Tag: Charlie Munger

Towards a Greater Synthesis: Steven Pinker on How to Apply Science to the Humanities

The fundamental idea behind Farnam Street is to learn to think across disciplines and synthesize, using ideas in combination to solve problems in novel ways.

An easy example would be to take a fundamental idea of psychology like the concept of a near-miss (deprival super-reaction) and use it to help explain the success of a gambling enterprise. Or, similarly, using the idea of the endowment effect to help explain why lotteries are a lot more successful if you allow people to choose their own numbers. Sometimes we take ideas from hard science, like the idea of runaway feedback (think of a nuclear reaction gaining steam), to explain why small problems can become large problems or small advantages can become large ones.

This kind of reductionism and synthesis helps one understand the world at a fundamental level and solve new problems.

We’re sometimes asked about untapped ways that this thinking can be applied. In hearing this, it occasionally seems that people fall into the trap of believing all of the great cross-disciplinary thinking has been done. Or maybe even that all of the great thinking has been done, period.

Steven-Pinker-by-Rebecca-Goldstein

Harvard psychologist Steven Pinker is here to say we have a long way to go.

We’ve written before about Pinker’s ideas on a broad education and on writing, but he’s also got a great essay on Edge.org called Writing in the 21st Century wherein he addresses some of the central concepts of his book on writing — The Sense of Style. While the book’s ideas are wonderful, later in the article he moves to a more general point useful for our purposes: Systematic application of the “harder” sciences to the humanities is a huge untapped source of knowledge.

He provides some examples that are fascinating in their potential:

This combination of science and letters is emblematic of what I hope to be a larger trend we spoke of earlier, namely the application of science, particularly psychology and cognitive science, to the traditional domains of humanities. There’s no aspect of human communication and cultural creation that can’t benefit from a greater application of psychology and the other sciences of mind. We would have an exciting addition to literary studies, for example, if literary critics knew more about linguistics.Poetry analysts could apply phonology (the study of sound structure) and the cognitive psychology of metaphor. An analysis of plot in fiction could benefit from a greater understanding of the conflicts and confluences of ultimate interests in human social relationships. The genre of biography would be deepened by an understanding of the nature of human memory, particularly autobiographical memory. How much of the memory of our childhood is confabulated? Memory scientists have a lot to say about that. How much do we polish our image of ourselves in describing ourselves to others, and more importantly, recollecting our own histories? Do we edit our memories in an Orwellian manner to make ourselves more coherent in retrospect? Syntax and semantics are relevant as well. How does a writer use the tense system of English to convey a sense of immediacy or historical distance?

In music the sciences of auditory and speech perception have much to contribute to understanding how musicians accomplish their effects. The visual arts could revive an old method of analysis going back to Ernst Gombrich and Rudolf Arnheim in collaboration with the psychologist Richard Gregory. Indeed, even the art itself in the 1920s was influenced by psychology, thanks in part to Gertrude Stein, who as an undergraduate student of William James did a wonderful thesis on divided attention, and then went to Paris and brought the psychology of perception to the attention of artists like Picasso and Braque. Gestalt psychology may have influenced Paul Klee and the expressionists. Since then we have lost that wonderful synergy between the science of visual perception and the creation of visual art.

Going beyond the arts, the social sciences, such as political science could benefit from a greater understanding of human moral and social instincts, such as the psychology of dominance, the psychology of revenge and forgiveness, and the psychology of gratitude and social competition. All of them are relevant, for example, to international negotiations. We talk about one country being friendly to another or allying or competing, but countries themselves don’t have feelings. It’s the elites and leaders who do, and a lot of international politics is driven by the psychology of its leaders.

In this short section alone, Pinker offers realistically that we can apply:

  • Linguistics to literature
  • Phonology and psychology to poetry
  • The biology of groups to understand fiction
  • The biology of memory to understand biography
  • Semantics to understand historical writing
  • Psychology and biology to understand art and music
  • Psychology and biology to understand politics

Turns out, there’s a huge amount of thinking left to be done. Effectively, Pinker is asking us to imitate the scientist Linus Pauling, who sought to systematically understand chemistry by using the next most fundamental discipline, physics, an approach which led to great breakthroughs and a consilience of knowledge in the two fields which is taken for granted in modern science.

