The Tyranny of the Collective

The Tyranny of the Collective

Mistakes made collectively, not individually, are the hallmark of organized knowledge—and the best argument against it. The argument “because everyone is doing it” or “that’s how others do it” abounds. It is not trivial: people who on their own would not do something because they find it silly now engage in the same thing but in groups. And this is where academia in its institutional structure tends to violate science.

One doctoral student at the University of Massachusetts, Chris S., once came to tell me that he believed in my ideas of “fat tails” and my skepticism of current methods of risk management, but that it would not help him get an academic job. “It’s what everybody teaches and uses in papers,” he said. Another student explained that he wanted a job at a good university so he could make money testifying as an expert witness—they would not buy my ideas on robust risk management because “everyone uses these textbooks.” Likewise, I was asked by the administration of a university to teach standard risk methods that I believe are pure charlatanism (I refused). Is my duty as a professor to get students a job at the expense of society, or to fulfill my civic obligations? Well, if the former is the case, then economics and business schools have a severe ethical problem. For the point is generalized and that’s why economics hasn’t collapsed yet in spite of the obvious nonsense in it—and scientifically proven nonsense in it. (In my “fourth quadrant” paper—see discussion in the Appendix—I show how these methods are empirically invalid, in addition to being severely mathematically inconsistent, in other words, a scientific swindle). Recall that professors are not penalized when they teach you something that blows up the financial system, which perpetuates the fraud. Departments need to teach something so students get jobs, even if they are teaching snake oil—this got us trapped in a circular system in which everyone knows that the material is wrong but nobody is free enough or has enough courage to do anything about it.

The problem is that the last place on the planet where the “other people think so” argument can be used is science: science is precisely about arguments standing on their own legs, and something proven to be wrong empirically or mathematically is plain wrong, whether a hundred “experts” or three trillion disagree with the statement. And the very use of “other people” to back up one’s claims is indicative that the person—or the entire collective that composes the “other”—is a wimp. The appendix shows what has been busted in economics, and what people keep using because they are not harmed by error, and that’s the optimal strategy for keeping a job or getting a promotion.

But the good news is that I am convinced that a single person with courage can bring down a collective composed of wimps.

And here, once again, we need to go back into history for the cure. The scriptures were quite aware of the problem of the diffusion of responsibility and made it a sin to follow the crowd in doing evil—as well as to give false testimony in order to conform to the multitude.

I close Book VII with a thought. Whenever I hear the phrase “I am ethical” uttered, I get tense. When I hear about classes in ethics, I get even more tense. All I want is to remove the optionality, reduce the antifragility of some at the expense of others. It is simple via negativa. The rest will take care of itself.

1 It is a property of sampling. In real life, if you are observing things in real time, then large deviations matter a lot. But when a researcher looks for them, then they are likely to be bogus—in real life there is no cherry-picking, but on the researcher’s computer, there is.