# Tag: Mental Models

## Multiplicative Systems: Understanding The Power of Multiplying by Zero

We all learned in math class that anything times zero is zero. But if you stop thinking about the idea here, you don’t see all the practical applications that understanding multiplicative systems can give you in life.

***

Let’s run through a little elementary algebra. Try to do it in your head: What’s 1,506,789 x 9,809 x 5.56 x 0?

Hopefully, you didn’t have to whip out the old TI-84 to solve that one. It’s a zero.

This leads us to a mental model called Multiplicative Systems and understanding it can get to the heart of a lot of issues.

## The Weakest Link in the Chain

Suppose you were trying to become the best basketball player in the world. You’ve got the following things going for you:

1. God-given talent. You’re 6’9″, quick, skillful, can leap out of the building, and have been the best player in a competitive city since you can remember.

2. Support. You live in a city that reveres basketball and you’re raised by parents who care about your goals.

3. A proven track record. You were the player of the year in a very competitive Division 1 college conference.

4. A clear path forward. You’re selected as the second overall pick in the NBA Draft by the Boston Celtics.

Sounds like you have a shot, right? As good as anyone could have, right? What would you put the odds at of this person becoming one of the better players in the world? Pretty high?

Let’s add one more piece of information:

5. You’ve developed a cocaine habit.

This little exercise isn’t an academic one, it’s the sad case of Leonard “Len” Bias, a young basketball prodigy who died of a cocaine overdose after being selected to play in the NBA for the Boston Celtics in 1986. Many call Bias the best basketball player who never played professionally.

What the story of Len Bias illustrates so well is the truth that anything times zero must still be zero, no matter how large the string of numbers preceding it. In some facets of life, all of your hard work, dedication to improvement, and good fortune may still be worth nothing if there is a weak link in the chain.

Something all engineers learn very early on is that a system is no stronger than its weakest component. Take, for example, the case of a nuclear power plant. We have a very good understanding of how to make the nuclear power plant quite safe, nearly indestructible, which it must be considering the magnitude of a failure.

But in reality, what is the weakest link in the chain for most nuclear power plants? The human beings running them. We’re part of the system! And since we’ve yet to perfect the human being, we have yet to perfect the nuclear power plant. How could it be otherwise?

An additive system does not work this way. In an additive system, each component adds on to one another to create the final outcome. Going back to algebra, let’s say our equation was additive rather than multiplicative: 1,506,789 plus 9,809 plus 5.56 plus 0. The answer is 1,516,603.56 — still a pretty big number!

Think of an additive system as something like a great Thanksgiving dinner. You’ve got a great turkey, some whipped potatoes, a mass of stuffing, and a lump of homemade cranberry sauce, and you’re hanging with your family. Awesome!

Let’s say the potatoes get burnt in the oven, and they’re inedible. Problem? Sure, but dinner still works out just fine. Someone shows up with a pie for dessert? Great! But it won’t change the dinner all that much.

The interaction of the parts makes the dinner range from good to great. Take some parts away or add new ones in, and you get a different outcome, but not a binary, win/lose one. The meal still happens. Additive systems and multiplicative systems react differently when components are added or taken away.

Most businesses, for example, operate in a multiplicative system. But they too often think they’re operating in additive ones: Ever notice how some businesses will add one feature on top of another to their products but fail at basic customer service, so you leave, never to return? That’s a business that thinks it’s in an additive system when they really need to be resolving the big fat zero in the middle of the equation instead of adding more stuff.

***

Financial systems are, of course, multiplicative. General Motors, founded in 1908 by William Durant and C.S. Mott, came to dominate the American car market to the tune of 50% market share through a series of brilliant innovations and management practices and was for many years the dominant and most admirable corporation in America. Even today, after more than a century of competition, no American carmaker produces more automobiles than General Motors.

And yet, the original shareholders of GM ended up with a zero in 2008 as the company went into bankruptcy due to years of financial mismanagement. It didn’t matter that they had several generations of leadership: All of that becomes naught in a multiplicative system.

***

On a smaller scale, take the case of a young corporate climber who feels they just can’t get ahead. They seem to have all their ducks in a row: great resume, great background, great experience…the problem is that they suck at dealing with other people and treat others like stepping stones. That’s a zero that can negate all of the big numbers preceding it. The rest doesn’t matter.

And so we arrive at the “must be true” conclusion that understanding when you’re in an additive system versus a multiplicative system, and which components need absolute reliability for the system to work, is a critical model to have in your head. Multiplicative thinking is a model related to the greater idea of systems thinking, another mental model well worth acquiring.

***

Multiplicative Systems is another FS Mental Model.

## Mental Model: Bias from Envy and Jealousy

“It is not greed that drives the world,
but envy.”
— Warren Buffett

***

It is a fact of life that we are not equal. Not biologically, not culturally.

Some inequities come from flawed governing systems, but most are simply due to luck — the vagaries of life. Some of us are born healthier, prettier and smarter than others, some will encounter opportunities to become extremely wealthy, and some will simply be born at the right place and time. Just as many will be born without such good fortune.

It’s difficult to imagine that these differences will not matter in our everyday interactions. When you think of how natural the differences among us are, you should quickly come to realize the potential power and frequency that bias from envy and jealousy can have on world affairs. It’s built deeply into the human condition, from birth.

The concept of jealousy is as old as modern humanity itself and has permeated our culture worldwide. We are advised not to brag too much, for it can evoke feelings of envy and jealousy in others. Christianity, Hinduism, Islam and other religions all have at least one cautionary tale about the destructive consequences of being captivated by these emotions as well as the dangers of being the one who is envied.

