Wucker’s Gray Rhino Is Essential Reading & Her Thoughts On Climate & COVID Compelling – CleanTechnica

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A year and a half ago I had the opportunity to sit down with Michele Wucker, author of The Gray Rhino and You Are What You Risk, to have a wide ranging conversation about risks we tend to ignore, Asian vs Western perceptions of risk, black swans, climate change, COVID, and more on Cleantech Talk. CleanTechnica’s management has kindly permitted me to share the discussion on my Redefining Energy—Tech podcast. Here’s the lightly edited transcript.

Michael Barnard (MB): Welcome back to redefining energy tech. I’m your host, Michael Barnard. About 18 months ago, I had the opportunity to sit down with Michele Wucker, author of the books The Gray Rhino, and You Are What You risk. Listen in as we discuss the differences between gray rhinos and black swans. Personally, I find the gray rhino metaphor much more useful, applying as it does to climate change pandemics and the subprime mortgage collapse, Wucker’s perspective is invaluable in these challenging times. Welcome, Michele.

Michele Wucker (MW): Thanks for having me. I’m delighted to be here.

MB: So I always like to start these things out to give people a sense of who the guest is, to pull them into the mindset. And given that your second book is all about that, why don’t you say who you are, how you arrived at becoming an international risk expert, the path that led you here, the interesting salient points, and what led you to the metaphor of the gray rhino?

MW: Sure. Well, for a long time I thought that my work on risk started at the very beginning of my career, when I was a writer and then analyst on emerging market debt issues, particularly Latin America, looking all the loans from the defaulted debt of the 1980s that were being repackaged and restructured and resold as Brady bonds. And sovereign credit risk was all we talked about all the time. And I looked a lot at Argentina also because I happen to love Argentina, looking at their debt crisis and the warnings that were made ahead of time, a proposal about nine months before their default and collapse to preemptively restructure the debt, which, of course didnt happen, and I left that.

I went into the think tank world and ten years later I was running the World Policy Institute in New York and watching Greece with very similar dynamics. The debts going up, the economy is going down, reserves are going down. The math was pretty simple. And so I came up with a policy paper jointly with the new America foundation saying, hey, Greece, learn from Argentina. If they had restructured earlier, there wouldn’t have been what’s now, 16 years of legal wrangling, and it wouldn’t have been such a big crisis. The cost would have been much smaller. And it was one of the first public calls for a preemptive restructuring in Greece. And lo and behold, late the following winter, Greece and its creditors came to an agreement.

And that left me with the question, how come some people, leaders, companies, see a big scary thing coming at them and deal with it right away, and some of them don’t. And I didn’t want to write a geeky book about sovereign debts and yield purrs and credits, breads and stock. I get that not everybody gets excited about that sort of stuff. And I also felt that the question was just so much bigger in terms of so many corporate questions, and, as my readers later told me, relevant to personal lives as well, which was a huge surprise. But I wanted to write about that in a way that was accessible. So I followed the well trodden path of Aesop and his fables and all of the other people who’ve used animal metaphors.

When I was talking to a friend about it, I said, you know, it’s big, it’s dangerous. And that’s when the rhino with the horn popped right into my brain, and he made a joke about the black swan. This was 2012, when people were still talking about these improbable, completely unimaginable things, even though everybody has tried to be the person who spots the next black swan, which is completely not the point of that book or metaphor at all. And I said, ha ha. But I didn’t want to be a derivative of a metaphor that’s been abused as a cop out instead of as it was intended, to get people to realize how uncertain the world is. And then I remember going to the zoo, probably in grade school, and seeing what they told me was either a black rhino or white rhino.

I don’t remember, even though the rhino was gray. I mean, you ask any kid what color the rhino is and they’ll say gray, but the sign says black rhino or white rhino. And so, for me, that part of the metaphor is a reminder of how surprisingly vulnerable we are to taking our eyes off of the obvious thing, to ignoring it, to getting trampled by it. And so the concept of a gray rhino is really a call to take a fresh look at the things in front of you and to look at your response. It’s not just identifying things. I guess I get asked all the time, how do I spot gray rhinos better? What’s the list? What are the big ones? My point is, you don’t need me for that. You can see right in front of you.

