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The silence of risk management victory

• 1970-01-01 4y ago
  Very well said with clear examples. This was a fantastic post, thanks.
• intrasight 4y ago
  Risk management really is the unsung hero of the modern world. A good book on the topic is "Against the Gods: The Remarkable Story of Risk". The answer to the question "why did a thriving capitalist economy emerge in Europe in the 17th century?" is simply "risk management". It was the intellectual leap that made it all possible.
  • deleted 4y ago
    [deleted]
  • chewz 4y ago
    > A good book on the topic is "Against the Gods: The Remarkable Story of Risk". I wouldn't recommend that book. I would rather recommend reading A Treatise on Probability by John Maynard Keynes... which is insightful and genius like most of his work. https://en.wikipedia.org/wiki/A_Treatise_on_Probability https://en.wikipedia.org/wiki/A_Treatise_on_Probability Some parts of Fooled by Randomness are also insightful (before Nassim Taleb became this weird, tin foil hat guy he is now)... https://en.wikipedia.org/wiki/Fooled_by_Randomness https://en.wikipedia.org/wiki/Fooled_by_Randomness As for capitalist economy - it is of course a matter of opinion but I would rather say that capitalist economy is more about rent seeking, externalising costs and taking crazy amounts of risk with moral hazard rather then about risk management... But perhaps it is because I am risk manager by trade and had seen too many insurance, banks and money managers from the inside... EDIT: Both books - as I have just realized - are saying more or less that probability and risks are real but rarely quantifiable. I guess that makes me a pessimist.
    • wklm 4y ago
      I loved Fooled by randomness, could you recommend further readings in a similar vein?
• cardy31 4y ago
  The point about society-level threats paying better than Silicon Valley is a good one. I often look around in the tech industry as a programmer and wish I could be paid well to do something that actually matters, instead of just keeping kids addicted to social media.
  • colechristensen 4y ago
    To be fair there are plenty of jobs in SV which aren’t tied to advertising or social media.
    • dinvlad 4y ago
      Highly-paid jobs? Would be good to hear some examples.
      • planarhobbit 4y ago
        • dang 4y ago
          You can't do this here, so we've banned you. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
          • planarhobbit 4y ago
      • PheonixPharts 4y ago
        Sure! You can build infrastructure for companies that sell advertising or social media (which is... also advertising) Alternatively you can work for one of the companies burning through VC money selling products/services at a loss who need to advertise those services so they can sell more and more quickly to create the illusion that one day they will be able to generate more than they spend! Don't worry too much about the loses the VCs will just make it up in their investments in advertising companies and companies selling infrastructure to advertising companies. Huh, something sounds weird about that setup, well good thing money is cheap!
• ZeroGravitas 4y ago
  > It would have been far better to risk naysayers’ ridicule and dive in earlier and stronger. It wasn't ridicule, it was propaganda intended to get people to vote against their own best interests (and therefore stop politicians from acting, by threatening them with consequences) And it worked, really well. Still does. If you're treating these issues as if it was a bunch of misled but ultimately well meaning individuals then you are in trouble before you start. For example, "we need new tech to solve this", which is both true and dangerous. True in the sense that a million little fixes have made things better, dangerous in that climate change deniers will use it to divert time, energy and money from known fixes: > Green energy cannot meet Germany’s need for reliable electricity. That is why Germany still needs copious amounts of fossil fuels; German CO2-emissions have risen since the nuclear power phase-out of 2011, despite the incredible subsidies for renewables. > Germany is an example of how not to do green energy. Instead the solution is to research and develop better green energy technology. That was Bjorn Lomborg during the previous Ukraine gas crisis in 2014. Better technology than Wind and Solar, which are the two winners of a global, 4 decade race to produce cheap, clean energy. That's what he thinks we need. While at that time Wind energy was the cheapest source of energy available, and Solar was rapidly catching it up. And here he is on twitter a few months ago doubling down on that: > The idea that the Ukraine war could be fixed by choosing Western dependence on Chinese solar panels and batteries over Western dependence on Russian oil and gas reveals just how unserious the environmental movement really is So, it's a real problem, and we really need to do something about it, but what the consensus solution is, isn't a solution after all, we just need to invest in future tech that will solve the problem. We can't rely on the the Chinese manufactured solar panels that he himself claimed did not work. Now they work, they're just too Chinese. That's the depressing lesson of Climate Change and COVID, if right-wing politicians can buy a few votes and stall some regulations via attacking science, reason, fact etc., then they will.
  • codexjourneys 4y ago
    Yes, we need to take massive action now with what we have, while also developing future tech like better transport for solar energy. Pushing for further delays based on “future tech will save us someday” isn’t anything I support. It’s disheartening but unsurprising that some factions are framing it as either/or instead of both/and. Interesting background about Lomborg, thank you!
