6. The Best Decision Makers

The myths of executive competency

But wait… some individuals must be the wisest, right? Isn't that the premise behind the President and the CEOs of big companies? Aren't they selected for their experience, wisdom, and their ability to succeed?

Not really, it's just salesmanship and politics. That belief comes from indoctrination that we must trust those in control in the hierarchy. Hierarchy empowers the few to rule and profit off the many. As you recall, Alexander Hamilton and other founders believed that we should be led by a king, clearly a poor choice. Throughout history, much suffering has resulted from decisions by kings and dictators.

The four factors we just reviewed on the collective intelligence of large groups demonstrated that the "best person" to make cooperative decisions is a large group of citizens, not a representative. However, as many people believe these myths, we need to debunk them.

Myth: We just need a better President

The only power we are allowed as citizens in the US is to vote for one of the two presidential candidates that are chosen for us. Therefore, it is understandable that people hope that everything would be fixed if their party's candidate were elected to be President. That's the only thing they can do.

However, control of the Presidency has flipped back and forth between the political parties many times and it hasn't solved our root cause or any of its symptom problems. Often, inroads made by one President are undone by the next or ignored. Thrashing back and forth between two extreme ideologies is not the answer.

We emotionally think of a good leader as a powerful parental figure who will save us from everything, make everything all right, and give us what we need and want. We vote for a President and a political party because that is their promise when they buy our votes. They will take care of us if we elect them. They claim to know better than anyone else does. They will fix the economy, the environment, our health, and save us from all enemies including the other political party and ourselves. We desperately want to believe and have hope with almost a religious fervor in the illusion they paint for us.

To help persuade us to believe, pictures and videos show the camera looking up to politicians, giving them a regal stature, inspiring trust. Confident, commanding, charismatic individual leaders can have great influence on the minds of people giving such leaders immense individual power. Historically in our society, we have been indoctrinated to think that the best leaders are strong, successful, powerful men who lead by command and control tactics, who seem invincible.

Regardless of our faith in confident, commanding representatives, they are still just tools of the parties and the elite who put them in power. Perhaps a greater risk is that if a sociopathic President were autonomous and instead controlled their political party with a clear majority in both chambers of Congress, they would have the potential to become a dictator. Psychopathic dictators are dangerous–we have seen this throughout history. For this reason, some countries do not allow their executive ruler to be the commander in chief of the military or to have control over a domestic military force. For these reasons, an individual President as the national decision maker is riskier than a plural president or citizens as self-rulers.

Myth: Political parties choose the best candidates

We have been indoctrinated to trust the political parties. We are told that the selection processes used by the political parties determine the best candidates for us. As a society, we assume the candidates of our party are intelligent, capable decision makers or they couldn't rise to the top in the great game of politics and be on the final ballot. In other words, we believe that the politicians funded by the elite are the best.

When I lived in Virginia, I associated with the then current Senate Majority Leader for about two hours a week for almost two years. The naïve respect that I automatically afforded him when we met quickly dissipated. Based on my observations, he was the quintessential politician. He could pontificate but not problem solve. He could look you in the eye and dogmatically spout his opinion with confidence, but it was all bluster. He did not have superior intelligence or any special qualifications for making decisions. In my opinion, he was far less capable than portrayed in news clips by the media. He was simply a loyal party politician, nothing more.

As a business management consultant, I worked with C-suite executives and department heads for large companies and the government for many years. Many executives were ambitious and competitive. Many colluded with their cronies and excluded everyone else. They were more successful at politics and networking than at making decisions or solving problems. Their primary focus was to find a way to profit personally from any business issue, even at the expense of their customers and their company.

They often believed it was their job to make a command decision. Their decisions were often reactive, typically without understanding the true nature of the problem. Their biases, emotions, and beliefs affected their decisions just they do with everyone else. They surrounded themselves with their own network whom they took with them from company to company even though they were often far less than capable. Many of the decisions of these executives and their buddies were wrong, resulting in leaping from solution to solution. In the companies I worked with, the lower level employees were typically those who saved the company from judgement errors by upper management, not the reverse.

