Tuesday, December 09, 2014

Big Solvable Problems

Some great ideas don't spread. Just because an idea is awesome isn't enough, it needs a dash of mojo to get it going. We are driven by incentives. We have lots of biases and incentives tend to feed off these biases so that our actions don't necessarily reflect even what we think is the best outcome. Bill Gates got involved in philanthropy when he read that 500,000 children die every year from Rotavirus. Rotavirus is the most common cause of severe diarrhea in children and it disturbed Gates to not have even heard of something that killed so many. Further research showed him that many diseases which had been eliminated, or virtually eliminated, in the US still killed millions of children. His assumption that if vaccines and treatments were available to save lives would lead to government doing everything they could to get them to the people who need them.

Some biases are useful. Some biases were useful in the past and are no longer so. I get the feeling that much of our political tensions and energies are spent on velvet/champagne problems. Now some of them are more obviously trivial than others (and in truth we don't spend a lot of time on them), but I think we actually have broad agreement on some of the bigger global issues. We just lack the dash of mojo and incentives required to get things moving. That is why I get really excited by organisations like the Gates Foundation and GiveWell. Capitalism has been good at gaining impetus to get things done because the handful of people with excess mojo can get rewarded. Most of us like the idea of equality, fairness and people not living in poverty. For the most part though, we only feel incentivised to do anything about it when it is local. This is a bias. At the heart of many investment philosophies is the ability to remove your biases and make the best decision. The profit motive gives us the incentive to act. We should try and remove some of our biases in areas which can't be monetised too. The happiness motive is more subtle, but it is still there. 'The Life You Can Save' by Peter Singer articulates how close we actually are to solving some of the big problems. One of the reasons we don't act is because solutions feel out of reach. This is not true. We are very close to being able to moan without guilt about our money not fitting neatly into our wallets. It. Is. Very. Annoying. Why do we even need cash anymore? 



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