My question is, how well are you responding it? How well are the people around you responding to it? That’s the gray rhino and risk part. And I realized, actually, that it went back way further than the financial stuff. My early interest was in psychology. I was an assistant to a psychologist when I was in high school at a psychiatric hospital. And I also wrote about, in my very first book, why the Cox Fight, about the Dominican Republic in Haiti. I mean, cock fights are betting. And I actually quoted, when I went back and reviewed the book a couple years ago for a speech I was asked to give, I looked at it. There’s a quote from Clifford Girtz, the famous anthropologist, about risk being the pleasure of winning, the thrill of risk taking, the despair of loss.

And he says, it’s not just that we have these emotions, it’s these emotions that society is composed of. And I went, wow, I’ve been thinking about this since, for years before I even realized I was thinking about risk. And so now, of course, I’m completely obsessed with risk and why we don’t always do as good a job as we’d like to think we are at heading off some of the obvious risks, like climate change, of course.

MB: Well, yeah, so we’ve talked about black swans, gray rhinos and black swans, as we discussed online, and messages and stuff have become a bit culturally dominant in the west, but I understand gray rhino is much more culturally dominant in the east, in Asia. So why don’t we start with, how would you define gray rhino and Black swan and the differences between them? Because I’ve been spending a lot of time this week on this subject with Ben Floberg, the global megaproject expert who leaned into the black swan stuff. So how do you define both of those terms and the value and utility of them and examples as well?

MW: Sure. So the black swan is the thing that’s improbable, unforeseeable, unimaginable. It’s the thing that comes out of the blue and whoops you upside the head with a two x four, as we said in Texas, where I grew up. It’s really meant to help people realize how uncertain the world is. And in fact, a little over a year ago, Nassim Taleb, the author of the Black Swan, and I were on a panel in Dubai with DJ Sarnet, the Dragon king guy. And you’re talking about these things and know. And that’s when he really emphasized this point about uncertainty, which has become such a buzzword since the pandemic started. And so his point was, really think about how uncertain the world is and think about how prepared you are to deal with uncertainty. And, of course, that’s not how most people use it.

People want to see, they sit in their armchair and say, the next Black swan is this. It’s that and no. So the pandemic came up, and Nassim Talebdez, you know, as I did, came out and said, no, this is not a black swan. Even though all the politicians were saying that, trying to use it as a cop out. They said, you know, I wrote even in the Black Swan, that viruses were the kind of thing that comes and goes, pandemics, you know, this is not something unimaginable. And, you know, I also wrote a couple lines in the Gray rhino, and I wrote it during the Ebola situation and said, you know, these keep coming again and again. My great grandfather died in the great flu of 1918. So, you know, serious personal experience with that.

So the gray rhino is meant to get people to take a fresh look at obvious things, the things in front of us that, you know, you, off the top of your head, scribble down three top things. These are the things that people are talking about, things that people know about. They’re seen as highly probable, they’re seen as impactful, and they’re things that many people don’t realize how vulnerable we are to, particularly in the west, as I found out when we started shopping around the book idea, all these editors came to me and said, well, things are obvious, so we’re dealing with them. Why do we need to take a fresh look at obvious things? And so I emphasize the point that, yes, obvious things do get neglected, but only some people neglect them.

And the people who don’t neglect the gray rhinos are the ones who have a competitive advantage. And some people tried making the gray rhino much more similar to the elephant in the room than it’s meant to be. And obviously, they’re really large gray beasts. But the whole point of the elephant in the room is that, by definition, people don’t talk about it. People don’t do anything about it. It’s often something. It’s an uncomfortable truth or, you know, embarrassing, but it stands in the corner of the room. It doesn’t do much. The gray rhino is coming at you. It can be further along the horizon, but it does not stand in the room. It drives me nuts if people try to say, the rhino in the room. No, it’s dynamic. It gives you a choice.