The stoics knew all about envy, and warned against its consequences constantly. Seneca described a wise man as one who is “Content with his lot, whatever it be, without wishing for what he has not …”

Tales of envy extend as far back as ancient times.

In one of the oldest recorded myths, the tall, slender and handsome Egyptian God Osiris marries his beautiful sister and brings civilization and prosperity to Egypt and the world. However, Osiris also has an ugly younger brother Seth who hates him. Seth envies Osiris for his attractiveness, power and success. Seth’s wife becomes so attracted to Osiris that she tricks him into sleeping with her and bears Osiris’s child. Unable to deal with his envy and jealousy, Seth traps and kills Osiris.

Even though the myth is several thousand years old, the problems caused by envy and jealousy can be just as real and destructive today. To avoid these feelings and becoming a victim of them is an important reason to examine them a little closer.

## The Two Types of Envy

It has been said that there are two types of envy – a good type and a bad type.

The first type is the feeling of inferiority that motivates a person to improve herself. This bias exerts its influence by framing the success of others as a learning opportunity for ourselves. Think about watching an inspirational movie, or reading a book about an inspirational figure, someone who you feel dwarfs your own capabilities and accomplishments. Frequently, our envy leads us to imitate that hero in a quest for self-improvement.

The other type, though, is malicious envy, which motivates the envious to take good things away from others. For Aristotle, the evil of malicious envy lay in its desire to lessen the good in the world and experience joy at another’s misfortune (also called Schadenfreude which, mysteriously enough, has no equivalent word in English.)

To the malicious envier, ridding oneself of envy requires taking away from the other — the beautiful car or house should be stolen or damaged, the virtuous person corrupted or killed and the beautiful face of someone ruined or covered. The malicious envier believes that those things should be his rather than theirs. He, after all, deserves it more.

Lord Chesterfield once said: “People hate those who make them feel their own inferiority.”

This can be true. While the envied need not cause the deprivation of the other, the envier may still experience anger or resentment, a sense of unfairness, which may lead to feelings of hate. The relation between envy and hate is pretty close, if you observe the world closely.

“Envy is pain at the good fortune of others.
We envy those who are near us in time, place, age or reputation.”
— Aristotle

There are two basic determinants of the type of envy that will be experienced: the degree of belief that one has been treated unfairly and the belief that one’s disadvantage is one’s own fault.

Common sense, and data presented by Peter Salovey in his book The Psychology of Envy and Jealousy, suggest that the second determinant, one’s belief in one’s own shortcomings, plants the motivation for improvement.

The belief that one has been treated unfairly has the opposite effect – it results in feelings of anger and resentment. You become a negatively coiled spring.

## Social Comparison

“Injustice is relatively easy to bear, it is justice that hurts.”
— Henry Louis Mencken

At the heart of envy is social comparison, which is a powerful influence in our self-concept. Think about it – much of our self-definition comes from comparison with others. We can’t define ourselves as great singers, if there is no one else around who sings worse than we do. Qualities like intelligence, beauty and skills are relative and thus when we compare poorly in comparison to our peers, our self-esteem suffers. Judith Rich Harris argues that this is a core part of our personality development.

An inflamed self-esteem is a good first step towards envy. We experience envy when the quality we feel inferior about threatens our self-concept. We may not even be aware that we are lacking a particular quality, but the object of our envy heightens our awareness of our deprivation.

Think about it this way: Do you feel envy when you see a great javelin thrower at the Olympics? Probably not, because, for most of us, success at javelin throwing isn’t a core part of our self-concept. But let’s say you were a competitive javelin thrower — might you feel a little envy if you saw someone much better than you competing at the Olympics?

Thus, envy of others is always a reflection of something we feel about ourselves. We’re not rich enough, or smart enough, or beautiful enough; we don’t have enough possessions, enough attention, enough success.

## Jealousy

If there is a way to define jealousy in its most narrow scope, then it would probably be the feeling of anxious insecurity that follows the perception of threat to a relationship which provides important attention. Perceiving such a threat makes a person feel insecure about the status of the relationship and thus also about the aspects of the self that are sustained by it.

We do not become jealous when our partners die or move across the country or quit the relationship without getting into a new one. What is always true for jealousy, unlike envy, is that it involves a triangle of relationships between the self, the partner and the rival. Therefore, when talking about jealousy it is important to realize its key characteristic — the threat of losing something to someone else.

There is the hypothesis that at the heart of feelings of jealousy lies our need to feel needed. This need exists because relationships define certain aspects of who we are.

We like to think of ourselves as sexually attractive, funny or otherwise worthy persons. However, when there is no one to be funny with or no one who is attracted to us, our self-definition of funny or attractive dissipates. We need the others not only to reaffirm these aspects, but also to create them. Humans are deeply social creatures — how we feel about ourselves has to do with our interactions with others. There are no personality traits in a vacuum.

Jealousy is not limited to romantic relationships — jealousy exists between siblings, co-workers and even friends. Yet there is a reason why we get so caught up in romantic jealousy.

Someone stealing away our chess partner’s time does not threaten our self-concept nearly as much someone stealing away our girlfriend’s time. We have a biological need for a romantic other that eclipses our need for a chess partner; feelings of deprival are intensified.

Children can also experience intense jealousy. The most important relationship for a child is that with his parents, which is why sibling rivalry can sometimes be so fierce. Naturally, as the child reaches adolescence and develops serious friendships and romantic relationships, the sibling jealousy tends to dissipate.

***

There are several notable commonalities and differences between jealousy and envy.

