Category: Book reviews

Rediscovering Nassim Nicholas Taleb, Almost at Random

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Nassim Nicholas Taleb (2011 photo by Bloomberg via Taleb’s website fooledbyrandomness.com)

 

By Daniel Wilcock

A random mistake at the airport earlier this month—checking in the book I intended to read along with the bag that contained it—reintroduced me to Nassim Nicholas Taleb‘s “Incerto” series of books. Even though I’d read and loved the Black Swan a few years back, the other three volumes, Fooled by Randomness, the Bed of Procrustes, and his latest Antifragile, somehow hadn’t caught my attention despite my knowing about them. How foolish. Taleb is an intellectual of the street fighting variety. His books pull brains out of stupid mode and light them on fire. They awaken readers to errors and misperceptions everywhere. That for me is the mark of a good philosopher. Yet a grain of salt or two may be needed. His stridency and dismissiveness of others are also the marks of an egotist cult leader, which I don’t think he is, but more on that later. How did I figure that his other books weren’t worth reading? Consider this blog post a way to make amends for this error.

By good fortune, but not randomness since the book is a perennial bestseller, a bookstore at Dulles International Airport happened to have a copy of Taleb’s second edition (2005) of Fooled by Randomness. Purchase made. Thus instead of reading the third volume of Lord of the Rings on the flight to Tokyo, an equally fine endeavor, I had the pleasure of jolting my worldview a bit. In Taleb’s hands, the hours ticked by pleasantly despite the cramped conditions, bland food, and impossibility of sleep.* If you enjoy non-technical philosophy and contrarian viewpoints, I’d say give this author a try.

Each of Taleb’s books is a fractal component his larger oeuvre, which argues that the “knowledge” and advice we encounter fail to adequately take into account the random, the opaque, and the unknown. This turns most modern human beings, particularly those who pay attention to mass media, into suckers and turkeys. His focus is on how to make decisions in an environment where we are continuously deluded and blind to the big disruptions he calls “black swans.” He thinks that these big events, which we never can predict, end up running our lives. He prefers negative to positive advice. These lessons, heavily informed by ancient philosophers like the stoics and contemporary behavioral economists such as Daniel Kahneman, mostly boil down to “don’t be a fool.” This is ultimately an impossible edict for humans, but archers aim high to hit distant targets.

Fooled by Randomness is the humblest and perhaps the most endearing of Taleb’s works. It shows how he gathered the bearings of his world view and contains the key admission that contextualizes the brash and seemingly arrogant way he battles with status quo thinkers. He admits repeatedly that he is a fool himself. One thing he attacks in others is their lack of similar humility, which is risky and ultimately destructive. Without this baseline caveat, it’s easy to misinterpret as self-righteous Taleb’s attacks on most other professional thinkers, particularly financial analysts, economists, journalists, and academics.

Fooled by Randomness is Taleb’s initial takedown of professional predictors. Like all of his books, it’s a mélange of autobiography (he worked as a trader for 20 years, then as an academic who writes books and doesn’t seem to like the academy much, and now as a flâneur, which is French for an idler who lives well by not making plans), philosophy, real-world observation and fictional narrative. It introduces a semi-autobiographical character called Nero Tulip (a name suffused with wry references), a financial trader who follows a seemingly lackluster “barbell” investment strategy of bonds plus small bets that pay off big in the event of market crashes. Despite having a risk-adverse worldview, Nero envies the flashy lifestyle of his neighbor, a fellow trader getting rich quickly with the latest financial trend. The neighbor “blows up” in the end and leaves the market. Nero is vindicated and remains in the market before he randomly ends up crashing a helicopter.

Later, in the Black Swan, Taleb introduces other semi-autobiographical characters like Fat Tony, another trader (and a necktie-free wise-guy gourmand that judges people subconsciously by smelling them) who functions as a comical mirror image of the experts Taleb attacks. Despite his argument that narratives pull the wool over our eyes, he calls it the “narrative fallacy,” Taleb uses these little stories nonetheless since humans’ brains function through narratives and also because he savors their artistic side. He appreciates style and intellectual pleasure, and finds great value in novelists and thinkers whose works have withstood the erasure of time. He’s a man who since his teens has read voraciously—40 to 60 hours a week, which reminds me of the number of miles run by marathoners each week—and I think these “Incerto” books are the output of his idiosyncratic inputs.

After putting down Fooled by Randomness, I picked up both the Bed of Procrustes, and Antifragile. The former is a collection of Taleb’s aphorisms, pithy little sayings that contain his wit and wisdom, and I think best enjoyed piecemeal, perhaps a page a day. Antifragile is another beast altogether, but similar in structure and content to the Black Swan. Taleb writes that Antifragile contains his main argument, the central idea of the Incerto. The title is a new word he invented. Antifragile refers to the quality of things that benefit from randomness, volatility, damage. These things have convex shape rather than concave when plotted on an axis. They have more of an upside than a downside when stressed. Examples can include the human body (up to a certain limit), the world of small businesses, barbell-style investors, and authors. In other words, he’s come up with a philosophy based on his own path to the good life. Again, he favors negative advice, a time-tested school of thought called “via negativa.” He finds wisdom in the concept of “small is beautiful” since larger size makes things more fragile. I could go on, but if you find these ideas tantalizing, the best thing to do is pick up the original.

