Ted Audio Collective
Hello everyone you're listening to after hours. I'm Felix. I'm me here. It's great to be back with you Felix
Yeah, and of course Thanksgiving is around the corner. Are you ready turkey and oven everything? Yeah
So besides thinking about the holiday do you have topics for us? Well, I confess I've been thinking a lot about Africa
Oh, okay. There are just some remarkable developments and we've never really had the opportunity to think hard about Africa
Mm-hmm
And so I thought it would be great
But it would be even better if we had someone who actually knew what they were talking about
Yes
Generally a good idea and in fact we do so we are joined today by one of our wonderful colleagues
Carrie Elkins who's both a professor of history and African-American studies and at the business school and just somebody who really thinks hard about
Continent and about business and just about everything that we want to hear about so Carrie
It's really great to have you here. Thank you so much me here. It's just great to be here and opportunity to talk with my friends and colleagues about Africa
So 30 plus years I've been working on Africa in the last especially sort of 10 to 15 years have been working a great deal
Think about businesses thinking about the role of entrepreneurship and so far as there's a connection between an historian and the present and future
Fantastic and Felix did you bring something to well? I've had pretty mundane topics compared to talking about Africa
I would like to talk about empty lots. Yes in particular empty lots of land in cities
I know it doesn't sound very enticing, but I promise you it'll be super interesting
Fantastic and how we get those empty lots not to be empty lots. That's right excellent good
So me here Africa yeah, so Africa rising. It's just a remarkable thing
That we will live to see over the next 30 years so in particular by 2050
Forkass and it's pretty clear. It's true one quarter of the working-age population is going to be in Africa and
And in fact one third of 15 to 24 year olds will be in Africa
So this is globally right exactly and so the transformations that we've seen for example in China over the last two decades
That I really just changed the global economy
It's hard not to imagine that happening with Africa in the next several decades at the same time
There is this enormous
Enthusiasm about what that prospect means for Africa as that youth gets older as they contribute more and more to the global economy
There's also concerns about the degree to which the growth there can be sustained
With that remarkable demographic growth so it feels like one of these things that we have to come to terms with to understand the next 20 years
And I'm curious if it inspires tremendous hope and excitement or if it's a cause of caution
But I'm curious Carrie if you feel that sense of optimism or if you feel something more subtle and nuanced
Yeah, I'm an African optimist as an academic we always footnote everything so I'll qualify in all kinds of ways and we can talk about that
But I think if we look at some of the trends what I encourage folks to is think about Africa
Sort of let's parse it out as a massive continent right 54 countries 1.2 billion people
So to talk about it and kind of a homogenous place and so you know if we were to look at say Kenya compared to Nigeria and South Africa
Three biggest economies, right and we think about Kenya's kind of anchoring East Africa
I'm very very bullish on Kenya
Nigeria they floated the currency they've got the population growth is a real real challenge there in South Africa's having it never really got
It's footing post South Africa, but nonetheless
There's a point to an optimism even outside the places where I'm super super excited about like East Africa and
I think at the same time we've got to be cautious right we've got to be cautious about the trends around
All this young pop you know the average age is 19 19 years old
It's amazing
But if we want to get down to brass tax in terms of things I worry about in terms of making sure there's employment
The other thing is I would take a lifeboat with young people from Africa any day of the week
So Carrie it is wonderfully here that optimism from you with those notes of caution Felix
What do you make of the opportunities ahead? I love your very first common Carrie in particular
Everything you say about Africa as a whole has to be wrong
Because it's this really huge continent
You all have seen these maps where they super impose other countries on Africa
And you see it's actually bigger than China India the US and the European Union taken together
So it's just massive as you pointed out. There's more than 50 countries
So you can't say many things that are common maybe the most interesting part about the demographic
concerns or the demographic opportunities is that if there's one thing or not so sure is
Whether the current demographic trends will hold as a result of many more girls going to school
Like in many emerging economies in Africa when a girl doesn't have any formal education
The average is about six kids or so if you go to primary school it's four kids if you have a secondary education
It's two kids and so because we have seen an
An amazing lift in enrollment rates of young girls in particular. I think the only question mark around
Demography is how quickly will it be that much better educated women will then marry later will have fewer kids
And as a result you get a little bit of a demographic squeeze maybe before you reach the really optimistic numbers now
That sounds like a not so great story, but funny enough. It's exactly the squeeze that then translates into
Economic growth so when people talk about the demographic dividend
It's literally that point at which the ratio of the people who are in the workforce
Relative to everyone else if that ratio goes up
That's when you get supercharged growth or higher growth rates and we know say from East Asia
That's about a third of growth for Asia just came from that demographic squeeze and so lots of optimism about many young people
But then in particular lots of optimism about what these young people will do different from the people before them
What's your sense me here?