You are more likely to look away and not deal with it than you think. But it is not a given. It is nothing inevitable. And like the black swan, you know, Nassim Taleb talks about how people don’t think enough about the fact that something unknown might hit them. And, of course, now people think about black swans all the time, even though not the way he meant and similarly, I think that gray rhinos are there. We don’t pay enough attention to the obvious. And the other thing about gray rhinos is that it’s not so much about predicting, because if you predict a gray rhino and then you take measures to avert its path or to use its strength for good, then the bad thing might not happen. So there is a lot of uncertainty within the gray rhino.

You don’t know that the stock market is going to fall by x points at 12:33 p.m. On whatever day. And you don’t need to be that precise about predictions. But you do know that if you don’t deal with this thing, then you’re going to be in trouble.

MB: Let’s take an example from decades ago, the hole in the ozone layer. I would articulate it was a gray rhino in the sense that we had a reasonable understanding of the chemistry of CFCs, a reasonable understanding of ozone. That’s why scientists said, well, what’s going on? And they started looking and they found it. And then they said, well, if this keeps going, then these kind of nasty things, a lot more Australians will get sunburns. And I like Australians. We all like Australians. Who doesn’t? And so then they created the Montreal protocol on substances that harm the ozone layer. And at the same time, here’s an interesting tidbit. They replaced chlorofluorocarbons, CFCs, with HFCs, hydrofluorocarbons, which are great, except that hydrofluorocarbons are still very high global warming potential.

So I’m pretty sure some nerd like me had his hand up at that time, or she had her hand up at that time saying, hey guys, HFCs fix the ozone labor. They don’t fix global warming. We should probably try to do both. And now, of course, we have the Kigali amendment which gets rid of CFCs and replaces them with actually CO2. In most cases, it’s turning out CO2 is actually the big replacement for refrigerants and it actually works. I’ve spoken to a bunch of people about it and my local grocery store’s cheese counter is now running on CO2. Who knew?

MW: It’s a closed loop.

MB: Yeah, it’s just a refrigerant that is, goes through a compression cycle, goes through a decompression cycle, exchanges heat. It’s used in heat pumps.

MW: And it has global warming as long as it stays there.

MB: Well, except that it has a global warming potential of one. And HFCs have a global warming potential of 1200 to 4000. And CFCs were worse actually. But the point is we dealt with the gray rhino of the hole in the ozone layer because there weren’t people who could derail our dealing with that gray rhino. I think this is an interesting compare and contrast. Let’s get into this a little bit in the foreground at a different part. Climate change from my perspective and part of the reason I find the gray rhino to be a much more useful metaphor and book than black swan is the ultimate gray rhino. Climate change, it’s slow moving, it’s going to take a while. The impacts are going to be in different places to different people, some of them people you never see the global implications for our economy.

Our food processes are hard to parse out in a way that is personally meaningful and so it’s easy to ignore. Is that a fair assessment of how you would have think about it or how would you re articulate climate change as a gray rhino?

MW: Well, you know, when I started writing the gray rhino, you know, every single interaction with my friends, I was asking them about, you know, what’s something that’s obvious. Either that people did a good job dealing with or don’t. And of course, climate change is all over the place. There’s a whole chapter about sustainability. But I would take issue with the slow moving characterization on two levels. First, gray rhinos might be fast or they might be slow. And there’s a certain economic historian who’s been going around saying that gray rhinos are by definition slow moving, which is actually not true. And they can be fast or slow, big or small, near or far, they can be all kinds of different things. And then in terms of climate change being slow moving, people say that all the time.

And I guess the question is, well, slow compared to what? Because a lot of the impacts are here already here in Chicago. It’s the picture of the Chicago River behind me. We’ve certainly seen lots of flooding with Lake Michigan. When I moved here in 2014, I have this video of my dog, who was an idiot puppy at the time, running around barking her full head off on a dog beach close to where I live. And that dog beach is now under, I don’t know, 20ft of water because the lake has risen so high and we’re seeing the water table rising, increasing flooding near the lake. There was a flood a couple of years ago where they had to close down big parts of Lakeshore Drive. We’ve had the wildfires.

