By Nate Shames
Dec 22, 2017
The recent passage of the Republican tax plan has prompted the traditional phenomena that accompany any major governmental action or initiative. A great number of people on a variety of different mediums all talk with a great deal of certainty about what this all means and what is going to happen as a result. They make a number of predictions, that are often quite apocalyptic in nature, and shout a lot at people who disagree with them and assign ulterior motives to their opponents. Rinse and repeat.
What interests me is less the specifics of any piece of legislation or opinion about it and more the certainty with which the forecasts are made. I often find it quite amazing that everyone on TV or in the opinion columns seems to know how everything will end. Apparently, the powers of divination have been doled out quite liberally and the recipients all happen to work in journalism! What a coincidence! As Nassim Taleb points out, it’s easy to be certain when you don’t have any skin in the game. None of the forecasters have risked anything on the basis of their forecast so if their predictions turn out to be wrong it won’t affect them. We should all be aware of forecasting generally, but we should ignore entirely forecasters who don’t have any skin in the game.
My former professor, political economist Mark Blyth, is fond of saying that “no linear projection in human history has ever been true.” He often uses as his example the view from 1980. If you were trying to do linear budget and deficit projections in 1980 for the next 20 years, you would come up with something very different than what actually happened. There’s no way you would have forecasted the fall of the Soviet Union and the creation of the Internet, both of which had a significant impact on the deficit to say the least!
To this end, Taleb employs the concept of alternative histories, things that could have happened, and had a significant chance of happening, that did not. This concept helps disabuse us of the notion that we are capable of consistently accurate predictions. So much hinges on so many little things. For example, in 1933, the Mayor of Chicago, Anton Cermak, was shot while shaking hands with the president-elect of the United States, Franklin Delano Roosevelt, who is speculated to have been the actual target of the assassin. Needless to say, had the bullet struck Roosevelt instead of Cermak, the world would be a different place and every prediction made about the future of the economy or the country at that point would have been wrong. Contingency plays an enormous role in our lives and long-term forecasts obliterate the role of randomness in order to provide some certainty to the consumers of the forecast.
I really don’t know what will happen tomorrow, let alone 20 years from now. Wars could break out, coups could be launch, bitcoin could collapse or surge, aliens could make contact, or the Cleveland Browns could win the Super Bowl, with the latter, of course, being the most outlandish possible event. There are an infinite number of alternative histories that could play out, but in all of them, having the Jungle Disk Data Security Suite will make you more secure than you are without it. Of that I’m sure, because that’s not a forecast. It’s a fact that is true right now.