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The extra node in network 2 corresponds to assigning a label, an abstract term to the thing being reasoned about. I wonder if a being with a network-1 mind would have ever evolved intelligence. Assigning names to things, creating categories, allows us to reason about much more complex things. If the price we pay for that is occasionally getting into a confusing or pointless argument about "is it a rube or a blegg?" or "does a tree falling in a deserted forest make a sound?" or "is Pluto a planet?", that seems like a fair price to pay.