A couple of years ago I took a picture of the sunrise. I live right by the lake, so I have way too many sunrise pictures on my Instagram feed of sunrises and my dog. And it looks like a moonrise because the sky is so kind of gray and silvery. The sun is kind of grayed out. And so then you look at the, every year, there’s another report about how much more intense the storms were this year than last and how much more damage. You’ve seen that great chart of blue lines turning into red lines of the heat of each year. So in certain ways, it’s already here and it’s accelerating. And I worry that people continue to talk about it as slow moving because I think that takes away some of the sense of urgency. It’s here, and it’s coming way faster than a lot of people want to give it credit for.

MB: Well, I’ll touch on a couple of different aspects of that. So I spend a lot of time in climate change and climate solutions. I’ve spent time with people like Michael Mann, Mark Z. Jacobson. Michael Mann actually quoted me in his most recent book, which I was totally chuffed about. When I talk about climate change, I say, you know, we identified, we isolated CO2 in the 1830s. We identified the greenhouse gas properties in the 1850s. Arrhenius wrote the first mathematical publication articulating the likely impact of CO2 in the atmosphere from fossil fuels. He was pretty close to right. In the 1970s, we started putting up satellites, and we had the data sets, and we had a very high certainty that this problem was real serious, caused by us. And the solutions were pretty obvious.

And so the time for the gray rhino early actions was the eighties and nineties, and barely anything actually was done. So this is the interesting point. I feel as if, to your point, early, when we identify a gray rhino, the time to deal with it is when we’ve identified it, not when its impacts are being felt. And so I have a longer historical time span. So that’s statement one, statement two, I deal a lot with cognitive psychology, and I come to the conclusion that humans think in two year timeframes. Stuff that exists in that timeframe is usual. Stuff that doesn’t exist in that timeframe is unusual.

But we live in this hyper futuristic world where you and I are talking through our computers with high fidelity video and great audio, and we’re recording in a cloud somewhere our conversation, which is going to be published on podcasts, which people are going to listen to as they walk down the street on their wireless bluetooth headsets. We live in Star Trek, but we don’t think of it that way. We live in the future. For even our people who were from ten years ago, that time horizon, psychologically I think becomes important as we think about these things. I definitely hear your impacts. I’m strong on the climate crisis side. I live in Vancouver. Our seawall, which was built in the past 20 years, is regularly being inundated by seawater, which is really not good.

And we of course are getting worse wildfires than you are because the articulation to clarify the eastern side of North America is getting more precipitation, the western side is getting less because of climate change. And so were getting drought and more wildfire. you’re getting not sea level rise, but lake level and riverine flooding. And so its kind of like that separation of concerns. I don’t think about riverine flooding and lake flooding nearly as much because I live on the seashore. I think about sea level rise, which is slow anyway. So what are good examples from your perspective? Of top three examples, weve talked about climate change and you mentioned Covid. I agree. Covid and pandemics are a gray rhino. And I say this as having helped build the world’s most sophisticated outbreak and communicable disease management solution.

To your point, sars, H1N1, Ebola. Now Covid, this is just stuff we should be prepared for.

MW: And epidemiologists don’t even think this was the big one.

MB: No, and it is a gray rhino in the sense that I follow. Was the world prepared for Covid with a sufficient number of personal protective equipment for all those things? Was the mRNA research well enough funded given the high likelihood of more coronaviruses? Would you say yes? I wouldn’t say yes. I’d say the response was very much in line with how you articulate we deal with gray rhinos. It was inadequate.

MW: That is such a good question because, you know, a lot of people have wrestled with this question. What made countries respond better or worse? There was a study about a year ago published in the Lancet comparing excess deaths, which was kind of the measure people use. And they said that the biggest thing was social trust. And there have also been studies that show the health preparedness studies and those showed that countries like the US or UK that you would think would be better prepared for this did surprisingly poorly. And some of the parts of being prepared had to do with trust, with social fabric, with political will, with things that weren’t necessarily PPE or whatever. And so I think there’s a huge risk literacy and public health education component that we haven’t dealt with at all. There is a distribution of health resources.