As promised, a grain of salt. I think any thinker who warns you off most other thinkers, and one who is so clearly impressed with his own pathways in life, runs the risk of being an egotistical cult leader. Were Taleb more of a religious fanatic, rather than what I perceive to be a very erudite and broad-minded deist, his brash denunciations of others would come across (to me) as highly suspect. He’s a rich and confident man making sweeping statements. You might argue that being a notoriously cantankerous philosopher is his retirement hobby. His words often lack much humility other than his early admission (and not often repeated by the time he gets to Antifragile) that he’s human and fooled by life just like the rest of us. I think his arguments in each book are highly worthwhile, but need to be placed in the deeper context of all four books taken together. Taleb says the books can be taken in any order, but I think Fooled by Randomness is the best place to start. Just reading the Bed of Procrustes, one might legitimately ask “who is this jackass?”

Taleb’s a self-confessed fool, but he’s grappling with the tools that illuminate his foolishness and even provide the chance for a good life. That’s why I won’t repeat the mistake of sleeping on his work. As Taleb the flâneur would argue, and as my mishap with my copy of Tolkien suggests, we gain from being open to randomness.

 

*

ANA economy-class does have a few good things going for it, such as the opportunity to savor Japanese beer such as Premium Malt’s (sic), but trans-pacific travel is still a grind. Having a good book for the 13 hour flight is an indispensable remedy for the pain of temporary captivity.

Review: Winning the Loser’s Game

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By Dan Wilcock

There’s a reason why investing sages like Jack Bogle, Burton Malkiel, and David Swensen praise Winning the Loser’s Game by Charles Ellis. Now that I’ve read the book (just closed the cover) I know why. This book is a bullshit eliminator, completely clear-eyed about market risk (the fact that losses will happen) that nonetheless explains the stakes in not taking on market risk in a world where taxes and inflation constantly erode wealth. It’s a book that explains the counter-intuitive nature of the market in a way that clicks: why investors should welcome stock price declines, why booming stock markets are better for stock sellers than stock buyers, why stocks aren’t important because of their price but rather because of their ability to produce dividends. Even though these are well established interpretations of the market, their wisdom never sunk in before I’d read Winning the Loser’s Game. Hence I’d recommend it wholeheartedly as one of the best books on investing.

The title of the book comes from a journal article Ellis wrote in 1975. He compares investing to tennis, which for virtually every amateur is a loser’s game. The victor wins on their opponent’s unforced errors. Ellis argues that investing used to be a winner’s game, but the field got so crowded with experts and operators who know how to take advantage of all the suckers (my words, not his) that the only way to win is avoiding unforced errors. The biggest of these is attempting to “beat the market.” This is an endeavor where more than three quarters of professionals ultimately fail. The individual investor socking away money in IRAs and 401ks shouldn’t even try. Rather than losing by actively trading, and compounding those losses with all the fees this entails, investors should craft a realistic policy that seeks to capture the entire market return (through entire market indexes) or a segment of the market through selected low cost mutual funds.

I was already bought into the idea of indexing (the lowest cost, getting the most of whatever the market returns), but before reading this book I might have been more likely to shift my index holding to more bonds in a bear market to preserve value. This is psychologically understandable, but exactly the wrong approach. Big downswings require that investors stick to their policy and make the most of bear markets by sticking to the path they set. This is a more nuanced, and more practical, version of the old saying “buy low and sell high.” That simple saying doesn’t prepare investors to do the right thing. The phrase is premised on active investing, and when the markets are at their most volatile is when we as human beings are most likely to make precisely the wrong decisions. By staying the course, and investing in consistent intervals, buying low and selling high happen naturally. The market cannot be timed, according to Ellis. Jumping in and out of the market is, for most people, lost opportunity.

I read the 4th edition of this book. As of this 2014, Loser’s Game is now in its 6th edition and updated post-great-recession. If you’d like to know how Ellis deals with the market fallout from 2008, I’d recommend that version (which I haven’t read). I think, however, that the reader of the 4th edition would have been very well served throughout the last seven years. They would have stuck the course and rode the massive upswing in equities to their now record highs. They would also have established an emergency fund that would allow them to buy largely into equities and then be steely about holding them.

Anyway, after making it halfway through the book, which I’d borrowed from the library, I ordered a copy for my personal collection (4th edition, much cheaper than the 6th). This is a book that any investor would be well served to read annually, perhaps just before looking at results and allocation. The rest—virtually everything we read online in the financial news—is counterproductive noise.

