The Trust Manifesto

The Trust Manifesto is about calculated altruism. There is a place for regular altruism in this world; I am a big believer in karma.

However, for those people willing to dive deeper into economics, psychology, and statistics, there are plenty of other reasons to extend trust. By understanding, combining and applying these ideas,  one can win more love, money, happiness and friendship than someone who does not practice calculated altruism.

A casino cannot predict how it will fare on any given transaction, but can predict with some certainty how it will do after 1,000 transactions. Those people that understand such ideas as true costs, the human tendency to overstate rare events. and other such things, can be like a casino and decide when it is rational to take risks that have a likely positive upside to their lives.

The Trust Manifesto is partly about the Golden Rule,  but unlike some belief systems tries to also explain why the Golden Rule is a rational way to maximize happiness and wealth.

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I realize that I haven’t posted in a long time, but I’ve been thinking and
reading about Trust while traveling and staying busy with work. In the
latest issue of Smart Money, there is an article which talks about Prospect Theory,
which has huge relevance to the Trust Manifesto.

In the article, they talk about a Cognitive Reflection Test (CRT), which
consists of just three questions:

1) A bat and a ball cost $1.10 in total. The bat costs $1 more than
the ball. How much does the ball cost?

2) If it takes five machines five minutes to make five widgets, how
long would it take 100 machines to make 100 widgets?

3) In a lake, there is a patch of lily pads. Every day, the patch
doubles in size. If it takes 48 days for the patch to cover the entire lake,
how long would it take for the patch to cover half of the lake?

It then says “each question has an intuitive – and wrong – response”.

I am proud that I got them all correct… “even at MIT, most students
got at least one answer wrong” it says. But it could just be that I have
seen many puzzles over the years and memorized the answers.

It says this test has an amazing correlation with being able to evaluate
risky propositions and the time value of money, the first of which is
the main theme of the Trust Manifesto.

Then they talk about Prospect Theory, which in summary says that
people take greater risks to avoid losses than they do to earn profits,
because losing feels worse than winning feels good. In the Wikipedia
article, you can see an actual graph, which in a perfectly logical person
would have the same shape in the loss area as in the winning area.

An example experiment is where people are asked whether they
prefer a sure $500, or a 15% chance of winning $1,000,000. People
who understand expected values well (and score highly on the CRT)
will certainly jump on the latter, and people who scored zero on the
CRT almost always choose the certain $500.

Another experiment is offering a sure $100, or a 75% chance of
winning $200. Only 19% of people with a zero on the CRT took
the gamble, even though it is a higher expected value. When the
values are negated, such that it is a sure $100 loss, or a 75%
chance of losing $200, the people with a zero on the CRT, most
gambled on the $200 loss, in effect taking a $150 expected loss
for the chance of breaking even, rather than an expected loss
of $100. People with high CRT scores had the reverse pattern.

Prospect Theory is only about 25 years old, but perfectly explains some
of the mechanisms that the Trust Manifesto is attempting to explain.

Put another way, a rational person would be willing to spend the same
amount of money and energy to enable a 50% chance of a $100 gain
as they would to prevent a 50% chance of a $100 loss. In practice, many
people are more energetic about preventing the loss, even though the
events have the same absolute expected value.

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When the Oklahoma City bombing happened 10 years ago,
Bill and Hillary Clinton gave some moving speeches. At the time,
that was one of the biggest terrorist acts ever done on American
soil, and actually, it still is. I remember quite vividly one thing
that Hillary said in a speech to some kids around that time.
She said roughly “there are more good people in the world than
bad people”. I have thought about that line constantly since then.
It really sums things up perfectly. It is comforting, but at the same
time realistic. There are bad people in the world. It is just
that they are outnumbered, so you need to think about what that
means.

Thanks to Google, I found the original quote in context.

MRS. CLINTON: I’m very happy to have this chance to talk
with children here in the White House and children who maybe
have been watching cartoons or just getting up around the
country and turning on the television set. I know that many
children around the country have been very frightened by
what they have seen and heard, particularly on television, in
the last few days. And I’m sure that you, like many of the
children I’ve already talked to, are really concerned because
they don’t know how something so terrible could have happened
here in our country.

But you know, whenever you feel scared or worried, I want you
to remember that your parents and your friends and your family
members all love you and are going to do everything they can to
take care of you and to protect you. That’s really important for
each of you to know.

