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we're here today with Wharton professors
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Howard kther and Robert Meyer to talk
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about their new book the ostrich Paradox
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why we under prepare for disasters
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Howard and Robert thanks for being with
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us thanks so much now I first wanted to
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ask you about the title of the book
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because like most people I assumed what
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it meant was that we should we should
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not be like ostriches that we should not
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keep our heads in the sand when it comes
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to disasters but actually it turns out
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that that's not quite the case so could
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you tell us yeah absolutely the um uh
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that what motivated the book because we
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were very much interested in writing
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about uh why it is that uh we can't seem
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to get a hold on disasters that that
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even though scientific abilities to
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forecast hurricanes and so forth has
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really grown considerably over the years
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that hasn't really been matched with it
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with any sort of a noticeable decrease
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in the uh uh in the costs both in terms
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of lives and monetary losses from uh
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from natural disasters or man-made
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disasters and and often the the reason
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that that's given is whenever that
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happens we say that well people are
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putting their heads in the sand they're
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they're ostriches and uh and that's sort
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of the the old cartoon notion of what an
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ostrich is when thread is coming a lion
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is coming they dig their head in the
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sand and sort of pretend it doesn't
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exist um and it turns out that actually
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that that's uh ostriches have been given
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a a severe bum wrap for that over the
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years because actually ostriches are
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incredibly good at dealing with risk uh
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they have enormous limitations they
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can't fly but the but the Nature has
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allowed them to overcome that by having
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enormous ground speed and have all sorts
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of risk of avoidance strategies so then
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occurred to us that actually therein is
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sort of like might be a a key to the way
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in which we can get people to be better
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uh at preparing for risk rather than
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being um less like ostriches actually to
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be more like ostriches to first start
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off and say what are the limitations
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that we have what are the psychological
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limitations that prevent us from being
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better and preparing for disasters and
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once we understand what those are are
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think about ways in which we can better
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adapt to those limitations so we're more
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like ostriches rather than less hence
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the Paradox yeah and the only point I'd
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want to add to Bob's comment is uh that
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I learned a bit about ostriches just in
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the context of the discussion that the
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two of us had together in terms of what
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they did and also that we do bury our
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heads in the sand often and so in some
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sense we felt that in a way using the
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ostrich as the as a way of an analogy to
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kind of the things that we do we might
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be in a position for people to pay
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attention and I think the real challenge
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in any of this area is for people to pay
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attention before something happen
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rather than afterwards and ostriches are
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very good at doing that and we hope that
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human beings can do a better job than
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they have up until now right now I mean
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the book actually starts with a really
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interesting example of galvaston Texas
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it was two I believe it was hurricanes
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hundreds of years apart maybe almost but
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the same reaction even though for the
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second time technology had Advanced
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significantly science had Advanced
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significantly Communications had
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Advanced significantly and yet there was
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still this same under response to the
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disaster
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and I wondered I guess the book is
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actually full of stories like this and
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was there one in particular that
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inspired the book well actually let me
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jump it there because for me the thing
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that inspired is actually a story which
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is not in the book okay and uh and it
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was like in I think it was 2008 I was um
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visiting New Orleans and I decided uh to
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take a drive along the Mississippi Gulf
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Coast and as I was driving along near
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the town of past Christian Mississippi
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which was an area which had been
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devastated by Hurricane Katrina I was
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sort of noticing how how quickly the
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place had recovered and there was what
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there was just a lot of nice grass
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fields and I was walking along I was
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driving along the road and I noticed
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that in one of the fields was a an ATM
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machine that was just sitting up by
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itself and uh and I and I looked at that
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and I pulled over and I said what's an
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ATM machine doing out in the middle of a
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field so I kind of walked up to it and I
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looked at it and then I began looking
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around and then I discovered afterwards
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that what what this was was used to be a
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shopping center that used to be right on
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the coast that had been completely
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destroyed by Hurricane Katrina and the
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only thing that was left was uh the the
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the the ATM machine and then I kind of
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did I was interested in this this how
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this happened and then the interesting
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thing was it turned out that this