Towards a Greater Synthesis

Even if we’re not trying to make great scientific advances, think about how we could apply this idea to all of our lives. Fields like basic mathematics, statistics, biology, physics, and psychology provide deep insight into the “higher level” functions of humanity like law, medicine, politics, business, and social groups. Or, as Munger has put it, “When you get down to it, you’ll find worldly wisdom looks pretty darn academic.” And it isn’t as hard as it sounds: We don’t need to understand the deep math of relativity to grasp the idea that two observers can see the same event in a different way depending on perspective. The rest of the world’s models are similar, although having some mathematical fluency is necessary.

Pinker, like Munger, doesn’t stop there. He also believes in what Munger calls the ethos of hard science, which is a way of rigorously considering the problems of the practical world.

Even beyond applying the findings of psychology and cognitive science and social and affective neuroscience, it’s the mindset of science that ought to be exported to cultural and intellectual life as a whole. That consists in increased skepticism and scrutiny about factual conventional wisdom: How much of what you think is true really is true if you go to the numbers? For me this has been a salient issue in analyzing violence, because the conventional wisdom is that we’re living in extraordinarily violent times.

But if you take into account the psychology of risk perception, as pioneered by Daniel Kahneman, Amos Tversky, Paul Slovic, Gerd Gigerenzer, and others, you realize that the conventional wisdom is systematically distorted by the source of our information about the world, namely the news. News is about the stuff that happens; it’s not about the stuff that doesn’t happen. Human risk perception is affected by memorable examples, according to Tversky and Kahneman’s availability heuristic. No matter what the rate of violence is objectively, there are always enough examples to fill the news. And since our perception of risk is influenced by memorable examples, we’ll always think we’re living in violent times. It’s only when you apply the scientific mindset to world events, to political science and history, and try to count how many people are killed now as opposed to ten years ago, a hundred years ago, or a thousand years ago that you get an accurate picture about the state of the world and the direction that it’s going, which is largely downward. That conclusion only came from applying an empirical mindset to the traditional subject matter of history and political science.

Nassim Taleb has been on a similar hunt for a long time (although, amusingly, he doesn’t like Pinker’s book on violence at all). The question is relatively straightforward: How do we know what we know? Traditionally, what we know has simply been based on what we can see, something now called the availability bias. In other words, because we see our grandmother live to 95 years old while eating carrots every day, we think carrots prevent cancer. (A conflation of correlation and causation.)

But Pinker and Taleb call for a higher standard called empiricism, which requires pushing beyond anecdote into an accumulation of sound data to support a theory, with disconfirming examples weighted as heavily as confirming ones. This shift from anecdote to empiricism led humanity to make some of its greatest leaps of understanding, yet we’re still falling into the trap regularly, an outcome which itself can be explained by evolutionary biology and modern psychology. (Hint: It’s in the deep structure of our minds to extrapolate.)

Learning to Ask Why

Pinker continues with a claim that Munger would dearly appreciate: The search for explanations is how we push into new ideas. The deeper we push, the better we understand.

The other aspect of the scientific mindset that ought to be exported to the rest of intellectual life is the search for explanations. That is, not to just say that history is one damn thing after another, that stuff happens, and there’s nothing we can do to explain why, but to relate phenomena to more basic or general phenomena … and to try to explain those phenomena with still more basic phenomena. We’ve repeatedly seen that happen in the sciences, where, for example, biological phenomena were explained in part at the level of molecules, which were explained by chemistry, which was explained by physics.

There’s no reason that that this process of explanation can’t continue. Biology gives us a grasp of the brain, and human nature is a product of the organization of the brain, and societies unfold as they do because they consist of brains interacting with other brains and negotiating arrangements to coordinate their behavior, and so on.

This idea certainly takes heat. The biologist E.O. Wilson calls it Consilience, and has gone as far as saying that all human knowledge can eventually be reduced to extreme fundamentals like mathematics and particle physics. (Leading to something like The Atomic Explanation of the Civil War.)

Whether or not you take it to such an extreme depends on your boldness and your confidence in the mental acuity of human beings. But even if you think Wilson is crazy, you can still learn deeply from the more fundamental knowledge in the world. This push to reduce things to their simplest explanations (but not simpler) is how we array all new knowledge and experience on a latticework of mental models.

