Hillary Clinton and Donald Trump are both psychologically flawed; and one of them is about to be elected as our President. Of course, flaws are part of the human condition, and being psychologically flawed is simply part of being human. However, when those flaws are magnified in very powerful people, we face the prospect of experiencing classical Greek tragedy. Given the situation, which candidate is the better bet for the country?
I first discussed what I regard as one of Hillary Clinton’s major psychological flaws in my book Beyond Greed and Fear, which was published in 1999. The flaw in question is aversion to a sure loss, the propensity to take imprudent risks instead of accepting a sure loss. What makes a risk imprudent is that it only pays off if you beat the odds. Rogue traders suffer from aversion to a sure loss when they double down after an initial loss and do not beat the odds, and instead spiral downwards at an accelerated rate.
The sure loss I wrote about in Beyond Greed and Fear, which Hillary Clinton would not accept, involved the Clintons’ failed Whitewater investment in Arkansas. I pointed out that the Clintons’ business partner and friend, the late Jim McDougal, on more than one occasion offered to take over the Clintons’ interest in Whitewater, in order to cap their losses, and forestall potential political damage. However, Hillary Clinton told Susan McDougal, Jim McDougal’s wife that Jim had assured her Whitewater would pay for Chelsea’s college education, and that she wanted to hold onto the Whitewater investment in the hope it would still do that.
Holding onto Whitewater instead of accepting the loss was an imprudent risk in which the Clintons did not beat the odds. They took Whitewater with them to Washington. Shortly thereafter, Congress asked then President Bill Clinton to testify on Capitol Hill about the history and status of the investment. Hillary Clinton strongly objected to his testifying, rejecting the advice of White House Chief Counsel, who urged the President to take the sure loss of some embarrassment by testifying in order to put an end to the issue. Hillary instead preferred to take an imprudent risk by permitting Congress to establish an independent counsel to investigate the case. The end result was Kenneth Starr, the independent counsel whose efforts led to Bill Clinton’s impeachment trial.
The psychological pitfall of being averse to a sure loss is one of Hillary Clinton’s deep seated personality traits. In recent years, it manifested in her reluctance to be forthcoming early in her campaign about the decision to use a private email server when she was Secretary of State. With FBI Director James Comey’s recent letter to Congress, less than two weeks before the Presidential Election, her imprudent risks are not paying off.
Donald Trump shares with Hillary Clinton a strong tendency to be averse to a sure loss. That is why he was slow to acknowledge his wife Melania’s having plagiarized Michelle Obama’s speech when giving her own at the 2016 Republican Convention. He too has a very difficult time accepting losses that reveal weakness.
Donald Trump uses counterpunching strategies when criticized, as noted many times in the media. Counterpunching is a way to avoid accepting a sure loss, and it can entail taking an imprudent risk. The “locker room” defense is an example of an imprudent risk, as well as issuing personal attacks on the women who came forward with claims of being groped by him.
The deepest insights into Donald Trump’s character come from his own words, expressed in an interview conducted by Michael D’Antonio in 2014, and reported in The New York Times. His words help us to understand why he is so averse to accepting a sure loss, preferring instead to take imprudent risks. He combines a huge ego, meaning extreme overconfidence about his own ability, with loss aversion, meaning experiencing the pain of losses much more intensely than the pleasure associated with gains of comparable magnitude. The Times article describes Donald Trump’s storming off the ski slopes in Colorado after his first wife Ivana had shown herself to be a much better skier than him. Those who want to view him fuming might wish to watch his reaction at the at the infamous 2011 White House correspondents’ dinner, when President Obama humiliated him, possibly in reaction to the birther issue.
The interview offers special insights into Donald Trump’s major fear, which is to be ignored, to be overlooked, or to be deemed irrelevant. Aversion to a sure loss is a special case of aspiration-based risk seeking. Those who set very high aspirations, and who view the avoidance of failure as extremely important, are very prone to take imprudent risks. As the record shows, Trump takes such risks. Moreover, we learn from the interviews that he loves to fight. Aspiration based risk seeking and a passion for the fight have resulted in high highs and low lows over the course of his business career.
The country has a choice between two figures whose social positions qualify them as candidates for Greek tragedy, albeit transplanted into the world of today. Perhaps Hillary Clinton can learn to dial back her tendency to be averse to a sure loss. She has certainly gotten her wrists slapped often enough to get the message. That said, my judgment is that Donald Trump is incapable of dialing back his vulnerability to aspiration-based risk taking.
Who is the better bet for the country? Aversion to a sure loss has caused a lot of voters to be disenchanted with Hillary Clinton, whose experience and talent are sufficient for being President. By voting for Donald Trump or some other candidate, for that reason, they run the risk of being averse to a sure loss, the loss of accepting her as President. That is surely an imprudent risk, and a Donald Trump Presidency would leave the country desperately hoping to beat the odds.