Regardless of the outcome of their decisions, the results were always spun politically into a victory. Those in charge took credit for a win no matter the loss of money, customers, or employees. Many stayed in power even after repeated failures and demonstrations of incompetence. However, most were smart enough to jump to the next company frequently enough to not face the consequences of their poor decisions.

They were very competitive and conveyed their importance and superiority with great power and conviction. However, they were not any better than anyone else was at finding solutions to complex problems. Most were just better at selling themselves and had an elite network to protect them.

Many politicians are similar to these executives. In my experience, a person is no more capable of making better decisions than anyone else simply due to their position or past positions.

Actual occupations of our representatives

Speaking of credibility due to past positions, aside from the fact that political parties make the decisions and control the government, it's interesting to review the actual occupations listed by the current members of the 117th Congress from the Congressional Research Service. [12]

  • 4 physicians and an optometrist in the Senate; 14 physicians, 5 dentists, 1 veterinarian, 2 psychologists, 2 pharmacists, 3 nurses, and 1 physician assistant in the House; 7 social workers (2 in the Senate, 5 in the House)

  • 7 ordained ministers (5 in the House, 2 in the Senate)

  • at least 78 former congressional staffers (15 in the Senate, 63 in the House, including 3 Delegates), as well as 5 former congressional pages (2 in the House and 3 in the Senate)

  • 2 sheriffs, 1 police chief and 3 other police officers, 1 fire chief, 1 firefighter, 2 CIA employees, and 1 FBI agent all in the House

  • 1 Peace Corps volunteer in the House

  • 1 physicist and 1 chemist, both in the House, and 1 geologist in the Senate

  • 9 engineers (8 in the House and 1 in the Senate)

  • 21 public relations or communications professionals (3 in the Senate, 18 in the House)

  • 7 accountants (1 in the Senate and 6 in the House)

  • 6 software company executives in the House and 2 in the Senate

  • 16 nonprofit executives or founders (15 in the House, 1 in the Senate)

  • 38 consultants (7 in the Senate, 31 in the House), 5 car dealership owners (all in the House), and 4 venture capitalists (2 in the House, 2 in the Senate)

  • 16 bankers or bank executives (4 in the Senate, 12 in the House)

  • 27 from the real estate industry (3 in the Senate, 24 in the House), 8 Members who have worked in the construction industry (1 in the Senate, 7 in the House), and 3 union representatives (all in the House)

  • 2 radio talk show hosts (both in the House), 4 radio or television broadcasters, managers, or owners (3 in the House, 1 in the Senate), 7 reporters or journalists (1 in the Senate, 6 in the House), and 3 newspaper publishers in the House

  • 38 former mayors (31 in the House, 7 in the Senate)

  • 13 former state governors (12 in the Senate, 1 in the House), 10 lieutenant governors (5 in the Senate, 5 in the House), 7 attorneys general of their states (6 in the Senate, 1 in the House) and 8 secretaries of state (3 in the Senate, 5 in the House)

  • 16 former judges (all but 1 in the House) and 38 prosecutors (9 in the Senate, 29 in the House) who have served in city, county, state, federal, or military capacities

  • 4 ambassadors (two in each chamber)

  • 238 former state or territorial legislators (45 in the Senate, 193 in the House, including 2 Delegates and the Resident Commissioner from Puerto Rico)

  • 18 insurance agents or executives (3 in the Senate, 15 in the House) and 7 Members who have worked in the securities industry (all in the House)

  • 1 artist, 1 book publisher, and 2 speechwriters (all in the House), and 2 documentary filmmakers in the Senate

  • 6 restaurateurs (5 in the House, 1 in the Senate), 2 coffee shop and 1 wine store owners (all in the House), and 1 brewpub owner in the Senate

  • 27 farmers, ranchers, or cattle farm owners (6 in the Senate, 21 in the House)

  • 1 almond orchard owner and vintner, as well as a forester and a fruit orchard worker (all in the House)

  • 1 flight attendant and 4 pilots, all in the House, and 1 astronaut in the Senate

  • 3 professional football players, 1 hockey player, 1 baseball player, and 1 mixed martial arts fighter (all in the House)

  • 7 current members of the military reserves (6 in the House, 1 in the Senate) and 7 current members of the National Guard (all in the House)

  • 113 members have worked in education, including teachers, professors, instructors, school fundraisers, counselors, administrators, coaches

This is the education reported by the 535 members of the current 117th Congress.

