Skin in the Game (book)

If an actor pockets some rewards from a policy they enact or support without accepting any of the risks, economists consider it to be a problem of "missing incentives". In contrast, to Taleb, the problem is more fundamentally one of asymmetry: one actor gets the rewards, the other is stuck with the risks. The centrality of negative incentives Actors – per Taleb – must bear a cost when they fail the public. A fund manager that gets a percentage on wins, but no penalty for losing, is incentivized to gamble with his clients' funds. Bearing no downside for one's actions means that one has no "skin in the game", which is the source of many evils. An evolutionary process is an additional argument for SITG. Those who err and have SITG will not survive; hence, evolutionary processes will eliminate (physically or figuratively by going bankrupt etc) those tending to do stupid things. Without SITG, this process cannot work. Examples Robert Rubin, a highly-paid director and senior advisor at Citigroup, paid no financial penalty when Citigroup had to be rescued by U.S. taxpayers due to the 2008 financial crisis. Many war hawks do not themselves bear any risks of dying in a war they advocate. ==Intellectual Yet Idiot==

Intellectual Yet Idiot (IYI) is a term coined by Taleb in his essay by the same name that refers to the semi-intelligent well-pedigreed "who are telling us 1) what to do, 2) what to eat, 3) how to speak, 4) how to think... and 5) who to vote for". They represent a very small minority of people but have an overwhelming impact on the vast majority because they affect government policy. IYI are often policy makers, academics, journalists, and media pundits. Taleb points out that being educated and "intellectual" does not always mean that someone is not an idiot for most purposes. "You can be an intellectual yet still be an idiot. 'Educated philistines' have been wrong on everything from Stalinism to Iraq to low-carb diets." Taleb dedicates a chapter to IYIs in the book. Usage The term was picked up and used late in the 2016 U.S. presidential election by Newt Gingrich when he criticized the negative response Trump received after the first presidential debate stating that "The Intellectual Yet Idiot class is so out of touch with America that they don't even realize how badly they are doing and how well Trump is doing." Gingrich has mentioned the term in interviews and speeches since then and has included in his book Understanding Trump a chapter called "The Rise of the IYI". The term has since been used extensively and has been cited in numerous periodicals including The Guardian, Financial Times, and New Statesman. Jonah Goldberg, in an article from National Review, references the term in defense of non-liberal intellectuals who have been branded "anti-intellectual" by the Left. Graham Vyse, in his article "Democrats Should Stop Talking About Bipartisanship and Start Fighting" from The New Republic, referenced Gingrich's use of IYI as divisive and that until the Republicans become more collaborative, "Democrats need to drop the subject, too, and fight like hell instead." ==Other ideas==

Minority rules A "stubborn minority" can impose its will on the relatively uninterested majority. A halal eater, for example, will never eat non-halal food, but a non-halal eater is not banned from eating halal. Thus, a catering company switches to serving halal meat despite it being preferred only by a tiny minority of its customers. ==Reception and criticism==

Economist Branko Milanović wrote that Taleb has created "a full system that goes from empirics to ethics, a thing which is exceedingly rare in modern world." The Economist described reading the book as similar to "being trapped in a cab with a cantankerous and over-opinionated driver." The Guardian published an ambivalent review, noting that Taleb's "combination of fearlessness, self-belief and immodesty adds up to charisma on the page" but that "every idea that sounds as if it might work in the abstract fails in the particular". Taleb responded with a list of the flaws and "reading comprehension" in the reviews in The Economist and The Guardian (claiming that journalists have an agency problem with subjects criticizing their profession for lack of skin of the game). Audiobook The audiobook version is narrated by Joe Ochman and reached #4 on Audible.com's nonfiction list in March 2018. ==References==