Heck, I'll bite the bullet and say that applied science, and perhaps engineering, owe more to 'irrational' people. (Not a smooth bullet, to be sure.)
My grandfather worked with turbines. He viewed the world in a very holistic manner, one I can't reconcile with rationalism no matter how hard I try. He was an atheist who had no problems with his children being Christians (that I know of). His library was his pride; yet he had made no provisions for its fate after his death. He quitted smoking after his first heart attack, but went on drinking. He thought electrons' orbits were circular, and he repaired circuitry often. He preferred to read a book during dinners than to listen to us talk, to teach us table manners.
And from what I heard, he was not half bad at engineering.
Here are my thoughts on the "Why don't rationalists win?" thing.
Epistemic
I think it's pretty clear that rationality helps people do a better job of being... less wrong :D
But seriously, I think that rationality does lead to very notable improvements in your ability to have correct beliefs about how the world works. And it helps you to calibrate your confidence. These abilities are useful. And I think rationality deserves credit for being useful in this area.
I'm not really elaborating here because I assume that this is something that we agree on.
However, I should note that rationalists aren't really making new and innovative discoveries (the non-superstar ones anyway), and that this may increase the "why don't rationalists win?" thing. I think that a big reason for this lack of progress is because a) we think about really really really difficult things! And b) we beat around the bush a lot. Big topics are often brought up, but I rarely see people say, "Ok, this is a huge topic so in order to make progress, we're going to have to sit down for many hours and be deliberate about this. But I think we could do it!". Instead, these conversations seem to be just people having fun, procrastinating, and never investing enough time to make real progress.
Altruistic
I also think that rationality is doing a great job in helping people to do a better job at being altruistic. Another thing that:
For people with altruistic goals, rationality is helping them to achieve their goals. And I think it's doing a really good job at this. But I also think that it doesn't quite feel like the gains being made here are so big. I think that a major reason for this is because the gains are so:
But we all know that (1), (2), and (3) don't actually make the gains smaller, it just makes them feel smaller. I get the impression that the fact that the gains feel smaller results in an unjustified increase in the "rationalists don't win" feeling.
Success
I get the impression that lack of success plays a big role in the "why don't rationalists win?" thing.
I guess an operational definition of success for this section could be "professional, financial, personal goals, being awesome...".
I don't know much about this, but I would think and hope that rationality helps people to be notably more successful than they otherwise would be. I don't think rationality is at the point yet where it could make everyone millionaires (metaphorically and/or literally). But I think that a) it could get there, and b) we shouldn't trivialize the fact that it does (I'm assuming) make people notably more successful than they otherwise would be.
But still, I think that there are a lot of other factors that determine success, and given their difficulty/rarity, even with rationality in your toolbox, you won't achieve that much success without these things.
Happiness
I get the impression that lack of happiness plays a big role in the "why don't rationalists win?" thing.
Luke talked about the correlates of happiness in How to Be Happy:
One thing I want to note is that genetics seem to play a huge role, and that plus the HORRIBLE hedonic adaptation thing makes me think that we don't actually have that much control over our happiness.
Moving forward... and this is what motivated me to write this article... the big determinants of happiness seem like things that are sort of outside rationality's sphere of influence. I don't believe that, and it kills me to say it, but I thought it'd make more sense to say it first and then amend it (a writing technique I'm playing around with and am optimistic about). What I really believe is:
Social
Socially, LessWrong seems to be a rather large success to me. My understanding is that it started off with Eliezer and Robin just blogging... and now there are thousands of people having meet-ups across the globe. That amazes me. I can't think of any examples of something similar.
Furthermore, the social connections LW has helped create seem pretty valuable to me. There seem to be a lot of us who are incredibly unsatisfied with normal social interaction, or sometimes just plain old don't fit in. But LW has brought us together, and that seems incredible and very valuable to me. So it's not just "it helps you meet some cool people". It's "it's taken people who were previously empty, and has made them fulfilled".
Still though, I think there's a lot more that could be done. Rationalist dating website?* Rationalist pen pals (something that encourages the development of deeper 1-on-1 relationships)? A more general place that "encourages people to let their guard down and confide in each other"? Personal mentorship? This is venturing into a different area, but perhaps there could be some sort of professional networking?
*As someone who constantly thinks about startups, I'm liking the idea of "dating website for social group X that has a hard time relating to the rest of society". It could start off with X = 1, and expand, and the parent business could run all of it.
Failure?
So, are we a failure? Is everything moot because "rationalists don't win"?
I don't think so. I think that rationality has had a lot of impressive successes so far. And I think that it has
A LOT
of potential (did I forget any other indicators of visual weight there? it wouldn't let me add color). But it certainly hasn't made us super humans. I get an impression that because rationality has so much promise, we hold it to a crazy high standard and sometimes lose sight of the great things it provides. And then there's also the fact that it's only, what, a few decades old?
(Sorry for the bits of straw manning throughout the post. I do think that it lead to more effective communication at times, but I also don't think it was optimal by any means.)