The Stone Age Hunt for Scapegoats: Fallacy of the Single Cause
Chris Matthews is one of MSNBC’s top journalists. In his news show, so-called political experts are wheeled in one after the other and interviewed. I (Rolf Dobelli) have never understood what a political expert is or why such a career is worthwhile. In 2003, the U.S. invasion of Iraq was the issue on everybody’s lips. More important than the experts’ answers were Chris Matthews’s questions: “What is the motive behind the war?” “I wanted to know whether 9/11 is the reason, because a lot of people think it’s payback.” “Do you think that the weapons of mass destruction was the reason for this war?” “Why do you think we invaded Iraq? The real reason, not the sales pitch.” And so on.
I can’t abide questions like that anymore. They are symptomatic of the most common of all mental errors, a mistake for which, strangely enough, there is no everyday term. For now, the awkward phrase, the fallacy of the single cause, will have to do.
Drawing the Bull’s-Eye around the Arrow: Cherry Picking
On their websites, hotels present themselves in the very best light. They carefully select each photo, and only beautiful, majestic images make the cut. Unflattering angles, dripping pipes, and drab breakfast rooms are swept under the tattered carpet. Of course, you know this is true. When you are confronted by the shabby lobby for the first time, you simply shrug your shoulders and head to the registration desk.
What the hotel did, explains Nassim Taleb, is called cherry picking: showcasing the most attractive features and hiding the rest. As with the hotel experience, you approach other things with the same muted expectations: brochures for cars, real estate, or law firms. You know how they work, and you don’t fall for them.
However, you respond differently to the annual reports of companies, foundations, and government organizations. Here, you tend to expect objective depictions. You are mistaken. These bodies also cherry-pick: If goals are achieved, they are talked up; if they falter, they are not even mentioned.
Two series of numbers: The first, series A, consists of: 724, 947, 421, 843, 394, 411, 054, 646. What do these numbers have in common? Don’t read on until you have an answer. It’s simpler than you think: The number 4 features in each of them. Now examine series B: 349, 851, 274, 905, 722, 032, 854, 113. What links these numbers? Do not read further until you’ve figured it out. Series B is more difficult, right? Answer: None use the number 6. What can you learn from this? Absence is much harder to detect than presence. In other words, we place greater emphasis on what is present than on what is absent.
Last week, while on a walk, it occurred to me (Rolf Dobelli) that nothing hurt. It was an unexpected thought. I rarely experience pain anyway, but when I do, it is very present. But the absence of pain I rarely recognize. It was such a simple, obvious fact, it amazed me. For a moment, I was elated—until this little revelation slipped from my mind again.
The Boat Matters More Than the Rowing: Illusion of Skill
Why are there so few serial entrepreneurs—businesspeople who start successful companies one after the other? Of course, there’s Steve Jobs and Richard Branson, but they represent a tiny minority. Serial entrepreneurs account for less than 1 percent of everyone who starts a company. Do they all retire to their private yachts after the first success just like Microsoft co-founder Paul Allen did? Surely not. True businesspeople possess too much get-up-and-go to lie on a beach chair for hours on end. Is it because they can’t let go and want to cosset their firms until they turn sixty-five? No. Most founders sell their shares within ten years. Actually, you would assume that such self-starters who are blessed with talent, a good personal network, and a solid reputation would be well equipped to found numerous other start-ups. So why do they stop? They didn’t stop. They just failed at succeeding. Only one answer makes sense: Luck plays a bigger role than skill does. No businessperson likes to hear this. When I (Rolf Dobelli) first heard about the illusion of skill, my reaction was: “What, my success was a fluke?” At first, it sounds a little offensive, especially if you worked hard to get there.
Berlin, 1927: A group of university students and professors visit a restaurant. The waiter takes order upon order, including special requests, but does not bother to write anything down. This is going to end badly, they think. But, after a short wait, all diners receive exactly what they ordered. After dinner, outside on the street, Russian psychology student Bluma Zeigarnik notices that she has left her scarf behind in the restaurant. She goes back in, finds the waiter with the incredible memory, and asks him if he has seen it. He stares at her blankly. He has no idea who she is or where she sat. “How can you have forgotten?” she asked indignantly. “Especially with your super memory!” The waiter replies curtly: “I keep every order in my head—until it is served.”
