Episode 260 Scott Adams: The President’s Portfolio, a Systems Idea
Date: 2018-10-14 | Duration: 30:50
Topics
Jamal Khashoggi mystery… How much risk should the west take when one proponent of Sharia Law kills another proponent? Kanye is operating at a higher level of awareness than his critics A “President’s Portfolio”, spotlighting startups with the potential to reduce healthcare costs STOP thinking yes/no…START thinking test small, see what happens
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## Transcript
## [Simultaneous Sip](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=5s)
But boom ba-ba-boom! Hey everybody. I'll bet there aren't that many people who are already awake, at least not in my timezone. Hey Pat, come on in here. The rest of you can watch this on replay, but the early birds—is Kanye's life now doing what?
Good morning, good morning, good morning. Do you have your beverage with you? I hope you do. Hey Jason, hey everybody. It's time to grab your mug, your glass, your cup, your vessel, your stein; fill it with the liquid of your choice. I like coffee. Join me for the simultaneous sip.
## [The Jamal Khashoggi Mystery](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=68s)
So let's talk about this Khashoggi thing. Khashoggi was the journalist who was allegedly slain by Saudi security forces, cut into pieces with a bone saw, and his body removed from the Turkish consulate.
As I've questioned before, you always have to wait with this sort of thing because there's always going to be more to this story. It just didn't quite make sense. The way we heard it sounded a little too fantastical for us to really have understood everything about this, and we're still waiting. We don't know what else we'll learn.
But there's kind of an interesting sub-question about this. The journalist who was killed is a Muslim Brotherhood proponent. The Muslim Brotherhood, as I understand the current incarnation, promotes a peaceful, democratic transition to Sharia law in the Islamic world. At least in their public face, the Muslim Brotherhood is a non-violent way to conquer the world for the benefit of Islam.
I'm wondering how we in the West should look at something like this alleged murder, should it become confirmed. Somebody is saying, "Are you insane? Non-violent?" No, I'm not insane; you're bad at listening. I said their public face and their public pronouncements are non-violent. What they're doing behind the scenes, I have not addressed. If you believe they're doing something behind the scenes to support Hamas or other terrorist groups, you would be agreeing with some Middle Eastern countries who also consider them a terrorist group.
But if we're just talking about Khashoggi, I've not been presented with any information in the press that would suggest that he in particular is in favor of any kind of violence. I have not seen that suggested, and I think I would by now. But he was a Muslim Brotherhood person. I think it would be fair to say that there are members of the Muslim Brotherhood who do not favor violence, but what they do favor is a view of the world that's, by Western standards, very anti-women and perhaps even more anti-LGBTQ.
When we're watching this, we're saying to ourselves: how much trouble does the United States want to get into for what looks like a Middle East internal problem? I'm not sure we want to take this guy's side. How much do we want to support the person who would change our system to something we would consider a form of slavery for women?
By Western standards, what Khashoggi was pushing was kind of a "women as second-class citizen baby-making slavery" situation in Western eyes. Obviously, within the Islamic community, they have a very different opinion of it. I'm trying to describe this without infecting it with any opinions of my own because I don't really have strong opinions on a lot of the stuff in the Middle East—I don't have the full context.
But it's an interesting question. In the democratic West, more than 50% of our population is either a woman or a gay man. If you add the half that are women to the 10% or so that are LGBTQ, it's something like 55% of the West. It's not clear to me how much risk the West should take over what's an internal squabble between two sides where we shouldn't like either one of them too much because of what they would do with the topics of women and gays should they get their way.
Then you have this weird situation where I don't think you could argue that Saudi Arabia has a more enlightened approach to women and gays than the Muslim Brotherhood. But in terms of the public, we see this bin Salman guy looking like a reformer. Women can drive, and there were some other smaller changes there. At least he's heading in the right direction. It's going to feel like Salman had something going on there that was the right direction, even if we don't like where he's at. Somebody says that Khashoggi had dirt on the regime, which I've heard is true, but we don't know what that was. Anyway, it does feel like an internal problem, and I'm not sure how much the United States should embrace it as our problem.