For example, instead of taking Warren Buffett’s dictum that markets are irrational on its face, try to understand why. What about human nature and the dynamics of human groups leads to that outcome? What about biology itself leads to human nature? And so on. You’ll eventually hit a wall, that’s a certainty, but the further you push, the more fundamentally you understand the world. Elon Musk calls this first principles thinking and credits it with helping him do things in engineering and business that almost everyone considered impossible.

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From there, Pinker concludes with a thought that hits near and dear to our hearts:

There is no “conflict between the sciences and humanities,” or at least there shouldn’t be. There should be no turf battle as to who gets to speak about what matters. What matters are ideas. We should seek the ideas that give us the deepest, richest, best-informed understanding of the human condition, regardless of which people or what discipline originates them. That has to include the sciences, but it can’t come only from the sciences. The focus should be on ideas, not on people, disciplines, or academic traditions.


Still Interested?
Start building your mental models and read some more Pinker for more goodness.

Elon Musk and the Question of Overconfidence

Ashlee Vance’s book on Elon Musk is well read for a good reason: It’s a fascinating look at a fascinating person.

You can interpret the book however you like. It’s a tale of genius. It’s a tale of someone driven beyond all reason to succeed. It’s a tale of a brilliant, talented engineer/entrepreneur. It’s the tale of someone trying to overcome a difficult childhood by setting audacious goals for himself and accomplishing them. It’s the tale of someone creating the future instead of waiting for it. It’s the tale of a deluded, arrogant, thrice-divorced jerk. It’s the tale of a guy with an IQ of 190 who thinks it’s 250. (Munger made that claim a few years ago — we were there.)

Frankly, it doesn’t matter how you see Musk — he is who he is (which brings to mind Eminem’s lyrics: I am, whatever you say I am. If I wasn’t, why would you say I am). But however you choose to read the book, and read it you should, there’s one part of the tale that it would be hard to disagree with: The guy is chasing larger goals than essentially anyone else, he’s made a surprising amount of progress towards achieving them in such a very short time.

His mind is different than yours or mine.

Which begs a good question: Why would Charlie Munger, an admitted science/engineering nut, the guy with a fanatical devotion to the Chinese firm BYD for its engineering culture and its aggressively entrepreneurial CEO, accuse Musk of attempting too much? (“Personally, I’m scared of the guy,” Munger added.)

***

As Vance describes in the book, in 2001 Musk came to aerospace engineer Jim Cantrell with his most audacious question to date: How do we become a multi-planetary species? 

Musk wanted to know how we could create a sustainable colony on Mars, a sort of “backup plan” for humanity.

That launched (puns!) Musk’s now 14-year old venture SpaceX, a private business dedicated to putting a sustainable human colony on Mars. (Yes, really.) That would require first figuring out a low-cost method of launching rockets into space, to get us and our supplies to the colony.

Prior to SpaceX, Musk was best known for co-founding Paypal — he was considered a bright software engineer and an up-and-coming entrepreneur, but Rocket Man? Not so much. To that end, someone recently asked a good question on QuoraHow did Elon Musk learn enough about rockets to run SpaceX? 

Luckily, Musk’s friend and SpaceX co-founder Jim Cantrell took note and left an interesting response, interesting because Cantrell doesn’t really answer the stated question so much as (what seems to us) a better one:

Elon Musk and the Question of Overconfidence

What allows Musk to attempt and complete projects everyone else considers impossible? 

Those projects would include designing rockets from scratch, creating a successful private company to put them into orbit (it hadn’t been done), starting a car company from scratch (it hadn’t been done in the U.S. since 1925), designing a fully electric vehicle that was also considered cool and desirable, and selling cars directly to consumers, among other projects.

We reprint Cantrell’s Quora answer, and recommend you take a minute to consider the merits and demerits of his approach to life.

What I found from working with Elon is that he starts by defining a goal and he puts a lot of effort into understanding what that goal is and why it is a good and valid goal.  His goal, as I see it, has not changed from the day he first called me in August of 2001.  I still hear it in his speeches.  His goal was to make mankind a multi planetary species and to do that he had to first solve the transportation problem.