I agree with both of you about all the reasons to be optimistic and in particular
This demographic transition that we're hoping for which is reduced fertility leading to this kind of higher
Per capita growth could really be really be powerful
I guess the thing that I can't get my arms around is this question of how monolithic Africa is now
Of course India is not monolithic and China is not monolithic and people who talk about behar
Don't often separate it from carnautica or goodroth
So there's heterogeneity there too, but in Africa
There's no unitary political actor carry so when I think about China and the degree to which we think about what India is
Accomplishing and may accomplish
It's very heterogeneous
But there's a unitary political actor who's able to exert an agenda and
I'm curious if you think we can realize the full effects of this
Demographic transition and all these opportunities without a unitary political actor on one hand
You might say we'll we'll have these different states competing on the other hand
We know that scale matters these big countries that are able to act
Uniformly they do amazing things
So do you see that as an impediment or do you kind of see that as something actually?
We're gonna see lots of different models sprouting up and there's lots of competition and maybe that's the way forward
I think we're gonna see a lot of different models
I think what's going to be so dramatic is going to be the unevenness of what happens right when we think about this sort of
demographic transition that you're talking about Felix it took Britain two centuries
Right, but it only took Thailand 40 years. Yeah, so I'm curious if you both could wave your wand and
Think about a change that would allow us and allow Africans to fully realize the remarkable potential of the continent
What would you hope for and wish for in the next 20 years?
I'll give you mine which is a little along your lines carry I
Think if we saw
Increasing levels of integration within Africa from an economic perspective and a trade perspective and the flow of goods and
Services and capital and labor that would get me so excited
If I could wave a wand
I don't think I would wave a wand and say lots of FDI
I think that's kind of complicated and problematic
But if I could wave a wand and say lots of economic integration
That would be something I would go for I'm curious what would be the sign that you would look for to really see something promising
I will probably go back to one of your earlier points carry and thinking about
What kinds of girls what kinds of activities really translate into jobs in particular into jobs that then are relatively well paid
Yeah, and there I think it's just very split on the one hand say there's so much enthusiasm about tech and Kenya and
All these ideas all these entrepreneurs and then we know from our own economy and we know from
China and South Korea and everyone else these kinds of industries just do not produce all that many jobs
So you end up with a real split in the population where some people do really really well and most everyone is left behind
The parts that I'm most excited about are I find very interesting is
These homegrown businesses that are relatively labor intensive and that are now
Going away from a model basically serving the super rich in Africa
Which is in part what is happening with FDI so say supermarkets?
I find a really interesting market so you have quick Martin Kenya you have
Cazion and Egypt you have market square in Nigeria and what all of these are doing is they're moving away from the biggest cities
Right and they're trying to build retail that is
Not fabulous fabulous like Gafur and others in Africa, but a step up from the open market with
Uncertain quality and uncertain prices and all of that and that to me is interesting
That's maybe the thing that makes me most hopeful because on the one hand it's labor intensive
We know yeah, and then it's serving
Maybe you could say an emerging middle class or it's thinking about
The geography in these countries a little differently and that not everything is just focused on
The main cities the capitals the biggest cities, but there's lots of opportunity elsewhere
That really gives me more hope than anything else. It is really remarkable people don't think about retail as a powerful growth engine
But it is so important it employs a lot of people
There's a lot of productivity improvements that happen through retail and happen through distribution channels
So I think that's the thing that people don't really think very much about and
some ways my magic wand would be
Sort of combining a little bit of what you were boasting. I start sort of in the big picture of things as historian
There are really very few places we can point to that sort of moved into sort of if you will the
Sustainable quote unquote modern economy without industrialization
Yeah, it hasn't happened. Yeah, and so even this simple minded historian knows right you know
These service sectors aren't going to get you out of this that you know, we've got to create jobs bottom line you have this young
energetic
scrappy
Increasingly more highly educated population fastest growing middle class in the world
If we look at some of what's been going on and to your points. It's industrialization
Mm-hmm. We've got semiconductor businesses there. We've got gear box which is doing all these high mix low flow electronic manufacturing
We've got is Susu's been there for a long period of time. They're creating jobs and of course the garment industry, right?
