Monthly Archives: December 2016

The books I’ve read in 2016

Some people seem to be interested in the books I read, and I always love hearing about what other people read.  So I’ve decided to put together a list of books that I read in 2016 – at least the ones I’m not too ashamed to own up to having read …

Red Notice, by Mike Browder, about his adventures in Russia’s corporate world, and his fight for justice.

Other People’s Money, by John Kay.  One of my top 3 for the year, and I wrote about it here.

The Penguin Lessons, by Tom Michell.  A true story, about a young man teaching in Argentina, and his adopted penguin – I enjoyed it.

Into the magic shop, A neurosurgeon’s true story of the life-changing magic of compassion and mindfulness, by James Doty.  Excellent in places, though a bit cliched at times.

The Sense of Style, by Stephen Pinker.  A wonderful antidote to stuffy grammar books that teach you rules to follow, this book explains (with good examples) what it is that makes some writing easy to follow, and other writing incomprehensible.  

Utopia for Realists, by Rutger Bregman.  This short book looked at a number of economic ideas that I’m very interested in, most notably basic income and the future of work.  I wanted it to be wonderful, the book that I could give to everyone I knew, but unfortunately I found it merely pretty good.

Simplify: Ten Practices to Unclutter Your Soul, by Bill Hybels.  Written by an American Pastor, with a very spiritual element (so not aimed at everyone), but have some thoughtful insights, and clever ways of thinking about things that most people struggle with at times.

Let’s Stay Together – Denis MacShane, and EU Referendum: a guide to voters, by David Torrance.  I read these two books in the leadup to the referendum – the first intentionally pro-Remain, and the second attempting to present both sides.    

On Rock or Sand, a collection of essays edited by Archbishop John Sentamu, about the future of Britain.  Some of the collection were excellent (particularly the one on how our Parliament could be improved), I wrote about it here.

On the Move, by Oliver Sacks.  His childhood memoirs delving into the world of chemistry, Uncle Tungsten, is one of my all time favorite books, so when I heard this neuroscientist’s adult memoirs had been published around the time of his death in 2015, I was keen to read them.  A fascinating character with an incredible way of noticing things that no one else noticed.

All That is Solid: How the Great Housing Disaster Defines Our Times, and What We Can Do About it, by Danny Dorling.  This is focussed on the UK property market, and really got me thinking.  I might not agree with 100% of what he was arguing, but he was right on a lot, and I learned a lot.

PostCapitalism, by Paul Mason.  I didn’t find it as good as his shorter pieces.  I wrote about it here.

Saving Capitalism: For the many, not the few, by Robert Reich.  This is also in my top three for the year, I wrote about it here.

You are not so Smart, by David McRaney.  I’m fascinated by how we think, and how we get things wrong, so I felt I should read this book which has got very good reviews.  I did learn a few new things, but most of it covered ideas that I was already familiar with.  

Harry Potter and the Cursed Child, by JK Rowling.  I couldn’t justify queuing for weeks, or paying £500 for the a scalped ticket, so I read the screenplay – and loved it.   I will hopefully get a chance to see it on stage one day.

Back to the Future of Socialism, by Peter Hain.  Written around the time of the 2015 election, this looked at the British Labour party, its record and its ideals.  I wrote about it here.

His Dark Materials Trilogy, by Philip Pullman.  I’m not really into fantasy, let alone fantasy aimed at children, but a friend persuaded me to read this – I at least get what the fuss (good and bad) is about.

The Return of the Public: Democracy, Power and the Case for Media Reform, by Dan Hind.  Interesting historical perspective, insight and ideas.  

Ethics in the Real World, by Peter Singer.  An excellent collection of articles, compiled over the years, but still relevant today.  I don’t agree with him on everything (apparently I’m not a consequentialist), but I do agree with him on a lot, and he does a great job of explaining his thinking.

Things to make and do in the fourth dimension, by Matt Parker.  One for the maths geeks, I’m afraid.  

The Wealth of Humans: Work and its Absence in the 21st Century, by Ryan Avent.  A very good book, this only just missed out on being in my top three for the year.  It considers, in a clear and rational way, how labour and capital are rewarded, and how this calculation has changed over time, particularly in light of technology, globalisation, and corporate know-how.  Highly recommended.