With both envy and jealousy we experience loss of self-esteem stemming from social comparison. In the case of envy the loss comes from our self-appraisal, whereas in the case of jealousy it comes from the appraisal by others. Therefore, when experiencing jealousy we are often left wondering what is it that the other person finds in our rival? whereas in the case of envy we know exactly what we’re missing.

Another common quality of both envy and jealousy is how extreme they can be in modern life. For instance, ongoing discussions about employee salaries and CEO salaries. In many workplaces this has resulted in a salary non-disclosure policy within the job contract. Still, when the compensation data is leaked, and some perceived inequality is discovered, there is often outrage.

These effects are observed in workplaces as diverse as universities, investment banks, corporates and law firms. In order to keep the air clear of envy and jealousy, numerous firms and government agencies have gone as far as opting for the same base compensation per seniority level, regardless of employee contribution. Berkshire Hathaway chooses not to disclose the compensation of most of its top people for fear of creating organization-wide envy, and CEO Warren Buffett credits his ridiculously low salary with keeping envy of his success to a minimum.

***

An important question remains: How should we deal with envy at a personal level?

There are three ways to overcome envy.

The first is to focus on the differences between you and the other person, rather than the similarities. Examine the situation — you are not as alike as you think you are.

The second is more difficult, but we certainly find we can do it in other contexts, as discussed above. Shape your malicious envy into a drive to improve and learn. From every person that we envy there is a virtue that we can learn from.

Thirdly, envy can be avoided (over time) with simple repetitive denial. Don’t let yourself become envious of others’ deserved success. Stop the feeling in its tracks, if you can. As for undeserved success, remind yourself that the world is not a fair place that owes us what we wish. Remind yourself that the success of others does not reflect on you and does not take away from you. Envy is a somewhat childish emotion, one that hurts us as we get older.

Jealousy is more difficult to overcome since we are not fully in control of the needs or perceptions of others. There is little we can do to make others appreciate us when they don’t, but we can learn to accept that we will not always be everything for everyone. Just as with envy – jealousy can be an important trigger for increased self-awareness as well as positive change. After all, a little jealousy can be a good thing, for we may be reminded to appreciate what we have.

The sins of jealously and envy drive huge swaths of human behavior, but if we work to understand it and see it in ourselves and others, it doesn’t have to drive ours.

***

“Man will do many things to get himself loved;
he will do all things to get himself envied.”
— Mark Twain

Envy is a great cause of human suffering. Charlie Munger points out why: “Envy is a really stupid sin because it’s the only one you could never possibly have any fun at. There’s a lot of pain and no fun. Why would you want to get on that trolley?”

Why indeed.

While envy and jealously are powerful drivers of behaviour on their own, they become more powerful when mixed with ego, greed, and fear. These emotions can weigh the mind down and dramatically diminish our ability to think with our full mental capacity. They can also hone our focus. These emotions have also motivated people to do great things.

And in case you’re wondering how you can avoid being the source of envy for others? Aristotle had an answer: “The best way to avoid envy is to deserve the success you get.”

***

Still Interested? Check up on some other mental models and biases.

## Mental Models: Getting the World to Do the Work for You

People are working harder and harder to clean up otherwise avoidable messes they created by making poor initial decisions. There are many reasons we’re making poor decisions and failing to learn from them.

Under the heading, Sources of Stupidity in an article entitled Smart Decisions we wrote about some of the factors that contribute to suboptimal decisions.

1. We’re (sometimes) stupid. Of course, I like to think that I’m rational and capable of interpreting all of the information in a non-biased way. Only I’m not. At least not always. There are situations that increase the odds of irrationality, for instance when we’re tired, overly focused on a goal, rushing, distracted or interrupted, operating in a group, or are under the direction of an expert2.

2. We have the wrong information. In this case, we’re operating with the wrong facts or our assumptions are incorrect.

3. We use the wrong model. We use models to make decisions. The quality of those models often determines the quality of our thinking. There are a variety of reasons that we use false, incomplete, or incorrect models. For instance, we’re prone to using less useful models when we are a novice or we operate in a domain outside of our area of expertise. The odds of the wrong model also increase as the pace of environmental change increases.

4. We fail to learn. We all know the person that has 20 years of experience but it’s really the same year over and over. Well, that person is sometimes us. If we don’t understand how we learn, we’re likely to make the same mistakes over and over.

5. Doing what’s easy over what’s right. You can think of this as looking good over doing good.  In this case, we make choices based on optics, explainability, politics, etc. Mostly this comes from not having a strong sense of self and seeking external validation or avoiding punishment.

## Simple But Not Easy

One of the metamodels that traverse all five of these sources of stupidity is understanding the world.

If you understand the world as it really is, not as you’d wish it to be, you will begin to make better decisions almost immediately. Once you start making better decisions the results compound. Better initial decisions free up your time, reduce your stress, allowing you to spend more time with your family and leave your competition in the dust.

## Understanding The World

How can we best understand the world as it is?

Acquiring knowledge can be a very daunting task. If you think of the mind as a toolbox, we’re only as good as the tools at our disposal. A carpenter doesn’t show up to work with an empty toolbox. Not only do they want as many tools in their toolbox as possible, but they want to know how to use them. Having more tools and the knowledge of how to use them means they can tackle more problems.  Try as we might, we cannot build a house with only a hammer.

If you’re a knowledge worker, you’re a carpenter. But your tools aren’t bought at a store and they don’t come in a red box that you carry around. Mental tools are the big ideas from multiple disciplines, and we store them in our mind. And if we have a lot of tools and the knowledge required to wield them properly, we can start to synthesize how the world works and make better decisions when confronted with problems.