Zeigarnik and her mentor, Kurt Lewin, studied this strange behavior and found that all people function more or less like the waiter. We seldom forget uncompleted tasks; they persist in our consciousness and do not let up, tugging at us like little children, until we give them our attention. On the other hand, once we’ve completed a task and checked it off our mental list, it is erased from memory.
Those Wielding Hammers See Only Nails: Déformation Professionnelle
A man takes out a loan, starts a company, and goes bankrupt shortly afterward. He falls into a depression and commits suicide.
What do you make of this story? As a business analyst, you want to understand why the business idea did not work: Was he a bad leader? Was the strategy wrong, the market too small, or the competition too large? As a marketer, you imagine the campaigns were poorly organized or that he failed to reach his target audience. If you are a financial expert, you ask whether the loan was the right financial instrument. As a local journalist, you realize the potential of the story: How lucky that he killed himself! As a writer, you think about how the incident could develop into a kind of Greek tragedy. As a banker, you believe an error took place in the loan department. As a socialist, you blame the failure of capitalism. As a religious conservative, you see in this a punishment from God. As a psychiatrist, you recognize low serotonin levels. Which is the “correct” viewpoint?
Non of them. “If your only tool is a hammer, all your problems will be nails,” said Mark Twain—a quote that sums up the déformation professionnelle perfectly. Charlie Munger, Warren Buffett‘s business partner, named the effect the “man with the hammer tendency” after Twain: “But that’s a perfectly disastrous way to think and a perfectly disastrous way to operate in the world. So you’ve got to have multiple models. And the models have to come from multiple disciplines—because all the wisdom of the world is not to be found in one little academic department.”
Every morning, you compile a to-do list. How often does it happen that everything is checked off by the end of the day? Always? Every other day? Maybe once a week? If you are like most people, you will achieve this rare state once a month. In other words, you systematically take on too much. More than that: Your plans are absurdly ambitious. Such a thing would be forgivable if you were a planning novice. But you’ve been compiling to-do lists for years, if not decades. Thus, you know your capabilities inside out and it’s unlikely that you overestimate them afresh every day. This is not facetiousness: In other areas, you learn from experience. So why is there no learning curve when it comes to making plans? Even though you realize that most of your previous endeavors were overly optimistic, you believe in all seriousness that, today, the same workload—or more—is eminently doable. Daniel Kahneman calls this the planning fallacy.
In their last semesters, students generally have to write theses. The Canadian psychologist Roger Buehler and his research team asked the following of their final-year class: The students had to specify two submission dates: The first was a “realistic” deadline and the second was a “worst-case scenario” date. The result? Only 30 percent of students made the realistic deadlines. On average, the students needed 50 percent more time than planned—and a full seven days more than their worst-case scenario date.
There was once an intelligent centipede. Sitting on the edge of a table, he looked over and saw a tasty grain of sugar across the room. Clever as he was, he started to weigh up the best route: Which table leg should he crawl down—left or right—and which table leg should he crawl up? The next tasks were to decide which foot should take the first step, in which order the others should follow, and so on. He was adept at mathematics, so he analyzed all the variants and selected the best path. Finally, he took the first step. However, still engrossed in calculation and contemplation, he got tangled up and stopped dead in his tracks to review his plan. In the end, he came no further and starved.
The British Open golf tournament in 1999: French golfer Jean van de Velde played flawlessly until the final hole. With a three-shot lead, he could easily afford a double bogey (two over par) and still win. Child’s play! Entry into the big leagues was now only a matter of minutes away. All he needed to do was to play it safe. But as Van de Velde stepped up, beads of sweat began to form on his forehead. He teed off like a beginner. The ball sailed into the bushes, landing almost two hundred yards from the hole. He became increasingly nervous. The next shots were no better. He hit the ball into knee-high grass, then into the water. He took off his shoes, waded into the water, and for a minute contemplated shooting from the pond. But he decided to take the penalty. He then shot into the sand. His body movements suddenly resembled those of a novice. Finally, he made it onto the green and—after a seventh attempt—into the hole. Van de Velde lost the British Open and secured a place in sporting history with his now-notorious triple bogey. It was the beginning of the end of his career. (He celebrated an impressive comeback in 2005.)
