Shun Abstract Universalism, Embrace Risk

by James A. Bacon

I don’t always agree with him, but I regard Nassim Nicholas Taleb (author of “The Black Swan,” Antifragility,” and “Skin in the Game,” among other works) as the most original and innovative thinker of our era. He is one of the very few people I follow on Twitter. In today’s Sunday sermon, permit me to highlight an excerpt from his writings that summarizes many of my own sentiments:

When young people who “want to help mankind” come to me asking, “What should I do? I want to reduce poverty, save the world,” and similar noble aspirations at the macro-level my suggestion is:

  1. Never engage in virtue signaling;
  2. Never engage in rent-seeking;
  3. You must start a business. Put yourself on the line, start a business.

Yes, take risk, and if you get rich (which is optional), spend your money generously on others. We need people to take (bounded) risks. The entire idea is to move the descendants of Homo sapiens away from the macro, away from abstract universal aims, away from the kind of social engineering that brings tail risks to society.

Doing business will always help (because it brings about economic activity without large-scale risk changes in the economy); institutions (like the aid industry) may help, but they are equally likely to harm (I am being optimistic; I am certain that except for a few most do end up harming).

Courage (risk taking) is the highest virtue. We need entrepreneurs.

Bacon’s bottom line: Those who seek to impose their abstract universal ideals on others — whether borne of religious conviction, faith in communism or fascism, or a quest for cosmic justice — have inflicted immeasurable harm upon the world. If you want to improve the world, go into business with a product, service or idea that will meet other peoples’ needs. If you want to alleviate suffering, focus on the suffering you encounter in your own life. 

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46 responses to “Shun Abstract Universalism, Embrace Risk

  1. I like this line. I try to to practice it. Sometimes it can be easy and other times it is worse than helplessly hoping.

    “If you want to alleviate suffering, focus on the suffering you encounter in your own life. “

  2. I am now reading Shellenberger’s “Apocalypse Never”, and just a few pages in I find it incredibly refreshing. May do a review when I’ve gotten through more. It is a similar theme: If you want to see environmental protection, forest conservation, more clean energy sources, the first step it to build the necessary societal wealth. Monetary (and energy) poverty accounts for much of the deforestation and pollution. The wealthy countries are making great strides. I suspect he will dive into how the Climate Alarmist movement is stopping actual progress (as is the case right here in the Commonwealth.)

  3. I agree with the fundamental premise but just want to point out that countries that have high levels of literacy and universal health care tend to have less poverty and suffering – i.e. more “boats” are lifted by the economy.

    If you do not have a basic education – chances are you’re not going to be competitive as a business against others who have education and enough wealth to have access to capital.

    Can someone work themselves up from the bottom? Yes. How many do that out of 1000 or a million?

    There are always exceptional people in this world who do overcome the odds but the vast majority do not and the question is – are things like education, health care and public roads “socialism”?

    Without these three – what you have are places like Somalia and much of the rest of countries with similar lack of publically-funded infrastructure.

    In order to have a country with opportunity to even the poor, you have to have publically-funded infrastructure, education and health care.

    • As we do.

    • Ask yourself, Larry: Has the creation of extensive social safety nets created more economic mobility or less? Is there more or less mobility today than 100 years ago? Fifty years ago? Could it be possible that the programs you defend (a) have been captured by the nurturing classes that administer them and are perpetuated regardless of whether they work or not, and, further, (b) have unintended consequences for the beneficiaries.

      Good intentions are not enough. We’ve had 50 years of good intentions. It’s time to look at results.

      • Jim – there IS more, clearly and it’s no contest when comparing the country that invest in publically-funded infrastructure, education and health care.

        It’s no contest.

        You’re arguing for 3rd world standards here by claiming that as long as there is poverty and disadvantaged , it “proves” that these things do not work.

        It’s you arguing that VDOT is a failure because we still have congestion so all the other they have done has not fixed it!

        • It is difficult conversing with you, Larry, when you so relentlessly misrepresent my perspective.

          • except I don’t. If you say I “misrepresent”, can I say that you put forth false ideological concepts that do not acknowledge realities?

            It’s pretty clear which countries excel in the world and the top countries have universal education and healthcare. That’s a simple fact.

        • There will always be more demand for resources than supply. The only solutions to regulate demand to meet supply is either Price or Force. Congestion will always be a problem when use of roads are essentially free.

          VDOT, however, fails because its bureaucracy has no competition. Any good bureaucracy, whether public or private, will push for expansion. Most everyone feels overworked and underpaid, because we humans have an inherent bias for self-interest. In too many cases, its become far too easy to blame others and advocate the use of Government Force to take from others, then regulate our own desires and wants.

          What would you rather do, set a price or point a gun?

          • I think you’re gonna be hard pressed to find any country in the world where the roads in that country are privately run by multiple companies competing.. and even then would you support private companies using eminent domain to acquire a key section of road they could not get by buyer/seller?