Hard Climbing: a Review of Peter Matthiessen’s The Snow Leopard

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Matthiessen hikes past Lake Phoksumdo en route to the Crystal Monastery (photo by Carsten Nebel via Wikimedia Commons)
In The Snow Leopard, Matthiessen hikes past Lake Phoksumdo en route to the Crystal Monastery (photo by Carsten Nebel via Wikimedia Commons)

By Dan Wilcock

Reading The Snow Leopard is a bit arduous, but its commanding views are worth the climb. For me, and I suspect many like-minded readers, the book lights upon a trifecta of fascinating topics: the hike of a lifetime, the natural world, and Buddhism.

The book, published in 1978, recounts a trek Matthiessen took into a remote part of Nepal five years earlier. He heads into the Himalayas with a biologist friend who’s tracking a rare species of mountain sheep. His agreed-upon task is to assist with the field work, but his real aims are to experience the transcendence of Zen Buddhism and to find the Lama of Shey, a spiritual leader who presides over the secluded Crystal Monastery.

As the story unfolds, Matthiessen also reveals how torn he is to be separated from his family— from his wife due to her death from cancer, and from his son by taking the trip. Buddha also deserted his family and embarked upon his path to enlightenment, so like Hesse’s Siddhartha this book is an echo of the Buddha’s story.

Despite the makings of a terrific yarn, the pages don’t exactly fly by—or at least they didn’t for me. Although there are some stunning passages describing nature and panoramic vistas, Matthiessen keeps his the narrative portion of the book fairly unvarnished and somewhat plodding as if it were direct transcriptions from his journal. Interspersed with the story is a certain amount of regional history, some of which is truly fascinating. Take for example, this tidbit on the history of the Nepalese Gurkha soldiers, and how far back China’s claim to Tibet extends:

“The legend of these soldiers had its start in 1769, when the armies of the King of Ghorka spread
out from the central valleys, absorbing the small tribal kingdoms and creating the Hindu state
now called Nepal; in their great ferocity, they rushed into Tibet, only to be thrown back by the
Chinese, who considered Tibet to be part of China even then.”

I think a lot of people familiar Tibet’s plight following China’s mid-20th Century annexation would be surprised to learn that that was just one episode in a much longer story. Nepal’s origin story is also something I had no clue about before picking up this book.

More prominently, the roughly half of the book is a “meditation” (har har) on Eastern spiritual practices, primary Zen and the Buddhism and indigenous traditions of Tibet. He has a gift for synthesizing these concepts, such as the following passage—in which the Buddha’s teachings are encapsulated in just one sentence:

“In what became known as the Four Noble Truths, Sakyamuni perceived that man’s existence is
inseparable from sorrow; that the cause of suffering is craving; that peace is attained by
extinguishing craving; that this liberation may be brought about by following the Eightfold Path:
right attention to one’s understanding, intentions, speech, and actions; right livelihood, effort,
mindfulness; right concentration, by which is meant the unification of the self through sitting
yoga.”

Even though it takes some trudging to make it to Crystal Mountain, both for Matthiessen and for the reader, the journey culminates in something like enlightenment, which he finds may not be a permanent condition but rather a falling away of illusions and worldly concerns. Matthiessen returned to bring us this book. I think it’s a gem, but one that may take some polishing to shine.

Miles on music: no restrictions, no categories

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Trumpeter Miles Davis (photo by Tom Palumbo via Wikimedia Commons_
Trumpeter Miles Davis (photo by Tom Palumbo via Wikimedia Commons)

By Dan Wilcock

This week I’ve been checking out Miles the Autobiography, the highly entertaining but very raw memoir of the late, great Miles Davis (co-authored with Quincy Troupe).

On page 205, Davis makes a very persuasive comment about the nature of music, and why it shouldn’t be contained or categorized. Here’s the quote:

“I always thought that music had no boundaries, no limits to where it could go and grow, no restrictions on its creativity. Good music is good no matter what kind of music it is. And I always hated categories. Always. Never thought it had any place in music.”

The context for this quote in the book is Davis’s departure from Prestige records, which didn’t pay him well and was oriented toward the underground of hardcore Jazz fans, and his being hired by Columbia records. Columbia made him accessible to the American mainstream, and Davis thought that was a good thing. There would be less limitation on how people could learn about and obtain his music.

Davis reveals that he had a nuanced and well-thought-out value system. In the way he acted, he was against selling out by serving up black entertainer stereotypes. He hated smiling on stage and playing the clown, and went as far as turning his back to the audience and not announcing song names. The music was the only thing.  But he didn’t view signing with a bigger record company as “selling out,” because he rejected the artificial categories that the jazz world imposed on itself. As long as he controlled his artistic process, signing up with Columbia just meant a better life and more power to reach music fans. Here’s how he puts it on the next page:

“I never saw nothing in poverty and hard times and the blues. I never wanted that for myself. I saw what it really was when I was strung out on heroin, and I didn’t want to see it again. As long as I could get what I needed from the white world on my own terms, without selling myself out to all of those people who would love to exploit me, then I was going to go for what I know is real. When you’re creating your own shit, man, even the sky ain’t the limit.”

