Overall, I put this book up there with John Allen Paulos’ Innumeracy as required reading for anyone interested in thinking clearly. It is a fantastic demonstration of how mathematical thinking can be fruitfully (and practically) applied by anyone to anything.
There are a few moments I do want to comment on, though; the book is so thoroughly thoughtful that its lapses in thoughtfulness really stood out to me.
First, toward the end of the chapter about the stock market, Silver points out that people are more apt to think it is a good time to invest when the market is high rather than low. This runs counter to the (hopefully) obvious fact that you will make less money if you buy when stocks are most expensive. “Buy low, sell high” and all that.
The sole explanation Silver gives for this irrational behavior is that (I’m paraphrasing almost egregiously here) a bull market is an advertisement for the benefits of investing. People are making money! Don’t you want to be making money too?
While this psychological element may play a role, I think there is at least one other dynamic at play: Not having the money to invest.
People of average means tend to only have extra money with which to invest when the economy is doing well. We’d all love to be comfortable enough financially that we can think strategically about investing just after a crash – but that’s just not the case for the vast majority of us.
It will shock no one that my other quibble concerns the chapter on climate change. Silver concludes the chapter by criticizing scientists for “crossing the Rubicon” from science into the messy and irrational world of politics.
“The street-fighter mentality, nevertheless, seems to be predicated on the notion that we are just on the verge of resolving our political problems, if only a few more people could be persuaded about the science. In fact, we are probably many years away.” (p. 410)
Silver seems to suggest that climate scientists’ entrance into the political arena indicates a miscalculation on their part. Scientists, however, are notoriously media- and politics-averse. Much as a group of whales beaching themselves is a sign that something is not right, the fact that scientists are joining the fray suggests we are in quite dire straights.
And their actions are entirely rational if you accept (as Silver seems to, gradually, over the course of the chapter) that their predictions will bear out. I’m sure most climate scientists – James Hansen chief among them – long for the luxury of “many years” during which to address this crisis.
If nothing else, their overly optimistic sense that we are just a few converts away from resolving the problem is likely necessary to their mental health. The alternative, while possibly more rational, consigns us to a level of warming that is likely to be catastrophic.