• UIUC_06 4y ago
  I don't see any realistic, actionable analysis or solutions in here. > People need to get paid (very!) well for their work on the endeavor Good luck with that one. Who, exactly, is going to pay? And if you did somehow pass a bill mandating $500/hour wages, how would the flood of applicants be managed? > Similarly, with climate change, programs to develop ways to transport solar energy could help, if implemented at scale and with vigorous commitment and funding. (It would be fairly easy to produce the solar energy; the challenges are reducing toxicity of manufacturing solar panels and batteries, increasing storage capacity, and figuring out transmission or transportation over long distances) I had the impression that many people already were working on all those. Is he saying that throwing more money at the problem would solve it faster? Finally, Y2K and Ebola are only two examples. How about "nuclear war over Taiwan"? That seems like the ultimate risk, and it's not by any means improbable.
  • mattzito 4y ago
    I agree somewhat that the article seems more structured around “managing risk is important”, rather than talking about concrete actions. But the idea of paying people more to work on issues to mitigate risk is very valid. Lots of people are working on climate change, it’s true, but it’s not hard to imagine a world where we subsidize that sort of work (assuming a reasonable qualification process), and the result is more people working on the solution. To put another way - if fewer people were working on it, would it take less, more, or the same amount of time? Presumably there is some optimal range where enough smart people are working on a problem to speed things up, but not enough to where there’s a lot of wasted make-work. To the last point, there are always going to be risks that we, individually or collectively, can’t do anything about- nuclear war over Taiwan being one of those. Our inability to influence those risks does not obviate the opportunity to mitigate others.
    • UIUC_06 4y ago
      We can't do anything about the Taiwan risk? I beg to differ. Are our political leaders, who are elected, ignoring it in hopes it'll go away, actively making it worse, or mitigating it?
  • 4y ago
• dllthomas 4y ago
  https://en.wikipedia.org/wiki/Preparedness_paradox https://en.wikipedia.org/wiki/Preparedness_paradox
• civilized 4y ago
  This is a perennial problem in the insurance industry, but in kind of the opposite way. In insurance, your job is to take on financially predictable risk at a premium that matches the predicted risk. You exclude risks that you're not comfortable predicting. But excluding risks usually also means you don't get detailed data about them, making it difficult to justify continuing or discontinuing the exclusion.
• OrvalWintermute 4y ago
  >Yes, though as extreme climate events pile up, naysayers dwindle. But their pushback against climate change efforts has delayed mitigation by decades. We’re now at a stage where we can no longer prevent some terrible effects of climate change. It would have been far better to risk naysayers’ ridicule and dive in earlier and stronger. Many people that talk about Climate Change, aka, Global Warming, are so indoctrinated via ideological shades that they do not recognize basic facts, and understanding where we are with our own knowledge 1. Deglaciation, and Warming as climate trends preceded our oil-based economy by thousands of years 2. Glacial Maximums are associated with low CO2 environments 3. "Our understanding of the Global Climate System is in its infancy" 4. There are massive discrepancies between accurate space based weather observations, and in-situ measurements. 5. Renewable Energy currently is insufficient to replace petroleum sources, and will be for a long period of time.
• everly 4y ago
  Sometimes when you do everything right no one knows you did anything at all.
• abbadadda 4y ago
  This is a good article. I think about this a lot working in SRE: Disaster avoidance is invisible and often under-appreciated. I’ve also been reading Toby Ord’s _The Precipice_ and avoiding getting too depressed while in a bit of awe how close humanity was/is to really destroying ourselves.
• ChrisMarshallNY 4y ago
  This is so true. I especially agree about the "self-interest" thing. Many good manipulators (politicians, managers, influencers, etc.), take it a step further, and convince others to work against their own self-interests, in order to serve the interests of the manipulators. We've seen plenty of this, lately (I won't go into specifics). Here's a rather pithy approach to risk management that I've used: https://littlegreenviper.com/miscellany/risky-business/ https://littlegreenviper.com/miscellany/risky-business/
• motohagiography 4y ago
  On the cybersecurity side, risk management is pretty tangible. It's technology governance, and security teams essentially act as a licensing body for tech in an organization, and provide intelligence about existential threats to the status quo of the line of business. Success is anticipating attempts on the org, and demonstrating how they were deflected or mitigated. There's very little that is vague about it. Just this week I discovered a new technique that some malware is using to bypass most sensors - we manage risk very concretely. I know portfolio risk managers who operate on instantaneous feedback about the P&L of their models and opportunity costs. Where I disagree with the article is that I think the author is seeing an opportunity to frame ideological concerns that exploit uncertainty by calling it risk and equating it to disciplines that he doesn't realize have very concrete competencies and performance metrics. Also, we have technology and economic solutions for our climate impact already. I'm still of the view that if your plan doesn't work unless you take over the planet and deprive entire nations of people of their freedoms, it's an objectively evil plan, and somehow that makes me a counter-revolutionary denialist.