Continue reading »]]> Published in The Guardian
Thursday June 12, 2008

Ian Stewart asserts that his university’s mathematics students “earn more money, on average, than those studying any other degree subject” and that “their ability to handle technical ideas is highly prized, and rewarded” (Letters, June 7). His assumption, shared by most other contributors to the current debate about maths teaching, is that this reward differential can be projected on to the nation as a whole, with the conclusion that if we were to have more well-paid mathematicians we would all be much richer.

We should distinguish between two rewards – to the mathematicians, and to the rest of us. The mathematically trained “rocket scientists” in the City and Wall Street have been engaged in a financial arms race. They have been extravagantly rewarded for devising the clever financial “instruments” that are so clever that no one, themselves included, understands them.

Almost 20 years ago, in Does God Play Dice? – The Mathematics of Chaos, Ian Stewart observed: “because we are part of the universe, our effort to predict it may interfere with what it was going to do. This kind of problem gets very hairy and I don’t want to pursue what may well be an infinite regress: I don’t know how a computer would function if its constituent atoms were affected by the results of its own computations.”

The bubble of bad debt now distributed globally presents precisely the problem that Stewart does not wish to pursue. The rocket scientists are still absurdly well rewarded for playing war games with other rocket scientists – with other people’s money. But they are the constituent atoms in Stewart’s infinite regress. They have all become day traders trying to second-guess each other over the next move up or down of whatever it is they are betting on.

The current bubble may prove to be the biggest ever. But maths courses, as Simon Jenkins has observed, don’t do history.

For more on the subject of numbers and rocket science see – Risk Management: it’s not rocket science – it’s more complicated

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Martin Parkinson raises an interesting question (comment on previous post): what should be the reaction to an accident that, a priori, was an extremely low probability event? He suggests that “any attempt to reverse the counterproductive aspects of ‘health and safety culture’ is doomed to failure”. After an accident he argues that most people will say, “well that tragic accident which just occurred could have been easily avoided – it would be unthinkable not to make the obvious small change which would avoid a repetition”. Further, he adds, “the accident might have been freakish and unforeseen, but if there is a seemingly easy and cheap “fix”, then no responsibly-minded person would fail to make that fix …there is no logical point at which you can say your environment has “just the right amount of apparent danger”.

This is an issue that I probed in a recent essay “Dangerous trees?”. See the section entitled “Fault trees, event trees and trees”.

Britain’s Health and Safety Executive declares risks of death of less than 1:1,000,000 to be “acceptable” – defined as “generally regarded as insignificant and adequately controlled”. But how should such risks be calculated? If one divides the number of people killed by trees in Britain every year by the population, the risk works out at about 1:10,000,000. Acceptable? Only until someone is killed.

After the event it is usually possible to identify the cause and the person(s) responsible. A risk worth taking becomes culpable negligence. Hindsight transforms an “acceptable” risk with a probability of 1:10,000,000 into one with a probability of 1:1.

The fear of becoming the legally-liable victim of such a transformation, assisted by no-win-no-fee lawyers, is perhaps the main driver of the excessive risk aversion that bans hanging flower baskets and forbids conkers without goggles. For most institutional risk managers, outside hedge funds, there are no rewards for taking risks, only costs for failure. For them, one accident is one too many. No set of circumstances for which they might be held responsible can be too safe.

Escape from the suffocating safety culture that such reasoning produces can be sought in a “blame-free” culture. After a low-probability “freakish” accident, emphasis should be placed not on establishing guilt and punishment, but on lessons to be learned. Judges, juries and the Health and Safety Executive have important roles to play. Reconstructed foresight, not 20/20 hindsight, should be the standard against which culpability for freakish accidents should be judged.

Thanks Martin for your highly pertinent comments.

Continue reading »]]> Summary of presentation to Omega Centre Conference on “Planning and decision-making amidst complexity, risk and uncertainty”, Royal Institute of British Architects, London, 22 January 2007.

The Omega Centre project aims “to contribute to the advancement of the art and science of planning, appraising and evaluating the impacts of mega land-based transport projects in major urban and metropolitan regions of the Developed World.” A key assumption of the project is that many of the poorly-understood impacts of such projects are characterized by complexity, risk and uncertainty. My presentation seeks to make connections between these themes and fields outside the transport sector where they are routinely encountered.

Read the full summary – download PDF.