I also want you to know that there are many more good people
in the world than bad and evil people. Just think of what we
have seen in the last few days. Think of all the police officers
and the firefighters, the doctors and the nurses, all of the
neighbors and the rescue workers, all of the people who have
come to help all of those who were hurt in Oklahoma. Think
about the people around the country who are sending presents
and writing letters. Good people live everywhere in our country,
in every town and every city, and there are many, many of them.

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The term diversity has been hijacked to mean many different
things, and it is often problematic to think about what it really
means. But it is the right word for the concept I want to cover, and
there is no equal subsitute.

I think that it is a fundamental law of the universe that diversity is
good. The benefits of diversity appear in so many different contexts
that its goodness is something ubiquitous like logic, or gravity, or
death, or taxes.

In 2006 American culture, diversity is often taken to mean that a
group (be it employees in a company, or students in a university,
or models in an advertisement) should be composed of a certain
mixture of ethnicities, genders, sexual orientations, religions, and
so forth. So the idea of diversity gets boiled down to simplistic policies
such as “1% of all admissions to the college should be Pacific Islanders”.
Of course, these rules are very context dependent, and a rule such
as this one might increase diversity at a college in Maine, and be
discriminatory at a college in Hawaii. When the idea of diversity
becomes synonymous with affirmative action, the goal is usually good,
but there is often a giant supply of paradox and irony.

If we take a broader view, diversity is an essential concept in finance,
sports, engineering, politics, genetics, networking, and much more.
An investment portfolio that maximizes return while minimizing risk
is not made up of one investment. On the contrary, diversity is carefully
considered and measured (and called a related term, diversification).
A successful baseball team can be made up of great pitchers who are not
great hitters, and great hitters who would be mediocre catchers, and
coaches who might not qualify to be even minor league players. In other
words, each player is extremely strong at a small number of things,
but they do not each have the same set of skills.

The most successful project teams are usually made up of people with
varying backgrounds. It usually makes no sense to hire only people
with exactly the same skills … for most projects of any complexity,
this is completely redundant. Hiring practices and laws often focus
on superficial dimensions, such as gender, race, and age, rather than
the other dimensions, such as skills and knowledge, but both play
an important role in having a strong project team. I remember being
part of an urgent project in 1999 where a system had to be deployed
to replace an aging one with a Y2K problem. The first deployment
absolutely had to happen one week in April, which happened to contain
Easter and Passover. Since the project team was extremely diverse in
religious beliefs, there were people who celebrated Easter, Passover,
and other holidays. Because of this diversity, there was someone
available every day of the week to push the deployment forward without
needing to ask someone to work a holiday that they celebrated.

Communications networks are another great example of the power
of diversity. The Internet is the evolution of the ARPANET, which was
a packet switched network designed to survive all sorts of global
mayhem. (That same diversity and redundancy is what makes
censorship almost impossible on the Internet, much to the chagrin of
some governments.)

Diversity is absolutely essential to the Trust Manifesto. When
transactions are rare and there is a huge amount at stake, it becomes
more difficult to extend trust, because the consequences can be bad.
When transactions are smaller and more frequent, it is easier to
estimate the probabilities of things going well or poorly, and the
probability of a completely negative outcome is slim. Imagine you
are drowning 1 mile offshore, and it is foggy. You have your
choice of being sought after by 100 people on a large Coast Guard
cutter, or 100 people on 100 jet skits. Both involve the same manpower
and equipment cost, but there is a much greater chance that at least
one jet ski will wander close to you before you drown.

Most personal and business situations involve huge numbers of
transactions with relatively smaller stakes. The diversification that
comes from that is where the opportunity lies. Perhaps an example
from investing will illustrate this best. Imagine three scenarios for
investing $100,000. The first scenario is putting all of the money
into US Treasury Bills. These are considered the least risky of all
investments, and the yield is usually fairly low … let’s say 4% for now.
Then, one could put all $100,000 into a stock that has appreciated
30% a year for the last four years. If all goes well, you could make 30%
this year, but of course it is a risky bet. Unless you are completely
risk averse, (or the opposite … addicted to gambling), neither of these
alternatives is appealing. Instead, a reasonable solution might be to
buy a basket of stocks that averaged 12% returns last year. If you put
$10,000 in each of 10 stocks, and a few have a bad year, you are still
likely to make more than the Treasury Bill yield. In the meantime, your
risk is far lower than if you had all of the money in the one stock that
might return 30%.