This is how we understand and deal with reality. The tools you put into your toolbox are Mental Models.

Mental models are a framework for understanding how the world really works. They help you grasp new ideas quickly, identify patterns before anyone else and shift your perspective with ease. Mental Models allow us to make better decisions, scramble out of bad situations, and think critically. If you want to understand reality you must look at a problem in multiple dimensions — how could it be otherwise?

Getting to this level of understanding requires having a lot of tools and knowing how to use them. You knew there was a hitch right?

We need to change our fast-food diet of information consumption and adopt the healthier diet of knowledge that changes slowly over time. While changing diets isn’t easy, it can be incredibly rewarding: more time, less stress, and being better at your job. The costs, however, are short term pain for long-term gain. You must change how you think.

## 2^nd Order Thinking

One example of a model we can immediately conceptualize and use to improve our ability to make better decisions is something we can borrow from ecology called second-order thinking. The simple way to conceptualize this is to ask yourself “If I do X, what will happen after that?”. I sum this up using the ecologist Garrett Hardin’s simple question: “And then what?

A lot of people forget about higher order effects — second and third-order effects or higher. I’ve been in a lot of meetings where decisions are made and very few people think to the second level, let alone the third. Rather, what typically happens is called first conclusion bias. The brain shuts down and stops thinking at the first idea that comes to mind that seems to address the problem as you understand it.

We don’t often realize that our first thoughts are usually not even our own thoughts. They usually belong to someone else. We understand the sound-byte but we haven’t done the hard work of real thinking. After we reach the first conclusion, our minds often shut down. We don’t seek evidence that would contradict our conclusion. We don’t ask ourselves what the likely result of this solution would be — we don’t ask ourselves “And then what?” We don’t ask what other solutions might be even more optimal.

For example, consider a hypothetical organization that decides to change their incentive systems. They come up with a costly new system that requires substantial changes to the current system. Only they don’t consider (or even understand) the problems that the new system is likely to create. It’s possible they’ve created more problems than they’ve solved – only now there are different problems they must put their head down to solve. Optically, they “reorganize their incentive programs,” but practically, they’ve simply expended energy to stay in place.

Another, perhaps more complicated, example is when a salesman comes into a company and offers you a software program he claims will lower your operating costs and increase your profits. He’s got all these beautiful charts on how much more competitive you’ll be and how it will improve everything. This is exactly what you need because your compensation is based on increasing profits. You’re sold.

Then second-order thinking kicks in and you dare to ask how much of those cost savings are going to go to you and how much will eventually end up benefits enjoyed by customers? To a large extent, that depends on the business you’re in. However, you can be damn sure the salesman is now knocking on your competitor’s door and telling them you just bought their product and if they want to remain competitive they better purchase it too. Eventually, you all have the new software and no one is truly better off. Thus, in the manner of a crowd of people standing on their tip-toes at a parade, all competitors spend the money but none of them win: The salesman wins and the customer wins.

We know, thanks to people like Garrett Hardin, Howard Marks, Charlie Munger, Peter Kaufman, and disciplines like ecology, that there are second and third-order effects. This is how the world really works.It just isn’t always a comfortable reality.

Understanding how the world works isn’t easy and it shouldn’t be. It’s hard work. If it were easy, everyone would do it. And it’s not for everyone. Sometimes, if your goal is to maximize utility, you should focus on getting very, very good in a narrow area and becoming an expert, accepting that you will make many mistakes outside of that domain. But for most, it’s extremely helpful to understand the forces at play outside of their narrow area of expertise.

Because when you think about it, how could reality be anything other than a synthesis of multiple factors? How could it possibly be otherwise?

## Daniel Dennett’s Most Useful Critical Thinking Tools

We recently discussed some wonderful mental tools from the great Richard Feynman. Let’s get some more good ones from another giant, Daniel Dennett.

Dennett is one of the great thinkers in the world; he’s been at the forefront of cognitive science and evolutionary science for over 50 years, trying to figure out how the mind works and why we believe the things we believe. He’s written a number of amazing books on evolution, religion, consciousness, and free will. (He’s also subject to some extreme criticism due to his atheist bent, as with Dawkins.)

His most recent book is the wise and insightful Intuition Pumps and Other Tools for Critical Thinking, where he lays out a series of short essays (some very short — less than a page) with mental shortcuts, tools, analogies, and metaphors for thinking about a variety of topics, mostly those topics he is best known for.

Some people don’t like the disconnected nature of the book, but that’s precisely its usefulness: Like what we do here at Farnam Street, Dennett is simply trying to add tools to your toolkit. You are free to, in the words of Bruce Lee, “Absorb what is useful, discard what is useless and add what is specifically your own.”

***

The book opens with 12 of Dennett’s best “tools for critical thinking” — a bag of mental tricks to improve your ability to engage critically and rationally with the world.

Let’s go through a few of the best ones. You’ll be familiar with some and unfamiliar with others, agree with some and not with others. But if you adopt Bruce Lee’s advice, you should come away with something new and useful.

Making mistakes

Mistakes are not just opportunities for learning; they are, in an important sense, the only opportunity for learning or making something truly new. Before there can be learning, there must be learners. There are only two non-miraculous ways for learners to come into existence: they must either evolve or be designed and built by learners that evolved. Biological evolution proceeds by a grand, inexorable process of trial and error–and without the errors the trials wouldn’t accomplish anything. As Gore Vidal once said, “It is not enough to succeed. Others must fail.”

[…]

The chief trick to making good mistakes is not to hide them–especially not from yourself. Instead of turning away in denial when you make a mistake, you should become a connoisseur of your own mistakes, turning them over in your mind as if they were works of art, which in a way they are. The fundamental reaction to any mistake ought to be this: “Well, I won’t do that again!”