When Davis signed with Columbia he had just emerged victorious from his battle with a heroin addiction, and the clarity with which he views his alternatives is inspiring.

Davis’s statement about music can be interpreted on a higher level too, which is how most people would understand it out of context. Often the wisest souls caution against categorizing music and getting too caught up in labels. I confess that I organize my music collection by genres, as most people do, but it’s refreshing not to think that way. Life is too short to worry about which container is best designed for certain patterns of sound waves. New Yorker writer Alex Ross’s essay “Listen to this” about why he hates the term classical music is a great read for further pondering along these lines.

Anyway, that quote really jumped out at me. So I thought I’d share.

Reflections on Salinger and Dream Catcher

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By Dan Wilcock:

PBS’s airing of the Salinger documentary this week rekindled my interest in J.D. Salinger, one of America’s most distinctive and endearing voices. Instead of diving into his fiction yet again, however, the documentary inspired me to read Dream Catcher, the memoir of Margaret “Peggy” Salinger, J.D.’s daughter. One of the documentary’s interviewees, who knew Peggy growing up, says that it’s the saddest book she’s ever read. That braced me for some real horror stories, but outright horror isn’t what the book reveals, except for the possible arson that Peggy’s mother may have committed. It’s more about the toll taken by neglect, and the nightmares that can arise from having deeply unbalanced parents.

Perhaps because I was braced for a wallowing, I was impressed by Peggy Salinger in her own right–as a writer and as an interpreter of more than just  her dad’s obsessions. She’s really good at “pushing back,” and the book amounts to a major return shove against her father and his self-involved cult of perfection. It contains a lot of great anecdotes from her youth. The anecdotes have some of the hallmarks of her father’s writing–little details that conjure both place and characters’ temperaments, such as the chimney at prep school in which Peggy and her ingenious best friend would hide to escape from the cruel headmasters and their forced outdoor activities.

The enlightenment that J.D. Salinger fans receive from Dream Catcher is that nearly all of J.D. (aka “Sonny,” aka “Jerry”) are either autobiographical (i.e. “Holden,” aka “Buddy,” aka “Seymour) or inspired by people around him (i.e. “Peggy”). The book fills in the back-story of how J.D. and Holden are really the same guy, and how the short stories are “refractions” of Salinger’s experiences in World War II, in which he was an interrogator on the front lines, witnessing both D-Day and the liberation of a concentration camp.

After Peggy is born, her story takes center stage, and it held my interest as much as the material about J.D. She goes through a lot, mentally and physically, to overcome the traumas that began with her painful childhood and adolescence, and I think the book shows how she becomes a stronger person for it.

The big reveal at the end of the Salinger documentary is the list of five forthcoming books that the author wrote over decades of reclusion, to be between 2015 and 2020. While this is an unprecedented revelation, and I certainly hope that it comes to pass, Dream Catcher tempers my expectations somewhat. If Salinger’s source material is almost entirely autobiographical, the fountain of source material may have reduced to a trickle. The end result may be a lot of Hapworth 16, 1924 naval-gazing-type prose, which would need hundreds of footnotes to be comprehended by most readers.

Peggy Salinger makes a similar point about the evidence leading up to her father’s literary disappearance, and what it suggests about what the rest of the writing may be like:

His work, by the time we get to Seymour: An Introduction and “Hapworth” is no longer secular fiction but hagiography [chronicles of saints]. This is a genre not concerned with time and place, character development, conflict and resolution. Hagiography, given its lack of tension, its lack of earthly focus, and context, is not meant to communicate to nonbelievers. They are excluded from the fraternity. Witness his direct address to the elect, the true believers, at the beginning of Seymour, who are offered a bouquet of early-blooming parentheses (((()))).

Here’s hoping that–like Proust–Salinger’s stored-up semi-autobiographical works-of-a-lifetime aren’t hagiography, but rather  life-altering/affirming masterpieces like his best published work. I hope they are a deep pool into which readers can jump for centuries and emerge changed, wiser, braver, more creative.

In the meantime, Dream Catcher is here right now, and because it introduces Peggy Salinger to the world it’s even better than the documentary, which–though fascinating–was kind of lousy if you really want to hear about it.

Review: The Information Diet

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By Dan Wilcock

Here’s a book that most of us could use. Clay Johnson’s book The Information Diet (2012, O’Reilly Media) takes a non-pretentious look at what would be painfully obvious were we not so engrossed: we’ve become information obese. Our brains are constantly fattened for the kill. We need to be a lot more choosy about the quantity and quality of what we put into our heads.

