Saturday, January 28, 2012

Thinking Deeply About Thinking

Daniel Kahneman’s premise is deceptively simple. We have two modes of thinking, which he calls System 1 and System 2. System 1 operates automatically, quickly, and effortlessly; System 2 operates deliberately, systematically, and painstakingly. System 1 intuits; System 2 computes. System 1 reacts involuntary; System 2 makes choices. While we use System 1 during most of our waking hours, System 2 relies on System 1 for suggestions based on experience. In a sense, this method is how two minds become one. Excelling in the world demands quick thinking, so our natural capacity to make judgments based on System 1 is an indispensable attribute. After all, we tend to believe our impressions. In effect, Systems 1 and 2 work like well-oiled gears in a high-efficiency machine for most of us.

Once Kahneman quickly establishes the distinctions between Systems 1 and 2, he devotes most of the nearly 500 pages of Thinking, Fast and Slow to biases they create and the missteps they engender. Using numerous actual and theoretical anecdotes from his own experience and popular culture, as well as engaging tests for the reader, the author continually returns to WYSIATI (what you see is all there is), a term he uses to explain how we generally make sense of the world—usually with success but possibly to our detriment.

WYSIATI helps us to quickly size up new situations and make correct snap judgments based on reality.  However, biases abound from this operating system. We see the world as more logical and predictable than it really is, and, against the advice of the proverbial Wall Street disclaimer, we rely on past results as indicators of future results. 

Kahneman, a Nobel laureate in economics, details how these distortions cause us to approach decision points with overconfidence, to frame situations improperly, and to rely solely on best-case scenarios, among many other missteps. He lays out a long list of “illusions” that drive our thinking, including an inaccurate assessment of our understanding or skill, an unreliable dependence on memory, and a misguided belief in pundits—all leading to errant judgments and poor results.

One of most revealing points of Thinking, Fast and Slow is that System 1 and System 2 are not always in agreement. At least three facts confirm this condition. For one, says, Kahneman, “We believe that duration is important [System 1], but our memory [System 2] tells us it is not. The rules that govern the evaluation of the past are poor guides for decision making, because time does matter.” Second, we are inclined to judge our past by the peak-end rule, when our experiences were at their highest or lowest, creating a distorted picture of the past and a seriously flawed projection of the future. A third indication of the dissonance between Systems 1 and 2 is our susceptibility to hindsight, which also misrepresents our actual understanding of past and present events.

Thinking, Fast and Slow is rich with insights about how and why we think. Anyone fascinated with language will find a lot of hidden treasures in this book. Language, insists Kahneman, is an antidote to fallacious thinking: “Ultimately, a richer language is essential to the skill of constructive criticism.” I could not agree more.