Tag: decision

The good, bad, and ugly of binary thinking
By Ryan Long

The good, bad, and ugly of binary thinking

Sometimes the best choice when you come to a fork in the road is to retreat, or even merge the two forks by taking one then going off road to the other! And yet binary thinking will force us to choose between the right or left fork, even if both forks suck standing alone. Only by understanding the perils of binary thinking can you protect against its destabilizing bipolar effects in conflict resolution.

First, the good. Binary logic is what makes many computer software programs run. The logic of going between “0” and “1” on streams of code is what gives direction to hardware. Not only that, but compact discs use the same logical geography to play music. Plus, in some cases, as Professor Steven Pinker points out in How the Mind Works or Malcolm Gladwell in Blink, binary logic helps us decide, often in split seconds, between: fight or flight in a dark alley, taking one fork in the ski slope or another, one moral decision as opposed to another in our relationships.

Second, the bad and ugly. The same logic that helps us make split second decisions in dark alleys also causes disaster in conflict resolution. In most but not all legal disputes I have handled, binary thinking keeps each side stuck in their black and white view of the law and facts, like the gun men pictured above. In most cases, both sides are right, and wrong, in different respects. (In others, there is a right, and a wrong, but that is quite rare.) As pointed out by Mr. John Kenneth Galbraith about the Myth of Consumer Sovereignty in The Affluent Society, rational decision making often gets irrational because consumers make decisions based on their perceived necessary choices — not their actual available choices.

The same goes with decision making in conflict resolution. Take negotiations between Democrats and Republicans. Labeling an idea “Republican” or “Democrat” can change an otherwise great idea in a split second into a horrible idea, depending on the listener’s prejudice. This is so even though each party may claim to have the same stated goal, such as less American unemployment. Rather than considering the idea with an open mind, the political listener shoves the idea into one pigeonhole or the other, even when the idea doesn’t fit into either hole, and then smashes it. Alternatively, the listener blasts the idea because it doesn’t fit into either hole. In so doing, yesterday’s distrust taints the new today. Thus, the circle of distrust is continued, as recounted in Politics of Distrust, which shows that, as of 2012, only 22% of Americans trust government.

While binary thinking can help us survive, it can, at other times, be deadly. Such thinking blinds us to innovative solutions available outside the binary system we desperately cling to. By considering these solutions, the two forks in the road can merge more often towards common goals.

Naked economic protectionism — constitutional?
By Ryan Long

Naked economic protectionism — constitutional?

Many of us like certainty. Death and taxes are two things we can be certain about. But should our choice of who we buy our casket from, if we buy one, when we die be dictated by the state? No, says the New Orleans based Fifth Circuit Court of Appeals in its March, 20, 2013 decision in St. Joseph Abbey v. Paul Wes Castille, et. al. This is a good thing. It means the state cannot protect an industry from competition without justification. What implications, if any, the decision on has on similar federal laws remains to be seen.

A group of Louisiana priests brought suit against members of the Louisiana State Board of Embalmers and Funeral Directors because of a law that prohibited the priests from making, and selling, caskets. According to the law, the priests needed to be funeral directors to do that. But becoming a licensed funeral director in Louisiana is expensive and time consuming. The priests claimed that the law violated the equal protection clause because it had no rational basis to a legitimate government interest, and that it was an unconstitutional taking of property without due process.

The Fifth Circuit agreed. Louisiana, after all, allows anyone to build their own casket for personal use, and doesn’t even require a citizen to be buried in a casket at all. The state also allows its citizens to buy caskets out of state. In any event, the Court reasoned, the requirements to become a funeral director have nothing to do with casket making. Thus, there was no rational relationship between the law and a legitimate government interest.

The most important part of the Court’s ruling is its rejection of naked economic protectionism. Under this view, the state has a legitimate government interest in the protection of a particular industry from competition even when there is no corresponding benefit to the public interest or general welfare. The Court said Louisiana could not protect funeral directors from competition by the priests merely because, say, they have a stronger lobby in Baton Rouge.

It remains to be seen whether the case goes to the Supreme Court. If it does and is affirmed, some federal laws and regulations may be in greater danger of being invalidated as naked wealth transfers to a special interest with strong ties in Washington D.C.

The gut is sometimes more reliable than the mind.
By Ryan Long

The gut is sometimes more reliable than the mind.

As reported in U.S. Rolled Dice in Bin Laden Raid, the green light to eliminate Mr. Osama Bin Laden eventually came down to “gut instinct.” While we all understand the role of numbers and rational thought in business decision making, we think that the West sometimes places too little emphasis on what can oftentimes be your best friend in uncertain times: your gut.

As we all know, there are times in business when the numbers tell the whole story. There is no gray area. There is no need to use your intuition to make a decision. And yet many decisions in business are not so black and white. For one thing, the numbers may be cooked by the seller of the stock you are thinking about buying. You may not know this by looking at the numbers, but may intuit it by feeling out the underwriter or broker. Like the Navy SEALS in the picture to the left, your eyes may not see anything behind those trees in your midst, but sometimes your intuition will tell you something is lurking there. Unfortunately, the West sometimes places too much emphasis on rational thought, and not enough on the value of intuition, a point that Mr. Nassim Nicholas Taleb makes in The Black Swan: The Impact of the Highly Improbable. Perhaps this is because of a reductionistic approach to studying decision making taught by many schools in the West, including the Economics Department at the University of Chicago, which oftentimes attempts to reduce the complexity of human decision making into mathematical equations. While this may be a helpful crude tool to understand a complex system, it is is not sufficient. Due consideration also needs to be placed on the role of intuition — the gut — in making good decisions.