Johnson is an IT guy. He founded Blue State Digital, the digital strategy company that helped Obama first win the presidency in 2008, and has since gone on to found a variety of ventures at the intersection of policy and software development. He writes with a smart, non-pedantic style. Yet he isn’t immune to hyperbole:

The Internet is the single biggest creator of ignorance mankind has ever created, as well as the single biggest eliminator of that ignorance.

Perhaps he’s right about this. Depends on how you define “biggest,” but it’s a bold claim nonetheless. That being said, boldness is a good strong suit to have if you’re going to take on the media matrix in which our minds swim. Rage Against the Machine once critiqued this matrix as follows:

No escape from the mass mind rape
Play it again Jack and then rewind the tape
Play it again and again and again
Until ya mind is locked in

Believin’ all the lies that they are tellin’ ya
Buyin’ all the products that they are sellin’ ya
They say jump, ya say how high
Ya brain dead
Ya gotta fuckin’ bullet in your head (source Metro Lyrics)

Johnson basically concurs with Zack De La Rocha, but without the stridency:

Our attention is the currency that marketers lust for, and it’s about time we started guarding it, consciously, like we guard our bank accounts.

Being an IT guy, Johnson favors a programming approach. Perhaps for most people already addicted to social media and their favorite pundits it’s more like re-programming. He suggests that people move beyond “a reactive model of computing, where you’re constantly being tugged and pulled in every direction and responding to every notification that comes across your screen, into a conscious model, where you’re in complete control of what you’re paying attention to.”

Music to my ears. The human can manage information, not the other way around. So simple it’s kind of dumb, but what’s really dumb is that far too many of us are not awake to this reality. Johnson argues that we have four powerful mental muscles we can flex: searching, filtering, creating, and synthesizing.

Johnson’s framework and the how-to advice that flow from it are the book’s best aspects. Less developed is the larger societal context in which he tries to fit these skills in the book’s final pages. After leaving Blue State, Johnson directed Sunlight Labs, part of the pro-government-transparency Sunlight Foundation, and I think he’s still too close to that foundation’s mission to be objective about it. It may be the case that this mission is what drove him to write the book in the first place (he often recommends going to original source information such as government databases), but for me the book’s general lessons are more valuable–and more universally applicable–than the limited issue of whether Government data gets posted.

All in all though, a very worthwhile book by a socially conscious technologist. More like this, please.

Today’s word is: hyu̇-ˈris-tik

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The word heuristic, which refers to applying a rule of thumb (often based on experience) to interpreting information that can allow you to come to quick conclusions, is red-hot in the marketplace of words. When I looked it up on m-w.com, a pop-up proclaimed that “Heuristic is currently in the top 1% of lookups and is the 172nd most popular word…a green arrow indicates a fast mover: this word increased significantly in lookups over the past seven days.”

Part of the reason for the word’s trendiness can be attributed to Daniel Kahneman’s Thinking Fast and Slow, the Nobel-prize winning psychologist’s 2011 bestseller that presents his theory about how the mind works on two levels, one fast, intuitive, and emotional, the other slow and deliberative. I’ve only begun reading it, but am already spellbound. Kahneman is one of the world’s foremost thinkers on heuristics. He uses the word as a noun (it’s also an adjective), though it strikes me that this is just a kind of shorthand that people working around this word have developed to avoid having to type “heuristic approach” over and over.

Beyond Kahneman, I think the word’s appeal today is that it’s a suitably academic word that sounds a heck of a lot better than other nouns that can be used to mean the same or similar things, such as: “cheat,”  “life-hack,” etc. It’s also popular because heuristics themselves are in demand. In our increasingly complex, big-data-driven lives, heuristics offer a way to avoid doing all of the number-crunching. Recently an index card that distills a reasonable personal finance strategy onto a 4×6 index card went viral. When I read the card, I agreed with everything on it—I had already subscribed to all of the heuristics.

I’ll post about Kahneman’s take on heuristics later, after I’ve read the book.  Something tells me that while they are super useful, they may also blind us as well.

Big Data’s Humanist Manifesto

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(Image: jaronlanier.com)
(Image: jaronlanier.com)

A review of Jaron Lanier’s Who Owns the Future? (2013) Simon & Schuster

By Dan Wilcock

In early 2013, IBM made the mind-boggling claim that 90% of the data in the world had been created in the previous two years alone. Facebook, which crested one billion users in October 2012, is but one of many platforms elevating Big Data’s exponential growth curve.  

Big Data—the vast digital Sahara of trillions of aggregated binary-code sand grains—may well be this century’s fulcrum of wealth and power. The data centers that comprise “the cloud” are now arguably as central to global commerce and security as the hubs of the petroleum industry. The recent revelations about NSA internet surveillance are further confirmation that a new era has dawned. 

And no matter how many people unplug their Facebook accounts, as I did shortly after reading Who Owns the Future?, we can’t go back to a pre-networked world. Short of some kind of unwanted cataclysm that knocks us off our current course, the momentum is just too strong. New developments in networking, such as the ‘internet of things’ which harnesses data and internet connectivity to make our cars, homes, and appliances ‘smarter,’ portend almost limitless network growth.