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shopping center was built on the exact
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same spot that in 1969 a condominium
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complex used to be there and 23 people
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died when the condominium complex was
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blown away by a hurricane and and so
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basically so I contacted the the the
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person who was uh who own the land of
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the shopping center and I said did you
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know that this used to be have this
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horrible history and they said yeah it'
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been but it been so many years since
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there had been a storm I didn't we
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didn't think it was in under much risk
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and so then I said well what do you plan
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to do with the property he says well
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we're thinking about us selling it and
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hope to put build up a condominium
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complex here again and so I was sitting
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there and I was thinking there's got to
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be a story there there there there has
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to be uh uh you know what why is it that
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we kind of keep uh don't learn from
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experience why is it that we're not
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better at thinking had in terms of what
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the the consequences are of of uh of of
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threats like this and so what are all
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the different types of psychological
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factors that that caus us to be so poor
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at preparing for disasters I think that
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U just to follow up on on a story in the
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book that actually did started off is a
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story of Glenda Moore who uh was in a
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position where she had to figure out
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what decision she was going to make
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after Hurricane Sandy and I think all of
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us were very very cognizant of the
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challenges we face after a storm occurs
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in in the sense that we know there are
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things we should do and we are things
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that we might not do but we don't really
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know them as well as we should and I
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think that Glenda's first concern was to
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be with her husband who had actually
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left and she and was in Brooklyn and
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made a set of decisions without
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necessarily carefully thinking them out
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and our concern I think when uh with
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respect to pointing this out to others
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is that to a large extent we react to
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two situations at the moment without
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necessarily doing an analysis of all of
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the possible dangers and the
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communication mechanisms are sometimes
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good but we sometimes don't hear them
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and so she actually made some decisions
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to leave that actually resulted in her
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losing her children and as a result of
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that uh there was a whole set of media
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attention given to that and our feeling
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was it was a way to start the book to
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point out the fact that we would like
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everyone to reflect on what could happen
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after a disaster then and do some steps
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beforehand to prepare and also to listen
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to the kinds of things that one is
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hearing and try to get the right kind of
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information so one doesn't do the things
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that could result in tragedy and now you
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actually outlined six different biases
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that may be at play that may lead to
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some of this under preparation for
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disasters and I somewhere in the book
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you had mentioned or maybe it was in
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this other interview that came with my
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book about that perhaps the most
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dangerous one of these six might be
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optimism which I thought was very
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interesting just because we usually
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think of that as a good thing yeah yeah
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yeah no absolutely I think in fact it is
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the good thing to have in life I mean uh
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you know we've been fortunately endowed
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with an optimistic Outlook uh uh and so
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forth the problem is is that in fact I
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think this is true with almost with all
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of the biases that we talk about in the
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book these are things which uh which the
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reason why we have them is they serve a
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good functional purpose and most of the
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time and most the the decisions we face
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on a day-to-day basis they basically
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serve us well and and um however it's
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also the case that when when you
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suddenly now we're in a situation of
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facing very very rare events things that
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we decisions we don't have to make on a
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day-to-day basis uh that's where when
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you start applying these same heris sixs
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all of a sudden all sorts of stuff goes
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wrong and optimism is a great case of
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that um you know it is good to look on
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the bright side of life and all of that
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sort of thing however when uh when
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you're talking about something that
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might happen to you that might mean the
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end of your life uh then being
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optimistic is not necessarily the best
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thing to do and and uh and one of the
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things we talk about is sort of you know
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what are the different ways in which
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people become erroneously optimistic in
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a way that's harmful and I think one of
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the things with optimism is that we try
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to find ways to sort of defend our
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optimism and so we think about a a n a
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disaster a flood or a hurricane we don't
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really want to think about those
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disasters we're optimistic because we
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are living in an area that we say this
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is a great place for us to live and we
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want to sort of keep that image alive
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and so we say well let's you know this
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is so low the chances of anything
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happening are so low that we're not