Once he has a goal, his next step is to learn as much about the topic at hand as possible from as many sources as possible.  He is by far the single smartest person that I have ever worked with …  period.  I can’t estimate his IQ but he is very very intelligent.  And not the typical egg head kind of smart.  He has a real applied mind.  He literally sucks the knowledge and experience out of people that he is around.  He borrowed all of my college texts on rocket propulsion when we first started working together in 2001.  We also hired as many of my colleagues in the rocket and spacecraft business that were willing to consult with him.  It was like a gigantic spaceapalooza.  At that point we were not  talking about building a rocket ourselves, only launching a privately  funded mission to Mars.  I found out later that he was talking to a  bunch of other people about rocket designs and collaborating on some spreadsheet level systems designs for launchers.  Once our dealings with the Russians fell apart, he decided to build his own rocket and this was the genesis of SpaceX.

So I am going to suggest that he is successful not because his visions are  grand, not because he is extraordinarily smart and not because he works incredibly hard.  All of those things are true.  The one major important distinction that sets him apart is his inability to consider failure.  It simply is not even in his thought process.  He cannot conceive of  failure and that is truly remarkable.  It doesn’t matter if its going up against the banking system (Paypal), going up against the entire  aerospace industry (SpaceX) or going up against the US auto industry (Tesla). He can’t imagine NOT succeeding and that is a very critical  trait that leads him ultimately to success. He and I had very similar upbringings, very similar interests and very similar early histories.  He was a bit of a loner and so was I.  He decided to start a software company at age 13.  I decided to design and build my own stereo amplifier system at age 13.  Both of us succeeded at it.  We both had engineers for fathers and were extremely driven kids.  What separated us, I believe, was his lack of even being able to conceive failure.  I know this because this is where we parted ways at SpaceX.  We got to a point where I could not see it succeeding and walked away.  He didn’t and succeeded.  I have 25 years experience building space hardware and he had none at the time.  So much for experience.

I recently wrote an op-ed piece for Space News where I also suggest that his ruthlessly efficient way to deploy capital is another great reason for his success.  He can almost smell the right way through a problem and he drives his staff and his organization hard to achieve it.  The results speak for themselves.  The article is here End of WWII Model Shakes Up Aerospace Industry.

In the end I think that we are seeing a very fundamental shift in the way our world takes on the big challenges facing humanity and Elon’s Way as I call it will be considered the tip of the spear.  My hat’s off to the man.

Our hats off to him too. For sure. But this first-hand account does solve the Munger puzzle to an extent.

Here’s Munger in 1998, in a speech to a group of foundation CIOs, including representatives from the Hilton Foundation and the Getty Trust.

Similarly, the hedge fund known as ‘Long-Term Capital Management’ recently collapsed, through overconfidence in its highly leveraged methods, despite I.Q.’s of its principals that must have averaged 160. Smart, hard-working people aren’t exempted from professional disasters from overconfidence. Often, they just go aground in the more difficult voyages they choose, relying on their self-appraisals that they have superior talents and methods.

We’ll leave it up to you to judge whether Musk may go aground in his various ventures — SpaceX, Tesla, and SolarCity among them, but it’s hard not to be impressed at the work completed so far. The world needs more people like him, not fewer.
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Still Interested? 
Check out Musk’s thoughts on regulators, the 12 books he recommended in 2014, or his system of first-principles thinking.

Multitasking: Giving the World an Advantage it Shouldn’t Have

one-leg-man

Echoing the comments of William Deresiewicz, Charlie Munger offers some sage advice on multi-tasking:

I will say this, I know no wise person who doesn’t read a lot. I suspect that you can read on the computer now and get a lot of benefit out of it, but I doubt it will work as well as reading print worked for me.

I think people that multitask pay a huge price. They think they’re being extra productive, and I think they’re (out of their mind). I use the metaphor of the one-legged man in the ass-kicking contest.

I think when you multi-task so much, you don’t have time to think about anything deeply. You’re giving the world an advantage you shouldn’t do. Practically everybody is drifting into that mistake.

Concentrating hard on something that is important is … I can’t succeed at all without doing it. I did not succeed in life by intelligence. I succeeded because I have a long attention span.

It sounds counter-intuitive but if you want to increase discretionary time and reduce stress you need to schedule time to think. The tiny fragments of time many of us find ourselves with have a negative effect on our ability to think deeply about a problem. Furthermore they impede our ability to learn — we stay at a surface level and never move into a deep understanding.

