My Letter Addressing the <i>Guardian's</i> Distortions

I used to think that the US press was guilty of distortions. Recent events changed my mind, as UK anti-Cameron papers tried to cut and paste from my talk to weaken him by trying to demonize me.
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I used to think that the US press was guilty of distortions. Recent events changed my mind, as UK anti-Cameron papers tried to cut and paste from my talk to weaken him by trying to demonize me. The problem is that they got my ideas backwards on every single point. Such lack of ethics, I am certain, would have never happened in the US. Here is my letter to the Guardian:


Dear sirs,

I am extremely honored to see my conversation with MP David Cameron at the RSA so repeatedly covered in your paper. However I was astonished by the representations that you made as they were in complete reverse to my positions on three subjects: the environment, market crashes, and taxation of the rich.

1) Climate Change. I am hyper-conservative ecologically (meaning super-Green). My position on the climate is to avoid releasing pollutants in the atmosphere, on the basis of ignorance, regardless of current expert opinion (climate experts, like banking risk managers, have failed us in the past in foreseeing long term damages and I cannot accept certainty in a certain class of nonlinear models). This is an extension of my general idea that one does not need rationalization with the use of complicated models (by fallible experts) to the edict: "do not disturb a complex system" since we do not know the consequences of our actions owing to complicated causal webs. (Incidentally, this ideas also makes me anti-war). I explicitly explained the need to "leave the planet the way we got it" .

Instead, I was presented as a "climate-change denier" (Lucy Mangan), and my environmental views summarized by "Climate change is not man-made" (Nicholas Watts).

A minimum of homework on the part of your staff would have revealed that I am one of the authors of the recent King of Sweden's Bonham declaration on attitude to climate change.

2) Crashes. By some coincidence I spoke at the same venue, the RSA, some 30 months earlier, way before the current crash, as part of my crusade against the risk of financial collapse and the need to robustify society. I find it depressing that the British public could have saved several trillion pounds and hundreds of thousands of jobs had they minded these hidden risks in the system. My position is that a robust system needs to produce frequent crashes, with citizens immune to them, rather than infrequent total collapse, for which we have no robustness. By constraining cycles and assuming "no more boom and bust" (as your current government did) you end up with a very large bust -and I am sure that I do not need more events like the most recent crisis to prove the point.

Instead, the anti-Black Swan crusader was portrayed as someone who "loves crashes" (Nicholas Watts and Lucy Mangan). Go figure.

3) Social Fairness. I spent 13 years fighting bankers bonuses (when nobody else did) and am currently crusading for clawbacks of past compensation as I have shown how regular taxpayers have been financing bonuses of millionaire bankers ("socialism for the losses, capitalism for the profits"). We are financing today those who got us here, with tax hikes on those who do the right thing, and larger tax break for those who blew us up. Companies who made mistakes and fragilized the system are being subsidized by the countercyclical ones who make it more robust.

Instead, I was quite shocked to see the headline "David Cameron's guru Nassim Nicholas Taleb says rich should not pay more tax to help the poor". This transformation of my ideas by Nicholas Watts is extremely wicked.

The depressing part is that nowhere does your paper discuss my central idea, that the risks that were in the system 30 months ago are still with us now, and that unless we lower debt to "definancialize" the economy (instead of increasing deficits through stimulus) we face more risks of blowups.

As a systematic thinker with a body of scholarly work around these risk management ideas --not a politician with ad hoc opinions -- the game of selective (and aggressively biased) quoting does not work very well. With the same game one could easily make Karl Marx an apologist of capitalism and Adam Smith a promoter of communism.


Nassim Nicholas Taleb, PhD.
Distinguished Professor of Risk Engineering
New York University, principal, Universa LP, and author, The Black Swan


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