## [Systems Versus Goals](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=494s)
Let's talk about systems versus goals. I wrote a book called *How to Fail at Almost Everything and Still Win Bigly*, in which I talked about having a system—something you work on every day that gives you a good result, but you don't necessarily know exactly how it's going to end. A system is something to improve your odds of a good outcome, but you don't know exactly where it goes.
A goal says, "We will have single-payer healthcare." A goal assumes the exact answer, as opposed to a system, which would be a way to work toward a better healthcare situation without knowing exactly how that works out.
Kanye did something much bigger than the press realized or reported. Kanye suggested what he called "ideation centers" in urban areas. This would be a center where you would work with the local folks to come up with ideas for solving things. If you come up with an idea, ideally you want to be able to test it in one city or one community—something small that you can test. The ideation centers would create ideas and package them so that you've got something for an investor—say, a billionaire who wants to help or even the government—to do a small test. If the small test works, you implement it.
What makes this a system is you don't know what ideas they're going to come up with. We don't have a system. Kanye is operating at a higher level than anybody who's criticizing him. This doesn't exist, and it's exactly what needs to exist: not a solution, but a system for creating solutions and testing as many as you can come up with.
## [The President’s Portfolio](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=616s)
I would extend this idea and suggest a mental experiment I made up: the President’s Portfolio. I don't mean the President is investing in stocks; it would be a portfolio of startups or companies working for the betterment of the United States as a whole.
Most startups are just trying to make money. If you're a game startup, you're just trying to make money. But there are other startups that would dramatically lower healthcare costs, get dramatically better results, or work on databases that reduce complexity.
The idea would be that the President, working with a team, would spotlight a list of healthcare startups that would really make a difference if they worked. There's no investment; he’s just spotlighting. You qualify if your startup is a serious one—for example, you've received money from a high-end venture company like Sequoia—and it can be demonstrated that you are for the benefit of the larger society.
The advantage would be the spotlight, so billionaires who want to help would know exactly where to look. They'd go to the webpage and say, "Wow, there's a company that could make an MRI cost ten dollars instead of hundreds of dollars. I'm going to invest in that." It might not work, but if it does, the whole country is better off.
This could apply to any category. Climate change: what are the companies working on things that would make a real difference? Wouldn't you like to know the dozen companies looking to capture CO2, scrub it out of the air, or make a better nuclear plant? Wouldn't you like to know the small portfolio of companies that are going to fix our biggest problems so that our billionaires can be weaponized to make a difference?
This is the genius of the Gates Foundation. Bill Gates seemed to say to himself, "I have all these billions of dollars. I want to help the world. How do I do it?" That's actually hard because you don't know where to put that money where the government can't do better. Gates created the foundation primarily to figure out where to put the money, because the "figuring out" is the hard part.
We are in the Golden Age, where the biggest problems are the way we think about stuff. We don't have a resource shortage; we have an ideas shortage. Kanye understands we have a system shortage. He suggested a hugely important idea the press has completely overlooked: a place to create ideas and package them so you can put them in front of a billionaire and say, "The community is on board, we've looked at the economics, can we do a small test?"
## [Stop Thinking Yes/No, Start Testing Small](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=985s)
I'm greatly annoyed when I watch the debate about single-payer. The debate goes: "Yes or no?" That's the whole debate.
Is there a smarter middle ground where you can find a way to do a small test? We should never be saying "no" to big ideas. Instead, we should say, "Can you test it? Can you test it small?"
That doesn't mean just looking at Europe. Could you pick a state or a county and say, "We're going to test single-payer in this county for the next three years. The government will artificially lower your drug costs—subsidize them—to give you the impact of what it would be if we had negotiating power on a countrywide basis." If the experts said negotiating prices down 30% would really be something, you artificially do a test where you force the prices 30% lower and see what happens.
That particular test might be a stupid idea; it takes people working in the area to come up with what a good test looks like. But if we're saying yes or no to any kind of healthcare change, it feels like the wrong process. The right process is: can you test it small? If you can test it small, you don't have to say yes or no.
We should get out of yes/no. If there's one change Kanye can bring to the world, it's to get us out of that. We should be a systems world where we're continually trying new ideas, packaging them in a way we can test them small, and then making a separate decision whether to go big. Yes/no is an unproductive way to address these big things.
