Can optimism become a weakness? Can too much confidence become hubris, leading to imprudence? America seems determined to push our optimism to the limit, to provide future generations with answers to these questions.
Seen in terms of John Boyd’s Observation – Orientation – Decision – Action loop, excessive optimism creates a “locked orientation.”
The result is an Orientation that doesn’t accurately represent the changing external environment, and actions coming from such an Orientation are often inappropriate, ineffective, or late. Just like what we’re seeing today. [Chet Richards, source]
Once hubris takes hold, our very success works against us. Why play hard in a game we “know” we will win? Complacency kills in a rapidly changing, hyper-competitive world where, as Andy Grove says, only the paranoid survive. Our triumphant, incredible success in the post-WWII era world blinds us to the awareness that this was just one chapter in history.
Our optimism is our enemy
With this insight, so many incomprehensible things become obvious.
Why did we ignore so many warnings, given over such a long time, by so many prominent experts and institutions? (see this for a list showing a tiny fraction of the warnings). Optimism!
Why did so many Americans ignore the many signs that the economy was slowing, dangerously slow? For example, in the almost 4 thousand of Internet posts mocking the warnings with “Dude, Where’s my Recession?” Optimism! (For analysis of this, see Making us dumber, chanting “Dude, where’s my recession?” and When did “Dude” predict a recession? How severe?)
Why has our leaders’ response to the financial crisis been so slow, incremental, and reactive? Twenty programs, each too late and too small. Optimism! With success guaranteed, and recessions always brief and shallow (for the past quarter-century), our leaders concentrate on delicacy and precision with their medicine.
Why have economists been so reluctant to acknowledge the magnitude and unprecedented nature of this downcycle? Optimism! Mainstream economists still tend to see this as a typical post-WWII recession. To open their minds to more extreme outcomes would push them to become Doctors Doom — “outcasts” from the safe community, like Professor Roubini.
We are like children playing on the beach who see a tsunami coming toward us. “Cool, look at the wave!”
An alternative perspective
We are about to suffer the consequences of past mistakes. At this point inevitable, unavoidable. Our last opportunities to even soften the crash passed many months ago.
Adults are realistic, looking at their problems with clear eyes and steely resolution. As did our forefathers in the Revolutionary War and the Civil War. Let’s hope we can put aside our bubble gum and beanie caps, and prepare for what lies ahead. A recession — even a depression — is not Armageddon. Just bad times, like those America has survived before.
With hard work and a modest portion of wisdom we can come out of this stronger than before.
Originally published on November 12, 2008 at Fabius Maximus and reproduced here with the author’s permission.’