Which is what we would think of more of like you're in Manchester in
1810 that's the kind of thing that's driving change right and at the same time in a regional
Both within countries and within regions in particular because tastes are different from place to place
What people want in East Africa are very different from what they want in South Africa or West Africa
So again Kenya with all of the booming middle class and even when we go to Mampasa or a key sumo some of these areas that are
Curly far from outside of Nairobi. You got to go to carapour
There used to be a Nakamat there which kind of went under the opportunity for sort of local businesses to take off the
Opportunity for retail now South Africa for those listeners have been to South Africa
They have really seized on this
I mean if you go to South Africa you might as well be in Western Europe. That's right and some of that sort of
Growth in some ways remind you of the Robert Barron period in the US were terrible things
I mean the part I was a horrific
Political scourge on the history of humanity in many ways at the same time
It accelerated in some ways it there was a powering back of investment into the country in the same way that we see in
Places like the US when we sort of castigate things like you know, it was terrible the way people treat in factories and the rest
But a result was we don't necessarily need the kind of Chinese investment and infrastructure is already there
So you can move goods in people around
Hmm makes a big big difference because a lot of places to feel it's to your point the regional areas are important
But the infrastructure is just so lacking to get in and out
So that's got to be addressed and China really made some big inroads with that and I think you people are trying to lean on the United States to do more in
In some of that investment. Yeah, and what's fascinating to me in that respect is
To think about there's so much enthusiasm for entrepreneurship right and we're thinking about oh who's going to create the next and pass out whatever it is
But really it's the boring stuff that is maybe most needed the mundane businesses like
Infrastructure is a great example. We just need a lot of boring construction. We need a lot of boring railway building
We need a lot of boring building out retail a lot of PVC pipes
I feel like
As exciting as some of the entrepreneurial ventures can be if we then think about
What is going to produce the kinds of jobs?
It's not the high flying ideas. It's the things we have done but haven't done in Africa for a very long time
Mm-hmm
So we talked a little bit about the magic wand and the wonderful things that could happen
If you had to pinpoint
Maybe one thing that gives you pause a trajectory or something that we think oh my god
It's been a little while since we also had a cover of the economist and then we had one percent growth for the next decade or so
What's the biggest impediment to Africa truly being a success story?
Well, gosh, I think it comes back to youth employment
Young people when they are unemployed especially young men when they're unemployed
Can become very problematic
And that's a story we've seen around the world and
The rates of unemployment in some countries including for example south africa are startlingly high
That can undo lots and lots of things and that can happen via crime that can happen via politics
That can happen via radicalization
And so there is this sense in which
We really need to think about that employment problem not just as a source of generating wealth
But because of it as a source of political stability
And so that is what I would keep my eye on is how do we think about youth unemployment?
How do we understand whether there are really opportunities?
For people because that is where things I think can go wrong. Kerry. I don't know. What do you think?
