skin in the game—having an exposure to the real world, and paying a price for its consequences, good or bad. The abrasions of your skin guide your learning and discovery, a mechanism of organic signaling, what the Greeks called pathemata mathemata (“guide your learning through pain,” something mothers of young children know rather well).
Having skin in the game means that you are vulnerable to the downside of your actions, decisions, and pronouncements. When you take a risk you not only open yourself to reward, but also to loss or injury.
You might choose to put your own skin in the fame voluntarily (if you are brave or virtuous), or you may be forced to have skin in the game by the rules or design of a situation.
SITG encourages learning. If you skin your knee, you might focus more as you ride your bike (or you might avoid that big hill on your next ride).
SITG allows systems to improve: if the restaurants in a city are vulnerable to bankruptcy, those that serve awful food close, and the average quality of food improves.
SITG helps moderate intervention/governance: if a leader goes to the front lines, or gets voted out, they might make a different decision.
I prefer Antifragile. I feel that most of the material here is contained there, with additional insights and more of a structure that seems to build. From the author’s perspective they are all part of the same story, and making the test non-linear (garbled?) is part of his approach/shtick.
There are many interesting quotes below that contain some interesting ideas about rationality, the limits of tolerance, and religion.
Ideas per Page: If you had never read his books or heard interviews, you would probably get many ideas per page (a high ratio). But if you know his work, not as high.
Related Books: Other Incerto books
Recommend to Others: Antifragile instead
Reread Personally: no
Quotes:
(Kindle, so no page numbers)
The principle of intervention, like that of healers, is first do no harm (primum non nocere); even more, we will argue, those who don’t take risks should never be involved in making decisions.
Transportation didn’t get safer just because people learn from errors, but because the system does.
mind your own business and not decide what is “good” for others. We know with much more clarity what is bad than what is good.
what has survived has revealed its robustness to Black Swan events and removing skin in the game disrupts such selection mechanisms.
“What is hateful to you, do not do to your fellow: this is the whole Torah; the rest is the explanation; go and learn.” Rabbi Hillel the Elder
Leviticus 19:18. “Do nothing to others which if done to you would cause you pain. This is the essence of morality.”
people who live in those coastal areas that are prone to hurricanes and floods are effectively subsidized by the state—hence taxpayers. Although they play victims on television after an event happens, they and the real estate developers are getting the benefits others pay for.
No person in a transaction should have certainty about the outcome while the other one has uncertainty.
risk sharing took place with caravans along desert routes. If merchandise was stolen or lost, all merchants had to split the costs, not just its owner.
There is no problem if people have a conflict of interest if it is congruous with downside risk for themselves.
Administrators everywhere on the planet, in all businesses and pursuits, and at all times in history, have been the plague.
Should you drop dead a few weeks after the visit, a low probability event, the doctor can be sued for negligence, for not having prescribed the right medicine that is temporarily believed to be useful (as in the case of statins),
A disabled person will not use the regular bathroom, but a nondisabled person will use the bathroom for disabled people.
Genes follow majority rule; languages minority rule.
some states will be subject to the rule, but not others. If, on the other hand, we merge all states in one, then the minority rule will prevail all across.
we can easily imagine bad outcomes stemming from a minority of bad agents.
Yes, an intolerant minority can control and destroy democracy. Actually, it will eventually destroy our world. So, we need to be more than intolerant with some intolerant minorities. Simply, they violate the Silver Rule.
only a few people suffice to disproportionately move the needle.
Why were they [wandering monks] banned? They were, simply, totally free. They were financially free, and secure, not because of their means but because of their lack of wants. Ironically, by being beggars, they had the equivalent of f*** you money, which we can more easily get by being at the lowest rung than by joining the income-dependent classes.
Traders who made money, I realized, could get so disruptive that they needed to be kept away from the rest of the employees. That’s the price you pay for turning individuals into profit centers, meaning no other criterion mattered.
The Ottomans relied on janissaries, who were extracted as babies from Christian families and never married. Having no family (or no contact with their family), they were entirely devoted to the sultan. It is no secret that large corporations prefer people with families; those with downside risk are easier to own, particularly when they are choking under a large mortgage.
A god who didn’t really suffer on the cross would be like a magician who performed an illusion, not someone who actually bled after sliding an icepick between his carpal bones.
Perfect ergodicity means that each one of us, should he live forever, would spend a proportion of time in the economic conditions of the entire cross-section: out of, say, a century, an average of sixty years in the lower middle class, ten years in the upper middle class, twenty years in the blue-collar class, and perhaps one single year in the one percent.
having rich people in a public office is very different from having public people become rich
It is downright unethical to use public office for enrichment.
*2 Complex regulations allow former government employees to find jobs helping firms navigate the regulations they themselves created.
Note that thanks to Lindy, no expert is the final expert anymore and we do not need meta-experts judging the expertise of experts one rank below them. We solve the “turtles all the way down” problem.
You can define a free person precisely as someone whose fate is not centrally or directly dependent on peer assessment.
The longer an idea has been around without being falsified, the longer its future life expectancy. For if you read Paul Feyerabend’s account of the history of scientific discoveries, you can clearly see that anything goes in the process—but not with the test of time.
religious “beliefs” are simply mental heuristics that solve a collection of problems—without the agent really knowing how.
the effects on the environment are not foreseeable—nobody studied the interactions. Recall that fragility is in the dosage: falling from the 20th floor is not in the same risk category as falling from your chair.
we only have one planet. So the burden is on those who pollute—or who introduce new substances in larger than usual quantities—to show a lack of tail risk.
It is much more immoral to claim virtue without fully living with its direct consequences.
virtue is doing something for the collective, particularly when such an action conflicts with your narrowly defined interests.
As Gibbon wrote: The various modes of worship, which prevailed in the Roman world, were all considered by the people, as equally true; by the philosopher, as equally false; and by the magistrate, as equally useful. And thus toleration produced not only mutual indulgence, but even religious concord.
we libertarians share a minimal set of beliefs, the central one being to substitute the rule of law for the rule of authority.
There are people who are atheists in actions, religious in words (most Orthodox and Catholic Christians) and others who are religious in actions, religious in words (Salafi Islamists and suicide bombers) but I know of nobody who is atheist in both actions and words, completely devoid of rituals, respect for the dead, and superstitions
So when we look at religion, and, to some extent, ancestral superstitions, we should consider what purpose they serve, rather than focusing on the notion of “belief,” epistemic belief in its strict scientific definition.
Your eyes are not sensors designed to capture the electromagnetic spectrum. Their job description is not to produce the most accurate scientific representation of reality; rather the most useful one for survival.
only evolution knows if the “wrong” thing is really wrong, provided there is skin in the game to allow for selection.
religion exists to enforce tail risk management across generations, as its binary and unconditional rules are easy to teach and enforce. We have survived in spite of tail risks; our survival cannot be that random.
How much you truly “believe” in something can be manifested only through what you are willing to risk for it.
Not everything that happens happens for a reason, but everything that survives survives for a reason.
If you incur a tiny probability of ruin as a “one-off” risk, survive it, then do it again (another “one-off” deal), you will eventually go bust with a probability of one hundred percent.
Rationality is avoidance of systemic ruin.
Pseudo-rationalism: 1) focusing on the rationality of a belief rather than its consequences, 2) the use of bad probabilistic models to naively decry people’s “irrationality” when they engage in a certain class of actions.
Silver Rule (negative golden rule): Do not do to others what you would not like them to do to you. Note the difference from the Golden Rule, as the silver one prevents busybodies from attempting to run your life.
The Digital Sauna 