THE UP SIDE OF DOWN: WHY
FAILING WELL IS THE KEY TO SUCCESS, by Megan McArdle
NY: Viking, 2014
(On sale February 11, 2014)
Hardcover $27.95
When teaching philosophy, I
used to tell my students that getting a concept wrong, being confused,
misunderstanding or misstating an idea or position were all positive signs. “It
means you’re thinking, not just
memorizing and regurgitating.” This is a lot of the message of Megan McArdle’s
new book: failure can lead to learning, which can lead to growth and success.
One thing you should know,
however, is that this is not a self-help book. You and your problems and issues (or me and mine)
are not McArdle’s focus. Her canvas is much broader. And that broader vision is
both the book’s strength and its weakness.
The big picture approach
helps to situate personal experience and individual concerns in a broadly psychological and social context that allows the author to commend or criticize
government and corporate policies and programs, as well as the aims and
strategies of individuals. On the other hand, it is a weakness when examples
drawn from disparate realms are tossed in with insufficient discussion
(“punish” puppies to house-train them? How? “spank ... immediately” to
discipline children? For what range of offenses, one instantly wonders with
some alarm) or when huge global issues such as poverty are brought in for a
brief paragraph, acknowledged with a nod, and then left by the side of the
road.
Those are my caveats. Having
issued them, I want to assure my readers that this book is well worth their
attention, for as many reasons as the topics it addresses.
McArdle presents fascinating
information from diverse disciplines and draws from it her own conclusions. She
writes engagingly not only when recounting very personal experiences (the kind that don't usually make it into books on economics) but also
because she brings an open mind to national debates, debates often rigidly
polarized in American society at large and treated superficially in familiar
sound bytes. The publisher identifies her as “an outspoken Libertarian,” yet
time and time again McArdle acknowledges an active role for government, and never does
she seem to be hewing to a party line –conservative, liberal, or libertarian.
More than once her even-handed discussion reminded me of Aristotle: no one person
or group is wrong (or right!) about everything, and she gives every
position its due issuing her critique. Then, too, her criticism is based on
empirical evidence, not personal opinion or blind ideology. Very refreshing!
What we need, this book implies,
is more information, more experiments, and even more gadflies and
whistle-blowers. Will that eliminate or even reduce failure?
In your dreams!
Despite the most thorough market research, scientific
research, psychological research -- at the end of the day the market is still
made up of human beings, and human beings are and always will be unpredictable.
So why bother?
Because we can
do better. Because we can prevent failure from turning into disaster.
To manage failure and learn
fast enough to stay clear of disaster, we must be aware of common errors in the
way we process information. Because of the normalcy bias, it’s hard for us to see a crisis if everyone around
us is acting as if things are all hunky-dory. (I think of this as the
“Emperor’s New Clothes” bias, but really, someone does need to blow the whistle
there, wouldn’t you agree?) Then, once we’re all convinced we’re going down the
right road, the confirmation bias
kicks in to reassure us and will even “bend the map” in order to discount information
that would otherwise clue us in to the fact that we are lost. The lesson here,
as we used to say to each other in grad school philosophy classes, reading one
philosopher after another who started out with what he considered self-evident
propositions, “It isn’t always what’s obvious.” Too often we just see what we
look for. And then there’s risk aversion, or what I always think of as the why-we-are-in-Vietnam syndrome:
We’ve put too much into this! We can’t get out now! Throwing good money after
bad makes for disastrous gambling, with ever-mounting losses. Excuse all my
Memory Lane quotations today, but it’s true that “You gotta know when to hold
‘em, know when to fold ‘em, know when to walk away, know when to run.”
To anyone familiar with the
work of Nevsky and Kahnemann or Dan Ariely, news of the ways in which our
reason is contaminated by irrationality is no news at all. The thing is,
“knowing” as in “being able to choose the correct answer on a test asking about
risk aversion facts or statistics" is not at all the same thing as knowing how to avoid the pitfalls, so any book that reminds us to double-check our thinking is probably a book we need to read. In one book I recently read
but did not review, Alex Stone’s Fooling Houdini: Magicians, Mentalists,
Math Geeks, and the Hidden Powers of the Mind, the author, who never believed in fortune-telling in the first
place visits a fortune-teller,
focuses on how she’s doing what she’s doing, sees clearly what’s going on – and
yet
Later that day, I caught myself brooding over what Stephanie said – that is, until I remembered the source and pushed these thoughts aside. And yet, no matter how hard I tried to dislodge them, they had a stubborn way of creeping back into my consciousness....