Everything I'm describing here is the exact way that capitalism works. Capitalism works great because they think of ideas and test them small before they decide to go big. That should be the standard form. If you're a Republican and you're saying "no" to any healthcare idea from the left, that's the wrong approach. The right approach is: "Can you test it small?" If you can't test it small, then you can say no.
Innovation might suffer if profits are reduced, but that doesn't mean something else wouldn't jump up to replace it.
## [Persuasive Systems & The High Ground Maneuver](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=1292s)
Systems generally fall into what I call the "High Ground Maneuver." In persuasion, the high ground maneuver takes you out of the weeds of the details and brings you to a level where everybody says, "Okay, that makes sense."
If you ask if single-payer is good or bad, you're in the weeds. The higher level is: "We don't know, let's run a test." Running a test is always the high ground. It's hard to think of an argument where it's better to start big before you've tested small. Everybody’s common sense recognizes that testing small before you go big just makes sense.
The wall is exactly the same situation. We are currently in the process of replacing some parts of the existing border with better walls because there is funding for upgrades. We will soon be able to see if those better walls cause people to go to other places. If the wall is put up and people are just jumping over it easily or throwing their fentanyl over the top, well, then you've learned something you didn't know. The wall, by its nature, is something you're testing before you get to the big implementation. You can always cancel the budget if the first bunches of wall didn't make any difference.
There's certainly an art to developing a test that tells you something about a larger implementation, and there's a risk that a test looks good on a small scale but doesn't work because you can't scale it. There's no clean answer other than it's always better to test because you'll be smarter than if you didn't.
## [How to Work in an Ideation Center](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=1416s)
How could a person find employment in something like an ideation center? You would have to have the right skill set. There's a firm in San Francisco called IDEO, and they're sort of a design ideation center. I've worked with them before. If you're a corporate customer and you want to design a new device, they'll put together a team—an engineer, a designer, an architect. They pull together high-level people, PhDs from MIT, and they'll very quickly run through ideas.
To get a job at an ideation center that doesn't quite exist yet, you might start by becoming one of those things—an engineer or a designer—so you have something to pitch should the ideation centers come into being.
## [Diversity and Group Effectiveness](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=1545s)
Somebody said diversity is the enemy of the group. Not exactly. I believe there are tests that show the most effective group is one where somebody is very smart and the other people are not necessarily that smart. The worst thing you could have is a group with five really smart people who are similar, because they would all have their own opinion of what to do and they wouldn't want to give up. They would just fight with each other.
Sometimes you're better with one smart person, one person who knows a certain skill, and someone with a certain point of view. That's why ethnic diversity is useful. If you're looking to sell something to the general public, you want as many different opinions as possible before you commit to the expense. Ethnic and gender diversity are useful because you get the perspective without the expense.
Small tests tell us nothing about how corrupt it will be once it's large? You're right, you can't learn everything from a small test, but you can often learn if there was a big, obvious reason why something won't work. At some point, there has to be unity in process and unity in the criteria for an idea that gets implemented.
## [Kanye and Cultural Gravity](https://www.youtube.com/watch?v=ua9jqX8sQTg&t=1668s)
The comment about Kanye and basketball is not as crazy as it sounds. If you literally looked at any of the stuff being reported as "crazy" from Kanye, every bit of it has a perfectly good explanation which he actually presented. Even the stuff about the hydrogen airplane has a solid basis in reason; it's just that the press doesn't like reporting the good news.
I've been getting lots of feedback from people responding to the concept of "cultural gravity." I don't know if it's just because people like it because it makes them feel innocent for many problems. When you think that cultural gravity is part of the problem in urban areas—that your own community is preventing you from success—it sort of relieves the observer from any guilt. I worry it could be taken that way, as opposed to a useful, practical way to look at the situation.
Kanye did a livestream on Periscope earlier. He’s not even on Twitter anymore, but he was Periscoping. I will watch Kanye's Periscope from last night. I'm going to be testing that "cultural gravity" concept and see if it gets any weight. Oh, he's back on Twitter? Good. I'm definitely going to watch Kanye's mind control Periscope. That’s got to be great.
I think we've said everything we're going to say. I'm going to sign off for now, and I will talk to you later.