesus’ actions and words, but it is up to us to assign meaning to those actions and words.

Before proceeding, however, I want to hit pause and offer my own assessment of Hume’s argument against the doctrine of transubstantiation by taking a short detour through the law of evidence, i.e. the rules courts use to determine what types of evidence are admissible when deciding a case. Although it is generally true that hearsay is not admissible, Hume fails to consider any of the well-settled exceptions to the hearsay rule! Accordingly, my next post will survey these exceptions to the hearsay rule and determine whether any of them could apply to the case for transubstantiation.

Should the United States create an “External Revenue Service” as President Trump has recently proposed? As it happens, Adam Smith concludes Book IV, Chapter 2 of The Wealth of Nations (Para. 45) by asking whether “it may be proper to impose taxes upon the importation of foreign goods, in order not to prevent their importation but to raise a revenue for government“? That is, should we recognize a fifth exception to the principle of free trade on top of the first four exceptions Smith has already identified?

Alas, the Scottish philosopher-economist decides to postpone his answer to this particular tax question until later, writing that “I shall consider [this tax question] hereafter when I come to treat of taxes,” which he does in Book V, Chapter 2 of The Wealth of Nations. Smith’s treatment of taxes in Book V, Chapter 2, however, is not for the faint of heart: it consists of almost 200 dense paragraphs spread out across 90 single-spaced pages.

Nevertheless, that said, Smith does provide a tantalizing preview of what his answer might be, for the the very last sentence of Book IV, Chapter 2 of The Wealth of Nations reads as follows: “Taxes imposed with a view to prevent, or even to diminish importation, are evidently as destructive of the revenue of the customs as of the freedom of trade.”

For my part, I will survey Smith’s treatment of taxes starting sometime in April of this year. In the meantime, let us switch gears, leave the world of political economy behind, and explore the work of another great Scottish Enlightenment figure. Yes, I am talking about David Hume and his famous essay “Of Miracles“! I will turn to Hume on Monday, March 3rd.

One of the greatest ironies of Book IV, Chapter 2 of Adam Smith’s Wealth of Nations is this: on the one hand, it contains some of the strongest arguments ever made in favor of free trade, and yet, at the same time, Smith ends on a pessimistic note. He not only concedes that “freedom of trade” is an unattainable ideal in the real world — or in the immortal words of the Scottish philosopher-economist. “To expect … that the freedom of trade should ever be entirely restored … is as absurd as to expect that an Oceana or Utopia should ever be established in it” (IV.ii.43) — he also concludes that democracy and free trade are mutually incompatible for two reasons: “Not only the prejudices of the public, but what is much more unconquerable, the private interests of many individuals, irresistibly oppose it” (ibid.).

Given this state of affairs, what is to be done? Smith’s answer to this question appears in the penultimate paragraph of Book IV, Chapter 2 of The Wealth of Nations (Para. 44) and can be summed up in two words, DAMAGE CONTROL:

“The legislature, were it possible that its deliberations could be always directed, not by the clamorous importunity of partial interests, but by an extensive view of the general good, ought upon this very account, perhaps, to be particularly careful neither to establish any new monopolies of this kind, nor to extend further those which are already established. Every such regulation introduces some degree of real disorder into the constitution of the state, which it will be difficult afterwards to cure without occasioning another disorder.” (Wealth of Nations, IV.ii.44, emphasis added)

In my humble opinion, this timeless passage contains the most succinct and eloquent statement of the theory of the second best ever written — a theory that was not fully developed or formalized by economists until in the 1950s. Simply put, as we saw in my previous post, Smith is a realist: he totally understands why in the real world existing monopolies and trade barriers are not going away anytime soon, for there are just way too many powerful interests who benefit directly from those very restrictions and who stand to lose if those legally-created monopolies and barriers are removed. Smith’s solution to this political reality is thus a pragmatic one: at very least, people in power should not make matters any worse than they already are. Is that too much to ask?

Is “freedom of trade”, whether at home or among nations, an attainable ideal? Adam Smith explains in just a few words why, alas, it is not! For reference, his explanation appears in the antepenultimate paragraph of Book IV, Chapter 2 of The Wealth of Nations (Para. 43), and despite its pessimistic conclusion, this particular passage is so on point, so poetic, and so astute that it not only speaks for itself; it speaks to us today:

“To expect, indeed, that the freedom of trade should ever be entirely restored in Great Britain is as absurd as to expect that an Oceana or Utopia should ever be established in it. Not only the prejudices of the public, but what is much more unconquerable, the private interests of many individuals, irresistibly oppose it…. The Member of Parliament who supports every proposal for [promoting these private interests] is sure to acquire not only the reputation of understanding trade, but great popularity and influence with an order of men whose numbers and wealth render them of great importance. If he opposes them, on the contrary, and still more if he has authority enough to be able to thwart them, neither the most acknowledged probity, nor the highest rank, nor the greatest public services can protect him from the most infamous abuse and detraction, from personal insults, nor sometimes from real danger, arising from the insolent outrage of furious and disappointed monopolists.” (Wealth of Nations, IV.ii.43, emphasis added)

For my part, I won’t mince words or waste any more of our time. Simply put, what Smith is really saying here is that democracy and free trade are mutually incompatible. Given this conundrum, what is to be done? I will explore Smith’s own answer to this question and conclude my series on “The Immortal Adam Smith” in my next post.

