Belmont Club

Magic bullets

This two year old video of Newt Gingrich illustrates the variance in human institutions. Between what people are capable of, and what other people are not capable of. Since the time the video was made, some members of the public may have come to doubt that the “world that works” is all it is cracked up to be. The world may not be as simple as Newt describes it. But that doesn’t change his essential point: which is that huge gaps in performance can exist between institutions made up of the same technological and human raw material. It is the culture between them that matters.

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At a time when people talk about the “end of capitalism” and new government led ‘global bargains’, it is useful to consider that the performance of each ideological system has a mean and a variance. There is a variance within the “the world that works”: badly run companies; entrepreneurs that fail. There is also a mean and variance in the world that doesn’t work as efficiently. But maybe the bureaucracies are broadly similar, while in the ‘world that works’ the differences are more stark. In times of upheaval, it is tempting to retreat from the variable ‘world that sort of works’ to the apparent safety of a mediocre system that accomplishes very little, but does it consistently.

Yet risk is not always bad. In the ‘world that works’ the exception sometimes becomes the rule. While it may be counter-intuitive, the really significant information within many systems is to be found in the outlier rather than in the average. Imagine you were a time traveler transported back to a primeval beach when life was just crawling out of the water. If  you dismissed the outliers you would be throwing away some of the most valuable bits of information. The future of life lay in the mutants. The average slime was always going to crawl on the beach; it was variants who were eventually going to grow legs, lungs, and a brain. It was the mutants who were eventually going to build a computer and go to the moon.

Naseem Taleb tried to express this idea in his book, the Black Swan when he argued that the significant information was often encapsulated in the new, disturbing signal rather than in underlying carrier wave.  We can either listen to the hum on the receiver or strain to decipher the message imprinted on it. Sometimes it’s easier to listen to the hum.

But from one point of view, nothing could be more dangerous. Mediocre systems are not only incapable: they are sterile. They have self-reinforcing dampening systems. It is no coincidence that many failing systems eventually impose a speech-code in which all events, however disparate, eventually become indistinguishable. George Orwell observed that one of the objectives of Newspeak, the state language of 1984, was to make it actually impossible to say anything by draining all words of meaning.  Totalitarianisms have the remarkable property of resembling each other. Timothy Garton Ash recalled how, when he visited Eastern Europe, “all over communist-ruled Europe, people would show me their dog-eared, samizdat copies of Animal Farm or Nineteen Eighty-Four and ask, ‘How did he [Orwell] know?'”

He heard the hum.