Monday, July 13, 2015

Book Review: “Future Babble” by Dan Gardner (2011)

According to the famed Canuck scribe, most “expert” predictions have been statistically proven to be crap. So why do we still hang on to their every word and value their prognostications?




“Economists, in particular, are treated with the reverence the ancient Greeks gave the Oracle of Delphi. But unlike the notoriously vague pronouncements that once issued from Delphi, economists’ predictions are concrete and precise. Their accuracy can be checked. And anyone who does that will quickly conclude that economists make lousy soothsayers.”

-- Dan Gardner
“Future Babble: Why Expert Predictions are Next to Worthless and You Can Do Better” (2011)

At the core of Dan Gardner’s 2011 treatise “Future Babble” is the same argument Isiah Berlin made in his seminal work, “The Hedgehog and the Fox.” There are those who claim to know a little bit about a lot of things, and those who claim to know an absolute ton about one specific area. Almost always, the dead certainty of the hedgehogs -- the camp that claims to be “experts” on a specific subject -- keeps them from making predictions that are as accurate as those made by the “foxes” -- i.e., those who know a little bit about a whole bunch of things and are willing to admit their deficits in knowledge.

The big scientific hook in Gardner’s early 2010s book, however, is its reliance upon a study conducted by researcher Philip Tetlock. In an analysis of 27,450 predictions made by 284 famous commentators, pundits and analysts (sadly, all of whom are kept anonymous in “Future Babble“), it was all but statistically confirmed that foxes outperform hedgehogs when it comes to guesstimating future economic, political and cultural trends. Indeed, the self-proclaimed “experts” had accuracy readings that were about as good as randomly selecting predictions out of a hat -- meaning their words of wisdom, for lack of a better term, are utterly worthless.

Very early on in “Future Babble,” the author makes it very clear why the expert predictions are often erroneous -- good-old fashioned egotism. Wisely, Gardner doesn’t dwell on this for too long, instead turning his attention towards why specific predictions go awry and -- most interestingly -- why we, as a collective culture, have such a predilection for "expert" predictions, despite their fairly ho-hum track records.

At the heart of the matter, Gardner suggests, is our innate (and perhaps inane) need for comfort in the face of the unknown. The quote below succinctly explains our want for prognostications, whether or not said predictions wind up even remotely close:

Admitting we don’t know can be profoundly disturbing. So we try to eliminate uncertainty however we can. We see patterns where there are none. We treat random results as if they are meaningful. And we treasure stories that replace the complexity and uncertainty of reality with simple narratives about what’s happening and what will happen.” 

That little passage does more than merely explain why we value suspect weather forecasts and predictions on the outcomes of sporting events. In a way, it also sums up why we instill faith in individuals and agencies that are hardly deserving of our attention and admiration. We just can’t accept a blank slate, that tomorrow is up in the air -- anything that assuages that discomfort, no matter how absurd or highfalutin, no doubt has a certain logic-resistant appeal.

As a social science work, “Future Babble” has a lot of meat to it. The author introduces us to all of the tried-and-true missteps that often hamper analytical research (your laundry list of biases, namely) as well as walk us through dozens upon dozens of examples of predictions that were flawed from the get-go.

For example, remember how in the early 1990s, economists in the U.S. were absolutely shaking in their boots over Japanese trade restrictions? Well, Gardner certainly does, as he give us a quick overview of such pessimistic titles as “Bankruptcy 1995” and “Unequal Equities.” Using the behavioral economics framework pioneered by Kahneman and Tversky, the author explains how a slew of heuristics led the penmen behind such works astray. By focusing on the biased anchor points used for their predictions, Gardner reminds us that not only did these folks get it dead wrong when it came to U.S./Japanese economic relations (from 1991 to 2009, the US economy grew 63 percent while Japan struggled to expand by 16 percent), they completely overlooked the economic ascension of China and India as possibilities.

Of course, that’s far from the first time doomsayers were proven wrong. One of the most enjoyable sections of the entire book is when Gardner revisits the rollicking bad times of the late 1970s, when stagflation and oil shortages had some “experts” convinced that “Mad Max Beyond Thunderdome” was right around the corner. Recall “A Blueprint for Survival,” “Famine 1975!” (complete with its suggestion to stop sending foreign aide to India altogether) and especially “The Late Great Planet Earth?” It’s OK if you don’t … surely, the authors of those works would rather you forget their grandiose (and exuberantly erroneous) predictions anyway.

Not surprisingly, Gardner draws connections between abysmal economic periods and the growth of the fringe. In troubled financial times, he said, both astrology book sales and attendance figures in “dogmatic” churches go up, while attendance in “liberal” places of worship tend to decrease. Naturally, this is a boon for the conspiracy theorist folks, as typified in the book by certified nutcase Lyndon LaRouche. “People who feel they lack control are more likely to see patterns that don’t exist,” the author states. “To the orderly mind of the conspiracy theorist, there is no such thing as randomness.”