“… though a great number of people should, by thus restoring the freedom of trade, be thrown all at once out of their ordinary employment and common method of subsistence, it would by no means follow that they would thereby be deprived either of employment or subsistence.” (Wealth of Nations, IV.ii.42)

Thus begins Paragraph 42 of Book IV, Chapter 2 of The Wealth of Nations. This is not only the longest paragraph of this celebrated chapter; it also contains two of the most revolutionary claims in the history of political economy — one descriptive, the other normative. In short, the descriptive claim is that labor markets are able to adjust quickly to new conditions; the normative claim is that labor markets should be free.

By way of background, recall Adam Smith’s fourth and final exception to free trade. As I explained in a previous post, he makes a limited exception on humanitarian grounds for pre-existing trade barriers that are already on the books; simply put, if the removal of such trade restrictions would cause mass unemployment at home, then “freedom of trade should be restored only by slow gradations, and with a good deal of reserve and circumspection” (Wealth of Nations, IV.ii.40). But at the same time, the father of economics gives two reasons why this disruption “would in all probability … be much less than is commonly imagined …” (ibid.). I already explained the first reason in my previous post: business firms that already enjoy an absolute advantage in their respective markets — i.e. firms that are able to produce goods more efficiently or cheaply than their competitors overseas — have nothing to fear from free trade.

Smith’s second reason, however, provides an even more powerful argument for free trade because it is more general in scope: He observes in paragraph 42 of Book IV, Chapter 2 of The Wealth of Nations that labor markets are able to adjust rapidly to new conditions. Furthermore, this claim is not just a theoretical one, for Smith provides a compelling historical example in support of his descriptive claim about labor markets. Specifically, he refers to the aftermath of the Seven Years’ War (1756–1763), which is known in North America as the “French and Indian War”, when more than 100,000 British soldiers and sailors “were all at once thrown out of their ordinary employment” in the armed forces:

“By the reduction of the army and navy at the end of the late war [i.e. the Seven Years’ War], more than a hundred thousand soldiers and seamen, a number equal to what is employed in the greatest manufactures, were all at once thrown out of their ordinary employment; but, though they no doubt suffered some inconveniency, they were not thereby deprived of all employment and subsistence. The greater part of the seamen, it is probable, gradually betook themselves to the merchant-service as they could find occasion, and in the meantime both they and the soldiers were absorbed in the great mass of the people, and employed in a great variety of occupations. Not only no great convulsion, but no sensible disorder arose from so great a change in the situation of more than a hundred thousand men, all accustomed to the use of arms, and many of them to rapine and plunder. The number of vagrants was scarce any-where sensibly increased by it, even the wages of labour were not reduced by it in any occupation, so far as I have been able to learn, except in that of seamen in the merchant-service.” (Wealth of Nations, IV.ii.42, emphasis added)

In addition, in the course of marshalling this historical evidence, the Scottish philosopher-economist also identifies an important asymmetry between “the habits of a soldier” and those of ordinary civilians who are already in the workforce: soldiers are glorified government employees who are paid regardless of how well they fight; civilian workers in the private sector, by contrast, are paid only if they show up to work and earn their keep, or in the immortal words of Adam Smith:

“… if we compare together the habits of a soldier and of any sort of manufacturer, we shall find that those of the latter do not tend so much to disqualify him from being employed in a new trade, as those of the former from being employed in any. The manufacturer has always been accustomed to look for his subsistence from his labour only: the soldier to expect it from his pay. Application and industry have been familiar to the one; idleness and dissipation to the other. But it is surely much easier to change the direction of industry from one sort of labour to another than to turn idleness and dissipation to any. To the greater part of manufactures besides, it has already been observed, there are other collateral manufactures of so similar a nature that a workman can easily transfer his industry from one of them to another.” (Ibid.)

For Smith, the ability of labor markets to adapt to new conditions and absorb so many former military men after the war was all the more remarkable given this acute asymmetry. But as Smith himself explains, the reason why labor markets were able to adapt so quickly and absorb so many military men was because no geographical or other artificial restrictions were imposed on where the former soldiers and sailors could work. The lesson here is clear: for labor markets to work their magic, labor markets must be free:

“Soldiers and seamen, indeed, when discharged from the king’s service, are at liberty to exercise any trade, within any town or place of Great Britain or Ireland. Let the same natural liberty of exercising what species of industry they please, be restored to all his Majesty’s subjects, in the same manner as to soldiers and seamen; that is, break down the exclusive privileges of corporations, and repeal the statute of apprenticeship, both which are real encroachments upon natural liberty, and add to these the repeal of the law of settlements, so that a poor workman, when thrown out of employment either in one trade or in one place, may seek for it in another trade or in another place without the fear either of a prosecution or of a removal, and neither the public nor the individuals will suffer much more from the occasional disbanding some particular classes of manufacturers than from that of soldiers. Our manufacturers have no doubt great merit with their country, but they cannot have more than those who defend it with their blood, nor deserve to be treated with more delicacy.” (Ibid., emphasis added)

In the passage above, the Scottish philosopher-economist concludes that ordinary workers should enjoy the same level of “natural liberty” as former military men, and to this end, Smith makes two specific policy proposals: (1) the government should “repeal the statute of apprenticeship” (ibid.), and (2) it should “break down the exclusive privileges of corporations” (ibid.). For Smith, in other words, “freedom of trade” should not be limited to just imports and exports; free trade should extend to labor markets as well!

But how likely is it that either of these reforms would ever be enacted in the real world? Is freedom of trade — or “natural liberty” more generally — whether at home or among nations — an attainable ideal in the rough-and-tumble world of politics? And if not (spoiler alert!), what is to be done? As we shall see in my next post, Adam Smith saves the best for last, for he addresses these big questions head on in the last few paragraphs of Book IV, Chapter 2 of The Wealth of Nations — that is why his work is so timeless; that is why Doctor Smith still speaks to us today!