In business school, one learns about how to reduce risk in a portfolio
through diversification. One surprising thing is how small a number
of stocks are needed in a basket in order to reduce most risk. I
remember that having just 8 stocks is almost as good as having 100
stocks, in terms of risk reduction.

I hope that you can see the connection between this type of diversity
and some scenarios we have covered in previous postings. Just like
one should not be unnessarily worried about one investment doing
poorly in a diversified portfolio, one should not be overly worried about
one customer or supplier taking advantage of you. The idea is to
structure things to take managed risks. People do not become wealthy
by only investing in Treasury Bills, and people do not become wealthy
by perpetually hanging out in casinos (unless they own them). It is in
that area between these two extremes, where people take small risks
on large numbers of transactions, and learn to be comfortable doing
that, where profit is made and personal happiness is found. A crucial
part of all this is that fundamental property of the universe: diversity
is good. This pops up in almost every field if you look hard enough.

Others have more efficiently made the same point as me by using these
eight words:

Don’t put all your eggs in one basket.

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When I was a student, I twice worked on projects that were about
seemingly innocuous topics, but which made a connection to what most
people would define as stereotyping.

This posting could be a lightning rod, so let me get a few things out of
the way. I consider myself a very open minded person (unfortunately,
almost everyone considers themselves to be well above average in open
mindedness and in driving ability, and we know this can’t be true for
all of them. But for me, it is true. No, really ). I have been to exactly
20 countries, and have met mostly nice people plus a few jerks in all 20
of them. I have friends of every major religion, political orientation,
sexual orientation and IQ. I am an active voter, but neither a Democrat
nor Republican, and although I have strong opinions about the current
occupants of the White House, I think that Democrats and Republicans
have had a similar number of great and stupid ideas when averaged
over the past 100 years.

The first project showed me that pattern recognition and
stereotyping are uncomfortably close to each other, and the second
project showed me that cultural sensitivity and stereotyping
are uncomfortably close to each other. My junior year, I was taking a
graduate seminar on Artificial Intelligence, and I decided to build a
simulation of some ideas found in Brains of Men and Machines, and
Brains, Behavior and Robotics. Many years later I worked for
one of the authors of those books, by coincidence.

These books talked about a form of neural net models called CMAC. I
programmed a pattern recognition system according to the ideas in the
books. It had primitive input and output, where I fed the patterns in a
text file instead of a fancy graphical interface. I would “teach” the CMAC
some patterns, and then later feed it some new patterns and see if it
could classify them. It did a decent job, just like any of today’s neural
nets would do a good job classifying credit risks, or picking race horses
(well, maybe not that), or guiding a cruise missle. The alarming thing was
that just by changing the labels of the data, and not the program itself, I
had a working simulation of a bigot. If I showed it a bunch of automobile
data, it might learn what a sports car and family sedan was like. But if I
changed the parameters from horsepower and place of manufacture to race
and gender, then it might make some guesses about profession. This was
sobering indeed, and I have never forgotten about that. After September
11th, the government embarked on a mission to build the Computer
Assisted Passenger Prescreening System, which is a fancy term for
an automated and expensive stereotyping system to guess who might be
a threat to an airplane. The people who built it probably just dusted off
some old code from Netflix’s movie recommendation system: Those who
enjoyed Caddyshack also liked Groundhog Day…. becomes Those
who bought first class one way tickets and carried box cutters are on
their way to meet 72 virgins…..

Nearly 15 years later, I was in business school, and we did a project on
cultural sensitivity for international business. What could be more politically
correct than trying to accomodate other cultures when doing business,
instead of being an “ugly American”? We used the book Do’s
and Taboos Around the World which despite the gimmicky title was pretty
interesting. My group put together a presentation, and when we looked at it,
it struck us that rather than being politically correct and sensitive, it almost
sounded downright offensive. The rules of thumb intended to promote
cultural sensitivity were stereotypes. They probably had validity in many
instances, but there is a very fine line between being sensitive to how
business is conducted in another place and some very negative stereotyping.
What if Country A were known for its punctuality, and Country B were
known for a more lazy attitude? It is easy to imagine both useful and
harmful inferences that come from this generalization. The useful ones
might be called “cultural savvy” and the harmful ones might be called
“bigotry”, but it is the same mechanism that is creating both of them.
It is something to think about.