One of the scariest things about mentalism is that even after you understand how it works, it still feels believable.
- Alex Stone, Fooling Houdini (2012)
How scary is that?
Okay, I said that The Up Side of Down isn’t a self-help book, but McArdle does have a few words of advice for unemployed job-seekers, most of them good. Her take on why the long-term unemployed slack off on the searching is that the longer they have to look, the more anxiety and unhappiness they experience and that discussions on unemployment benefits should take this into account, to reduce job-seekers’ anxiety and keep them moving – presumably to wherever there are jobs. This was basically a good discussion, as far as it went, but the number of jobs that have gone overseas is left unaddressed, and the advice to spend time with others in the same boat, other unemployed people, for “support” didn’t sound convince me. After all, you won’t get job leads hanging out with other people who are out of work, and you might just get more depressed and feel more hopeless. I wonder if McArdle has read Barbara Ehrenreich’s Bait and Switch. I’d love to see Ehrenreich and McArdle onstage together, not debating, per se, but conversing these important issues at a deep and meaningful level.
Okay, I said that The Up Side of Down isn’t a self-help book, but McArdle does have a few words of advice for unemployed job-seekers, most of them good. Her take on why the long-term unemployed slack off on the searching is that the longer they have to look, the more anxiety and unhappiness they experience and that discussions on unemployment benefits should take this into account, to reduce job-seekers’ anxiety and keep them moving – presumably to wherever there are jobs. This was basically a good discussion, as far as it went, but the number of jobs that have gone overseas is left unaddressed, and the advice to spend time with others in the same boat, other unemployed people, for “support” didn’t sound convince me. After all, you won’t get job leads hanging out with other people who are out of work, and you might just get more depressed and feel more hopeless. I wonder if McArdle has read Barbara Ehrenreich’s Bait and Switch. I’d love to see Ehrenreich and McArdle onstage together, not debating, per se, but conversing these important issues at a deep and meaningful level.
There’s much more in this
book than what I’ve covered here. For instance, Chapter 8, “Blame,” begins
with the way human brains work, brains looking for patterns, causes, and agency
– brains jumping, therefore, from accident to intent, positing intention and
design to what may be random events, assigning blame where there may not even
be responsibility. Just as having control reduces stress, so believing we have
control reduces stress. -- But if we’re all in control, designing events to
conform to our intentions, isn’t someone always guilty? -- Not so fast!!! We may have only imagined the intention....
The following chapter,
“Punishment,” may surprise many readers (and I know from teaching
undergraduates that there will be strong resistance here), because in it the
author lays out the well-supported claim that visiting vengeance on criminals
(‘vengeance’ usually called in this context by the milder term ‘retribution’)
is usually counterproductive. She does not argue against punishment in general
but says that the consequences, to be both effective and cost-effective, must
be immediate and inevitable. No letting small violations slide and then,
unpredictably, crashing down with harsh verdicts. Actually, the harsher the
verdicts, the more 3-strikes-you’re-out, “the higher the incarceration rate,
the less it discourages....” The probation program she introduces to us
mainlanders is from Hawaii, called HOPE, and the judge’s message to his
probationers, people who have failed usually several times in many different
ways, is that everyone wants them to succeed, that the focus from here on in
will on the future, not the past.
Closely monitoring
probationers costs less than keeping criminals in prison. Likewise, providing
free housing to homeless people, even if they are alcoholics and/or drug
addicts, is cheaper than the myriad costs to society of homelessness.
With bankruptcy, as with
criminals and homelessness, this libertarian author takes a surprising
position, namely that choosing bankruptcy can make much more sense than
remaining under the crippling burden of debt year after year. Bankruptcy lets
people start over. And since so many entrepreneurial endeavors fail, it’s important
that people willing to take the risks of starting new businesses should have
the opportunity to try again after failing.
In so many ways, in so many realms, forgiveness costs much less than punishment. This should be a wake-up call to individuals, voters, and government officials.
In so many ways, in so many realms, forgiveness costs much less than punishment. This should be a wake-up call to individuals, voters, and government officials.
Realizing that McArdle's book
originated as essentially ten separate magazine features (the author is a
long-time blogger and a writer for Bloomberg View, The Atlantic, The
Economist, and Newsweek) helped me make sense of the variety of topics
brought together in a single book under one umbrella title. It isn’t the book I
expected, but it brought together many intriguing issues, and I look forward to
future books from Megan McArdle.
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