  • 22 have no educational degree beyond a high school diploma or GED

  • 5 have associate’s degrees as their highest degrees

  • 126 earned a master’s degree as their highest attained degrees

  • 26 have doctoral  degrees (Ph.D., D.Phil., Ed.D., or D. Min)

  • 25 have medical degrees

  • 194 hold law degrees

We can see that half of the Senators and a third of the members of the House hold law degrees. Lawyers have no special training or experience in making large, complex, cooperative-type decisions but they do learn how to present persuasively and make deals. As 57% of the members of the House and 71% of the Senators were previously politicians at the state or federal level, it's not surprising that evidently a law degree and being a loyal part of the political club give you the best chance at winning funding and becoming a career politician in Congress.

Myth: The expert advisors make the real decisions

Many people assume that politicians don't actually make the decisions anyway. They certainly don't personally write the bills with thousands of pages of legal jargon. Often, they haven't even read them when they vote. Aside from voting the party line as they are told, they rely on experts to advise them and supposedly, we can trust the experts. Unfortunately, those in advisory positions are not unbiased experts trying to do what is best for the people. The elite and their special interests invest in funding political parties, lobbyists, think tanks, foundations, federal advisory committees, and government policy-planning networks for their own benefit. All of these so-called advisors represent the elite's interests and agendas, not the people's interests and needs. Those advisors are not our representatives. They represent the elite just as the political parties do who control the politicians.

Experts do not make the best decisions

When we want to understand something, we turn to those who have studied it and published their opinions. We think of them as experts. However knowledgeable they may be, the experts have been shown to be worse than the people are at making decisions. This is illustrated by the studies on collective intelligence and the fact that experts never agree with each other. In the political arena, when those in charge of the political hierarchy decide that one perspective suits their purposes and another doesn't, they disenfranchise all those who disagree. The result is groupthink controlled by those in charge, which leads to poor, biased decisions.

Myth: Wealthy individuals make the best decisions

But what about those who are successful in business? They have proven themselves already. Certainly, the rich and famous would make the best government leaders, right? As the wealthy have the most money, many people automatically attribute their success to increased intelligence and capability. However, this is more of an American myth than a global myth. Americans are far more likely than Europeans are to assume that wealth is the consequence of resourcefulness and expertise. Europeans are far more likely to credit it to good fortune. [13]

The role of randomness in good fortune

Most people assume erroneously that luck is skill and ability. [14] For example, people who start businesses face many risks. The majority fail, often due to timing and unforeseen challenges, even though they may have great ideas and execute well. Many of those who were successful in their first business went on to start subsequent businesses that failed. Past entrepreneurial success is not correlated to future entrepreneurial success or with good management decisions. Rather than being more skillful, the company may have fortuitously been in the right place, at the right time, with the right product, with the right funding.

For example, suppose 100 people tried to start new businesses. Most give up or fail before launching. Let's say 10 actually get the business off the ground. Within 5 years, 5 go out of business and 5 remain in business. Many would assume those remaining 5 are smarter and wiser than the other 95. Most would see them as the top 5% in skills and ability. This belief is known as survivor bias, the false belief that the survivors have some special ability rather than just coincidence.

The stock market is another example. Given the millions of traders, statistically there will always be outliers due to random chance alone. Financial writers promote that Warren Buffet knows how to make the best trading decisions. However, statistically he just happened to be the one who was lucky enough to get more decisions right. Someone had to get more right due to just randomness alone. Moreover, he has made many wrong decisions as well. [15]

Exclusive opportunities of the elite

Being wealthy does not mean that you are smarter or make better decisions than others make. However, it does give you the ability to leverage much more money than others can, which multiplies your wealth at a faster rate. It also allows you to have lower risk by diversifying your investments. And when any investments go south, your money gives you a cushion that other people do not have.

This is especially true when applied to the elite class. More often, their wealth results from being part of the elite inner circle as exemplified by Robert Morris, Alexander Hamilton, and other elite founders profiting off the people after the Revolutionary War. (There are many recent examples but I purposely have not included any in this book because it upsets people to hear that leaders of their party have enabled profiteering just as those in the other party have done.)

 


 
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