People who have read alot of my postings so far have detected much
use of probability and statistics. I think that trust has to do with
accurately predicting probabilities of certain events, and then basing
decisions and policies with those probabilities in mind, to yield
maximum gain. And I think that people often fail to do that correctly,
and that’s why I write.

Imagine you noticed a pattern in a coin that was repeatedly flipped. Let’s
say the coin is slightly damaged and lands on heads 51% of the time, and
tails 49% of the time. You would have to watch it for a while to detect that
pattern, but that information would be useful to have. If you ran a casino,
such odds would be enough to make a decent profit over time, although
sometimes you would lose and have to pay out. To choose another gambling
example, suppose you noticed that a poker player always rubbed his chin
when he had a very strong set of cards. It could be that sometimes he
rubs his chin when he does not have a strong set of cards, but if you noticed
that he did it more often than not, it would give you an edge when playing
against him.

An enormous problem with stereotypes is that they can have predictive
power. That is why they are so difficult to overcome. They can be useful
tools to deal with the world, and that is why it is so difficult to get people
to stop using them. The downside is that they are also wrong much of
the time (just like our deformed penny is wrong 49% of the time), and
when they are wrong, they can do plenty of harm to the person being
stereotyped, and to the person doing the stereotyping.

The town I live in has more than 200 professional firefighters. Currently,
just one of them is a woman. That information can be used in all sorts of
ways, some of them good and some of them bad. If I met a man and
woman at a party, and knew that one was a schoolteacher and one was a
firefighter, I could guess with 99.5% certainty which was which.
Sometimes I would be wrong. If I was the architect of a new fire
station and I had a $100,000 budget for bathrooms, I could spend
$50,000 on the men’s room and $50,000 on the women’s room, or
I could spend $90,000 on the men’s room and $10,000 on the
women’s room. One of those plans will result in shorter bathroom lines,
at least for the next few years, but may be a discouraging sign to
women who are thinking about taking the firefighter test.

It is very unwise to be a slave to stereotypes, but it is equally dumb
to not acknowledge where they come from and why they persist. If
they had no predictive power whatsoever, they would cease to be used
(and probably be replaced by different, more useful ones, but not
just go away).

Humans are not great at intuitively figuring out true probabilities for
things, and therein lies a problem for all who hope to use trust correctly.
There are many names applied to roughly the same mechanism:
cultural savvy, bigotry, gut feel, sensitivity, stereotyping,
intuition, and pattern recognition.

Tread carefully.

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A guy named Toshio Yamagishi has spent many years doing research
on issues of trust. He is particularly interested in differences in trust
between different societies, and gives prescriptions for what Japanese
society should do to prepare for the future. I have started to read one
of his books, and it is completely fascinating. I am sure that many of the
experiments he describes in the book will be material for this blog.

In Yamagishi’s words:

It is well understood that a society cannot function if there is no trust among its
people. Trust is a lubricant of social relations, making relations possible among
people and organizations. An absence of trust will reduce greatly the efficiency of
interpersonal relations, including social and economic relations. In this sense,
trust is privately possessed social capital making our society and easy place to
live.

He goes on to write “the central message [is] that collectivist society produces
security but destroys trust.” He defines a collectivist society as one in which
group members cooperate at a much high level with each other than with
people outside of the group.

This thesis sounds paradoxical at first, but the more of his book you read, the
more it starts to make sense. Examples of collectivist societies (using his
definition) would be organized crime families, members of New York’s Diamond
Dealer’s Club, OPEC and Japanese businesses.

He talks about how in Japanese business, there is alot of time spent up
front building the trust relationship. That is what permits entrance to the
collectivist society. The Japanese businessperson prefers to do business
with one of the other members of the collectivist group. Transactions are
more efficient than in less trusting styles of business, and huge deals can
be executed within the collectivist society with just a phone call. This
sounds very much like the Diamond Dealer’s paper, which I have read but
not yet written about here.

Yamagishi writes “… people who are immersed in secure relationships
with compatriots … have difficulty forming trust toward people in general.”
He goes on to say that relation fortification has been the main
focus of trust research in the past, and that his book focuses on relation
extension. That’s interesting to me, because the Trust Manifesto is
not about being trustworthy, or about trusting the people you have always
trusted. It is about carefully analyzing when trust should be extended to
others who you are uncertain about. I have been using the word extended
for many years when describing my idea on trust to people, because it is exactly
the right word, and I am glad to see the related word extension in Yamagishi’s
work. (To be fair, the book was translated from Japanese, so all we know
for sure is that the translator and I think alike.)

