Seed Magazine has an excellent article by Nicholas Humphrey on understanding consciousness and why current attempts may be failing because we’re asking the wrong questions.
Humphrey suggests four questions which he feels are more relevant to the problem, and, with a rhetorical flourish, suggests some answers to them.
However, one of the most interesting parts is where he discusses philosopher Jerry Fodor’s interest in what consciousness is useful for:
Fodor has stated this aspect of the problem bluntly: “There are several reasons why consciousness is so baffling. For one thing, it seems to be among the chronically unemployed. What mental processes can be performed only because the mind is conscious, and what does consciousness contribute to their performance? As far as anybody knows, anything that our conscious minds can do they could do just as well if they weren’t conscious. Why then did God bother to make consciousness?”
Fodor is undoubtedly asking the right question: “Why did God‚Äîor rather natural selection‚Äîmake consciousness?” Yet I’d suggest the reason he finds it all so baffling is that he is starting off with the completely wrong premise, for he has assumed, as indeed almost everyone else does, that phenomenal consciousness must be providing us with some kind of new skill. In other words, it must be helping us do something that we can do only by virtue of being conscious, in the way that, say, a bird can fly only because it has wings, or you can understand this sentence only because you know English.
Yet I want to suggest the role of phenomenal consciousness may not be like this at all. Its role may not be to enable us to do something we could not do otherwise, but rather to encourage us to do something we would not do otherwise: to make us take an interest in things that otherwise would not interest us, or to mind things we otherwise would not mind, or to set ourselves goals we otherwise would not set.
Even if you don’t agree with Humphrey’s take on consciousness (of course, in consciousness research, it’s de rigeur to disagree with almost everyone) it’s a thought-provoking and clearly written piece.
As an aside, the cover story on the same issue of Seed Magazine is a piece by Jonah Lehrer on IBM’s large-scale low-level brain simulation project Blue Brain. It’s not freely available online, however, so you’ll need to hit the news stands or the library to have a read.
Link to Seed article ‘Questioning Consciousness’.
Mind Hacks 
I think the problem is that consciousness and unconsciousness are often thought as compleatly different processes, when in fact simply by focusing our attention to them we can become conscious of most of our uncosciousness processes (not all of them at once, of course, but any of them we choose to focus on). As implyed in above quotes, i also think consciousness is clearly related to attention and learning new things. While adults can walks or drive a bike unconsciously and focus their attention to something else, children who are still learning thease skills cannot.
This is a fascinating subject. I started to write a comment earlier and it morphed into a post at my own site. My apologies if this is too long. Please feel free to redact or remove it:
My own thoughts on the subject are related to, but not identical to, Humphrey’s view. What I believe Humphrey is touching upon is the idea of consciousness as an ongoing, artistic experiment.
The following analogy is, perhaps, a bit too simplistic and mechanistic, but it’s the best I can come up with. We can think of consciousness as akin to an artistic creation that is continuously in the works. Phenomenal objects—sensations, images, memories, cognitions and fantasies—are part of a highly fungible palette of mental materials. Conscious and unconscious organizing and regulating operations function as the artist’s tools, while consciousness is the display canvas. Internal representations are neither wholly governed by externalities, nor are they wholly independent of external influences—they are in flux—undergoing continuous destruction and recreation. The moment-to-moment condition of that canvas is part of a feedback loop entailing a process of experimental creation, revisionary destruction and recreation.
The advantage to such a process IS that it allows for experimentation that could not so easily take place if we always insisted on real world experimentation. I might not want to drive my speeding car into a tree to determine the possible outcomes of hitting a tree at 90 mph. Since the world of internal objects and imaginary representations is far more fungible than the world of real objects, an imaginal world provides us with greater latitude for experimental and creative activity. It does so without subjecting us to the high costs and dangers of such experimentation in the real world. The canvas of consciousness seems to serve in a participant role within a creation-destruction-revision feedback loop that insulates us from many real world costs.
Of course, the high-fungibility of phenomenal objects and their organizing mental operations contributes to the chronic misrepresentation of reality. Mental representations are not, in and of themselves, the things they represent and so they always contain misrepresentations (My wife‚Äôs fluctuating images of my face are not my face, nor are they perfect facsimiles of my face. But the capacity to internally represent external reality opens the door not just to error, but to both conscious and unconscious experimental discovery of possibilities that exist beyond immediate externalities. We can and do play, in effect, with mental representations ‚Äî experimenting with the imaginal world in ways that inform us of possibilities ‚Äî both good and bad. The capacity to safely posit and test alternate versions of reality is of enormous and continuous value to us. I would argue that it is so automatic and so integral to the fabric of our phenomenal experience that we don’t notice that it is happening all the time.
Could all of this experimentation be accomplished without a canvas — without a mental sandbox or phenomenological scratch pad? I doubt it. I think some sort of canvas expands the latitude of experimentation and possibility by providing a temporary holding space for experimental versions of reality — preserving the availability and fungibility of our hypotheses for further experimentation and revision. We need a place to erase reality and redraw it or the procreative possibilities of our existence are limited by a far more slow process of biological adaptation to our environment. To experiment internally without display on the canvas of consciousness seems as impossible as experimenting in the real world without a real world. How do you test a hypothesis without positing a thesis somewhere? That somewhere, I believe, is our phenomenological awareness.
It seems to me that psychologists and philosophers have come too much uncritically to accept the assumption that every biological development must serve a purpose and that all we need to do is dream some purpose and we have the explanation for the development in question. This is pretty haphazard reasoning. Evolutionary “purpose” thus becomes a substitute for Divine Will.
In the case of consciousness, I don’t see in what way assuming it serves a designated purpose contributes a jot to answering the putative hard question of how it arises from biophysical processes.