I remember I was talking to a bunch of reporters around the first spring of COVID and there were a bunch of sort of red state radio stations that were interested. And the reason was because they were in areas where the hospitals were a problem, they couldn’t get enough staff, they were underfunded, things like that. And so in that sense it was, there are other factors we maybe didn’t look at, but there had been a scenario exercise at the White House months before the pandemic started. Or you even look at China, which had made a lot of changes since SARS to speed up its detection and action, which has gotten a lot of criticism from the west, but it’s really easy to criticize in hindsight when there are, I think I’ve read there’s 1400 something new viruses, potential epidemics, pandemics every year.

At the very beginning, you don’t know which one is which. And so I think I remember the time going, wow, they actually were able to sequence this and get it out pretty fast, when that’s not the dialogue that the rest of the world had. And so I think they’re also another factor is where you are in the crisis. I mean, there’s some places that started out doing much better and then became much worse. I think Peru was one of those examples. So there are lots and lots of factors in preparedness also risk perception. There is a group called the Risk and Social policy working group that did a series of surveys around Covid, around risk perception, and around the kinds of safety measures that people were adopting, the masks or the social distancing and things like that.

And what they found was that across the board, people perceived the risk of catching COVID and dying of COVID to be way higher than reality. But the explaining factor for whether people took protective measures wasn’t how risky they thought it was. It was the kind of communications and messaging that came out. It was the, you can do this as an individual personal agency. This is effective and it’s something that’s not hugely onerous to do. That was the kind of messaging. And the other part was public health officials who were open about what they knew, what they didn’t know, and how they messaged when situations changed. I mean, we heard at the beginning of people saying, oh, don’t wear masks because the nurses and doctors need them. And that turned out to be quite a problem over time.

And then we saw that we’ve seen the politicization of things, I think, about risk. It’s funny, I did a lot of work on citizenship earlier on in my career, different forms of citizenship around the world. I had a Guggenheim Fellowship looking at some of this, the rise of dual citizenship, non citizen voting denizenship, new arrangements for expatriates. And what’s really struck me is that citizenship comes from the word city, and a city is really a risk protection mechanism. If you look at the very beginning of human social organization from the cave people around the. Their campfire, they are sharing risks among themselves and protecting them from, you know, at the time, it was the risk of, you know, getting eaten by something with really large teeth or, you know, a boulder falling on your head or things like that.

The risks have changed over time. But really, societies and groups are about shared identification of risks and about sharing the burden of protecting each other from risks and ideally, sharing the benefits from good risks, the people who go out and kill the thing to be eaten. And I look at the difference among countries’ responses to Covid in that lens and look at the huge differences in risk perceptions and in views of taking responsibility not just for risk to you, but for the people around you. And I think, wow, we got an awful lot of work to do.

MB: I think Steven Pinker has written one really good book and then some other stuff. And the one really good book is The Better Angels of Our Nature. Yeah, you’ve read that as well. Obviously, I’m seeing you nodding. And he based it upon other people’s research, which I think is a key indicator of which of his books are better. Just saying. The concept that he introduces, which I think he’s popularized from other people, is we’ve gone through moral evolutions. We’ve gone through four moral evolutions, each of which has taken hundreds and potentially thousands of years. He articulates it back to its historic questions. But we start out with the family, and the family and the tribe is kind of everybody else is not people.

And then we’ve evolved to the point where everybody in the country were people, and then we’ve evolved to the point where everybody in the world are people. Most people now accept that Chinese people and Black people and people in other countries are actually human beings. There’s still some recidivists there, but most of the world has, you know, most of, at least most of the developed world and a lot of the less developed world has gotten there. And he articulates, of course, the next one, where intelligent animals and assumption of sapience and individuality in the part of, for example, pigs and octopuses is the next moral evolution. And so it’s an interesting question. From that individuality perspective he leans into, especially in the United States, the tribalism is articulated around they’ve got theirs and nobody else got theirs.

