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Churches should pay attention to Nassim Taleb. OpEd by Aaron Renn

Your life has to be congruent with the message you’re sending.

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“I am most often irritated by those who attack the bishop but somehow fall for the securities analyst—those who exercise their skepticism against religion but not against economists, social scientists, and phony statisticians.” – Nassim Taleb, The Black Swan


In 2002, future Nobel Prize winning economist Joseph Stiglitz and future Obama OMB chief Peter Orszag wrote a paper examining the risks facing government sponsored mortgage guarantors Fannie Mae and Freddie Mac. They wrote, “The paper concludes that the probability of default by the GSEs [Fannie and Freddie] is extremely small... To be sure, it is difficult to analyze extremely low-probability events, such as the one embodied in the stress test.  Even if the analysis is off by an order of magnitude, however, the expected cost to the government is still very modest.”

Nassim Taleb, an options trader, took at look at Fannie and Freddie for himself and concluded that not only could they go bankrupt, at some point they almost certainly would go bankrupt. He wrote in his 2007 book The Black Swan, “The government-sponsored institution Fanny Mae, when I look at their risks, seems to be sitting on a barrel of dynamite, vulnerable to the slightest hiccup. But not to worry: their large staff of scientists deemed these events ‘unlikely.’”

Shortly thereafter, Fannie Mae and Freddie Mac went bust and were put into federal receivership in 2008 in the wake of the financial crash that occurred almost immediately after the publication of Taleb’s book. This impeccable timing turned the book into a major bestseller, moving around three million copies.

With Taleb successfully predicting things like the Fannie Mae bankruptcy, and earning millions for himself as a trader going back to the 1980s, he has a track record that compels paying attention to what he has to say. So let’s do that.

Taleb has written four books to date in a series he now dubs the “Incerto.” They are: Fooled by Randomness, The Black Swan, Antifragile, and a book of aphorisms called The Bed of Procrustes.

The Black Swan is his most famous but least important book to read today. His aphorisms you can take or leave. But everyone should read and wrestle with the ideas contained Fooled by Randomness and Antifragile. Now, Taleb is not perfect. He’s of Greek Orthodox background but does not appear to be a serious believer. He’s arrogant and proud of it. He’s prone to throwing around labels like “idiot” on Twitter without real knowledge of the person he’s insulting, and does not appear to apologize or backtrack when he’s in the wrong.

Nevertheless, the ideas put forth by Taleb are extremely profound. Their core is also very rigorous. Taleb has a math PhD and published many of the ideas contained in The Black Swan in a subsequent series of 14 papers that appeared in peer-reviewed journals. Yes, he’s an amateur philosopher, but he’s much more than that.

His ideas upend many of our modern conceits, and are extremely favorable to Christianity. So it’s surprising that Christians don’t seem to have paid much attention to his work. Here are the results from some Google searches I ran on his name:

The only place I found any significant number of articles mentioning him is on mega massive blogging platform Patheos, with 197 hits.

To encourage you to read and think about Taleb for yourself, I will share some of his key concepts and how they apply to the church. ...

Skin in the Game

Skin in the Game is the title of Taleb’s forthcoming book and it is sure to be a must read based on advance excerpts he's published. He traces many of the ills of our society to a lack of skin in the game by our leadership class. Banks get into trouble? Bailouts. CEO of Wells Fargo presides over the creation of 2.5 million bogus accounts? Golden parachute. Etc.  Consider America’s political journalists, who thoroughly botched last year’s presidential election. Not one of those clowns lost his job over this epic fiasco. Many of these screw ups actually got promoted or hired at more prestigious entities.

One of the analyses of our income inequality problem is that it’s not as much caused by a lack of upward mobility from the bottom as by a lack of downward mobility at the top. As Gary Solon put it, “[Rather than] a poverty trap, there seems instead to be more stickiness at the other end: a ‘wealth trap’ if you will. There are probably more rags to riches cases than the other way around . . . there seems to be better safety nets for the offspring of the wealthy.”

This is because the upper middle class and higher in America today have managed to insulate themselves from having skin in the game. Historically people in America didn’t just rise upwards from the bottom, they fell downward from the top. That seems to be less true today for the elite.