The crowbar of rational inquiry, the great lever that enforces consistency, is reductio ad absurdum–literally, reduction (of the argument) to absurdity. You take the assertion or conjecture at issue and see if you can pry any contradictions (or just preposterous implications) out of it. If you can, that proposition has to be discarded or sent back to the shop for retooling. We do this all the time without bothering to display the underlying logic: “If that’s a bear, then bears have antlers!” or “He won’t get here in time for supper unless he can fly like Superman.”

Rapoport’s Rules

Just how charitable are you supposed to be when criticizing the views of an opponent? […] The best antidote I know for [the] tendency to caricature one’s opponent is a list of rules promulgated by the social psychologist and game theorist Anatol Rapoport (creator of the winning Tit-for-Tat strategy in Robert Axelrod’s legendary prisoner’s dilemma tournament).

How to compose a successful critical commentary:

1. You should attempt to re-express your target’s position so clearly, vividly, and fairly that your target says, “Thanks, I wish I’d thought of putting it that way.”
2. You should list any points of agreement (especially if they are not matters of general or widespread agreement).
3. You should mention anything that you have learned from your target.
4. Only then are you permitted to say so much as a word of rebuttal or criticism.

Sturgeon’s Law

The science-fiction writer Ted Sturgeon, speaking at the World Science Fiction Convention in Philadelphia in September 1953, said,

When people talk about the mystery novel, they mentioned The Maltese Falcon and The Big Sleep. When they talk about the western, they say there’s The Way West and Shane. But when they talk about science fiction, they call it “that Buck Rogers stuff,” and they say “ninety percent of science fiction is crud.” Well, they’re right. Ninety percent of science fiction is crud. But then ninety percent of everything is crud, and it’s the ten percent that isn’t crud that’s important, and the ten percent of science fiction that isn’t crud is as good as or better than anything being written anywhere.

This advice is often ignored by ideologues intent on destroying the reputation of analytic philosophy, evolutionary psychology, sociology, cultural anthropology, macroeconomics, plastic surgery, improvisational theater, television sitcoms, philosophical theology, massage therapy, you name it. Let’s stipulate at the outset that there is a great deal of deplorable, stupid, second-rate stuff out there, of all sorts.

Occam’s Razor

Attributed to William of Ockham (or Occam), the fourteenth century logician and philosopher, this thinking tool is actually a much older rule of thumb. A Latin name for it is lex parsimoniae, the law of parsimony. It is usually put into English as the maxim “Do not muliply entities beyond necessary.” The idea is straightforward: Don’t concoct a complicated, extravagant theory if you’ve got a simpler one (containing fewer ingredients, fewer entities) that handles the phenomenon just as well. If exposure to extremely cold air can account for all the symptoms of frostbite, don’t postulate unobserved “snow germs” or “arctic microbes.” Kepler’s laws explain the orbit of the planets; we have no need to hypothesize pilots guiding the planets from control panels hidden under the surface.

Occam’s Broom

The molecular biologist Sidney Brenner recently invented a delicious play on Occam’s Razor, introducing the new term Occam’s Broom, to describe the process in which inconvenient facts are whisked under the rug by intellectually dishonest champions of one theory or another. This is our first boom crutch, an anti-thinking tool, and you should keep your eyes peeled for it. The practice is particularly insidious when used by propagandists who direct their efforts at the lay public, because like Sherlock Holmes’ famous clue about the dog that didn’t bark in the night, the absence of a fact that has been swept off the scene by Occam’s Broom is unnoticeable except by experts.

Jootsing

…It is even harder to achieve what Doug Hofstadter calls joosting, which stands for “jumping out of the system.” This is an important tactic not just in science and philosophy, but also in the arts. Creativity, that ardently sought but only rarely found virtue, often is a heretofore unimagined violation of the rules of the system from which it springs. It might be the system of classical harmony in music, the rules for meter and rhyme in sonnets (or limericks, even), or the canons of good taste or good form in some genre of art. Or it might be the assumptions and principles of some theory or research program. Being creative is not just a matter of casting about for something novel–anbody can do that, since novelty can be found in any random juxtaposition of stuff–but of making the novelty jump out of some system, a system that has become somewhat established, for good reasons.

When an artistic tradition reaches the point where literally “anything goes,” those who want to be creative have a problem: there are no fixed rules to rebel against, no complacent expectations to shatter, nothing to subvert, no background against which to create something that is both surprising and yet meaningful. It helps to know the tradition if you want to subvert it. That’s why so few dabblers or novices succeed in coming up with anything truly creative.

Rathering (Anti-thinking tool)

Rathering is a way of sliding you swiftly and gently past a false dichotomy. The general form of a rathering is “It is not the case that blahblahblah, as orthodoxy would have you believe; it is rather that suchandsuchandsuch–which is radically different.” Some ratherings are just fine; you really must choose between the two alternatives on offer; in these cases, you are not being offered a false, bur rather a genuine, inescapable dichotomy. But some ratherings are little more than sleight of hand, due to the fact that the word “rather” implies–without argument–that there is an important incompatibility between the claims flanking it.

The “Surely” Operator

When you’re reading or skimming argumentative essays, especially by philosophers, here is a quick trick that may save you much time and effort, especially in this age of simple searching by computer: look for “surely” in the document, and check each occurrence. Not always, not even most of the time, but often the world “surely” is as good as a blinking light in locating a weak point in the argument….Why? Because it marks the very edge of what the author is actually sure about and hopes readers will also be sure about. (If the author were really sure all the readers would agree, it wouldn’t be worth mentioning.)