And he actually articulates that in different regions of different countries, the south is more like that in the United States rather than the north. So it’s kind of an interesting comparison. What is our moral evolution is, you know, and comparing and contrasting China as a differently weird example, because they did, speaking as someone who actually helped, did that epidemiology thing, they did a really good job. They did virtually everything right in deeply uncertain times. They told everybody, as soon as the government figured out what the heck was actually going on, they communicated and they dealt with it insanely, efficiently and effectively. As a result, on an outcomes, perspective, they have very few deaths per million, and they had a much lower dip in GDP than most countries and a faster return to normal GDP than most countries. So they got it.

And most people chipped in. You know, Zach Dychtwald as well. I read his book [Young China] recently, and I’ve been communicating with him. It’s a China must read for me, like your book, it’s a must read. It’s one of the ones I recommend to people. But, yeah, it’s kind of interesting, that moral sense of who do you consider important? But even then, some of the individuality that we saw, especially in the more extreme examples, United States, they didn’t even care about their family.

MW: Yeah. Well, you know, I want to mention also some other really relevant work to us is my friend Peter Atwater does work on social mood. And I quote him in you are what you risk and the sequel to the gray rhino about in times of certainty or uncertainty and certainty bringing a lot of confidence. And then when you feel certain and confident, you are likely to think more expansively. You’re thinking to the future, think globally, think beyond yourself. But when you’re uncertain and unconfident, your world narrows to what’s right in front of your nose. So he talks about it as a me here now versus us everywhere forever. And in something like a global pandemic or climate change, you really need that us everywhere forever perspective to solve the problems.

You need a real interdependent approach, drawing on Ben Barber’s work, which I’m a huge fan of, and what a great loss that he’s not with us anymore. But looking at your success as interdependent with other people’s success is very important. And with climate change, there’s another example. I have a friend I used to have fights with for years. There’s one of those friends that you can have those knock down arguments about things. But he said, why should I give up my SUV because they’re building more coal plants in China. And so when you think that other people are doing things that are helping to advance what you’re trying to do, you’re more likely to do it rather than if you feel like you’re just, you know, screaming into the wind. And it’s that. It’s that, you know, sort of pure dynamic sort of thing.

And feeling that other people are doing something with you and that you have a sense of agency is so important. It was for Covid, and it is very much so for climate change.

MB: So let’s lean into that a little bit, because I think your second book deals with risk fingerprint and risk empathy, and I think we’re starting to verge onto those discussions. So why don’t you tell us a little bit about your second book and how it’s different than your first book, but also define risk fingerprint and risk empathy, because we’re going to leverage those and we’re going to play with some ideas around those.

MW: You Are What You Risk. It’s actually the second gray rhino book. It’s actually my fourth book, not counting the ones I’ve got little pieces of. But that came about because as I went around the world talking about the gray rhino, I would always get this question, how do I apply it to my personal life? Or here’s how I applied it to my personal life. Thank you so much. And I thought, are you talking to someone behind me? Because I don’t really write self help books.

MB: I’m kind of like, yeah, you’re a wonk who dealt with global debt crises. And your book was very clear. Your second book is very clear, “you know, okay, I obviously missed something about this part of it”. So it’s a very delightful introduction to that book.

MW: It was very funny. So I was trying to figure out how to apply this. And then the other question was something you alluded to before. The west is obsessed with black swans. I got a lot of pushback from people in the west, assuming that I was saying something different from what I was saying, and also, I think, making a lot of money off of volatility. But I went to China, and within the first three weeks, it had sold 30,000 copies and has sold many times that by now. And I go there and I need an entourage to go in and out of events, and people completely get what I’m talking about.

And I’ve spoken with some of the senior, most economic policy makers there, and they ask very detailed questions about some of the things that I’ve been worried about, sort of speculative bubbles and inequality. And you can see some of the policies over the last five years addressing some of those issues, which certainly they’re probably worried about some of the same things I was in the first place, but the gray rhino became a really big communications tool. And so I asked people, why is this so big immediately in China and across Asia as well? I do a lot of work in Korea and India. And the best answer I got was, you gave us a way to talk about something that was already on our minds. And I thought, why do people in China see some of the things that I do?