Nor can we erase the data we’ve already created. “The option to ‘delete’ data is largely an illusion,” write Google executives Eric Schmidt and Jared Cohen in their book The New Digital Age, published less than two weeks before Who Owns the Future?

Lanier’s book presents a caustic but indispensable minority report to such Silicon Valley triumph literature. It takes companies like Google and Facebook to task for driving a new economic order in which wealth and power are consolidated where entrepreneurs, the best computers, and best computer scientists converge to harvest Dig Data. The list of industries being disrupted grows each day.

As a minority report, it also sketches an alternative vision of new economic system in which individuals get paid for the data they generate. There are some problems with this idea, which I’ll detail below, but his aim is respectable. He wants ordinary people to survive and thrive in the new era. He calls himself a “humanist softie,” which I think is an admirable position to take.

 The Rise of the Siren Servers

This moment of ascendant power has long been the dream of technology companies. Lanier identifies himself as someone who helped build today’s commercial and academic internets. The dust jacket calls him a co-creator of “start-ups that are now part of Oracle, Adobe, and Google: and the recipient of a lifetime career award from the Institute of Electrical and Electronics Engineers.

Lanier writes about how the progressive vision of a humanistic digital economy imagined by internet pioneers such as Ted Nelson, whose writings in the 1960s presaged today’s digital sharing and the use of hyperlinks, has been clouded by the rise of what he calls “siren servers.” These he defines as: “an elite computer, or coordinated collection of computers, on a network. It is characterized by narcissism, hyperamplified risk aversion, and extreme information asymmetry.”

 He puts this in slightly simpler terms in the following paragraph:

Siren servers gather data from the network, often without having to pay for it. The data is analyzed using the most powerful available computers, run by the very best available technical people. The results of the analyses are kept secret, but are used to manipulate the rest of the world to advantage.

To what advantage do today’s tech giants slice and dice our data? Riches for company founders and an increasing pile of advertising revenue from companies vying to grab more market share. For companies, the servers offer the ability to get precise and immediate feedback on customers, to whom they sell products and services more efficiently (with fewer employees). For government security agencies, the analysis yields a gold mine of previously-unavailable mission-critical information about threats.  

Jaron Lanier is also a musician who works with rare instruments (Image: Wikimedia Commons)
In addition to being a computer scientist and author, Jaron Lanier is also a musician who plays rare instruments (Image: Wikimedia Commons)

Who Could Argue with “Free?”

Big Data is provided to siren servers “for free” because users get a “free service” in return. Google brings us to the information we need faster. Facebook gives us a window into the unfurling lives of remote family and friends. Skype allows us to video chat without paying them, and thus we can save hundreds of dollars in international long-distance charges in the process.

The word free above is placed in quotations because the exchanging information for a service means the service isn’t really free. The fact that something is provided without cost usually just means that you, as the user, are not the customer. You are the product. You are being sold. The implication from Lanier’s book is that you are increasingly being ripped off.

He points to musicians who now have to sing for their supper each night because they no longer can rely on support from labels and translators whose works get fed into online translation engines without consent. Technology and the lure of free content make it tough for some folks to make a living these days, and Lanier argues that the ranks of such people will continue to grow as servers advance in developing artificial intelligence.

Lanier doesn’t bring them up, but the infamous instant messages sent by Mark Zuckerberg to a friend that describe Facebook’s early users as “dumb fu*ks,” for trusting him with their information confirms the suspicion that the mega servers are conceptually designed to rip people off. But Lanier doesn’t spend time blaming the owners of siren servers for taking their opportunities:

And it’s not Facebook’s fault! We, the idealists, insisted that information be demonetized online, which meant that services about information, instead of the information itself, would be the main profit centers.

Instead of people getting paid, they get pumped for data for which, by express consent in the user agreements that everyone signs without reading, they are blocked from seeking payment. Lanier writes:

Even the most ambitious outcomes in the most fabulous futures articulated in the moneyed dreamspace of Silicon Valley, those where the world isn’t utterly wrecked by nuclear war or some other disaster, tend to leave people behind. Even the optimism is dismal for people. People will be suppressed and left behind.

The Experimental Path Away From Creepiness

My own decision to quit Facebook had been brewing for some time. I absolutely hated the AT&T ad campaign that launched the Facebook Phone, which in one ad featured dancing freaks on an airplane and a smirking guy who keeps using his phone to “like” things after the flight attendants tell him to turn off his phone. It reminded me of all the idiots who can’t stop using Facebook, even when they are behind the wheel.

Then Facebook started using friends’ faces on advertisements for Amazon.com and other companies. It exemplified what Lanier calls the creepiness of siren servers:

Creepiness is when information systems undermine individual human agency. It happens when you feel violated because the flow of information disregards your reasonable attempts to control your own information life.

