Two Types of Professions

TWO TYPES OF PROFESSIONS

Consider the fate of Ioannis (John) and Georgios (George), two identical twin brothers, born in Cyprus (both of them), currently both living in the Greater London area. John has been employed for twenty-five years as a clerk in the personnel department of a large bank, dealing with the relocation of employees around the globe. George is a taxi driver.

John has a perfectly predictable income (or so he thinks), with benefits, four weeks’ annual vacation, and a gold watch every twenty-five years of employment. Every month, £3,082 is deposited in his local Nat West checking account. He spends a portion of it for the mortgage on his house west of London, the utilities, and feta cheese, and has a bit left for his savings. He used to wake up on Saturday morning, the day when people stretch and linger in bed, anxiety free, telling himself “life is good”—until the banking crisis, when he realized that his job could be “made redundant.” Unemployment would seriously hit him hard. As a personnel expert, he has seen the implosions of long careers, with persons who, laid off at the age of fifty, never recovered.

George, who lives on the same street as his brother, drives a black taxi—meaning he has a license for which he spent three years expanding his frontal lobes by memorizing streets and itineraries in Greater London, which gives him the right to pick up clients in the streets. His income is extremely variable. Some days are “good,” and he earns several hundred pounds; some are worse, when he does not even cover his costs; but, year after year, he averages about the same as his brother. To date, he has only had a single day in his twenty-five-year career without a fare. Because of the variability of his income, he keeps moaning that he does not have the job security of his brother—but in fact this is an illusion, for he has a bit more.

This is the central illusion in life: that randomness is risky, that it is a bad thing—and that eliminating visible fluctuations eliminates risk.

Artisans, say, taxi drivers, prostitutes (a very, very old profession), carpenters, plumbers, tailors, and dentists, have some volatility in their income but they are rather robust to a minor professional Black Swan, one that would bring their income to a complete halt. Their risks are visible. Not so with employees, who have no volatility, but can be surprised to see their income going to zero after a phone call from the personnel department. Employees’ risks are hidden.

Thanks to variability, these artisanal careers harbor a bit of antifragility: small variations make them adapt and change continuously by learning from the environment and being, sort of, continuously under pressure to be fit. Remember that stressors are information; these careers face a continuous supply of these stressors that make them adjust opportunistically. In addition, they are open to gifts and positive surprises, free options—the hallmark of antifragility, as we will see in Book IV. George was used to having, once in a while, a crazy request, one he was free to decline: during the Icelandic volcano scare, when U.K. air traffic was shut down, he was asked by a rich old lady to drive her to a wedding in the South of France—a two-thousand-mile round-trip journey. Likewise, a prostitute faces the small probability of seeing a severely infatuated rich client give her a very expensive diamond, or even an offer of matrimony, in what can be expected to be a short transitional period before her widowhood.

And George has the freedom to continue until he drops (many people continue to drive cabs into their eighties, mostly to kill time), since he is his own boss, compared to his brother, who is completely unhireable in his fifties.

The difference between the two volatilities in income applies to political systems—and, as we will see in the next two chapters, to about everything in life. Man-made smoothing of randomness produces the equivalent of John’s income: smooth, steady, but fragile. Such income is more vulnerable to large shocks that can make it go to zero (plus some unemployment benefits if he resides in one of the few welfare states). Natural randomness presents itself more like George’s income: smaller role for very large shocks, but daily variability. Further, such variability helps improve the system (hence the antifragility). A week with declining earnings for a taxi driver or a prostitute provides information concerning the environment and intimates the need to find a new part of town where clients hang around; a month or so without earnings drives them to revise their skills.

Further, for a self-employed person, a small (nonterminal) mistake is information, valuable information, one that directs him in his adaptive approach; for someone employed like John, a mistake is something that goes into his permanent record, filed in the personnel department. Yogi Berra once said: “We made the wrong mistake”—and for John all mistakes are wrong mistakes. Nature loves small errors (without which genetic variations are impossible), humans don’t—hence when you rely on human judgment you are at the mercy of a mental bias that disfavors antifragility.

So, alas, we humans are afraid of the second type of variability and naively fragilize systems—or prevent their antifragility—by protecting them. In other words, a point worth repeating every time it applies, this avoidance of small mistakes makes the large ones more severe.

The centralized state resembles the income of John; the city-state model that of George. John has one large employer, George many small ones—so he can select the ones that fit him the best and hence has, at any point in time, “more options.” One has the illusion of stability, but is fragile; the other one the illusion of variability, but is robust and even antifragile.

The comparison shows how frequent, manageable fluctuations can reveal risks that a smooth income hides.