Deresiewicz warns: “You simply cannot (think) in bursts of 20 seconds at a time, constantly interrupted by Facebook messages or Twitter tweets, or fiddling with your iPod, or watching something on YouTube.”

The opposite approach is to focus on a problem or subject and try to achieve a deep fluency. How many of us, however, have time? We don’t do the work required to have an opinion. Instead we operate with surface knowledge. We tackle problems with the first thought that comes to mind. Because we make a poor initial decision, we spend countless hours attempting to correct it. No wonder we have no time to think. We’re not heeding the advice of Joseph Tussman and letting the world do the work for us.

We sound good and yet and we fail to learn — in part because everyone else is doing the same thing. Well, when you do what everyone else does, don’t be surprised when you get the same results everyone else gets.

If you want to get off the same track that everyone else is on, start scheduling time to think. That’s what Munger did when he sold himself the best hour of his day. Structure your environment in a way that promotes thinking and reduces interruption. And match your energy to your task.

What Can the Three Buckets of Knowledge Teach Us About History?

Every statistician knows that a large, relevant sample size is their best friend. What are the three largest, most relevant sample sizes for identifying universal principles? Bucket number one is inorganic systems, which are 13.7 billion years in size. It’s all the laws of math and physics, the entire physical universe. Bucket number two is organic systems, 3.5 billion years of biology on Earth. And bucket number three is human history, you can pick your own number, I picked 20,000 years of recorded human behavior. Those are the three largest sample sizes we can access and the most relevant. — Peter Kaufman

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When we seek to understand the world, we’re faced with a basic question: Where do I start? Which sources of knowledge are the most useful and the most fundamental?

Farnam Street takes its lead here from Charlie Munger, who argued that the “base” of your intellectual pyramid should be the great ideas from the big academic disciplines. Mental models. Similarly, Mr. Kaufman’s idea, presented above, is that we can learn the most fundamental knowledge from the three oldest and most invariant forms of knowledge: Physics and math, from which we derive the rules the universe plays by; biology, from which we derive the rules life on Earth plays by; and human history, from which we derive the rules humans have played by.

With that starting point, we’ve explored a lot of ideas and read a lot of books, looking for connections amongst the big, broad areas of useful knowledge. Our search led us to a wonderful book called The Lessons of History, which we’ve posted about before. The book is a hundred-page distillation of the lessons learned in 50 years of work by two brilliant historians, Will and Ariel Durant. The Durants spent those years writing a sweeping 11-book, 10,000-page synthesis of the major figures and periods in human history, with an admitted focus on Western civilization.(Although they admirably tackle Eastern civilization up to 1930 or so in the epic Our Oriental Heritage.) With The Lessons of History, the pair sought to derive a few major lessons learned from the long pull.

Let’s explore a few ways in which Durants’ brilliant work interplays with the three buckets of human knowledge that help us understand the world at a deep level.

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Lessons of Geologic Time

Durant has a classic introduction for this kind of “big synthesis” historical work:

Since man is a moment in astronomic time, a transient guest of the earth, a spore of his species, a scion of his race, a composite of body, character, and mind, a member of a family and a community, a believer or doubter of a faith, a unit in an economy, perhaps a citizen in a state or a soldier in an army, we may ask the corresponding heads — astronomy, geology, geography, biology, ethnology, psychology, morality, religion, economics, politics, and war — what history has to say about the nature, conduct, and prospects of man. It is a precarious enterprise, and only a fool would try to compress a hundred centuries into a hundred pages of hazardous conclusions. We proceed.

The first topic Durant approaches is our relationship to the physical Earth, a group of knowledge we can place in the second bucket, in Kaufman’s terms. We must recognize that the varieties of geology and physical climate we live in have to a large extent determined the course of human history. (Jared Diamond would agree, that being a major component of his theory of human history.)

History is subject to geology. Every day the sea encroaches somewhere upon the land, or the land upon the sea; cities disappear under the water, and sunken cathedrals ring their melancholy bells. Mountains rise and fall in the rhythm of emergence and erosion; rivers swell and flood, or dry up, or change their course; valleys become deserts, and isthmuses become straits. To the geologic eye all of the surface of the earth is a fluid form, and man moves upon it as insecurely as Peter walking on the waves to Christ.

