I’m highly skeptical of the whole “Wisdom of Crowds” phenomenon and things like betting markets for probability because it all relies on the assumption that the general public is, at least on average, well-informed. The problem is, it is entirely possible for public opinion to be based on totally incorrect “common knowledge”, especially about complicated subjects. For example, the persistence of creationism in America shows an alarmingly large number of people (disproportionately on the political Right) who are ignorant or misinformed of basic, established facts of science. Left and Right alike are also frequently highly misinformed about such prominent topics as the makeup of the U.S. federal budget. Even the best political analysts can fail to take into account unusual circumstances. Perhaps most importantly, even reasonably well-informed crowds taking part in simple tasks can be misled or pressured into giving wrong answers. If you really want to laugh, cringe, and learn a few things, check out the List of Common Misconceptions on Wikipedia.
I mention all this for two reasons. First, I’ve been wanting to complain about it to anyone who will listen for a while, and posting it online allows me to rant less in real life. Second, it’s a preface to this article I just found, with the hyperbolic, paranoid-sounding title “Revealed: the Capitalist Network that Runs the World”. Now, I saw the title and cringed, immediately expecting an incoherent rant that would’ve made me lose faith in New Scientist’s editorial staff. However, what I found instead is an interesting read which confirms, through mathematical modeling, what the general public (especially, as I have noted before, the Occupy movement, various liberal publications, and myself) already suspected: a handful of huge financial institutions have enormous influence over the rest of the economy. Highly unnerving.