I would definitely put that on top of my list right if we think of sort of the top three things
The unemployment factor is major. I mean if you have one and four people in the world are going to be african the disproportionate number will be
average age of you know 19
And they're all unemployed. What does that mean? It's mind boggling actually when you think about it right and at the same time when you think about the ingenuity
In look, I don't want to sugarcoded the way in which many of the content live it's micro transactions right we go out we fill out gas in our car
We grow shut maybe once a week
Not in most places in Africa
You pay your fuelings to take the public transport to work
You buy your little bit of firewood for your breakfast to cook it all these tiny little micro transactions
My other worry is if we go from the micro to the macro
I worry about the corruption. It's bad. We can't underestimate that
That's fairly universal across most of these countries and we need a whole another show to sort of go into that
I want to be careful in saying it's not a particular african problem. I think this is a global problem
Yeah, in terms of failure of political leadership. I think it's felt most acutely in places where we have disparities of income level
When we have lack of jobs and you know, we have to look at things like debt to GDP ratio
Kenyans around 70%
All these countries we should be thinking about these kinds of things
But I think someone has been local, but I think fti is going to matter on some of this infrastructure and get it there
I think still there continues to be some prejudice around Africa in terms of investment. That's interesting
No, what worries you Felix
So that's really us live in the United States. We're used to looking at old politicians
I think that's one of the biggest political issues in Africa. Yeah in particularly if you think about how young the voters are
And then having people in their 70s people in their 80s people in their 90s and everybody desperately trying to install a son or a daughter or a cousin
to follow
That I think is terrible in the sense that it will undermine the belief in democracy as a reasonable way to organize politics
And yeah, we see it in lots of places
Sudan Ethiopia where it's the young people who then push against these very old leaders, but
Finding a way to have more turnover and in Africa it comes with
relatively young democracies
Maybe not the most mature institutions and so I think the danger is huge and you see it in a series of coups in each air
Yeah, this year Burkina Faso the year before Sudan chat Danny in 2021
It's literally like the dominoes are falling and that is maybe the one thing that worries me more than anything else
Can't just jump in on that because it's a spartan idea
Which is it makes me think in a in your points about the coups
Felix that
My hope is always that people talk about Africa's a continent not as a country, right? That these are 54 very different countries
Mm-hmm, and I think what we're also going to see is a real diversion between them in so far is the ones that do take off
Yeah, and I think that Ghana
Mauritius
Kenya
Rwanda
That's one of nationalized its diamonds
And even South African Nigeria relative to your Burkina Faso's your Molly your Chad your Sudan
That we're going to see this kind of divergence and in some ways not unlike how people talk about parts of Southeast Asia
Or potentially even Europe the difference between
Norway and Greece
But the extremes will be more extreme when we think about the levels of poverty, but if we were to have this call and
20 years
That's what I would be expecting our conversation would be our conversation would be what do we do with the countries and also by the way
These become hot beds this a hell and the rest in these are places where global terrorism does take root and these things are we should be worrying about
If I looked at my crystal ball, I would say that's where this continent is headed
And I think that suddenly people will have much greater facility in knowing the difference between these different not just regions
But countries in the continent itself. Mm-hmm. I think the last thing on that I would just say carriers
It does feel to me like one of the big
Countries has got to really do well. It's Nigeria itself Africa. It's Kenya. I take your point right?
But at the heart of Europe there's Germany
There is an economic engine and so I would love to see not just that diversion, but I would love to see a large country
Really figure it out because I think that would be very very powerful for the whole continent in many ways
Usually so and a country like Kenya being able to figure out how do you get
North fault or how do you get Tesla to make the batteries in Kenya the coalball 60% of the world's coalball is coming from the DRC
Right next door that's part of the East African community
Yeah, how do they figure this out right and I think to your point if that doesn't happen
Then we are gonna have a similar conversation in the future. Excellent. So I'll put it in the calendar 20 years. We'll talk again
We've got a date. Well, I'm hoping that there's going to be so much to talk about that it'll be even sooner than 20 years
So let's hope for that fantastic
Okay
Okay Felix empty lots
What's so great about him to you look
Yeah, so it's a bit of a puzzle at the heart of the real estate market in the United States
So I'm just looking at demographics. I'm looking at how many kids do people have I'm looking at what's the rate at which homes
Get so old that we really want to tear them down and maybe new ones
Relative to that benchmark over the last 10 years
We built about seven million fewer homes than you would expect
So there's just a big discrepancy between how much we build and then
Where we want to live and how we want to live and how many kids we want to have and it's particularly interesting
Against the other observation that in every major city
There are tens of thousands of empty lots and we often talk about housing affordability
First and foremost as being a city problem and so putting these two things together
Just doesn't work really well. How can it be that we have to support ability crisis?