            And you’d let them charge whatever they decided was according to “demand” and refuse others the ability to use it if they could not pay?

            What country in the world does roads this way?

      • Well, you COULD try to buy healthcare insurance at the age of 70, but I doubt you’d like it.

    • Agree that infrastructure and especially education are fundamentally essential investments to a prosperous society, but they don’t necessary have to be publicly funded.

      The question is: would those with political power also be enlighten enough to see how access to education for the masses rises the tide. History indicates those with political power would rather fight to be at the top of a sinking ship.

      Be careful not to equate wealth and political power. Many in the Plantation Elite © are jealous of the prosperity obtained by commoners through free market value creation, and hence advocate via their pseudo-Progressive politics for unnatural restrictions on wealth creation and wealth distribution on political grounds.

      Recent case in point, advocating for the funneling of taxpayer funds to mass transit cronies (under the guise of helping the poor.)

      • It’s really a simple thing easily verified by the data.

        Countries that provide tax-funded education and health care – have higher GDP with for more economic prosperity for more of their citizens.

        And I would add tax-funded public roads which provide economic mobility for all and largely power our economy. Virtually every item you have in your home came to you on a public road.

        None are free. All are funded by taxes. And the countries that provide them sit atop the country rankings for GDP.

        • >None are free. All are funded by taxes.
          Once the taxes are been taken, the services provided are essentally free to the users. The problem is the disconnect between the taxpayer and those spending taxpayer money.

      • Actually, the obvious truth based on facts that are now plainly apparent, is that state and federal public monies along with pie in the sky good intentions, and a corrupt political system that is far too dependent on spending public monies and feeding off identity politics, has ruined public education in America.

        One of the ironies to that statement is that Virginia, given its systemic political perversity that money and now also identity too rules all, has managed to get the worse of both worlds, by building within its public education system a voracious appetite for ever more money, while cutting state funding for higher education and at the same time encouraging higher education administrators and senior faculty to jump themselves and their institutions into high risk entrepreneurial for profit businesses.

        Higher education has now gone from educating students to businesses devoted to those who run and manage those businesses, their ideological interests being added to their money interests. Hence, Jim Ryan always publicly tells research is UVA’s number one priority. See his 2020 virtual Convocation Address. Today, we witness the results of that unfolding disaster at UVA and throughout the state and the nation.

        This latter assertion has been fully documented here and elsewhere. An excellent primer on Virginia’s and the nations great mistake is here:

        The Great Mistake: How We Wrecked Public Universities and How We Can Fix Them (Critical University Studies), published Oct. 1, 2018 by The Johns Hopkins University Press.

  4. “Those who seek to impose their abstract universal ideals on others — whether borne of religious conviction, faith in communism, fascism, or even free market capitalism, or a quest for cosmic justice — have inflicted immeasurable harm upon the world.”

    Key is the ideal, not from whence it comes. Fair and balanced ideology.

  5. In other words, today’s “charitable causes” are often just first world problems.

    In a purely unemotional world, it would rarely, if ever, make economic sense for a business enterprise to donate to charity (or pay taxes). Charity donations should be left to choices of the individual (as should payment of taxes), while business focus on creating value for their customers.

    In an idealisitc sense, business are “donating” to their community by creating a more efficient process, and therefore, creating value for their customers. Such value creation often results in providing relativity better job opportunities also.

    Whether that value creation generates sufficient ROI to justify an investment is another matter. However, the focus of maximizing ROI to shareholders, rather than value creation for customers, I personally believe is a fundamental flaw in our financial and economic education.

    • Of course, value creation must include resource depletion and environmental destruction. “For what shall it profit a man, if he shall gain the whole world, but lose his breathing air?”

      • Of course, peak oil has been right around the corner since the 1960s. Certainly, oil isn’t as easy to find as it once was but, more interestingly, the producers continue to have incentive to find it. There’s plenty of oil, its a question of whether the customer finds value at the price point it takes to get it.

        Then, there’s the peak Buffalo issue but that has more to do with lack of property rights. Should I have the right to pollute my neighbors yard? At least not to the point were it destroys they’re ability to quietly enjoy but, at what point does your interpretation of quite enjoyment become a first world problem.

        • Never put much stock in peak oil. I mean, predicting when. I’m sure there will be a last drop at some point.

          In my business, we were the target of high risk exploration ventures, from oil to sunken treasure, always wanting us to work at risk. Our unofficial motto was “We’ll help you find it, but we won’t help you look for it. Keep your 10% of the find, pay before we start.”

          Quiet enjoyment? Well, there have been times I have wondered it a .22 could take out a backpack leaf blower without passing through the backboard. Idle contemplation, I assure you.

          • Force is certain one way to regulate others, though I think most of us would prefer voluntary, non-aggressive means to tyranny.

