Questioning the Proxies We Use

Reading First Principles About When to Use First Principles by Auren Hoffman got me thinking about how most people choose the proxies (sources/experts) that they rely on when they’re not engaging in first principles thinking (aka, most of the time).

I agree with Auren that more proxies are better, that it’s important to find proxies with conflicting views, and to have a few proxies that are heretics in their fields. I wonder rhetorically how many people really take this thoughtful approach (maybe a reason why Auren wrote the post). I also wonder, even if you follow Auren’s advice, how to decide which proxies to put the most weight on and how to determine when the proxies in the majority might be wrong?

If you have two proxies that disagree with each other over a particular topic, then either you have to sift through their arguments and attempt some level of first principles thinking yourself, or, take the easier option: pick one and acknowledge the second’s arguments.

Either you’ll choose the proxy that’s in the majority view (of your other proxies) solely since they’re the majority, or you’ll choose the minority because a few, or even one person that you respect supports the contrarian hypothesis. If you opt for the latter, good for you. Although, it also means you probably need to do more thinking and research to better understand why you’re in the minority in the first place and to develop a stronger stance.

More often than not, it makes sense to opt for the majority. It’s easier, less likely to be wrong, and easier to defend.

When you lean towards the majority view, though, are there any shortcuts to determine when it’s worth questioning and going first principles yourself? I ask, and find this critical, because even if you rely on multiple proxies, you’ll often naturally opt for the majority opinion and still have to choose when to go first principles and when not to.

It’s from the point of realizing the majority opinion is wrong that you can find the hidden truths in society and create a space to contribute/take advantage of the secret.

A useful framework: look at the incentives that your proxies have to say what they say.

Terrorism looms large in the minds of many. It causes widespread fear and leads to subconscious biases against certain groups of people all over the world.

One’s belief leans more towards either:

  1. Terrorism is really bad and we should be scared of certain groups of people (likely the subconscious default for many at this point).
  2. I’m not going to let terrorism impact my daily life and will see everyone as the same.

A large part of what leads to #1 is the media. They serve as a proxy, subconscious or not, for many.

What’s the media’s incentive to talk about terrorism? They want viewer attention and website clicks. Terrorist news performs well (since it’s scary!), so the more it’s reported, the more people watch the news. Using the media as a proxy in general can be dangerous, but in this case, especially so. They are literally paid to make people fear terrorism.

So, first principles thinking here makes sense when deciding how much there is to fear. It helps that it’s even pretty easy. There’s of course more that factors in, but for some quick numbers:

Since 9/11, terrorism has killed around 50 people in the EU, 10 in the US, 7 in China and 25,000 globally each year. In contrast, car accidents number 1.25 million, diabetes/high sugar levels 3.5 million and air pollution 7 million annually. [stats courtesy of 21 Lessons About The 21st Century, Harari]

Example 2: Going to college

The value of going to college has been much debated in past years. As a recent college grad, I can attest that probably all of the proxies I used at the end of high school were telling me to proceed to college. My parents, my peers, my peers’ parents, my high school, guidance counselors, etc.

When I break it down, though, each one of those proxies had some incentive to tell me to go to college. My high school and guidance counselors wanted to boost their % of graduates that attended college, and I was another number that would drive future admissions for them. My parents, as great as they are, were also incentivized. If they told me not to go to college, they’d have to justify it to their friends, live with the ambiguity of what their kid is going to do with his future, and if things didn’t go well, likely bear lots of responsibility. If I succeeded, they’d look good, but I’d receive way more of that benefit than them. On the other hand, them telling me to go was the safer, more secure route and future.

This isn’t to say that I shouldn’t have gone to college. Nor is it to say that just because my proxies were incentivized to tell me to go to school meant that it wasn’t the right choice.

It is to say, though, that recognizing everyone around me was incentivized to say I should go to school, not purely out of my best interest, would have been a sign to do some more first principle thinking myself.

Example 3: Immigration into Europe

In 1968, British Conservative Parliament member Enoch Powell gave a speech, now known as the Rivers of Blood, that strongly criticized mass immigration into England. Shortly after the speech, Powell was dismissed from his position by party leader Edward Heath, who made the statement, “I dismissed Mr Powell because I believed his speech was inflammatory and liable to damage race relations. … I don’t believe the great majority of the British people share Mr Powell’s way of putting his views in his speech.” In fact, Gallup did a poll that found 75% of the country agreed with Powell.

This event contributed greatly to the pretext for much of immigration policy and discussions in Europe through the rest of the 20th century. Overly simplified, politicians were scared to speak up against immigration for fear of being accused as racist and receiving the same fate of Powell (whose career never fully rebounded). As a British, or other EU citizen, using the government as the proxy for correct immigration policy deserved serious questioning. What were politicians incentivized by? At least in part, by not losing their power or spot in office for fear after the Powell situation.

This isn’t to say an individual could have necessarily done anything to stop the situation, but perhaps if more people saw the incentives of their proxies at work, things would have played out differently and Europe wouldn’t be facing as massive of immigration challenges today.

What about the opposite case when incentives aren’t self-serving?

There are countless scientists and scholars that say climate change is real and argue varying levels of impact into the future. Then, you have the people saying it’s all a hoax. Are you going to sift through the arguments of each side and sort out what you believe? That could take 1000 hours. Most likely, you’ll hop on the majority that say it’s real and real bad because that opinion is more socially accepted in your circles, it’s coming from ‘acclaimed scientists,’ and so on.

Now, what if you ask about the incentives that scientists have to say climate change is real? Someone might argue that they’re incentivized for the publicity, to get published in scientific journals, receive grant $, or to support businesses that make money by stopping climate change. Those are all possible, but at this point, you’d get more publicity for denying than accepting climate change, scientific journals have received ample evidence already, and it’s not entirely clear which types of businesses will even financially succeed in mitigating climate change.

The deniers on the other hand, could be incentivized to protect big oil or maintain other current societal norms.

The incentives of climate change enthusiasts could be questionable enough to you that you want to dive into first principle thinking and, if so, go for it. It might be enough, though, to look at the credibility of the scholars advocating on behalf of climate change, see they might be incentivized to protect our planet more than anything, and accept what they have to say.

In Summation

These situations exist across society, and you could drive yourself crazy analyzing the incentives of every player/proxy on every opinion, rule, or policy. Focusing, like Auren says, on what REALLY matters to you can be a good filter. Once you do that, the incentives of your proxies on important topics might not be clear or obvious, but in that lies the fruitful challenge of first principles thinking.



Denver Native | WUSTL ’18 Econ | SF

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