The Joy of Tax, by Richard Murphy.  I had considered reading this for a while, but had been put off by some bad reviews.  In the end I’m very glad did read it, the positives did outweigh the negatives, and I will be quoting examples from the book for some time.   (I note that it focusses primarily on the UK system, but would still be relevant for those in other countries.)

Politics: Between the Extremes, by Nick Clegg.  Another one that only just missed out my top three, I was left with a much greater appreciation for the challenges our MPs face, particularly those in the centre.  Highly recommended.  

The Globalization Paradox, by Dani Rodrik.  I loved this, and it made by top three (though you’d need an interest in economics to enjoy it).  I wrote about it here.

The Undoing Project: A friendship that changed our minds, by Michael Lewis.  The story of behavioural psychologists Daniel Kahneman and Amos Tversky, who contributed so much to our understanding of our irrationalities.  I wrote about it here.

 

Now onto 2017 – I’ve got a decent list of books I want to read, but I’m always grateful for suggestions.

Kahneman, Tversky, and Christmas

One Christmas day, back when I was twenty, my dad gave me a copy of Peter Bernstein’s “Against the Gods – the Remarkable of Risk”. I had just finished my second year of a Maths / Commerce degree, so it wasn’t that surprising a gift, but I still don’t think anyone could have predicted just how much the ideas in the book would influence my life.    

I can’t recommend that book highly enough to anyone starting off in the world of statistics or finance: Bernstein captures the origins of probability, statistics, gambling and finance, bringing to life the personalities, the ideas, and the intellectual debates.  This isn’t a textbook, but you’ll learn more from it than most textbooks.  It still has pride of place on my bookshelves, on a shelf dominated by people first brought into my life by this book: Laplace, Bayes, Keynes, Savage, Kahneman, Tversky, and Thaler.

The years haven’t dimmed my interest in the questions of how people make assess risk, value outcomes and make decisions.  Obviously at work, surrounded by traders and risk managers, these questions have always been at the front of our minds.  And there were always a few decision geeks like myself, sharing examples of how our thinking could let us down, but the examples seemed quite contrived to outsiders.  

But 2016 seems the year that questions of rationality and decision making became widespread, with the general population questioning how so many ‘other’ people can be so ‘dumb’, voting a certain way or thinking that the public would vote a certain way.  I am optimistic that 2017 will be a year in which we start to get some more good answers to these questions of how and why people act under uncertainty, and how they should (and for the record I don’t believe the ‘experts’ are always right).  

Anyway, Christmas being a time of reminiscence, it is appropriate that I finished another book today, about two of the characters I first discovered 18 years ago in ‘Against the Gods’: Daniel Kahneman and Amos Tversky.  These psychologists were among the first to explore how we really make decisions, particularly uncertainty, noting consistent biases that earlier researchers ignored, and in doing so created the foundations of behavioural economics, as well as having significant impact on the fields of medicine, public policy, and the military.  Tversky passed away in 1996, while Kahneman is still contributing (and wrote ‘Thinking, Fast and Slow’ in 2011).

Their partnership was the subject of the very recent book, ‘The Undoing Project: A friendship the changed our minds/the world’, by Michael Lewis (the best selling author whose book ‘The Big Short’ was turned into a successful film).    As with any book by a popular author about a topic you know well, I had my fears, but I felt I owed Kahneman and Tversky too much respect to ignore whatever insight I might gleam from a book about them.

The technical content was good, well explained.  For anyone not familiar with their work, and with even a remote interest in the area, it would be worth reading it for that alone.  If you know their work, you aren’t going to get put off by it, but it won’t teach you much you didn’t know.

My favorite example from the book is the ‘Linda’ problem, an example where the audience is told:   Linda is 31 years old, single, outspoken and very bright. She majored in philosophy.  As a student, she was deeply concerned with issues of discrimination and social justice, and also participated in anti-nuclear demonstrations.