Yamagishi says that the role of trust is to be a “constructor of spontaneous
relations”. Bingo!

The book goes on to talk about how the stable relations among trusted
partners have benefits, but typically hinder the amount of trust that is
extended to outsiders. In economic terms, the closed organization lowers
transaction costs but increases opportunity costs. In the Japanese
business example, the auto maker knows that his steel supplier
is completely trustworthy and will honor an order that was delivered
over the phone, but he does not know if he is doing business with the
most efficient steel supplier that might be available.

There will be much more from this book, and you can download a
copy yourself.

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Yesterday’s Wall Street Journal had an article called “Life’s Lessons”,
about the topic of ethical wills, which are “a way to pass values, hopes, family
stories or spiritual beliefs to children or other close family members or friends”.

Then in a callout box, the article summarizes it like this:

Leaving a Legacy

What should an ethical will contain? The contents will vary from person
to person, but here are some starting points:

• – your beliefs and opinions
• – important events in your life
• – things you did to act on your values
• – something you learned from your grandparents, parents, siblings, spouse or children
• – something you learned from personal experience
• – something you are grateful for
• – your hopes for the future

They grabbed this material from the website www.ethicalwill.com. I don’t think
I had ever heard the term before yesterday, but it strikes me that the Trust Manifesto
might be an instance of one.

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My new friend Steven P. Perkins is an author, director, painter, video artist, performance
artist and all around thoughtful person, and he has some ideas about trust that have made
me think. I asked him if I could post some of his e-mail to me.

Steven writes: “I had a peek at the Trust blog, ATMs etc. Huge issue. Extremely personal
issue. I found myself asking if one person’s perspective on trust had anything at all to do
with anothers–if, on any level at all, my take on how I approach trusting others in this
world would inform/change/enlighten/shift yours or anyone elses. It seems to me a topic
determined completely by personal experiences and the only way I could affect change in
another person’s sense of trust would be through direct personal contact, i.e., through my
actions or inactions whatever the case may be … My experiences of say X+Y+Z+A+Q+F
add up to a different level of trust than yours because you experienced X+Y+A+P+R. I’m
also saying that because of my distinctly different set of personal experiences I cannot
effectively change your perspective on trust unless I add a new experience.”

“For example, I’m your boss and I give you a positve job review then next month fire you.
I have directly affected your perspective on trust. But if I sit here and say that happened
to me, my boss did this or that, it doesn’t mean shit to you–won’t change your take on
trusting YOUR boss. It might cast a shadow of doubt about your boss, hey, I’ve thought
this could happen to me, but human nature is that it’s not real until it happens to me. The
topic of Trust qualifies as perhaps the clearest reflection of our direct personal experience.”

I think Steven is mostly right on the money with this. People’s attitudes about trust run
very, very deep. I used the word “hardwired” in an e-mail to Steven, and he rightly pointed
out that they are not hardwired. Trust comes from a set of experiences, many of them early
on, but “hardwired” implies prior to birth, and I did not mean that. To use a computer
metaphor, it is like there is a write only memory, and episodes related to trust get written to
that memory. On one level, creating a Trust Manifesto is like asking people to reorganize
those memories and come to different conclusions about trust. That is a fool’s errand. I am
never going to trust most dogs to not bite me, no matter what happens with me and dogs
from now on.

Should I donate the trustmanifesto.com t-shirts to the Salvation Army? Maybe.
But there are phases of our lives where we are learning about how much trust to
extend to others. Much of it occurs in childhood, but some of it occurs in the workplace.
I learned about how much to trust people who work for me from my first boss after
graduate school. He had a liberal way of trusting people, and I saw how that
worked. There were peers of his that were completely untrusting of their people,
and they also got things done. If I had worked for them, I might have modeled
my future management style after them.

I also think that some of the things I have talked about so far can be measured
objectively to see if they work or not. One can do an experiment on the Garden State
Parkway with attended and unattended toll booths and see which generates the most
net profit. One can run a store with and without using sidewalk retail space, and see
which is the most profitable (holding constant things such as weather and day of the
week). If I have convinced anyone that those sorts of experiments are at least worth
doing, then the Trust Manifesto is a success.