There are some big, useful lessons we can draw from studying geologic time. The most obvious might be the concept of gradualism, or slow incremental change over time. This was most well-understood by Darwin, who applied that form of reasoning to understand the evolution of species. His hero was Charles Lyell, whose Principles of Geology created our understanding of a slow, move-ahead process on the long scale of geology.

And of course, that model is quite practically useful to us today — it is through slow, incremental, grinding change, punctuated at times by large-scale change when necessary and appropriate, that things move ahead most reliably. We might be reminded in the modern corporate world of General Electric, which ground ahead from an electric lamp company to an industrial giant, step-by-step over a long period which destroyed many thousands of lesser companies with less adaptive cultures.

We can also use this model to derive the idea of human nature as nearly fixed; it changes in geologic time, not human time. This explains why the fundamental problems of history tend to recur. We’re basically the same as we’ve always been:

History repeats itself in the large because human nature changes with geological leisureliness, and man is equipped to respond in stereotyped ways to frequently occurring situations and stimuli like hunger, danger, and sex. But in a developed and complex civilization individuals are more differentiated and unique than in a primitive society, and many situations contain novel circumstances requiring modifications of instinctive response; custom recedes, reasoning spreads; the results are less predictable. There is no certainty that the future will repeat the past. Every year is an adventure.

Lastly, Mother Nature’s long history also teaches us something of resilience, which is connected to the idea of grind-ahead change. Studying evolution helps us understand that what is fragile will eventually break under the stresses of competition: Most importantly, fragile relationships break, but strong win-win relationships have super glue that keeps parties together. We also learn that weak competitive positions are eventually rooted out due to competition and new environments, and that a lack of adaptiveness to changing reality is a losing strategy when the surrounding environment shifts enough. These and others are fundamental knowledge and work the same in human organizations as in Nature.

The Biology of History

Durant moves from geology into the realm of human biology: Our nature determines the “arena” in which the human condition can play out. Human biology gives us the rules of the chessboard, and the Earth and its inhabitants provide the environment in which we play the game. The variety of outcomes approaches infinity from this starting point. That’s why this “bucket” of human knowledge is such a crucial one to study. We need to know the rules.

Thinking with the first “bucket” of knowledge — the mathematics and physics that drive all things in the universe — it’s easy to derive that compounding multiplication can take a small population and make it a very large one over a comparatively short time. 2 becomes 4 becomes 8 becomes 16, and so on. But because we also know that the spoils of the physical world are finite, the “Big Model” of Darwinian natural selection flows naturally from the compounding math: As populations grow but their surroundings offer limitations, there must be a way to derive who gets the spoils.

Not only does this provide the basis for biological competition over resources, a major lesson in the second bucket, it also provides the basis for the political and economic systems in bucket three of human history: Our various systems of political and economic organization are fundamentally driven by decisions on how to give order and fairness to the brutal reality created by human competition.

In this vein, we have previously discussed Durant’s three lessons of biological history: Life is Competition. Life is Selection. Life must Breed. (Head over to that post for the full scope of that idea from Durant’s book.) These simple precepts lead to the interesting results in biology, and most relevant to us, to similar interesting results in human culture itself:

Like other departments of biology, history remains at bottom a natural selection of the fittest individuals and groups in a struggle wherein goodness receives no favors, misfortunes abound, and the final test is the ability to survive.

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We do, however, need to be careful to think with the right “bucket” at the right time. Durant offers us a cautionary tale here: The example of the growth and decay of societies shows an area where the third bucket, human culture, offers a different reality than what a simple analogy from physics or biology might show. Cultural decay is not inevitable, as it might be with an element or a physical organism:

If these are the sources of growth, what are the causes of decay? Shall we suppose, with Spengler and many others, that each civilization is an organism, naturally and yet mysteriously endowed with the power of development and the fatality of death? It is temping to explain the behavior of groups through analogy with physiology or physics, and to ascribe the deterioration of a society to some inherent limit in its loan and tenure of life, or some irreparable running down of internal force. Such analogies may offer provisional illumination, as when we compare the association of individuals with an aggregation of cells, or the circulation of money from banker back to banker with the systole and diastole of the heart.

But a group is no organism physically added to its constituent individuals; it has no brain or stomach of its own; it must think or feel with the brains and nerves of its members. When the group or a civilization declines, it is through no mystic limitation of a corporate life, but through the failure of its political or intellectual leaders to meet the challenges of change.