The audience is then asked whether it is more likely that:

  1. Linda is a bank teller, or
  2. Linda is a bank and is active in the feminist movement

Despite the latter being a special case of the former, most people respond that the second is more likely, on account of the job description feeling more ‘representative’ of her.  

The book described Kahneman explaining to an auditorium of University of British Columbia students: “Do you realize you have violated a fundamental rule of logic?”, to which a young woman shouted from the back of the room, “So what! You just asked for my opinion”.  

There were some funny personal anecdotes, like the one of 12 year old Tversky diving off a 10m board before he knew how to swim (he asked an older kid to pull him off the bottom after he landed), or the story of Tversky’s first trip to the US, and his excitement at his first time landing in an aeroplane (despite being an experienced paratrooper in the Israeli Air Force).

On the other hand, I felt conflicted on the more personal content – about Kahneman and Tversky’s personalities, and the tensions inherent in their relationship.  Yes, it helped me understand them, and often you have to be a bit messed up to see what everyone else has missed.  But it occasionally felt like I had been reading their personal letters, and hearing their innermost anxieties, and it all felt a bit too soon for that.

So, all up, it was a slightly odd mix of a book, good description of their theory, interesting history of what Israel was like in the 1950s and 60s, academic feuds, and personal anxieties (and a weird first chapter that really didn’t belong, unless possibly you were expecting the sequel to Moneyball).  But all up, a worthwhile read.

The Globalization Paradox

I recently finished Dani Rodrik’s 2012 book “The Globalization Paradox”, which I found excellent: as an economic history of globalization, as a critique of the theory that has underpinned economics over the past 30 years, and as a guide towards a more sustainable version of globalization.

The central idea of the book is that there will always be tension between globalization, democracy and national self-determinism.  While many economists and technocrats seem happy to advocate the giving up of national sovereignty (and I suspect they’d be happy to give up democracy too), Rodrik questions the viability and sustainability of that approach.  That isn’t to say he is anti-globalization – he just argues that whatever globalization we have must be built on national democracy, otherwise individual countries won’t enforce the global market’s rules and outcomes.  

This is a perspective that I’ve been gradually coming to myself, watching Brexit, and the collapse of global trade agreements.  Unfortunately, it is a view that is often drowned out, both by nationalists who refuse to accept that globalisation can be good for a country, and globalists who just assume, without question, that globalisation must be good for the country.  Rodrik helpfully clarifies the conditions under which globalisation will help a country, with many examples from history.

I enjoyed the history – both of 18th and 19th centuries (for example the British East India Company and the Hudson Bay Company, and also the differing approaches between the Northern and Southern states of America), and also the 20th century with war, depression, economic miracles and basket cases.  Rodrik writes with an engaging style, and has the advantage that he isn’t trying to convince us of any absolutes, just that things are a bit more complex than you might have heard from the orthodox economic version of history (or any version that blames everything on a bunch of malevolent bankers and politicians).
So what next?  Rodrik is clearly impressed by the balance achieved within the 1944 Bretton Woods agreement, which provided ways for countries to interact, while allowing plenty of room for countries to take into account their individual circumstances and to meet the demands of their own citizens.  Obviously the world has moved on since then, and he isn’t arguing for us to blindly copy the solutions from 1944.  But it does show a precedent for the kind of balance that can be achieved: we can strive for a future in which nations consciously and sustainably interact.

The Limits of Logic

I suppose it is inevitable, being alive in 2016, that I’ve had a lot of thought-provoking conversations this year.

Perhaps unlike many people, when I think about political issues, I am as fascinated by logic as I am of substance (I blame that on having done a Masters in Philosophy of Science!).  I am more inclined towards being intellectually honest than being right or convincing.  I don’t say that to boast – there are definitely times when being more confident in expressing my gut feelings would have led to better outcomes.  

Since so many people seem a bit perplexed at how others could possibly believe the things they do, I thought it might be useful to outline some of the reasons I’ve encountered why our beliefs are generally less logically convincing than we might think:

  • Ambiguous Language
  • The Questionable Power of Evidence
  • The Uncertainty of the Future
  • Differing Values

Ambiguous Language

One source of conflict relates to the language we use, and our definitions.  Quite often, when debating political issues, we use evocative, emotive language, which unfortunately can be ambiguous and carry baggage that we may not intend. It can make sense if we’re trying to rally the loyal troops, but it is going to be unhelpful if we’re trying to clear up a disagreement.

