The Undoing Project: A Friendship that Changed the World(72)

In late 1973 or early 1974, Danny gave a talk, which he would deliver more than once, and which he called “Cognitive Limitations and Public Decision Making.” It was troubling to consider, he began, “an organism equipped with an affective and hormonal system not much different from that of the jungle rat being given the ability to destroy every living thing by pushing a few buttons.” Given the work on human judgment that he and Amos had just finished, he found it further troubling to think that “crucial decisions are made, today as thousands of years ago, in terms of the intuitive guesses and preferences of a few men in positions of authority.” The failure of decision makers to grapple with the inner workings of their own minds, and their desire to indulge their gut feelings, made it “quite likely that the fate of entire societies may be sealed by a series of avoidable mistakes committed by their leaders.”

Before the war, Danny and Amos had shared the hope that their work on human judgment would find its way into high-stakes real-world decision making. In this new field called decision analysis, they could transform high-stakes decision making into a sort of engineering problem. They would design decision-making systems. Experts on decision making would sit with leaders in business, the military, and government and help them to frame every decision explicitly as a gamble; to calculate the odds of this or that happening; and to assign values to every possible outcome. If we seed the hurricane, there is a 50 percent chance we lower its wind speed but a 5 percent chance that we lull people who really should evacuate into a false sense of security: What do we do? In the bargain, the decision analysts would remind important decision makers that their gut feelings had mysterious powers to steer them wrong. “The general change in our culture toward numerical formulations will give room for explicit reference to uncertainty,” Amos wrote, in notes to himself for a talk of his own. Both Amos and Danny thought that voters and shareholders and all the other people who lived with the consequences of high-level decisions might come to develop a better understanding of the nature of decision making. They would learn to evaluate a decision not by its outcomes—whether it turned out to be right or wrong—but by the process that led to it. The job of the decision maker wasn’t to be right but to figure out the odds in any decision and play them well. As Danny told audiences in Israel, what was needed was a “transformation of cultural attitudes to uncertainty and to risk.”

Exactly how some decision analyst would persuade any business, military, or political leader to allow him to edit his thinking was unclear. How would you even persuade some important decision maker to assign numbers to his “utilities”? Important people didn’t want their gut feelings pinned down, even by themselves. And that was the rub.

Later, Danny recalled the moment he and Amos lost faith in decision analysis. The failure of Israeli intelligence to anticipate the Yom Kippur attack led to an upheaval in the Israeli government and a subsequent brief period of introspection. They’d won the war, but the outcome felt like a loss. The Egyptians, who had suffered even greater losses, were celebrating in the streets as if they had won, while everyone in Israel was trying to figure out what had gone wrong. Before the war, the Israeli intelligence unit had insisted, despite a lot of evidence to the contrary, that Egypt would never attack Israel so long as Israel maintained air superiority. Israel had maintained air superiority, and yet Egypt had attacked. After the war, with the view that perhaps it could do better, Israel’s Ministry of Foreign Affairs set up its own intelligence unit. The man in charge of it, Zvi Lanir, sought Danny’s help. In the end, Danny and Lanir conducted an elaborate exercise in decision analysis. Its basic idea was to introduce a new rigor in dealing with questions of national security. “We started with the idea that we should get rid of the usual intelligence report,” said Danny. “Intelligence reports are in the form of essays. And essays have the characteristic that they can be understood any way you damn well please.” In place of the essay, Danny wanted to give Israel’s leaders probabilities, in numerical form.

In 1974, U.S. Secretary of State Henry Kissinger had served as the middleman in peace negotiations between Israel and Egypt and between Israel and Syria. As a prod to action, Kissinger had sent the Israeli government the CIA’s assessment that, if the attempt to make peace failed, very bad events were likely to follow. Danny and Lanir set out to give Israeli foreign minister Yigal Allon and the director-general of the ministry precise numerical estimates of the likelihood of some very specific bad things happening. They assembled a list of possible “critical events or concerns”: regime change in Jordan, U.S. recognition of the Palestine Liberation Organization, another full-scale war with Syria, and so on. They then surveyed experts and well-informed observers to establish the likelihood of each event. Among these people, they found a remarkable consensus: There wasn’t a lot of disagreement about the odds. When Danny asked the experts what the effect might be of the failure of Kissinger’s negotiations on the probability of war with Syria, for instance, their answers clustered around “raises the chance of war by 10 percent.”

Danny and Lanir then presented their probabilities to Israel’s Foreign Ministry. (“The National Gamble,” they called their report.) The director-general looked at the numbers and said, “10 percent increase?—that is a small difference.”

Danny was stunned: If a 10 percent increase in the chances of full-scale war with Syria wasn’t enough to interest the director-general in Kissinger’s peace process, how much would it take to convince him? That number represented the best estimate of the odds. Apparently the director-general didn’t want to rely on the best estimates. He preferred his own internal probability calculator: his gut. “That was the moment I gave up on decision analysis,” said Danny. “No one ever made a decision because of a number. They need a story.” As Danny and Lanir wrote, decades later, after the U.S. Central Intelligence Agency asked them to describe their experience in decision analysis, the Israeli Foreign Ministry was “indifferent to the specific probabilities.” What was the point of laying out the odds of a gamble, if the person taking it either didn’t believe the numbers or didn’t want to know them? The trouble, Danny suspected, was that “the understanding of numbers is so weak that they don’t communicate anything. Everyone feels that those probabilities are not real—that they are just something on somebody’s mind.”