Never take advice from someone who doesn’t have skin the game. For those of you who’ve been subscribers since the early days of this newsletter, you know one of my guiding principles is skin the game.  I only recommend things that I personally do or have done. (To get meta, the only reason I’m touting Taleb, for example, is because I’m personally working to apply Taleb, such as by embracing the skin in the game principle). If I’m going to tell people they should be willing to say things that will get them into trouble, I need to be saying things that could get me into trouble.

Skin in the game is another reason to favor small churches. Rightly or wrongly, virtually every big name pastor in America is seen as being rich or very financially secure. Once you have written books and gotten out on the speaking circuit, people are going to assume you’ve got a nice nest egg socked away. The problem is that rich people’s bank account gives them a safety margin for action that ordinary people don’t have, reducing their credibility. So it’s easy for them to say X, Y, or Z. The pastor of a smaller church – the guy with four kids and a mortgage to pay who depends entirely on the tithes of his 100 person congregation for income – when that guy says to do something risky, and does it himself, he’s got credibility.

One reason the Apostles had so much credibility is that they had literal skin in the game. Paul was a Jewish blueblood, a Roman citizen from birth, had the equivalent of a law degree from Harvard, and was clerking for “Supreme Court” justice Gamaliel. He threw all that away to endure beatings, shipwreck, imprisonment, etc. When he’s writing letters like Philippians or 2 Timothy from prison, you can believe the messages contained in them carried a lot of weight to those who received them. Paul was putting his money where his mouth was. And he had personal relationships with people that let them see that, as when he appealed to the Thessalonians by saying, “You know what kind of men we proved to be among you.” (1 Thess 1:5, 2:1-12). I might even use this as a heuristic. If the members of a church can’t personally vouch for the character of the lead pastor from first hand knowledge, that church is too big. This is another reason for smaller churches.

I extend the skin in the game concept to what I call “congruence,” which Taleb discuses but doesn’t name separately. Your life has to be congruent with the message you’re sending. So I’m writing this newsletter on masculinity, I need to be living it out or I’m not credible.  Paul was congruent.

What would congruence and skin in the game look like today? Consider the great deal of discussion about whether a “New Monasticism” or a "Benedict Option" is a necessary response to this troubled era for Christians. The argument is that American society and culture is becoming so hostile to Christianity that believers need to flee, at least in part, the public square and its controversies and temptations. But can believers really live up to the ideals of leaving decadent American life in order to live in a monastic higher spiritual calling (albeit without a vow of celibacy)? Can they be congruent like Paul was?

One example might be New Monastic Jonathan Wilson-Hartgrove.  He lives in historically black neighborhood called Walltown in Durham where he resides in a commune he co-founded called Rutba House. Rutba House strives to having half of their residents be homeless, ex-offenders being released from prison, or similar folks. He attends a majority black church where he does not appear to play a leadership role. He continues to attend there and support them even though he admits he doesn’t agree with their conservative stance on sexual morality. Whether you agree with him on everything or not (he has rabid left-wing politics), when I visited him 3-4 years ago and looked at what they were doing, he appeared to be living a life very congruent with what he was teaching and had skin in the game. That commands respect, even if like me you disagree with some of his theology and politics.

In a “negative world,” I believe skin in the game and congruence are two essential features every Christian, and certainly every leader, will need to exhibit.

---Excerpted and adapted from Aaron Renn's Masculinist #4, October 11, 2017, the monthly newsletter on the intersection of Christianity and masculinity. You can subscribe to the Masculinist here:

Aaron M. Renn is on a mission to help America’s cities thrive in an ever more complex, competitive, globalized, and diverse 21st century. This requires building a future that is both demographically and economically sustainable and equitable. It means creating an engine of opportunity and upward mobility, and a platform on which a broad majority of citizens can build towards achieving their aspirations. His insights are rooted in a 15 year career in management and technology consulting, where he was a partner at Accenture. He’s held multiple technology strategy roles, and directed multi-million dollar global technology implementations. He also founded the urban data analytics web startup Telestrian.  He currently lives in New York.

A Journey through NYC religions used some insights from Kassim Talib to describe the unexpected growth of religion in New York City.

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