Munger’s Law of Rat Poison
The precariousness of blissful conditions
Charlie Munger was quoted saying:
“Wise people want to avoid other people who are just total rat poison, and there are a lot of them.”
Howsoever Press Secretary ChatGPT may spin it, the quote does not mince lexicology. It’s hard to take out of context. It means what it says, pointing to two aphorisms: 1) a small injection of bad ruins a lot of good; and 2) that which is good is uncommon — “for the sake of ten, be it not destroyed.”
Open systems are vulnerable to abuse
Nordic libraries had a tradition of being very open. Visitors are trusted with easy access to valuable collections (Häkli, 2002). Until one map heist of rare maps changed it all — the story itself is quite a thriller. Now everyone must check in bags and coats at the door.
When even an unknown stranger can be trusted as the heir to humanity’s immense cultural wealth, you can go to an exhibition to see Beethoven’s original manuscript — the actual strokes of those fateful notes, you can stand in Freud’s apartment with his personal effects, you can get so close to a Rembrandt that you could lick it — of course you would not.
Then you have tourists climbing onto statues, breaking historical treasures to take selfies, carving their names onto ancient ruins, throwing potato purée at paintings, ironically, to alert the world about the tragedy of the commons. You have a little Sunday sketching group who like to draw in museums, well-behaved, nobody even litters — then “Baam!” because of the purée gang, you must leave your watercolour in the cloakroom.
AirBnB puts it this way: “The worst 10% of guest and host experiences were making it worse for everyone.” A handful of douchebags flew aeroplanes into buildings, now millions of man-years are spent squeezing through security theatre. Politically motivated crimes try to the public with the threat of mayhem; but vandalism also needs no rationale. What stops random actors from pulling fire alarms here and there, chucking a trash sofa onto train tracks? In thermodynamics, chaos is destined to increase over time — what about society? Is order a natural state, or does it require conscientious people actively holding things together with effort?
Open systems have higher trust, lower transaction premiums, and higher aggregate present value — namely, people trust the future — few are used to hustling fly-by-night. While you have an open society, cherish it.
The crowd over-reacts and over-restricts
Societies are also not good at having rationally proportionate measures. Whenever things go awry, the strongest force for change is moral panic. Public discourse goes ape-shit in a race to the bottom for defensiveness.
That’s airlines can’t hand out peanuts, chocolate eggs can’t contain toys, and the Q-tip illustrations suggest that you use them to stroke your elbow, tickle your toe, but never in any case put it near your ear canals. Firms act defensively because there’s no shortage of trolls abusing tort law for gain.
Proportionality is an exotic concept in the land of the absolutely equalised universal. One teenager drinks beer and crashes an e-scooter off a bridge, therefore naturally driving a scooter must be treated the same as driving a 2-tonne SUV and millions of regulated hours must be put in to hamper the ease of buying beer by those who appear to, but may not yet, have reached 16 (in Germany that is, where it’s already rather permissive in comparison).
Thus is the “veil of stupidity”, when protective measures must be applied indiscriminate (indeed, exercised without common sense). You go through a security screening when you visit the parliament’s sitting session, fair enough, then in the long queue you also see them padding down an 80-year-old Finnish gramma. Yeah, like they are known for premeditated attacks with their walking frames.
The availability bias makes people intuitively quite bad at assessing whether planes trips are more dangerous than cars. What happens when the whole political class of a large economy is hijacked by headline panics? Germany’s foot-shooting nuclear power policy. That’s what.
Order is an uphill struggle
In the internet’s golden days, Tumblr was a treasure universe of exquisitely curated aesthetics and ideas, interlinked through reposts. If you liked architecture of a certain style, you could find a blog dedicated to that, full of delightful images, no spam, no selfies, no stunts. And it linked to similar blogs and a world of wonderful discoveries.
It’s not clear what happened in the middle. Towards the end of its days, as an indicator of madness, the site launched robo-censors to hunt down nipple-like pixels of the female-presenting kind. Soon after, the once-unicorn company was sold for less than a tuna.
In the beginning, Facebook was a small circle, signup required a verified university email address. Then, something happened in the middle. Later, grandmas and everyone’s roughneck uncle got on there. It became a threat to human reason and the democratic basic order.
In the early days, Quora had high-profile domain experts with genuine knowledge and enthusiasm that you could interact with and learn a lot from, on topics like biology or digital signal processing. Then, things changed over time, and not for the better. Opinion spam from riffraffs flooded the page, and the feed was filled with questions along the line of “Do I look fat in this selfie?” Later, the whole site became completely unnavigable, each page was a run-away SEO compilation of garbage.
The internet, itself a highly interconnected system of systems, seems to be a repeating tale of golden age corrupting over time and going to the dogs — idiomatically speaking — pups are great. The internet is like Godwin’s law writ large.
What’s going on with this fateful, recurring thing that happens to the internet, to the economy, to society?
In an economy, in the beginning, purchasing power is low — then, growth occurs and great offerings emerge: high quality at good prices (at this point still verging on luxury for most, but your purchasing power has surged). You can get a lot of value — this is the golden age. Then, shockwaves after shockwaves rip through the economy, financial crises, plague, war, bad governance. The best-value vendors are the first to be wiped out. Prices rise, while quality sinks. It’s a “spiral crash” over the years.
Circles, communities, platforms — how can we break the curse of the second law of thermodynamics, and move towards order and flourishing? Society, after all, is not a burger joint where the next random clueless chap can be dragged in to keep on flipping.
But it can’t keep on crashing forever, right? Otherwise, where does any good period come from? So there is hope.
To the Roaring Twenties!