[…]

But do civilizations die? Again, not quite. Greek civilization is not really dead; on its frame is gone and its habitat has changed and spread; it survives in the memory of the race, and in such abundance that no one life, however full and long, could absorb it all. Homer has more readers now than in his own day and land. The Greek pets and philosophers are in every library and college; at this moment Plato is being studied by a hundred thousand discovers of the dear delight of philosophy overspread life with understanding thought. This selective survival of creative minds is the most real and beneficent of immortalities.

In this sense, the ideas that thrive in human history are not bound by the precepts of physics. Knowledge — the kind which can be passed from generation to generation in an accumulative way — is a unique outcome in the human culture bucket. Other biological creatures only pass down DNA, not accumulated learning. (Yuval Harari similarly declared that “The Cognitive Revolution is accordingly the point when history declared its independence from biology.”)

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With that caveat in mind, the concept of passed-down ideas does have some predictable overlap with major mental models of the first two buckets of physics/math and biology.

The first is compounding: Ideas and knowledge compound in the same mathematical way that money or population does. If I have an idea and tell my idea to you, we both have the idea. If we each take that idea and recombine it with another idea we already had, we now have three ideas from a starting point of only one. If we can each connect that one idea to two ideas we had, we now have five ideas between us. And so on — you can see how compounding would take place as we told our friends about the five ideas and they told theirs. So the Big Model of compound interest works on ideas too.

The second interplay is to see that human ideas go through natural selection in the same way biological life does.

Intellect is therefore a vital force in history, but it can also be a dissolvent and destructive power. Out of every hundred new ideas ninety-nine or more will probably be inferior to the traditional responses which they propose to replace. No one man, however brilliant or well-informed, can come in one lifetime to such fullness of understanding as to safely judge and dismiss the customs or institutions of society, for these are the wisdom of generations after centuries of experiment in the laboratory of history.

This doesn’t tell us that the best ideas survive any more than natural selection tells us that the best creatures survive. It just means, at the risk of being circular, that the ideas most fit for propagation are the ones that survive for a long time. Most truly bad ideas tend to get tossed out in the vicissitudes of time either through the early death of their proponents or basic social pressure. But any idea that strikes a fundamental chord in humanity can last a very long time, even if it’s wrong or harmful. It simply has to be memorable and have at least a kernel of intuitive truth.

For more, start thinking about the three buckets of knowledge, read Durant, and start getting to work on synthesizing as much as possible.

Charlie Munger on the Medical System

Long a fount of wisdom, Charlie Munger provided us fascinating insight on everything from energy policy and mental models to how good gamblers think and making effective decisions.

At the Daily Journal Meeting (held March 25th, 2015), Munger answered a question on Obamacare:

Of course the system of medical care, as evolved under the United States, has much wrong with it.

On the other hand, it has much that’s good about it. All the new drugs and devices, and new operations, medicine has taken more territory in my lifetime than it took in the whole previous history of mankind. It’s just amazing what’s been done.

A lot of it is obvious and simple, like inoculating the children against infantile paralysis, scraping the tartar off your teeth so you don’t wear plates when you’re 55 years old, and so on. People now take those benefits for granted, but I lived in a world where a lot of children died. Every city had a tuberculosis sanitarium, and half the people who got tuberculosis died. It’s amazing how well medicine has worked.

On the other hand, compared to the best it can possibly be, the American system is pretty peculiar. It’s very hard to fix. One kind of insanity is to say, “We’ll pay you so much a month for taking care of the people, and everything you save is yours.”

That is the system the government uses in dealing with the convalescent homes. That’s a great name, a convalescent home. You convalesce in heaven. You don’t convalesce them at home. [laughs] It’s attempting to have a euphemistic name.

That creates huge incentives to delay care and keep the money. The government has strict rules, compliance systems, and so forth. If we didn’t have that system, the cost of taking care of the old people in convalescent homes would be 10 times what it is. It was the only feasible solution.

The rest of the world is going in that direction, because the costs just keep rising and rising and rising.

If the government is going to pay A anything he wants for selling services to B, who doesn’t have to pay anything, of course the system is going to create a lot of unnecessary tests, unnecessary costs, unnecessary procedures, unnecessary interventions.

Psychiatrists that keep talking to a patient forever and ever with no improvement, of course that system is going to cause problems. The alternative system also causes problems.