Why are they willing to recognize this and delve deeper than in the west? And so I really had, you know, two questions about personal society, personal psychology and group dynamics and government policy. So I was bouncing some of these ideas off of a good friend who was one of the very first investors in environmental issues way before everybody else, way before they invented ESG and all that. And he was a really great sounding board. And I said, what do I do with this? All these people who want to apply to their personal lives? He said, you know, there’s a bigger connection between businesses and policymakers and personal risk taking than you might think. He said, our investment committee just met and talked about the things that didn’t work out every single time.

All the red flags were there in our due diligence, but we didn’t pay attention to them because they weren’t the macroeconomic environment or the business model or the marketing plan or the product itself. It was bad personal risk decisions by the CEO, the drunk driving, the speeding, the cheating, the domestic violence. And companies are starting to see now, we’ve seen some very public examples of CEO’s with bad personal risk judgment. Not having that, too. I was just talking with some folks in South Africa this morning, and they were like, oh, yeah, we know that guy, but we work the overstock.com comma, the Uber stuff.

When the CEO’s were showing questionable behavior or when the Ashley Madison cheating website was, had a big data leak, some very creative academics took that data and cross referenced it with securities violations and other bad business stuff, and they found a huge correlation. So that on the one hand, you know, personal, what each person brings to a risk situation affects whether they deal with the gray rhino or not. And the other part is this cultural thing. I mean, China has, there’s so many things that are different about China. Obviously, the system of government, the government’s ability to take decisions that are maybe unpopular in the short term but are better long term, you have a lot more flexibility. The collectivist cultures versus individualist cultures, which I did a lot.

I looked at a lot of the research on that in, You Are What You Risk. And I, too, am a big fan of looking at research that other people are really good at doing, that, you know, detail oriented academic research and who might not be so good at taking it publicly and helping to draw attention to that work. That’s, you know, one of my superpowers. But looked at some of this research on individualist versus collectivist attitudes and found that there are very different risk perceptions.

That if you’re in a collectivist society or if you’re in a society where you believe that the government has the ability to handle something, you’re not going to see something like, say, buying an apartment in Beijing at crazy high prices as such a big risk as you are if you don’t think the government is going to come in and handle the situation. Some of this research showed that although Americans and Chinese in one study made very similar financial risk decisions, as measured by the choices that they made, they had very different perceptions of how much risk that was. So the Chinese were actually taking less risk because they didn’t see the situation as being as risky as the Americans did. And they both had stereotypes about the kind of risk decisions that Americans would make. And so you get the role of stereotypes.

A lot of VC’s don’t invest in women founders because they think they’re going to, quote unquote, not take enough risk when, you know, again, the data does not show that’s true. So there are all these stereotypes that we have about what other people think about risk or even about ourselves. I’ve been on a lot of podcasts lately talking about women in risk. And when we do the prep call, they say, oh, so we’re going to talk about how women are risk averse, right? I said, no, we’re going to talk about how to bust up that stereotype and talk about how women are risk savvy, risk appropriate, risk astute, not that a word that you use.

And so I realized also that there’s a big connection between big policies that governments make, between organizational culture and individual risk decisions, that there’s a real feedback loop among those. And so exploring that helped to really explain why some public policies were working and others weren’t why legacy companies that bought startups had some digestion problems and trying to merge the two cultures and people don’t think enough about risk, about all these unseen factors that go into first why we take the active risks that we do.

Go bungee jumping or invest everything in your cousin’s penny stock, or take the risk of heading off a big risk one of the big insights from the gray rhino is that people often would rather take the risk of being wrong in a group rather than being right and heading off doing the things to head off the risk that might not work on the first try. So it’s just, it was just a fascinating journey, which I’m continuing looking at some of the policy aspects of this, but it’s so applicable to the psychology of why people deal with climate change or not.