The Salary as a Silent Killer

Research from Bernard Nijstad (University of Amsterdam) divided 12 people into two groups. Six worked together to brainstorm on a topic while the other six worked individually. He found that people who worked alone almost always came up with more good ideas – even though all 12 initially agreed that a group experience would be more productive. In Wrong, David H. Freedman quotes Nijstad: “When you’re alone, it’s painfully clear when you’re not producing, but in a group you can just sit there and not notice you’re not contributing.”

Let’s extend this finding to the modern work life. When you earn a salary from a boring job, you can exist without noticing that you’re not doing anything meaningful with your life. Existing without a salary makes inaction, incompetence and a lack of meaning much more obvious. A boring job with a good salary that someone does not enjoy is a form of chronic stress. Worse, over time the stress disguises itself as a fact of life, as if it’s somehow unavoidable.

Let’s generalize. Small chronic pain (boring job, marriage, arthritis) is much much worse than acute pain (e.g., getting fired/laid off, divorced, broken arm). Humans seem to recover from those in the latter category much faster and are better off in the long run. More, experience in the latter category makes you automatically not-boring. I recently interacted with a friend who had been laid off. She was very disappointed, but I reminded her that this was good news in disguise. “New York is filled with boring people who have nothing exciting to talk about” I said. “I think part of me dies whenever I hear someone say that they work “in finance” or “in publishing.” If I meet someone at a bar who said “I just got laid off” I would immediately engage them – even better if they said “I just got fired.”

A dose of isolation, failure or loss is necessary every so often–the longer one goes without encountering a bout of extreme but acute harm the more vulnerable he is. You are only as strong as the worst adversity you’ve encountered and overcome.

From NN Taleb:

Anything deemed bad for you is, well, good when infrequent and in small quantities.

From the idea of the “S-family” dose response with a convex section it flows *necessarily* that anything deemed harmful that you are exposed to 1) in small enough quantities, 2) in a non-recurring, not chronic exposure, and, 3) in an acute, short lived way (“one off”), *no matter how toxic* it is deemed to be in long term consumption, will eventually either leave you better off or at least no worse off than before. This means that sugar, smoking, pollution, medication, the New York Times, etc. have to leave you not worse off under the condition that your exposure is episodic, not chronic. (Beware the “small”: some things like heroin or an MBA class can leave you permanently altered after a single exposure at doses that do appear small but are not).

Implication: The modern mantra “everything in moderation” did not enter our lexicon by chance. It is a response to abundance. In our species relatively short history, Hobbes audit of human nature was correct most of the time—disease and violence were common. However, with ample resources, “surviving” the day-to-day trenches of life is about making it through the workday—not avoiding physical danger. With more time on our hands abundance is our new enemy, hence our turn to moderation.

Moderation is less wise than we think, however. Consider how we eat. A hallmark of the modern diet is three meals a day. It is generally a good idea to consume food three times a day, but an emerging science of nutrition suggests that intermittent fasting—skipping a meal once a week for instance—is beneficial for the body.

Likewise, jogging is one of the most overrated activities around. It burns calories and improves the cardio system, yes, but short sprints (or ‘interval training’) are much more effective in terms of becoming stronger. Weight lifting is the same. Reps with a manageable amount of weight are nearly useless (again, in terms of building strength). When we push our muscles to their limits, the body overcompensates, which in turn gives us the strength to lift 5 more pounds the next time around.

In sum, moderation prevents us from experiencing worst-case-scenarios, which often leads to Lucreatian underestimation (i.e., believing that the tallest mountain you’ve ever seen in person is the tallest mountain in the world). Imagine how parsimonious one would be if his salary was randomly distributed throughout the year.

The mind benefits from the highs and the lows (i.e., non-fatal extremes). The middle is deceptively dangerous.