At the book’s conclusion, Lanier makes the following suggestion for anyone beginning to have doubts about the value of siren server services like Facebook:

My suggestion is, experiment with yourself. Resign from all the free online services you use for six months to see what happens. You don’t need to renounce them forever, make value judgments, or be dramatic. Just be experimental. You will probably learn more about yourself, your friends, the world, and the Internet than you would if you never performed the experiment.

I took Lanier up on this suggestion with regard to Facebook. This kind of decision is just a part of a larger technology-related journey on which most people are traveling these days. As a master’s degree student in technology management at Georgetown University, part of my aim has been to learn how to manage technology and not be managed by it. This is just part of my journey.

Lanier’s Economic Model and the Porn Problem

Enough about me, and back to the book (and I’ll explain what the latter part of the above sub-headline is about in short order). Lanier’s book isn’t merely an accusation. It also points toward what he thinks would be a better way for our economy.

In a nutshell, Lanier wants to foster an expanding economy based on humanist values rather than what he perceives to be a contracting economy characterized by disruption of middle class livelihoods and wealth consolidation. In the long run, he argues, both people and businesses will be better off with a system that helps ensure broad-based prosperity and rewards individuals for bringing value to the digital marketplace.

Lanier’s website contains a useful four-point condensation of this plan:

  • Universal micropayments
  • All information is valued, and valued in connection with the people who enabled it to exist
  • Individuals are 1st class participants, just like big players
  • Two way links; no copies needed

The fourth point refers again to tech visionary Ted Nelson, who argued that hyperlinks should be read in both directions. Links should do more than point. They should also record what is pointing at them. Thus there is more historical accountability to how the original content gets used and there’s less need for mindless copying. Lanier calls his model “Nelsonian” in tribute.

He admits that he doesn’t have the technical expertise to fully formulate this plan and that implementing it would entail a lot of painful trial and error. I’d like to see him team up with a cogent economist and produce a sequel to this book that would spell out how it all might work.

Yet a couple of problems spring to mind that I’m sure Lanier has thought of (his imaginativeness is his great strength—he refers in several places to the outlandish sci-fi-type projects he works on for Microsoft Research). My guess is that he didn’t want to unwind these balls of string. The first might be called the “porn problem.”  If universal micropayments are made and all information is valued based on usage patterns, adult-film industry workers might become phenomenally wealthy.

The other, perhaps more elementary, problem is that such a system of micropayments might reward many people for ‘being,’ rather than ‘doing’—an inversion of classic values (at least in America) An example of this might be the rise of digital loafers who make a career of gaming the payment system (wait, on second thought, I realize that SEO analysts and social media experts are already pioneering this space).

In order to provide commensurate payments for online activity that really advances humanity, the market and civil society will need to make judgments. Yet there is deep precedent for exactly that—extending back to John Locke’s version of utilitarianism that placed higher values on certain moral outcomes.

Conclusion: Will We Be Reading This Book in 20 Years?

My guess is that Lanier the internet futurist is again ahead of the times. He’s seen the writing on the wall, and he cares enough about fellow human beings to initiate a conversation about how to build a more productive alternative the emerging era of winner-take-all server wars. Time will tell if the book will be as important as Silent Spring was for environmentalism. The geeky aspects of the book may be a strike against him in this regard, but there’s a strong chance that this minority report will increasingly win converts.

This is a challenging book for anyone immersed in today’s data-driven world (perhaps especially for anyone who loves their Facebook account). Many people may not care about the implications of using social media or Google’s “free” tools. They just want their free stuff. This book isn’t for them. Others, when confronted with issues such as the government’s online surveillance, may find the need to take nuanced positions. This book may help think through the implications of Big Data.

It’s not about purism or self-righteousness. Almost everyone uses Google tools every day and I don’t see a good alternative coming about any time soon even though I realize their business model is very similar to Facebook’s. There’s no escape from Big Data short of moving to rural Bhutan.

Thus I highly recommend this book, which I think of as Big Data’s humanist manifesto—it’s hard to imagine a recent book more relevant to the future of information technology.

Franklin’s Wisdom: Don’t Be a Croaker

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Benjamin Franklin
Benjamin Franklin with the expression he might have worn when he wrote of croakers (image: Wikimedia Commons)

By Dan Wilcock

I can only imagine the expression Benjamin Franklin wore when he wrote the delightful passage below in his autobiography. My guess is that he either sported a lopsided grin or pursed lips and twinkling eyes. At any rate, as with the best parts of the autobiography, Franklin’s discourse on “croakers” is a hoot that nonetheless contains some very sage advice.