We talked about it when we talked about that dark side of the wealth increase that we see in the data
Mm-hmm and at the same time we have so much land that is not being used
I'm curious. What do you make of it? How can both of these things exist at one at the same time?
Yeah, it is a great puzzle and it's not just in the US. It's really around the world. Yeah, I think there's two ways to think about that problem
The first has to be regulatory so if you think about land use regulations
That can really hinder how properties developed yeah
And then the second is an instrument that I think people have become super interested in Felix
Which is this question of how
We think about undeveloped land and how we should tax those kinds of properties
Yeah, and so I don't know if you've been paying attention to this but all of a sudden this classical idea
Of a land value tax or a land tax
Has just come roaring back and the underlying idea is kind of interesting and it's fairly simple
Which is rather than a traditional property tax where you tax both the structures and the land
We should have really just a land tax or alternatively a split level kind of tax where you would tax land
potentially quite a bit and properties quite a bit less and
Maybe that is the solution that we need to spur lots and lots of development
So I'm not sure which you think is more interesting Felix, but I think those are two big pieces of the puzzle for thinking about why this conundrum exists
Yeah, I think it's spot on I think in particular the tax debate is super interesting
Because it goes exactly back to the heart of the problem when you think about empty lots in the US
Of course to some extent this reflects the racist policies of past times
Who had access to mortgages who didn't have access to mortgages black families in particular?
They often had these what's called a land contract which is basically a seller finance kind of mortgage
With the one important difference that you build no equity whatsoever in the home until you made that very last payment
And as a result if there's a recession if you get into financial trouble for some other reason
Many black families were forced out of their homes and then since that happened in these concentrated areas
It was very difficult to develop them afterwards
Combined this with the great recession where many absentee landlords and investors came and swooped up
Many many of these empty lots and the idea is just let it sit there
And at some point in time there might be a boom you pay next to nothing for many of these lots
And once the boom then drives up land value without ever really having done any work other than invested wisely at the right moment in time
You will make a fortune right so that means the plots are not really available because the incentives to sell are just minimal
That's one of the reasons to believe that one of these taxes might actually be a really great idea because now all of a sudden
Just letting the land sit there is going to be expensive. Yeah
I'm just so happy to hear you waxing poetic about taxes
Because usually I'm the one who wants to talk about them
And you're right. This is an idea which has lots of lots of reasons to love
In addition to the ones you're proposing
So the wonderful thing about a land tax conceivably is
First we don't expect big behavioral responses other than the ones you just mentioned
Which is we actually worry about a lot of taxes that change people's decision making
And for example even a property tax in some sense gets it exactly wrong
Which is you don't want to put a big tax on the actual structure
You want it to be more based on the land because it's a fixed factor
There's really little behavioral response there and second you know
It has elements that are quite progressive
High value land tends to be owned by wealthier people
And so it's conceivably both advancing efficiency goals as well as equity goals
It can be a little bit complex
But it is really in many ways a wonderful tax
The puzzle Felix of course is Henry George of course popularized this idea more than 150 years ago
And yet we've only seen limited amounts of experimentation with it. It seems to be roaring back
We've seen for example some counties in Pennsylvania have experimented with this some people attribute
Some of the changes in Harrisburg is one example as being a really vivid example of what can happen when you do a split level tax
So this is not the pure utopian land value tax where we replace all taxes with a land tax
It's a little bit more modest right which is we try to do things at the local level in a more thoughtful way
And of course now Detroit has pioneered this idea again
And there are other jurisdictions Australia uses it a fair bit Denmark use it a little bit
But part of the conundrum for me is Felix it has these attributes
You think we'd like it and yet we don't see it nearly as much as we should potentially see it
Now we're starting to see it again
But I'm curious what you make of that fact that in some sense it seems relatively ideal
And yet we see them so I'm a little bit about it. Yeah, and maybe to drive home your point even further
Usually people will oppose any change in taxes because it will make someone worse off
Right here you really have an opportunity to lower the tax on the structure
By just about as much as you increase the tax on the land
So that for most of the people who say live in a home or live in an apartment
The tax consequences will basically be zero
So that makes it even more puzzling why it's not an even bigger movement than it is
One intuition that I have is practically speaking in many cases
The very low incentives to develop land are really coupled with other kinds of issues