The Deepity

A “deepity” is a proposition that seems both important and true–and profound–but that achieves this effect by being ambiguous. On one reading it is manifestly false, but it would be earth-shaking if it were true; on the other reading it is true but trivial. The unwary listener picks up on the glimmer of truth from the second reading, and the devastating importance from the first reading, and thinks, Wow! That’s a deepity.

Here is an example. (Better sit down: this is heavy stuff.)

Love is just a word.

[…]

Richard Dawkins recently alerted me to a fine deepity by Rowan Williams, the Archbishop of Canterbury, who described his faith as a

silent waiting on the truth, pure sitting and breathing in the presence of a question mark.

***

Still Interested? Check out Dennett’s book for a lot more of these interesting tools for critical thinking, many non-intuitive. I guarantee you’ll generate food for thought as you go along. Also, try checking out 11 Rules for Critical Thinking and learn how to be Eager to be Wrong.

## The Value of Grey Thinking

One of the most common questions we receive, unsurprisingly, is along the lines of What one piece of advice would you recommend to become a better thinker?

The question is kind of cheating. There is, of course, no one thing, and if Farnam Street is a testament to any idea, it’s that you must pull from many disciplines to achieve overall wisdom. No truly great thinker is siloed in a small territory.

But a common experience tends to occur as you rid yourself of ideology and narrowness, as you venture deeper and deeper into unfamiliar territory; and it’s worth thinking about it ahead of time. It goes by many names, but a fair one might be Grey Thinking.

## Thinking in Grey

Children love torturing their parents and teachers with the relentless Why? The chain of whys can be endless — Why does the doggy pant? He’s hot. Why? I’m hot and I don’t pant. Yes, but he has fur, and doesn’t sweat. Why does he have fur? To keep him warm. Why don’t I have fur then? OK that’s enough.

If you’re a parent, you’ve probably had this experience. It’s agitating in the moment, but it’s just a symptom of the child’s view of the world: Something to be explored. Their views are not fixed yet.

As we get older, we start to get rigid. We are forced to take tests with definite answers — A, B, C, or D? How well we do at these determines, to an extent, our position in life. The shortcomings of this system are well documented so we won’t rehash them. But a major symptom of this style of learning, combined with our natural proclivity to land on easily digestible answers, is that we start thinking in rigid categories: War is good. War is bad. Capitalism is good. Capitalism is bad. America is Socialist. America is a Free Market System. We must support our troops. College is useless. College is indispensable.

And so on. These slogans become substitutes for actual understanding, and it’s not as benign as it seems. The slogan isn’t just a shorthand: It replaces thinking for many people, because it’s hard to generate real understanding. As discussed in the Eager to be Wrong piece, it’s a lot easier to land somewhere simple and stay there. It requires less energy.

But the fact is, the reality is all grey area. All of it. There are very few black and white answers and no solutions without second-order consequences.

This fundamental truth is easy to grasp in theory and hard to use in practice, every day. It takes a substantial deprogramming to realize that life is all grey, that all reality lies on a continuum. This is why quantitative and scale-based thinking is so important. But most don’t realize that quantitative thinking isn’t really about math; it’s about the idea that The dose makes the poison.

The dose/poison idea is the opposite of the slippery slope argument favored by the ideologue. It starts with this, and then the whole thing goes to hell. Well, maybe, but not necessarily and not usually. Nearly all things are OK in some dose but not OK in another dose. That is the way of the world, and why almost everything connected to practical reality must be quantified, at least roughly.

This isn’t to say that some things shouldn’t be stamped on hard, and fast. Doing heroin even once is probably a bad idea. But make sure to use the right mental model for the right situation. We can re-frame our slogans above: War is awful but history shows it to be occasionally necessary, and a very complex phenomenon. Capitalism is enormously productive but has many limitations. Some socialist institutions actually work well in a capitalist economy, but pure socialism hasn’t tended to work at all. College has its pluses and minuses; it works for some and not for others. Support for soldiers may carry some conditions. And so on.

If any of these ruffle your feathers, then good. The first step towards thinking in 3D is realizing that you carry many of your cherished positions too strongly. Most of practical reality lies outside the realm of mathematical certainty.

## Lyndon Johnson

There’s a wonderful series of books on Lyndon Johnson, the 36th President of the United States. By all accounts, LBJ was not someone you’d like to marry into your family. He was a relentless politician, a climber, a habitual liar, and treated many people like dirt, including his wife Lady Bird. He also embroiled the country in Vietnam, for which many never forgave him.

On the other hand, LBJ was a deep Southerner who cared deeply about the rights of the poor and the rights of people of color, at a time when few whites did, and even fewer whites in power did. He used his political power to enact Civil Rights legislation that seemingly no one else could get through, and with his Great Society programs, gave millions of poor and elderly people dignity, both of which we basically take for granted today, but were an enormous struggle to enact.

LBJ was not popular in his time, though history has been a bit more friendly to him. But the question stands…was he a good guy? Do we admire him or can we barely contain our hatred?

To an ideologue, LBJ fits into some category or another. He’s despicable, and his crimes cannot be made up for. His lies and his personal reputation make him unforgivable. Alternatively, by passing Civil Rights, maybe LBJ is something of a dark hero — a flawed, Batman-like figure who we needed but couldn’t appreciate in his time.

The truth is, of course, in between. He’s all of these things. The problem lies with us, the categorizers. We want to place him somewhere and move on. You may fairly, on balance, think LBJ detracted more than he added. That’s fine. But that’s not what most people want to do — they want to put the black hat or the white hat on him. Villain or hero.

