What To Do About the Immaturity of Systems Modeling

Sam Harris recently had a conversation with Scott Adams (Dilbert creator and author of How to Fail at Everything and Still Win Big) about Trump. Adams predicted Trump's victory because he sees Trump as a master persuader. There's a lot to say about that but Adams made a really useful distinction about what he saw as the three stages of climate change policy. He distinguishes between:
1) The reality of climate change as an ongoing phenomenon that seems to be man made;
2) The ability to simulate future climate change with good models; and,
3) An appreciation of the economic policy implications of the above.

A decade or three ago, it was fashionable to dismiss climate change. This has become problematic for at least two reasons. One, the science is not that sophisticated. Certain industrial activity releases greenhouse gases. These gases - as the name suggests - work like a greenhouse and trap heat. That science is not exactly quantum entanglement and the data for greenhouse gas emissions and resultant warming seems to track pretty well to the theory. So Adams cedes this point and allows that climate change is probably real and ongoing.

Adams worked as a financial analyst at a bank, though, and challenges the second point: the ability to simulate future climate change. He said that it reminds him of the financial models he ran as an analyst that - should they reveal something his boss didn't like - could readily be changed with just a tweak of a few variables. Given we can't really forecast accurately what might happen, it is good to be skeptical, he says.

In this he has sort of put his finger on something really important and is sort of missing the point (probably intentionally).

What is really important is that systems define so much about what does or does not go well in our world - systems as varied as the economy and financial markets, energy systems, ecosystems and school systems - and yet we really don't understand system dynamics that well. Systems are tough to model and our models are not great. This is reason to be skeptical about any predictions but it also suggests that systems modeling deserves a massive infusion of research money. A crowd was gathered to watch a hot air balloon ascend and some woman said, "What is the use of all this new technology." Benjamin Franklin answered, "Madam, what is the use of a new born infant?" Systems simulation matters a great deal and is not that mature. Better to invest more heavily in it than to walk away from it. (And I think that computers' ability to simulate systems is maturing just when that capability is most needed for shaping policy dependent on such systems.)

And even with admitted limitations of models for any systems, it is worth asking whether even the models Adams was tweaking for his boss were all that bad. Once you understand a model for an economy or business, you articulate risks, a range of outcomes, and important variables. With good models you learn what factors they are most sensitive to (housing mortgages are sensitive to widespread economic downturns or refinancing from a drop in interest rates, for instance) and even spotty historical data can give you some sense of the probability of those events. (Yes. Nassim Taleb has rightfully pointed out that markets can be rocked by unpredictable events but risk mitigation can protect you from some of these rare events. A person who has saved three years of salary is better prepared for an event "they never could have predicted" than is someone with only three months of salary.)  Financial models are a little sketchy in prediction but there are ways to gauge their efficacy in spite of a large margin of error. (For instance, only about 20% of businesses succeed past 5 years. If your bank lending model assumes that is going to raise to 50%, it will probably be wrong; if it assumes that it will raise to 25% or drop to 15%, it could be right but done properly even that should require a coherent explanation that tracks to the numbers rather than arbitrary tweaks.) Further, to the extent that Adam's boss was unique in cheating the models so that they showed what he wanted, his bank would suffer. There is a drive to make models more accurate and - within the financial world at least - big rewards for such accuracy.

Models force questions and conversations about what variables matter and they bound reasonable outcomes. It is true that climate change models will be wrong but the simplest truth is pretty easy to predict: we will emit more greenhouse gases and temperatures will be higher than they would have been without these emissions. There are a host of unknowns that come with that (will particular regions benefit or lose, will changes in wind or sea currents result in unexpected cooling in certain regions, might unforeseen natural phenomenon or new technology absorb these gases, etc.) but the general story is known. If you invest in stocks over a 25 year period you can't be sure of when your portfolio will drop by half or raise 20% a year for successive years but you can reasonably guess that over your lifetime you'll be a better shape for having saved 10% of your income than not. Same with greenhouse gases; reducing emissions will drive less uncertainty, disruption and climate change.

Denying climate change is in a long tradition of denying scientific results like the health hazards of tobacco or the notion that we orbit the sun. Climate change deniers are traditionalists who conflate market economies with oil and gas and see an admission of climate change as a threat to those forces. (It does seem like climate change will threaten oil and gas. The possibility of oil and gas being displaced by alternative energy is not a refutation of markets that periodically unleash gales of creative destruction, though, but is instead an affirmation. Markets are no more dependent on oil than horses and markets don't treat fossil fuel industries as sacred.)

As to Adams' third point about evaluating the economics of climate change policy, I'll just say this. If it is inevitable that we'll adapt new energy technologies, there is less likely to be a penalty for rushing into creating and then converting to alternative energies than there is to be a penalty for delaying that change.

