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Archive for the “Fragilistas” Category

Nassim Taleb, the author of best sellers Fooled by Randomness and The Black Swan has a new book out called Antifragile:  Things That Gain From Disorder  (Random House, 1212)  Read it.  It is the best popular apologia for practical entrepreneurship I’ve read in quite a while. 

Taleb is what I would describe as an anti-intellectual intellectual.  He’s a curmudgeonly thinker and skeptic who believes in common sense and learning through experience.  Kinda like most entrepreneurs.

Taleb states in his earlier book, The Bed of Procustes, the central problem which he rails against in Antifragile.  He says, “We humans, facing limits of knowledge, and things we do not observe, the unseen and the unknown, resolve the tension by squeezing life and the world into crisp commoditized ideas.”  (Wikipedia)  He posits that man, in his longing for certainty, artificially invents grand economic theories that simply cannot take into account the randomness and unpredictability of reality.  He rails against the arrogant hubris of the currently dominant statism championed in the economic theories of John Maynard Keynes and Keynes’ current acolytes Ben Bernanke, Paul Krugman, Joseph Stiglitz, et. al.  He believes realistic trial and error beats academic knowledge every time.

For Taleb the greatest business sin is to be a “fragilista.”  He defines a fragilista as a person who weakens the institution he works in because he thinks he knows what’s going on.  These folks believe they can conquer randomness; that they can control and prevent game-changing “Black Swan” events.  They create more and more rigid structures and rules that support their confident sense of control and mastery.  Taleb’s epiphany is that this is a foolish chimera that actually undermines what they claim to be buttressing.  He believes top-down planning guarantees inflexibility, inefficient complication, and delays.  It predictably results in the downfall of companies and governments, whenever they turn their destiny over to central planners.

(Though he doesn’t address this specifically, I find his writing very congruent with my own cynicism about teaching entrepreneurship in business schools.  There is no way to formally teach creativity, passion, originality, and ability to deal with the unknown–randomness–from whence cometh great entrepreneurship.)  Can Entrepreneurship Be Taught?

Taleb fundamentally stands the quality of uncertainty on its head, declaring that the unpredictable is both desirable and healthy.  The “antifragile” company is an alive, existential company that benefits from the adversities, uncertainties, and stressors that challenge it, not from trying to structurally preclude them.

By implication, Taleb is a capitalist Darwinian, not unlike Ayn Rand.  He clearly believes in the idea of “creative destruction” advanced by the Austrian economist Joseph Schumpeter, which is that all things are improved when shocked–that wolves are fundamentally good for the elk herd because they winnow out the weakest members, creating a stronger genetic and practical future for the species.  Or, in entrepreneurial terms, restaurants are eternally failing, resulting in constantly improving cuisine.  If failing restaurants were somehow protected (or bailed out) from the random judgements of the market place, the result would be the end of innovation and bland food.  The parallel implications of government bailouts on the macro-economic scale are obvious.

I could easily go on about Antifragile, but enough said.  The book is great fun to read.  If I have a quibble it is that Taleb seems to ground his thinking is the most obscure of intellectual and philosophical sources.  (I have an M.A. in philosophy, but I have frankly never heard of such ancient worthies as Aenesidemus of Knossis, Antiochus of Laodicea, Menodus of Nicomedia, Herodotus of Tarsus, or Sextus Empiricus.)

In practical terms I’d sum up Taleb’s message as simply this:  Shit happens.  Go with it.  It’s a blessing.  Small is beautiful and efficient.  Praise the Lord!

As Catholic mystic Thomas Merton says, “We live on the brink of disaster because we do not know how to let life alone.  We do not respect the living and fruitful contradictions and paradoxes of which true life is full.”   I think Taleb would agree. Thank you, Thomas.

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