Postscript 

“All things in moderation” is not only a modern mantra. Publius Terentius (c. 190-195 BC) wrote “Moderation in all things (not anything in excess).” Source

The PlayPump Fallacy

From Tim Hartford’s Adapt: Why Success Always Starts With Failure*

PlayPump is a water system designed as a merry go-round to encourage kids to use it. A few years ago it was implemented in African villages that struggled to get water. Here’s the idea: “As the children play, the roundabout spins, and the pump fills a large tank that can be tapped as needed. The PlayPump removes the need both for unreliable electrical pumps and for hours of labor from hardworking women: clean water simply appears as a byproduct of innocent play.”

Hartford goes on to outline why this is not exactly true. According to a 2007 UNICEF report, the PlayPump was plagued by a number of failures–including the untenable amount of hours kids would need to play on it in order to receive ample water. Interestingly, however, Westerners got the impression that PlayPump was working wonders. Why? “Each time I’ve visited a PlayPump,” says Owen Scott, a Canadian engineer, “I’ve always found the same scene: a group of women and children struggling to spin it by hand so they can draw water…. [But] as soon as the foreigner with a camera comes out.. kids get excited. And when they get excited, they start playing. Within five minutes, the things looks like crazy success.”

Call this the PlayPump Fallacy: Each observation confirms the theory, but each observation illustrates the opposite of reality. 

Challenge for readers: Is there a proper term for this fallacy??? And could you direct me towards examples in ancient or contemporary literature??? 

 

* I know this is a bullshit title generated by a publisher to sell books, but it’s critical to remember that an essential feature of natural selection is that success always starts with success. That is, genes that survive get selected and passed on. This became apparent to me after reading Rafe Sagarin’s Learning From the Octopus.

The Willow-Bark Fallacy

I’m reading Druin Burch’s Taking the Medicinefrom which I discovered the following anecdote and insight:

In 1757, an English clergyman named Edward Stone took a walk. For unknown reasons (even to Stone) he decided to taste the bark of a willow tree. It was bitter. But it reminded Stone of cinchona, which at the time was used to cure malaria. Stone subscribed to the ancient and erroneous maxim that “many natural maladies carry their cures along with them or that their remedies lie not far from their causes.” From this, he reasoned that “since malaria was very coming in the marshy places where willow grew” Burch writes, “it was likely that the tree would cure the disease.”

Stone collected the bark, waited a few months until it was dry and pounded it into a powder. He began treating patients who had malaria and discovered that the bark was an efficacious treatment. Given that cinchona was expensive (it had to be shipped from South American) this was good news. Stone wrote a letter to the Royal Society and his remedy was adapted around the country.

The problem was the dried willow bark didn’t cure malaria – it simply reduced fevers (it was later synthesized and is now the main ingredient in aspirin). As Burch points it, “Stone’s achievement was to note a real effect of the bark – its ability to bring down fevers – even though he mistook this for a guarantee of its helping provide a cure.” It gets worse. When the Napoleonic war broke out, importing cinchona became harder, which rose the demand for the bark. “Willow, which did not cure malaria, thus partly replaced cinchona, which did.”

So let us term this The Willow Bark Fallacy: improving something based on erroneous beliefs and falsely believing that you know what you’ve improved, which actually renders things worse off in the long run.  

Big Data Could Be a Big Problem

Think about this: NASA knows where Saturn will be in 5,000 years while traders do not know what the price of a stock will be in 24 hours.

The problem of prediction “is not that we are universally good or bad at it, but rather that we are bad at distinguishing predictions that we can make reliably from those that we can’t,” says Duncan Watts, author of Everything is Obvious. So while NASA can count on physical laws remaining stable, traders must navigate the highly unstable financial markets.

The overlooked error is that more information is better in simple and stable domains (physics) while in complex and unstable domains (finance but not weather), more information can be toxic. As Watts puts it, “there is a difference between being uncertain about the future and the future itself being uncertain. The former is really just a lack of information—something we don’t know—whereas the latter implies that the information is, in principle, unknowable.”

We embrace big data but forget that as information increases the number of false hypotheses and incorrect conclusions drawn will increase as well.