Add the fact you’ve got politicians and add the fact you’ve got existing players who are enormously rich and powerful, who lobby you like crazy. A state legislature, now, is just 19 percent or whatever it is of GDP going to the medical system, imagine what the lobbying is like.

We get these Rube Goldberg systems. We get a lot of abuse of various kinds. There’s hardly an ethical drug company that hasn’t created multiple gross abuses, which are in substance growing through the bribery of doctors, which, of course, is illegal.

You have all these ethical companies. Ethical meaning it’s the designation of a drug company that has patented drugs. They’ve all committed big follies. The device makers of anything have been worse. There’s been a lot of abuse and craziness, and the costs, of course, just keep rising and rising.

That’s in a system that every child has been the greatest achiever in the history of the world. It’s very complicated. I think it will get addressed more because…We probably will end up with systems that are more like we do with the convalescent homes.

If you look at medicine, what’s happening is that more and more they’re going to a system where they pay somebody X dollars and everything they save, they keep. That system has some chance of controlling the cost. If you go into a great medical school hospital today, and you’re within a day of dying of some obvious thing like advanced cancer, the admitting physician is very likely to ask for a test of your cholesterol or any other damn thing. All the bills go to the government. As long as the incentives allow that, people will do it and they’ll rationalize their behavior. Something has to be done along that and more than is now being done.

I think the drift will be more in the direction of the block care. I don’t see any other system that would have controlled cost in the convalescent homes.

By the way, your doctor can’t just walk by every bed in the convalescent home and send the bill to the government. That’s not allowed by the law. But if you transfer the patient into a hospital, he can walk by the bed five times every day and send a $45 bill to the government.

If the incentives are wrong, the behavior will be wrong. I guarantee it. Not by everybody, but by enough of a percentage that you won’t like the system.

I think that’s enough on a subject that’s so difficult. I think we can see where it’s going. We may end up with a whole system that’s…In the Netherlands, they have a system where the same people are giving a free system to everybody and a concierge system to the others. It’s working pretty well.

Transcript Source.

The Best Way to Get Smarter? Learn to Read the Right Way.

There is a Buffett & Munger interview from 2013 that we reflect on frequently. They discuss how they’ve leaped ahead of their peers and competitors time and time again:

Munger: We’ve learned how to outsmart people who are clearly smarter [than we are].

Buffett: Temperament is more important than IQ. You need reasonable intelligence, but you absolutely have to have the right temperament. Otherwise, something will snap you.

Munger: The other big secret is that we’re good at lifelong learning. Warren is better in his 70s and 80s, in many ways, than he was when he was younger. If you keep learning all the time, you have a wonderful advantage.

When you couple this with the fact that Buffett & Munger estimate that they spend 80% of their day reading or thinking about what they’ve read, a philosophy is born:

The way to get better results in life is to learn constantly.
And the best way to learn is to read effectively, and read a lot.

The truth is, most styles of reading won’t deliver big results. In fact, most reading delivers few practical advantages; shallow reading is really another form of entertainment. That’s totally fine, but much more is available to the dedicated few.

In a literal sense, we all know how to read. We learned in elementary school. But few of us take the time to improve our skills from the elementary, passive, cover-to-cover reading into a skill set that affords us real and lasting advantages.

Those advantages don’t come from the type of reading that most of us employ most of the time. Real learning stems from a deliberate reading process and a set of principles that are simple, yet challenging.

Simple principles like: Some books demand to be read in their entirety. Most don’t. It’s your job to decide.

Deep, thorough reading doesn’t come naturally or easily to most people. It isn’t achieved by passively absorbing content while reading at max speed. But wisdom and deep understanding can be teased out when you know how to do it.

We can teach you the best of what we’ve learned about reading and how to mold that into an uncommon, sustaining advantage. And with that, we introduce our new course:

Farnam Street’s Guide to How to Read a Book

How to Read a Book is a comprehensive online course that offers observations and strategies on everything from how to build strong reading habits to how to achieve novel insight on topics that already seem mastered by others. We believe this course has the ability to seriously impact any wisdom seeker’s life by enhancing your ability to learn.

Find out more information here:

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For those of you not interested, no problem. Thank you for listening. We’ll be back to our regularly scheduled programming later this week.