Examples of such terms from discussions I’ve had this year have been “racist”, “socialist”, “free market”, “establishment”, “Christian”, and “foreigners”.  If both people happen to mean the same thing by the language, that’s great, but we shouldn’t assume that will be the case.  

In these cases, I find it best to avoid loaded terms, and stick to simpler terms that say exactly what you mean, and be as generous as possible in interpreting what the other person is saying (asking questions where necessary).  Feel free to explain to the other person why, though you agree with the person’s intention, you feel that their words convey a message they don’t intend – they may choose to reword.

The Power of Evidence

I’ve heard a lot of concern raised about people’s unwillingness to accept evidence, and willingness to believe ridiculous things.

For many people, the way they seem to consider information is as follows:  if it backs up your desired argument, it should be considered proof; if it contradicts your desired argument, it should be ignored (either as a lie or as inconclusive).

In fact, I think of evidence as much more complex.  There is a spectrum of kinds of information.  Some can prove or disprove a point, but most information (particularly in politics) is a lot less conclusive, either for or against an argument.  It can be a useful exercise to ask yourself what information might be considered overwhelming evidence (both for and against) –  I’d suggest that if we’re honest, most non-trivial statements are just about impossible to prove, even with lots of data.

The Future is Unpredictable

The biggest struggle I face when debating politics is that none of us know what is going to happen.  With such an uncertain world, it is a rare decision that would prove optimal in every possible scenario.  

For example, I’ve heard some people who suggest that it is pointless to talk about the downsides of Brexit because it hasn’t happened yet.  This makes no sense – most of decision-making relies on making decisions under uncertainty.  

Decision theory tells us that we can deal with this uncertainty, by considering each outcome, and its probability.  While I agree this is sensible, I’m not sure that we can ever get our head around the infinite range of possibilities and their probabilities, let alone agree on them.  Inevitably we will end up making simplifications, ignoring certain outcomes.  

For example, with Brexit, I’ve been in several conversations where it has become clear that the other party thinks that a recession is more or less likely than I do, that the EU will be more or less generous, or that the prospects for the EU are better or worse than I think they are.  Even if we do our best to state our assumptions, there will be a point where we have to agree to disagree.

This is particularly relevant when the outcomes our significantly influenced by one person.  In the case of Trump’s election, we are all forming views of how he might carry out his role.  I’m not sure that there can ever be an objective view on how likely (probabilistically) he is to act different ways.

Differing Values

Another challenge in reaching consensus is that everyone has beliefs and values that they largely take for granted, that they perhaps cling to more strongly than others people do.  

Maintaining beliefs of this kind is natural, and I would even say helpful, particularly when faced with complex situations which don’t have clear cut answers, for example when considering political and social questions.  It is a lot easier to follow instinctive rules and habits (eg be nice, follow the rules) than to work out every question from first principles.

While it is possible for us to have fundamentally different values, in practice I find these cases rare, at least with the people I talk to.  Far more common in my experience is when we both share values, but prioritise them differently.  For example, the vast majority of people I know want to prevent harm, deter cheaters, improve outcomes, allow freedom – but how they weigh these up against each other, and which they are willing to question, still allows huge room for argument.

The challenge is to make the effort to understand what the other party values (noting that we will most likely value it too, even if less strongly), but to highlight the tradeoff.  Sometimes this will resolve the question – our friend might recognise that their instinct leads to a worse outcome.  But even if it doesn’t resolve the question – for example if the other party is happy with a tradeoff that I’m not comfortable with, at least we’d have a better understanding of where our disagreement is really coming from (rather than an assumption that the other person is evil!).   

 

To conclude, I certainly don’t want to discourage my friends from their convictions, nor to deter them from standing up for what they believe is right.  But I hope that by occasionally taking a step back, and realising things aren’t as absolute as we tend to think, they might be more effective at bridging the divide, and ultimately convincing people