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Obama 2012

Human Nature Caused The Financial Crisis.

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Filed: AOS (pnd) Country: Canada


Oxford, England (CNN) -- Was last year's financial crisis a chance event? Or was it the product of 35 million years of evolution?

Laurie Santos' research suggests that some of the bad choices made on Wall Street and in the mortgage business may have been deeply rooted in the basic nature of the human species.

Santos, a professor at Yale University, has been investigating the workings of a dangerous inconsistency in people's attitudes to risk. She spoke about it Wednesday at the TED Global conference in Oxford, a four-day event ending Friday where experts passionate about their work got the chance to give contrasting views of the future we all face.

Which would you do: Accept a guaranteed gift of $500 or gamble by taking a risk on a coin toss that would give you $1,000 for heads -- and nothing for tails?

Most people would play it safe and take the sure $500, Santos said.

What if, instead of a gain, you faced a potential loss? Your choice would be to give up $500 for sure or take a risk on a coin toss that could cost you $1,000 if you lost -- or nothing if you won? Most people opt for taking the risk rather than playing it safe.

Using tokens as a form of money and grapes as prized products to be exchanged for the tokens, Santos has shown that capuchin monkeys make the same set of irrational choices -- taking more risk when they have something to lose than when they have something to gain.

"The errors we make are predictable, we make them again and again," said Santos, explaining that she wants to learn "how a species as smart as we are" can make such persistent mistakes. We can overcome our biological limitations, she said, but first we have to recognize what they are.

Adding to the pressure on the human species is the future we're staring down. Tim Jackson, professor of sustainable development at the University of Surrey, imagined the world in 2050. To keep greenhouse gases from reaching an unsustainably damaging level, the needed improvements in energy efficiency would have to occur at a pace 10 times faster than at any time in history. And, Jackson said Thursday, the only times the world has made substantial improvements in reducing carbon emissions have been during recessions.

He views the world economy as built on an engine of growth that feeds the appetite of people in Western countries for novelty, for ever more consumer goods that impress others but that can only be purchased by creating more debt. Even if we don't want the products, we have to buy them -- or the economy crashes.

In what has probably been the most cited quote of the conference on Twitter, Jackson said, "We spend money we don't have on things we don't need to create impressions that won't last on people we don't care about."

Does that mean our choice boils down to this: Crash the economic system or trash the planet? Not exactly, according to Jackson.

The answer, he said, lies in creating socially responsible businesses and nonprofits that plow money back into "protecting and nurturing" the environment on which our future depends. As an example, he cited ecosia.org, a search engine that says it allocates 80 percent of its search-related revenues to a rainforest protection project in the Amazon.

Santos and Jackson were by no means the only speakers at TED Global to suggest people make dumb choices but can overcome them by taking the right measures. TED is a nonprofit that distributes "Ideas Worth Spreading" through its conferences and through more than 700 talks freely available at its web site. [CNN partners with TED to present one talk every Tuesday, along with added content.]


The Great Canadian to Texas Transfer Timeline:

2/22/2010 - I-129F Packet Mailed

2/24/2010 - Packet Delivered to VSC

2/26/2010 - VSC Cashed Filing Fee

3/04/2010 - NOA1 Received!

8/14/2010 - Touched!

10/04/2010 - NOA2 Received!

10/25/2010 - Packet 3 Received!

02/07/2011 - Medical!

03/15/2011 - Interview in Montreal! - Approved!!!

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