This is a special case of a broader mental phenomenon that we’re doing all the time. This music sucks! This music is the best thing ever created! Yoga is for weirdos. Yoga is the only way to achieve mental peace.

It’s only once you can begin divorcing yourself from good-and-bad, black-and-white, category X&Y type thinking that your understanding of reality starts to fit together properly. Putting things on a continuum, assessing the scale of their importance and quantifying their effects, understanding both the good and the bad, is the way to do it.  Understanding the other side of the argument better than your own, a theme we hammer on ad nauseum, is the way to do it. Because truth always lies somewhere in between, and the discomfort of being uncertain is preferable to the certainty of being wrong.

It isn’t easy, but it’s not supposed to be.

## The Munger Operating System: How to Live a Life That Really Works

In 2007, Charlie Munger gave the commencement address at USC Law School, opening his speech by saying, “Well, no doubt many of you are wondering why the speaker is so old. Well, the answer is obvious: He hasn’t died yet.”

Fortunately for us, Munger has kept on ticking. The commencement speech is an excellent response to the Big Question: How do we live a life that really works? It has so many of Munger’s core ideas that we think the speech represents the Munger Operating System for life.

***

To get what you want, deserve what you want. Trust, success, and admiration are earned.

It’s such a simple idea. It’s the golden rule so to speak: You want to deliver to the world what you would buy if you were on the other end. There is no ethos, in my opinion, that is better for any lawyer or any other person to have. By and large the people who have this ethos win in life and they don’t win just money, not just honors. They win the respect, the deserved trust of the people they deal with, and there is huge pleasure in life to be obtained from getting deserved trust.

A second idea that I got very early was that there is no love that’s so right as admiration-based love, and that love should include the instructive dead. Somehow, I got that idea and I lived with it all my life; and it’s been very, very useful to me.

Acquiring wisdom is a moral duty as well as a practical one.

And there’s a corollary to that proposition which is very important. It means that you’re hooked for lifetime learning, and without lifetime learning you people are not going to do very well. You are not going to get very far in life based on what you already know. You’re going to advance in life by what you’re going to learn after you leave here…if civilization can progress only when it invents the method of invention, you can progress only when you learn the method of learning.

Learn to fluency the big multidisciplinary ideas of the world and use them regularly.

What I noted since the really big ideas carry 95% of the freight, it wasn’t at all hard for me to pick up all the big ideas from all the big disciplines and make them a standard part of my mental routines. Once you have the ideas, of course, they are no good if you don’t practice — if you don’t practice you lose it.

So I went through life constantly practicing this model of the multidisciplinary approach. Well, I can’t tell you what that’s done for me. It’s made life more fun, it’s made me more constructive, it’s made me more helpful to others, it’s made me enormously rich, you name it, that attitude really helps.

Now there are dangers there, because it works so well, that if you do it, you will frequently find you are sitting in the presence of some other expert, maybe even an expert that’s superior to you, supervising you. And you will know more than he does about his own specialty, a lot more. You will see the correct answer when he’s missed it.

[…]

It doesn’t help you just to know them enough just so you can give them back on an exam and get an A. You have to learn these things in such a way that they’re in a mental latticework in your head and you automatically use them for the rest of your life.

Learn to think through problems backwards as well as forward.

The way complex adaptive systems work and the way mental constructs work, problems frequently get easier and I would even say usually are easier to solve if you turn around in reverse.

In other words if you want to help India, the question you should ask is not “how can I help India?”, you think “what’s doing the worst damage in India? What would automatically do the worst damage and how do I avoid it?” You’d think they are logically the same thing, but they’re not. Those of you who have mastered algebra know that inversion frequently will solve problems which nothing else will solve. And in life, unless you’re more gifted than Einstein, inversion will help you solve problems that you can’t solve in other ways.

Be reliable. Unreliability can cancel out the other virtues.

If you’re unreliable it doesn’t matter what your virtues are, you’re going to crater immediately. So doing what you have faithfully engaged to do should be an automatic part of your conduct. You want to avoid sloth and unreliability.

Avoid intense ideologies. Always consider the other side as carefully as your own.

Another thing I think should be avoided is extremely intense ideology, because it cabbages up one’s mind. You’ve seen that. You see a lot of it on TV, you know preachers for instance, they’ve all got different ideas about theology and a lot of them have minds that are made of cabbage.

But that can happen with political ideology. And if you’re young it’s easy to drift into loyalties and when you announce that you’re a loyal member and you start shouting the orthodox ideology out what you’re doing is pounding it in, pounding it in, and you’re gradually ruining your mind. So you want to be very careful with this ideology. It’s a big danger.

In my mind I have a little example I use whenever I think about ideology, and it’s these Scandinavian canoeists who succeeded in taming all the rapids of Scandinavia and they thought they would tackle the whirlpools in the Grand Rapids here in the United States. The death rate was 100%. A big whirlpool is not something you want to go into and I think the same is true about a really deep ideology.

I have what I call an iron prescription that helps me keep sane when I naturally drift toward preferring one ideology over another. And that is I say “I’m not entitled to have an opinion on this subject unless I can state the arguments against my position better than the people do who are supporting it. I think that only when I reach that stage am I qualified to speak.” Now you can say that’s too much of an iron discipline..it’s not too much of an iron discipline. It’s not even that hard to do.

Get rid of self-serving bias, envy, resentment, and self-pity.

Generally speaking, envy, resentment, revenge and self pity are disastrous modes of thought. Self-pity gets pretty close to paranoia, and paranoia is one of the very hardest things to reverse. You do not want to drift into self-pity.