As you would assume, the author spends a large portion of the book discussing the failed predictions made by Paul Ehrlich, whose work “The Population Bomb” is pretty much the contemporary poster child for erroneous forecasts. Deconstructing Ehrlich’s reverse magum opus and companion pieces such as “The End of Affluence,” Gardner surmises that the popularity of said works are derived not only from humanity’s innate need to know in the absence of certainty, but the magnetism of Ehrlich’s pop cultural personality. He recounts an episode of “The Tonight Show,” in which Ehrlich and a fellow analyst discussed the looming “overpopulation” crisis. While virtually everything Ehrlich said was proven faulty, the crowd nonetheless threw their support behind him instead of the other, much more accurate talking head. The certainty of the hedgehog, the author reminds us, no doubt has incredible appeal -- even if the actual predictions made by said “expert” are about as on-the-mark as the rantings and ravings on Above Top Secret.

Interestingly, Gardner takes it pretty easy on Norman Angell, whose pre-WWI book "The Great Illusion" is synonymous with regrettable predictions. The author states that Angell's work -- which argued that the entwined economies of Europe made large-scale war an unwise (although not entirely impossible) proposition -- never really came out and directly said that World War I wasn't a possibility in the book. Taking an apologist stance, Gardner asserts that its Barbara Tuchman's partially erroneous description of the book in "The Guns of August" that forever tethered Angell to dubious prognostications -- a legacy that overshadows his career, including the fact that he received a Nobel Peace Prize in 1933.

One of the more interesting things drudged up in “Future Babble” is Gardner’s assertions that people, in general, fear the unknown much more than they fear even guaranteed negatives. Citing a leaked CIA interrogation manual, Gardner pens the following: “Sustained long enough, a strong feeling of anything vague or unknown induces regression, whereas the materialization of the fear, the infliction of some sort of punishment, is likely to come as a relief.” That little nugget firmly in mind, perhaps its not surprising that same of the biggest post-recession hits have been potboilers with titles such as “The Long Emergency” and “America Alone,” no?

Citing a “negativity bias,” Gardner said the lay folk are more prone to recall that which is bad than that which is good. Couple that with a tendency to defer to authoritative figures (Gardner’s passage on “An Experimental Study of Nurse-Physician Relationships” from 1966 is particularly distressing) and a want for solutions that are clear, concise and confident, and its not really surprising why gurus like Peter Schiff have drawn the followings they have (and in case you were wondering, yes Gardner does indeed run through a few of Mr. Schiff’s less-heralded prognostications. And yep, there are a whole hell of a lot of them.)

The author uses the failed apocalyptic preachings of "Marian Keech" to demonstrate the uncomfortable truths of cognitive dissonance -- that, collectively, “belief determines reality.” This is followed by a fairly interesting discussion of hindsight bias, concluding with an overview of the infamous “Simon-Ehrlich Wager,” in which America’s favorite crypto-eugenicist wound up eating his own shit regarding erroneous mineral price projections.

The best part of the book is no doubt the final chapter, in which Gardner runs down the cognitive characteristics of the “fox” thinker. First and foremost, these types tend to rely upon what Surowiecki described as “The Wisdom of Crowds” -- “the combined judgment of large numbers of people making decisions independently.” Secondly, they engage in heavy duty metacognition, constantly revisiting their own hypotheses and challenging their own belief systems. And lastly -- and perhaps most importantly -- they practice a little goddamn humility. “Instead of posing as prophets, we must become the makers of our own fate,” the author quotes iconic “fox” Karl Popper. Perhaps encapsulating the entire fox “ideology,” Gardner then mentions Socrates, who considered himself gloriously “ignorant” to the workings of the world … a far, far cry from today’s Bruce Bueno de Mesquitas and their “game theory” loving ilk, no?

Gardner left his job at the Ottawa Citizen newspaper last year, presumably so he could focus on his follow-up to “Future Babble.” That book, titled “Superforecasting,” was penned alongside Philip Tetlock, with a targeted September 2015 publication date. Needless to say, it’s a work I am definitely looking forward to, especially considering the explosion in “statistics-driven” prognostication coverage (Nate Silver, you bespectacled goon, I’m looking directly at you) over the last five years. In the meantime, if you haven’t checked out this 2011 tome, I’d highly recommend it. It’s a very worthwhile read that’s meaty enough for behavioral science buffs, but it’s also accessible to those who can’t tell C. Mills Wright from Emile Durkheim. It won’t clear up all your questions surrounding modernity and its contemporary sociopolitical cult of personalities, but it will give you a very firm framework to begin your own analyses; plus, it gives you plenty of ammunition to use the next time one of your “free-market-firster” pals brings up the alleged “clairvoyance” of one Pete Schiff … that, my friends, is probably worth the Amazon shipping and handling costs all by itself.

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