Skin in the Game

Books

Nassim Nicholas Taleb uses two criteria to filter ideas and books. First, the Lindy Effect: the more the book has been around, the longer its future life expectancy. Second, the more skin in the game, the more convincing the idea is. In practice, I am attracted to books that look ancient, and look at how far the author is prepared to pursue his/her ideas.

In most Chinese cities, I seldom find bookstores where you can buy the Book of Lord Shang (商君書) and Guiguzi (鬼谷子) together, except in Beijing. I think the only reason is that readers in Beijing have skin in the game as they rub shoulders with Leviathans and Machiavellis every day.

Shang Yang (商鞅) and Guiguzi (鬼谷子) predated Thomas Hobbes and Niccolò Machiavelli by over 1,500 years. And unlike today’s members of the “intelligentsia”, they have real skin in the game, more so than their rival Confucians. Shang Yang was literally torn to pieces for executing his reform ideas which paved the way for Qin’s universal rule. Guiguzi bred Su Qin (蘇秦) and Zhang Yi (張儀), two preeminent rhetoricians that are rivalrous yet mutually-reinforcing in the Warring States period. In the end, one was (again) torn to pieces, the other died in exile.

Therefore, their books are great, per Lindy Effect and skin in the game. The same principles apply to other fields. Among Republican China’s men of letters, I think Wang Guowei (王國維) is the best. He was a rarity by drowning himself in Kunming Lake in the Summer Palace in 1927. Cao Xueqin (曹雪芹) personally experienced the fall of his illustrious family from its height, dying in poverty. Hence, I think the Dream of the Red Chamber (紅樓夢) is infinitely better than F. Scott Fitzgerald’s Great Gatsby. I too love Nietzsche, who died of insanity, and Yukio Mishima (三島由紀夫), who committed ritual suicide.

Skin in the game is something to aspire to.

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Architecture in a Post-Truth World

CCTV

Büro Ole Scheeren took the needle of the tower and bent it back into itself to create a loop. There is no beginning or end. Walk around the base of the tower, and you see it go from strong and imposing to unstable and fragile. It’s the perfect symbol for a post-truth world.

On the Spread of Untruth

In Richard Dawkins’ conception, human being is the medium through which information and ideas, or memes, spread. However, we constitute a poor medium which favors the spread of untruth rather than truth. As pointed out by Curtis Yarvin, human beings find nonsense as a more effective organizing tool than truth. To believe in truth is easy, but to believe in nonsense is an unforgeable demonstration of loyalty. History is full of examples of this phenomenon in action: all organized religions (such as Christianity), Soviet Union, China’s Cultural Revolution, and today’s mainstream media and academia (what Nassim Nicholas Taleb called the Intellectual Yet Idiots).

We can also reinterpret the tale of the emperor’s new clothes. For kids, the moral is honesty and courage in speaking the truth. For adults, it is that the best proof of a cadre’s loyalty is her dedication to the absurdity and stupidity of the leader.

The Birth of Tragedy

gibbon

Charlie Chaplin said, “Life is a tragedy when seen in close-up, but a comedy in long-shot.”

Reading chapters from Gibbon’s Decline and Fall, and Trump’s press conference, you will conclude that a nation’s decline is the reverse – it is a close-up comedy and long-shot tragedy. Trump has turned White House into reality comedy shows.

Factionalism in War and Peace

In Tolstoy’s War and Peace, Prince Andrey enumerated the factions within the Russian high command during Napoleon’s invasion. You usually see the full range or a subset of these dynamics as a group responds to situations.

  1. Rigid military theorists
  2. Non-planners favoring spontaneous actions
  3. Courtiers reconciling the first two groups
  4. Advocates of surrendering to Napoleon
  5. Adherents to Barclay de Tolly
  6. Adherents to Bennigsen, calling for Barclay to be replaced
  7. Devoted worshippers of the Tsar
  8. Place seekers chasing crosses and promotions (the largest group)
  9. Older politicians who can withdraw from conflicting opinions and take an objective view

The Political Logic of China’s GDP Growth Target

I’m a political analyst, not an economist. But in many situations, it’s more than enough for me to understand the logic behind the Chinese economy.

As an important example: in the March 2016 National People’s Congress session, why did Xi Jinping set 6.5% as the GDP growth target for the next 5 years?

This number has nothing to do with economics. It’s all about politics and the logic is as follows:

  1. In October 2015, the Fifth Plenum of the 18th Central Committee set itself the ambition of doubling the 2010 GDP by 2021.
  2. Why 2021? Because it is the 100th anniversary of the founding of the Chinese Communist Party (CCP). Doubling the GDP so that China becomes a “moderately well-off society” will fulfill one of the “two centenary goals” of the CCP, very key to sustaining its legitimacy.
  3. Take a look at the realized GDP growth rates for the past 5 years: 2011-9.5%; 2012-7.8%; 2013-7.7%; 2014-7.3%; 2015-6.9%.
  4. If the average growth rate for the next 5 years from 2016 to 2020 is 6.5%, the 2021 GDP will be exactly double that of 2010. Mathematically: (1+9.5%)*(1+7.8%)*(1+7.7%)*(1+7.3%)*(1+6.9%)*(1+6.5%)^5=2.

On Posture

Posture

In politics, posture is very important. This includes physical posture. The picture shows Japan’s surrender to China at the end of WWII. Standing on the left and right are the Commander-in-Chief of the Chinese (Ho Ying-chin) and the Japanese (Yasuji Okaruma) Army respectively. It looks as if China was bowing to Japan. The relative heights of the two generals, the length of the table, coupled with the fact that Japan first handed over the surrender document, led to this awkward situation. To achieve a favourable posture, you first need to get the details and the order of actions right.