I have a friend who carried a big stack of index cards about this thick, and when somebody would make a comment that reflected self pity, he would take out one of the cards, take the top one off the stack and hand it to the person, and the card said, “Your story has touched my heart, never have I heard of anyone with as many misfortunes as you”. Well, you can say that’s waggery, but I suggest that every time you find you’re drifting into self pity, I don’t care what the cause — your child could be dying of cancer — self-pity is not going to improve the situation. Just give yourself one of those cards.

It’s a ridiculous way to behave, and when you avoid it you get a great advantage over everybody else, almost everybody else, because self-pity is a standard condition and yet you can train yourself out of it.

And of course self-serving bias, you want to get that out of yourself; thinking that what’s good for you is good for the wider civilization and rationalizing all these ridiculous conclusions based on the subconscious tendency to serve one’s self.

At the same time, allow for the self-serving bias in others who haven’t removed it.

You also have to allow for the self serving bias of everybody else, because most people are not going to remove it all that successfully, the human condition being what it is. If you don’t allow for self serving bias in your conduct, again you’re a fool.

I watched the brilliant Harvard Law School trained general counsel of Salomon lose his career, and what he did was when the CEO became aware that some underling had done something wrong, the general counsel said, “Gee, we don’t have any legal duty to report this but I think it’s what we should do it’s our moral duty.”

Of course, the general counsel was totally correct but of course it didn’t work; it was a very unpleasant thing for the CEO to do and he put it off and put if off and of course everything eroded into a major scandal and down went the CEO and the general counsel with him.

The correct answer in situations like that was given by Ben Franklin, he said, “If you want to persuade, appeal to interest not to reason.” The self serving bias is so extreme. If the general counsel had said, “Look this is going to erupt, it’s something that will destroy you, take away your money, take away your status…it’s a perfect disaster,” it would have worked!

Avoid being part of a system with perverse incentives.

Incentives are too powerful a controller of human cognition and human behavior, and one of the things you are going to find in some modern law firms is billable hour quotas. I could not have lived under a billable hour quota of 2,400 hours a year. That would have caused serious problems for me — I wouldn’t have done it and I don’t have a solution for you for that. You’ll have to figure it out for yourself but it’s a significant problem.

Work with and under people you admire, and avoid the inverse when at all possible.

And that requires some talent. The way I solved that is, I figured out the people I did admire and I maneuvered cleverly without criticizing anybody, so I was working entirely under people I admired. And a lot of law firms will permit that if you’re shrewd enough to work it out. And your outcome in life will be way more satisfactory and way better if you work under people you really admire. The alternative is not a good idea.

Learn to maintain your objectivity, especially when it’s hardest.

Well we all remember that Darwin paid special attention to disconfirming evidence particularly when it disconfirmed something he believed and loved. Well, objectivity maintenance routines are totally required in life if you’re going to be a correct thinker. And there we’re talking about Darwin’s attitude, his special attention to disconfirming evidence, and also to checklist routines. Checklist routines avoid a lot of errors. You should have all this elementary wisdom and then you should go through and have a checklist in order to use it. There is no other procedure that will work as well.

Concentrate experience and power into the hands of the right people – the wise learning machines.

I think the game of life in many respects is getting a lot of practice into the hands of the people that have the most aptitude to learn and the most tendency to be learning machines. And if you want the very highest reaches of human civilization that’s where you have to go.

You do not want to choose a brain surgeon for your child among fifty applicants all of them just take turns during the procedure. You don’t want your airplanes designed that way. You don’t want your Berkshire Hathaways run that way. You want to get the power into the right people.

You’ll be most successful where you’re most intensely interested.

Another thing that I found is an intense interest of the subject is indispensable if you are really going to excel. I could force myself to be fairly good in a lot of things, but I couldn’t be really good in anything where I didn’t have an intense interest. So to some extent, you’re going to have to follow me. If at all feasible you want to drift into doing something in which you really have a natural interest.

Learn the all-important concept of assiduity: Sit down and do it until it’s done.

Two partners that I chose for one little phase of my life had the following rule: They created a little design/build construction team, and they sat down and said, two-man partnership, divide everything equally, here’s the rule; “Whenever we’re behind in our commitments to other people, we will both work 14 hours a day until we’re caught up.”

Well, needless to say, that firm didn’t fail. The people died rich. It’s such a simple idea.

Use setbacks in life as an opportunity to become a bigger and better person. Don’t wallow.

Another thing of course is life will have terrible blows, horrible blows, unfair blows, doesn’t matter. And some people recover and others don’t. And there I think the attitude of Epictetus is the best. He thought that every mischance in life was an opportunity to behave well, every mischance in life was an opportunity to learn something, and your duty was not to be submerged in self-pity but to utilize the terrible blow in a constructive fashion. That is a very good idea.

The highest reach of civilization is a seamless system of trust among all parties concerned.

The last idea that I want to give you as you go out into a profession that frequently puts a lot of procedure and a lot of precautions and a lot of mumbo jumbo into what it does, this is not the highest form which civilization can reach. The highest form which civilization can reach is a seamless web of deserved trust. Not much procedure, just totally reliable people correctly trusting one another. That’s the way an operating room works at the Mayo Clinic.

If a bunch of lawyers were to introduce a lot of process, the patients would all die. So never forget when you’re a lawyer that you may be rewarded for selling this stuff but you don’t have to buy it. In your own life what you want is a seamless web of deserved trust. And if your proposed marriage contract has 47 pages, my suggestion is do not enter.

Still Interested?
Check our our Munger compendium.