So for instance one of the reasons why we haven't been more aggressive
I think is that the problems around the incentives to build
are coupled with other issues that we haven't really tackled successfully
I remember when I lived in Philadelphia the city tore down
dozens and dozens of structures in particular in the north of the city
Because there was just no prospect that anyone would ever lift there
And what happens when the city incurs these costs they typically put a tax lien
So you have things like back taxes, tax leans
You have unpaid water bills, sometimes you have environmental burdens on the land
And so there's additional impediments that then make developers maybe shy away from owning those pieces of land
I think we need to encourage both of these things we need to encourage
Actually someone wanting to invest in the land in the first place
And that I think is best done by being generous on the tax side
Recognizing the long-term benefits that you get
And then once you have these incentives once you own the land
That we use the tax code to make people invest in structures
But really we need both of these things
Otherwise we transfer lots and lots of these lots to what's called municipal land bank
And then the land bank sometimes has difficulty transferring them to private owners
Because everybody worries about the environmental burdens and water bills and back taxes
Yeah, I think that's exactly right
I think this debate about land taxes has also
It's stayed at a very ethereal cerebral level
So the people who like it often conceive of it as a way to replace everything
Yeah and so it's operating in a utopian space
Which is where a lot of ideas and tax today operate
They operate in a space that's relatively detached from actually the likelihood of it happening
What we really need is not at 40,000 feet but at 10 feet like what Detroit is doing
To try to experiment with it a lot more
And not conceive of it as some replacement for everything in the world
Yeah
And not wax poetic about all its merits
But simply experiment with split rate taxes or land taxes
Kind of throughout lots and lots of jurisdictions
And then we would really learn how it can be developed, how it can be used
Because you know when these instruments get developed
It feels like it takes time to figure it out
To your point, a lot of weird things can happen
There's like second order effects that can screw up lots of things
But we just haven't seen enough of that
So it feels like an idea that we need to experiment with at the local level a lot more
But should be a part of the toolkit in a way that it just isn't up until today
That's a really interesting point
I think it's also true for carbon taxes
Yeah
So it would have this ideal carbon tax
And we talk about it endlessly
And frankly, we're not really moving in that direction
We're not really moving
What is it about taxes that we have these
Idealistic ideas that somehow don't translate into actual policy
I confess, I think about this problem a lot actually
Because I don't think it's just carbon and land
It's even things like, frankly, the wealth taxes
And so people idealize what that would mean
But no one ever gets that serious about doing it
And even for example, multinational coordination about global firms
Which has gotten a lot of attention
So we have these big projects in taxation
Where people love to kind of think about carbon taxes and land taxes and wealth taxes
But the nitty gritty work of fixing the income tax
Or the nitty gritty work of implementing property taxes at the local and state level
Somehow isn't sexy enough for people
And then these larger conversations become distracting
As wonderful as they can be because they stimulate ideas
I really worry that it provides an opportunity to talk about it
Without ever really being serious about changing anything
Yeah
It's almost like a remarkable level of distraction
Where everybody gets to keep their current state of play
Complain and then articulate some idealized vision
And nobody wants to do the hard work of, for example
Expanding their income tax credit
Thinking hard about doing things that are more progressive with the income tax
Think about changing way we do capital gains tax as opposed to think about wealth taxes
So I don't know, I fear that it's this weird way in which we all get to wax poetic about some dream
And then in that process nobody does the hard work of figuring out the real things that are going to solve these problems
That's incredibly interesting
And maybe a reason to be more hopeful about land taxes
Exactly
I think two reasons one is
Usually we have to do these tax projects at
At least at national level or maybe even a global level like the corporate minimum tax
Because otherwise you get these huge distortions that no one wants
Land taxes on the other hand, that's a local project
And as we see now in Pennsylvania
The droid really local jurisdictions that do it
Yeah
And to a first approximation
One of the quote-unquote distortions that you might expect is that
People move because that's where reasonable housing is available
Yeah
And to a first approximation in particular the cities that have big problems with land and empty lots
They would welcome nothing more than having more people in their town
So yeah
There's going to be maybe a little pushback of people who fear that property values might fall
That if I sell my house it's not quite as valuable
So that's a possibility even keeping taxes the same because there's more supply
But generally speaking do I want to live in an environment where lots of other people want to live
Do I like the fact that my town is popular and more people move to my town?