            Demand for energy won’t abate. But, I suspect, that we’ll find an economically sensible alternative to oil before the last drop of oil is depleted. Maybe one day we’ll all have a Mr. Fusion (and a levitating skateboard.)

          • well, force usually follows ” screw your laws”… no?

        • re: ” Should I have the right to pollute my neighbors yard? At least not to the point were it destroys they’re ability to quietly enjoy but, at what point does your interpretation of quite enjoyment become a first world problem.”

          Any more so that he’d have that right to pollute yours?

          Have you seen 3rd world countries rivers?

          How about the Potomac before we forced people to fund sewage treatment plants?

    • ” In a purely unemotional world, it would rarely, if ever, make economic sense for a business enterprise to donate to charity (or pay taxes). Charity donations should be left to choices of the individual (as should payment of taxes), while business focus on creating value for their customers.”

      Businesses want their customers to know that they do actually “contribute” in a meaningful, measurable way to the community rather than just claim that their mere existence that they are.

      If doing that actually gets them more business, then it’s clearly an “investment”.

  6. I’m talking pure homo-economicus. If you want your business to donate, that’s your choice. Do I think your C-Corp should get a tax deduction to do so: no, I don’t (nor, do I think businesses should even be involved in tax collection and other schemes.) However, Individuals should be able to make tax Creditable donations to legit charities (legitimacy is another issue.)

    There’s a difference between donating to charity for the common good, and “donating” for marketing purposes (included, social projecting.)

    I’m sure there are many things the “government” agrees to allow that you don’t think they should allow. Heck Larry, did you know that an overwhelming majority of people (5 in 6) find Russian Roulette to be completely harmless? Does that make it a good idea?

    • “Heck Larry, did you know that an overwhelming majority of people (5 in 6) find Russian Roulette to be completely harmless?”

      Love it. But the Expected Return does suck.

      • Dealing with folks who do not like the idea of government or taxation in a spitballing theoretical way is wild at times… 😉

      • Gotta warn you – if you get too provocative – bad comments can result and it will be mostly your fault… ;-)… might need to put that someone on the TOS ?

        • And Larry, I thought we were finally starting to agree to a few things.

          Unfortunately, as a private business owner, I have to get some government induced paperwork done before Monday gets here so sadly must leave you to your own commenting devises.

        • No sense da humor.

          I really don’t care what others say when not direccted at me, but I lay claim to the odd numbered replies in my threads.

      • > But the Expected Return does suck
        Hypothetically speaking, that’s what I think about our current tax collection system

        • Well, it used to be based on honesty of self-reporting. If instead of greating soldiers with “Thank you for your service,” we greeted all citizens with “Thank you for your tax reporting honesty,” patriotism would be a virtue again.

        • re: “self reporting” – well they warn you by sending you various “tax documents”- … IRS to taxpayer: ” hey we know you did this”

    • And I’m saying in a free market world, businesses can do that with whatever justification they want and if they think doing so enhances their business, then so be it.

      If you as a customer do not like it, then you have options also.

      a majority of people think Russian Roulette is completely harmless?

      what the……. really?

      but yes – in a representative system of governance, the majority does decide. Heckfire, the SCOTUS decides by majority vote. What do you want different? 3rd world rules?

      • > If you as a customer do not like it, then you have options also.
        Ahh, consumers of Dominion power unite! Your government hath given you choices! Either buy from Dominion or live in a cave!

        Interestingly, the free market gives people an incredible array of choices. Where systems severely limit our choices, pursuing the most light handed approach should be the preferred method. Hence, natural rights, including property rightsm to protect the minority from the tyranny of the majority (or whatever tyranny has the legal authority to kill you for non-compliance.)

        • Well, I think your “rights” – natural or not end where mine begin.

          Seems like we can sort that out with an elected represented governance or perhaps do like it’s done in 3rd world countries – perhaps something in between but in the end your rights are not just what you think or say they are. It just does not work that way.

          I just don’t quite understand where exactly the “rights” thinking comes from when we are in a world with others who also have rights. Seems like there has to be a reconciliation of “rights” so that we don’t impend on each other, or we end up with a lawless society where weapons decide. We end up like Iraq or Somalia.

          no?

        • 10,000 years of economic crashes and the free market capitalists say, Well, let’s push the wreakage back up the hill and see if it crashes in the same place.”

  7. Mother Teresa need not apply

  8. Back to Mr. Taleb, his comment reminds me of Milton Friedman’s great retort to William Buckley’s support for a national service program – all jobs are service jobs – the kid working at 7/11 is providing a service equal in importance to volunteers at hospitals.

    I learned my lesson at a workshop with Paul Goodman in the early 70’s. After I ranted about the need for revolution, Goodman told me to stop thinking about the abstract – focus on the concrete. I’ve tried to follow his advice.

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