I am a big believer in Darwinian Natural Selection in many contexts, but it does
not always work. By natural selection, I mean that we can start with a random
set of things, such as bobcats, or semiconductor companies, or basketball teams.
The ones that are slightly stronger than the others will tend to do better. In the case
of bobcats, the stronger, smarter ones may get more food, and live longer and
reproduce, and make better baby bobcats than the weaker, dumber ones would.
In the case of semiconductor companies, the ones making lower quality products
will have lower sales until they eventually go out of business. In the case of
basketball teams, the ones that are better will be able to charge more money
for tickets and t-shirts, and that money can be used to buy even more good players,
and the best players will be more attracted to accept contracts there. Natural
selection does not always work. Early on in the days of consumer videotape
recorders, there were three formats: Betamax, P2000 and VHS. The worst quality
of all was VHS, yet by 1990, that’s what was found in almost every home. (Those
in that industry will claim it is because JVC allowed porn to be produced on
VHS early on, whereas Sony wanted to be more highbrow with Betamax, and
Philips wanted to be more highbrow with P2000.) In the area of personal computer
operating systems, some of the suckiest ones imaginable have had 90% market
share. So the cream is not rising in every industry. But those two examples,
videotapes and operating systems, have huge network effects. That is, even a
mediocre standard is better than no standard. Just like it doesn’t matter much
whether you drive on the right or left side of the road, as long as everyone is
doing the same, the world may be better off if large numbers of people use
the same standards for videotapes, electrical current, and spreadsheet formats,
even if they are not optimal.

If Darwinian processes were at work in the areas of trust, then we can expect that
people who trust the optimal amount in a given context would be measurably more
successful than others who have it wrong.

The thing is that there is not always just one optimum. There coexist successful
restaurants that have superb service at high prices and successful restaurants
that have modest service at discount prices. In the sport of Jai-Alai, the typical
successful player is almost always a certain height, weight and speed. In the 1980s,
I remember a player who broke that mold, and who was far taller and fatter than
everyone else, and he was not fast at all. He could not run after the ball like the other
players could, but if it came anywhere near him and he caught it, he would fire it back
like a missle. He did rather well, yet played the game different from others. There are
successful bosses who trust their people and successful bosses who are ruthless
bastards, so one cannot say that a certain management style is the most successful one.

Steven, thanks. You’ve raised some important points.

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It seems to me that there are three categories of things that one can trust another about:
secrets, possessions, and actions. These categories of trust vary in importance based on the
role of the person or institution which needs to be trusted.

Let’s define them and consider some examples.

Trust about secrets means that a person or institution knows some information that
is not widely known, and you would like them to reveal that information only accordng to
your wishes. For instance, your doctor knows a great deal more about your medical
history than a stranger would, and may even know more than you do at times. Typically,
you would want the doctor to reveal none of this to anyone, except perhaps another doctor
who was trying to help you, or by necessity an insurance company which had to pay for
some procedure or medicine. You are not dependent on the doctor to publicize the information
for you more widely than that; you could do that yourself should you choose to.

Trust about possessions means that a person or institution will not steal, borrow
without permission, or damage a thing or service. I think we cannot limit ourselves to
physical objects here; it could be a picture in a JPG file, a song in an MP3 file, a subway ride,
or a satellite television signal.

Trust about actions means that a person or institution is trusted to not do something
harmful to others (we need to exclude revealing secrets and stealing things, because
those are covered in the previous two categories). Examples would be spitting in a drink,
spreading false information, molesting someone, and hijacking a plane. Wow, those sound
pretty grim.

Right off the bat, the second category is less important to me than the first or third, and it
should be less important to you also. If someone steals my snowblower, that is mildly annoying,
but far less important to me than if a guy swerves into my lane and hits my car head on at
60 mph. Most of the examples in this blog so far have been about theft of possessions and
money. I don’t consider those to be very important in the big scheme of things, but they
are the easiest to analyze quantitatively and get out of the way. I consider a person not paying
a toll on the Garden State Parkway to be less important than a guy deploying anthrax in
Times Square, and I hope you do, too.

My friend Tal uses a quotation that I love:

I don’t cry for things that can’t cry for me.