Yes lots of reasons to like it
So in a way your explanation makes me a little more hopeful that
We probably can't pull it off with carbon taxes
But maybe land is an opportunity
Land is an opportunity but it's got to be a grassroots movement at a local level
It's not going to be Henry George again
It's got to be this very grassroots level and there's got to be experimentation with it
Yeah
I think what we need is someone to embrace it and really go out there and push it
Because if we start to see policy entrepreneurs do this stuff
As opposed to being preoccupied with these more in some sense attractive ideas
But they're frankly somewhat illusory
These are real ideas that could potentially have a remarkable impact on the ground
Okay Felix what do you got for recommendations?
I have a book recommendation this week
It's a book by Bob Rubin who used to be a senior partner at Goldman Sachs
Who served as Treasury Secretary under President Clinton
So a very prominent figure
And he has a new book out called The Yellow Pad
And it's about decision making and the way to think about complicated decisions
Where you're sort of at a loss even analytically how to think about these decisions
And it's actually quite fabulous
And I don't know if this is literally true or if it's just sort of a mechanism in the book
He describes how he would usually take one of these legal paths
And he would describe all the outcomes that are possible
And then he would attach probabilities to it
And when I first looked at it I thought yeah so probabilistic thinking
Isn't that what we're all doing all the time?
Isn't that the most obvious way to make decisions
And what's fabulous about the book is
Then he looks at lots of decisions that he made as a private investor
When he was a Goldman, when he was the Treasury Secretary
And you see that the nuances are actually incredibly important
And that in many of these cases our intuition about decision making
Is not really close to what this yellow pad would suggest
So give you two examples
He talks about how you should always think about risk as a range
Risk is not a number, risk is a range
And you need to think about the probability distribution
And then of course everybody knows
When I just look at expected outcomes
That's not quite the right way to think about it
And then guess what?
He talks about risk management in large financial institutions
Where they essentially look at one number
And the whole distribution gets lost
So it's a real joy to read
Because it takes something that you take for granted
And that you're familiar with
But it puts it in the context of a really remarkable career
And the rich life and you see many of the wrinkles of decision making
That are super interesting to follow
That sounds fantastic
I've been just taking a look at it now
I hadn't seen that it had come out
It just came out like six months ago
That looks great
Yes, it's relatively recent
My only disagreement is mine is a quadriple graph paper pad
But aside from that it sounds fantastic
Right
Very good
What do you have for us, me here?
So I have a weird quirky TV show on Amazon Prime
Ooh, I love weird quirky
Yeah, and as you know, I'm a cop, drama, comedy, kind of fan
And this is the ultimate weird intersection of cop show and comedy
And it's called Deadlock
And it takes place first off in a beautiful place
Which is Tasmania, Australia
And then second, it is a portrait of this wonderful community
In Tasmania, Australia
In particular, the woman who is the lead
Is in a lesbian relationship with this other woman
And then there is a whole community of people
In Tasmania
And it is just such a wonderful pinpoint portrait of that geography
And of a community
It's just both hilarious
And actually has got a really good mystery underneath it all
It's actually like there's good cop show
And then it's just laugh out loud funny
Along the way
It's a mini series
It's a mini series, I think it's six or seven episodes long
Which is my perfect arrangement
And thoroughly enjoyable
So I had happened to have gone to Tasmania recently
And I just found it to be fantastic
Wonderful
And this is it for tonight
Thank you everyone for listening
This was after hours from the TED Audio Collectors