“There are croakers in every country, always boding its ruin. Such a one then lived in Philadelphia-a person of note, an elderly man, with a wise look and a very grave manner of speaking; his name was Samuel Mickle. This gentleman, a stranger to me, stopt one day at my door, and asked me if I was the young man who had lately opened a new printing-house. Being answered in the affirmative, he said he was sorry for me, because it was an expensive undertaking, and the expense would be lost; for Philadelphia was a sinking place, the people already half bankrupts, or near being so; all appearances to the contrary, such as new buildings and the rise of rents, being to his certain knowledge fallacious, for they were, in fact, among the things that would soon ruin us. And he gave me such a detail of misfortunes now existing, or that were soon to exist, that he left me half melancholy. Had I known him before I engaged in this business, probably I never should have done it. This man continued to live in this decaying place, and to declaim in the same strain, refusing for many years to buy a house there, because all was going to destruction; and at last I had the pleasure of seeing him give five times as much for one as he might have bought it for when he first began his croaking.”

My translation: doomsday is overrated. We can always see it coming if we look for it. For a budding entrepreneur, as Franklin was at this stage of his life, croakers aren’t the best people with whom to hang around.  Their “certain knowledge” of our “sinking” state of affairs and impeding ruin foster the wrong mindset.

I don’t think Franklin is advising that we discount risks. He’s no fool. Rather, I think he’s saying that focusing exclusively on risks may be the biggest risk of all. The moral of the story can be seen when the croaker forks over five times what we would have for a house if he hadn’t believed that Philadelphia of the 1700s “was a sinking place.”

I think we can forgive Franklin for the schadenfreude he displays here.  The cheery sagacity with which he tells this tale makes it a classic.

The three-fold hero

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King Arthur
King Arthur is one of the thousand faces of the universal hero (Image: Wikimedia Commons)

By Dan Wilcock

In The Hero with a Thousand Faces by Joseph Campbell, heroic myth functions on three levels:

1. The stories contained in the book

2. Campbell’s journey as a scholar

3. The reader’s experience

In other words, we read about heroic myth from a heroic scholar and, by doing so, experience the heroic for ourselves.

Reading it for the first time last month, I marveled at Campbell’s feverish prose. Take the book’s first paragraph–a sentence majestically gnarly in syntax and playful in content:

“Whether we listen with aloof amusement to the dreamlike mumbo jumbo of some red-eyed witch doctor of the Congo, or read with cultivated rapture thin translations from the sonnets of the mystic Lao-tse; now and again crack the hard nutshell of the argument of Aquinas, or catch suddenly the shining meaning of a bizarre Eskimo fairy tale: it will be always the one, shape-shifting yet marvelously constant story that we find, together with a challenging persistent suggestion of more remaining to be experienced than will ever be known or told.”

I was also struck by how, like an episode of Columbo, the villain of the hero’s quest is revealed at the very beginning. Here is what we get on page 15:

“The figure of the tyrant-monster is known to the mythologies, folk traditions, legends and even nightmares, of the world; and his characteristics everywhere are essentially the same. He is the monster, avid for the greedy rights of “my and mine.” The havoc wrought by him is described in myth and fairytale as being universal throughout his domain. This may be no more than his own household, his own tortured psyche, or the lives that he blights with the touch of his friendship and assistance; or it may amount to the extent of his civilization. The inflated ego of the tyrant is a curse to himself and his world – no matter how his affairs seem to prosper. Self terrorized, fear haunted, alert at every hand to meet and battle back the anticipated aggressions of his environment, which are primarily the reflections of the uncontrollable impulses to acquisition within himself, the giant of self achieved independence is the world’s messenger of disaster, even though, in his mind, he may entertain himself with humane intentions. Wherever he sets his hand there is a cry (if not from the housetops, then – more miserably – within every heart): a cry for the redeeming hero, the carrier of the shining blade, whose blow, whose touch, whose existence will liberate the land.”

This passage made my brain feel like it was bending. For someone like me living in 21st Century America, it isn’t too hard to look in the mirror and find the tyrant monster. We live in a culture that values “self achieved independence” and praises the “giants” of our society. Our culture inflates egos, and we may not notice that we are a curse to ourselves and the world “no matter how [our] affairs seem to prosper.”

I was struck by how Campbell focuses on “uncontrollable impulses to acquisition,” which made me think about the consumerist economy we inhabit. The tyrant’s greed sets him up as nature’s antagonist, which prevents him from a moment’s peace.

So who is the hero? Here’s Campbell on page 16:

“The hero is the man of self achieved submission.“

The book’s remaining 375 pages are a hallucinatory journey through the world of mythology that provides countless examples to illustrate this simple yet profound observation. It’s a journey I recommend wholeheartedly.

For me one of the best examples isn’t mentioned by Campbell (though I’m sure he encountered it): Hermann Hesse’s Siddhartha. The book’s main character, a young man in India who lived in the same time as the historical Buddha,  goes on a quest that echoes the Buddha’s life. The main character’s submission to enlightenment at the story’s conclusion illustrates perfectly Campbell’s point.

Hesse made Siddhartha another face of the Buddha. Campbell made his career a hero’s quest, from which thousands of readers launched their own journeys.