That’s a great quote, and I just Googled it to see if Tal got it from someone else, or if he’s
the wise person this should be attributed to. There was exactly one hit in Google. Have you
heard of Googlewhacking? This is almost a perfect case of that, except pure Googlewhacking
can only use two words. The one hit was in a Rosh Hashana message from Rabbi Geoffrey
Shisler. So far, so good. One of a rabbi’s jobs is to teach wisdom. Well, it turns out that rabbi
attributes this quote to Elizabeth Taylor on the occasion of her jewelry being stolen. So this is
a pretty crappy example, because Elizabeth Taylor has plenty of money to buy more jewelry,
probably insurance to cover the theft, and seven ex-husbands from eight marriages to buy
her more. OK, so maybe the ex-husbands wouldn’t buy her more, but she’s buddies with
Michael Jackson, so he could buy her more if he has any money left.

So think about that quote, even if you have less money and fewer spouses than Elizabeth
Taylor. Material things are often fixable or replaceable, and very few of them have
tremendous sentimental value. I have tons of material things; I’m not a monk. But if I
dented a fender or scratched a camera lens, I would not cry. Anyone can earn more money
to fix a fender or buy a new lens. What is important is the places you went in the car
with the dented fender, and the safety of those trips, and the people and places you
photographed through that lens.

Back to the three categories of trust. The types of trust that come into play are very
dependent on the role which someone is playing, and they often appear in combinations.
So for example, let’s consider the trust that I have in my mayor. He does not really have
access to much secret information about me, and he is not usually around any of my
possessions, so I do not need to trust him on the first two categories. I do need to trust
him in the area of actions. I need to know that he has given the police department
enough money and training to protect my town, and I need to trust that he will not
condemn my house and build a road through my yard, and so on. In the overall
context of my life, this is pretty small stuff. I am not saying that mayors are
trustworthy, because they are sometimes not. One of the most colorful cases in
history has to be that of Buddy Cianci, former (and no doubt future) mayor
of Providence. In graduate school, I happened to live a few hundred yards away
from Mayor Cianci’s home. The best description of this is in Mike Stanton’s excellent book
Prince of Providence. The perpetual question about Buddy is how he got reelected so
many times even after felony convictions, and I think the answer is that mayors can do
limited harm in the big scheme of things, and Buddy’s improvements to the city and sheer
entertainment value offset the bad things in the minds of enough voters to give him victory.
There will be related examples in future postings.

If we move in other directions … up to the President of the United States, and down to
the people that work for the mayor, we see that more trust is required. The President
can declare a war that my kids might have to fight in. That surely is bigger than a bagel
not paid for, or magician’s contract not honored. (I am not presuming that the war
is good or bad, but just that it has bigger implications than most of the other things
discussed in this blog.) People who work for the mayor have more power to violate my
trust in some ways. They could reveal my income to someone, unfairly deny me a
building permit if they did not like me, accidentally shoot me while pulling me over
for speeding, or steal something from my home when picking up my garbage or
putting out a fire at my house.

Let’s summarize. There are three types of things that require trust: information,
possessions, and actions. Possessions are the easiest to analyze quantitatively,
but also the least important as you are lowered into your grave, and in all the
years leading up to that. The types of trust required are highly dependent on
what role a person or institution is playing in your life, and are not necessarily
correlated with traditional measures of power or heirarchy (e.g., a mayor cannot
do as much harm to me or my family as the people who work for him.) Sometimes
only one type of trust is at work: I trust that a seller will send me the baseball
card that I bought on eBay. Sometimes a person needs all three types of trust to function
effectively: a minister is trusted to not reveal things that people have confessed to him,
and to not steal money from the collection plate, and to not molest people in his or her
congregation.

In future postings, we will sometimes use this framework to categorize what it is that
someone or something is being entrusted with. By now, I hope you realize that the
toll collection on the Garden State Parkway is being handled close to optimally,
and even if it were not, in the long run it just does not matter as much as many
other things that you should be worried about.

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So here’s the framework for analyzing a situation. I am sure this will be refined
over time. That’s why this is a blog and not a book.

– How much does it cost to monitor what you don’t trust in this situation?
– Is the monitoring truly able to prevent the thing you are afraid of happening?
– Who is motivated to steal or deceive you in this is situation and why?
– What good things get blocked if you put monitoring in place?
– What is the true cost of what is being taken from you?
– If trust is violated, can you retaliate?
– Do you really know who can and cannot be trusted?
– Are there potential future benefits to trusting now?
– Are there other ways to make people trustworthy in this situation without controls?

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