Forcing the OR Between Science & Religion

Responding to Chrlane's comment on the previous post, I was struck by a thought that clarified so much of my squeamishness about the evolution vs. religion debate in recent years.

People like Pat Robertson and Sam Harris have been trying to force an OR between science and religion. Pat Robertson and others would say that the Bible is to be trusted on matters of origin more than scientists and would say that you can believe in God OR those secular scientists. Sam Harris would point to the illogic of certain scriptures and beliefs and say that you can believe in God OR science, but not both.

The secular scientists and religious fundamentalists both make me nervous for very similar reasons: they are insisting that we choose between science and religion, forcing an OR between the two.

Perhaps it is because the majority of us Americans are neither scientists nor theologians that we can so casually hold to our belief in science AND religion. I suppose that at some level it is logically inconsistent to hold to both.

But I also think I know enough about the process of science and faith to stop short of believing that either is infallible or, even, that they are addressing the same issues. I'm a Christian, yet the conversation about whether the Bible is inerrant seems to miss the point. For Christians, the foundational truths in the Bible are Christ's teachings - teachings typically communicated in the form of parables, stories that may or may not have happened. That is, the "truth" of the stories Jesus told have little to do with the truth they contain. By contrast, science is all about objective truth that can be measured, replicated, and studied.

I'm sure that there are plenty of people who would be horrified that I'm so naively and ignorantly insisting that the link between science and religion is AND rather than OR. And while the fundamentalists and agnostics who decry my lack of intellectual rigor may have a point, I think that they actually miss the larger point. Their conclusions are fundamentally uncivil - resulting in widespread dismissal of a large swath of the population. While forcing an OR between science and religion may work within the small confines of their own minds, it does not work within the wider expanse of society and civil discourse. I don't think it is any coincidence that whenever the OR groups gain power - whether they are running theocracies or atheist regimes - dissent is punishable by imprisonment OR death. As for me, I simply don't trust the OR groups, whether they claim to be operating under the guise of religion OR science.

Sounding the Alarm on Alarmism

Expectations have a huge influence over our resultant reality. If you expect that people will act rude towards you, the probability of that goes up. (You might perceive offense where others would see good-natured jesting. You may well bristle at the least provocation, triggering a series of responses that make rudeness of some form not just more probable but inevitable.) If you expect a region of the world to react like zealots, you may well get that reaction. And this scares me.

The current issue of Newsweek shows a small child in Iraq holding a weapon and states, The Next Jihadists. Right-wing talk show hosts have been blathering on about the threat of Islam with the glee that they once reserved only for Bill Clinton's libido. And now even the intelligentsia is sounding alarm bells; atheist Sam Harris, in part of his larger agenda against religion as a whole, warns that Muslims are bent on world conquest and death to non-believers.

And this is the problem with expectations: all of this is true. There are Jihadists, Islam does have recurring patterns of, or references to, violence in its scriptures, and there is plenty of evidence that some Muslims would gladly kill themselves in order to kill innocent civilians. Yet there is a difference between what is true and the whole truth, as is said in a court of law.

Our own society provides plenty of evidence of a violent streak. We are gun-toting extremists who believe that God has blessed us and our wars. Our God is the true God and we are willing to send in invading armies to make it possible for our ministers to teach non-believers in foreign land. Just as most of what the alarmists say about Islam is true, so is most of what critics of our culture and policy (people like Noam Chomsky) say is true.

Life is, at any moment, so full of possibility that our minds would be overwhelmed if we could truly perceive it all. So like a radio tuning in to a particular station, we focus on one set of possibilities and, very often, make those real. (You doubt this? Think about what you expect each day about how your day will unfold, from breakfast to commute, to work. Now think about how little difference you regularly get from that.) We see what is true but not the whole truth.
The Middle East is a place of moderates eager to modernize, temper religious extremism with tolerance, and raise their children in a peaceful place that encourages economic and scientific advances. This, too, is true and is at least as true as the alarmists’ notions that have by now hijacked the thoughts of the right and left, the reactionaries and the thoughtful. And what is so alarming about that is how often expectations steer us towards one set of possibilities.

Representative Keith Ellison and His 1 Billion Informal Constituents

It seems as though we have a few choices in dealing with the Muslims who share the planet with us:
1. Send Sam Harris, author of The End of Faith, around the world to convince them all to become atheists.
2. Send Pat Robertson around the world to convert them to Christianity (in which case Sam Harris may feel compelled to follow him around to convert them to ... well you get the point).
3. Try to convert the Islam-a-phobics in the West into becoming warm and friendly neighbors with their fellow Muslims.
4. Stop with the conversion fantasies and continue to focus on creating a further web of interdependency and familiarity through increased levels of trade.