Arnold Kling  

David Brooks Repeats Himself

Sumner's Common Sense... Ezra Klein: Pass Laws, Be Prod...

I thought that Why Our Elites Stink (I suspect Brooks winces at the headline the editors supplied)

these people are brats; they have no sense that they are guardians for an institution the world depends on; they have no consciousness of their larger social role.

was simply a precis of Bobos in Paradise. So I went back to my own review essay of his book.

Brooks comes across to me as an elitist. His message to Bobos seems to me, "You are an elite, even though you refuse to recognize it. This carries with it responsibility. You ought to become more engaged over big social issues."

In fact, one could make a case that one of the problems with Bobos is that they are arrogant and isolated from mainstream America. In that case, urging them to seize the elitist mantle seems like an unwise course.

I don't want to give today's elites a sense of stewardship. The Obama Administration has enough of that already. Take Steven Chu, for instance.

What I want to give today's elites is an awareness of their own cognitive limitations. Brooks' problem with modern elites is that they are not sufficiently aware of their responsibility--they lack noblesse oblige. My problem is that they are not sufficiently aware of their ignorance--they lack a sense of self doubt.

Yes, the financial managers sometimes show a lack of sense of responsibility. Take Jon Corzine, for instance.

But a sense of responsibility is not a sufficient condition for good financial management. A sense of responsibility is of no help if you have an inflated sense of your ability to manage risk. That is what afflicted bankers and regulators during the run-up to the financial crisis.

I think that Enron is perhaps the most interesting example to think about in this context. One view is that it was all a hoax to begin with. I suspect that this was not the case.

My view is that the top executives at Enron were convinced that they had found a new way to make money, even though what they had discovered was yet another strategy for writing out-of-the-money options (in some sense, the fancy off-balance sheet entities were a way to have Enron write out-of-the-money options on its stock). Then, things began to go sour. At that point, dishonesty set in. Perhaps some executives understood what was happening and deliberately tried to cover up the problems. Others (most likely including Ken Lay) did not really understand why the firm's finances were unraveling. This latter group became "honest liars," so to speak.

One of the things I most appreciated about Leland Brendsel, who was chairman of Freddie Mac in the days when the firm avoided high-risk lending, is that he always worried that he might not know enough about how the company was making its money. He did not operate under the assumption that profits reflected his personal brilliance. That is what I like to see. I will take personal humility over a sense of noblesse oblige any day.

COMMENTS (10 to date)
Kenny writes:

But the humble are disadvantaged relative to the arrogant in the status competitions that produce most leaders.

Tom West writes:

I think you are running up against a general rule of human existence.

You will not be given power by people (and all are given power, even dictators) *unless* you have such an inflated sense of your own abilities that everyone else around you is swept up into that super-confidence.

People will not invest with power and/or money someone with a rational sense of their own limitations.

I'd sneer, but it's also true that most of the great successes, both in business and in politics, have been obtained by people who were both deluded, and able to delude others, about their abilities.

Jeff writes:

Walter Russell Mead wrote about the arrogance of our elites recently while riffing on Chris Hayes' book, too:

Slightly off topic, but Mead writes of Hayes:

I get the impression he’s still in the group that thinks we could preserve the blue social model if we just willed hard enough...

Replace "willed" with "exerted more moral authority," as you like to put it.

Joe Cushing writes:

Of course now it is law that a CFO and CEO know how their company makes money. If the company commits financial crime, the CFO and CEO can go to jail for not knowing about it.

Joseph K writes:

I was born not knowing and have had only a little time to change that here and there.

Richard Feynman

It seems so difficult for anyone highly educated or highly successful today to truly understand the limits of their knowledge. Humility and curiousity seem to me to be two requirements of wisdom.

Bill Hocter writes:

Arnold-I think you win the argument with Brooks.

ivvenalis writes:

If these people hadn't been outrageously confident in their abilities, they probably wouldn't have gained the sort of power they did in the first place. Humility would have been absolutely counterproductive.

Randy writes:

Re; "I will take personal humility over a sense of noblesse oblige any day."

Well said.

And, thinking of my own successes over the decades; these were seldom the result of my "position" or "upbringing", but nearly always some minor adaptation building on my specific area of expertise that worked out well. For Brooks to be correct then, I would have to assume that being elite is itself a specific area of expertise - and I just don't.

Thomas DeMeo writes:

Arrogance is only a problem when it becomes imbalanced. I doubt Jon Corzine felt arrogant about his understanding of complex risk analysis. He more likely observed that the guys who had the biggest balls were making the most money, and he thought he had a big pair himself. His arrogance wasn't about his intellect.

The small minority of individuals who did possess the highest levels of confidence about the way risk really works were unable to impose their understanding upon the organizations they worked for. They weren't arrogant enough.

MingoV writes:

I agree with Thomas DeMeo. Arrogance isn't the problem because it is based on real attributes and measurable accomplishments. The problem is conceit. Conceited persons grossly overestimate their abilities and the significance of their accomplishments. Conceited persons are dangerous because they falsely believe they can handle situations that are beyond their experiences, knowledge, and abilities.

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