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going to really think about it it won't
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happen to us it may happen to others it
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won't happen to us it's below we we use
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the Expression our threshold level of
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concern we're not going to worry so we
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keep that optimistic bias in the sense
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of trying to avoid having to think about
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things that we probably should be
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thinking about beforehand and our whole
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idea in bringing that up along with the
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four or five other we have six biases uh
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is to say they're all connected in some
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sense uh and in one way or another we
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have to try to figure out ways to let
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people know that these are things that
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we all do and we all have our own
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personal examples and then we can think
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about ways to improve the decisions by
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trying to avoid them in the future and
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now your method of improving this what
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you lay out in the book is called the
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behavior risk audit and this sort of
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this involves looking at each of these
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risks and kind of turning I mean each of
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these biases and kind of turning them on
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their heads and seeing how can we create
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polies that actually address these
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biases and maybe get around them can you
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talk a little bit about how people could
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do this well let let me illustrate with
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one and and Bob May pick one another one
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um myopia is one of the biases that we
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have people are have very very short
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term we all have short-term Horizons we
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want to get immediate returns in some
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sense and if there are things that we
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can do for the long term we often find
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they are very prohibitively expensive
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they're costly we can't really do them
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let's take an example of having to make
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our house safer against uh Hurricane
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Sandy or flood uh or hurricane uh
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there's a lot of cost to doing that you
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could elevate your house but that's very
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costly you could maybe flood proof or
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you could do a set of things and people
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will say well look what are the benefits
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that I'm going to get from that in the
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next period And so they'll be very
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reluctant to put in the money because
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they say the benefits we have to get are
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going to be very short run and they're
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right I mean in some sense if you're
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going to get a short run benefit like a
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reduction in your insurance premium uh
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you'll say well I'm not going to get
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enough to pay for that expense so we
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would recommend that instead of thinking
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about just the long term with respect to
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this there are two things that one can
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do one is you might give a person a loan
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to help them out and spread the cost
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over time and the other thing to deal
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with the it won't happen to me instead
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of saying it's going to be a one in a
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100 chance of a flood occurring next
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year which is kind of what the
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probability is stretch the time and say
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to people think about the fact that
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there might be a a hurricane in the next
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30 years and that likelihood is greater
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than one in four or one in five and then
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people will think about the long term
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and maybe decide that they can take some
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action yeah another example another one
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of the biases we talk about is uh is
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simplification and the the idea there is
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is that most people don't like to
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consider lots of different factors when
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making decisions and uh and one feature
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of this is a thing called The Single
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Action bias and what it is is that when
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you're faced with the problem uh you
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basic as soon as you take like one
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action to try to solve it there's a
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tendency for your brain to go good there
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was the problem I took some action
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problem solved and uh so in a lot of
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walks of life that's kind of an okay
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thing to do but think about in the
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context of of preparing for natural
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disasters when in fact there's large
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numbers of things that you need to do or
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or you're trying to build a safer house
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in which in order to make the house
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structurally sound there's lots of
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different things that you have to do
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well often kind of historically the way
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in which uh agencies like uh uh Noah and
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and FEMA and whatnot have encouraged
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people to prepare for disasters is to
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give them checklists and the checklist
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will have 60 items on them and you say
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make sure you do this with your dog make
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sure you do this and so forth well the
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single action bias will say people are
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going to ignore most of those things but
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they are going to see the list they are
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going to be aware that there's a threat
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the problem is is that they're going to
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go down this list randomly and take care
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of the dog or whatever and once they've
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done that that's the end of the list and
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they feel that they're sort of prepared
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for the disaster when and they're
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they're really not so so one of the
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remedies for that is to say now that we
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know people simplify and they tend to
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focus on one action what an agency needs
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to do is don't give them a massive
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checklist say if you're going to do one
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thing here's the one thing to do okay
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and once you've done that here's the
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second thing to do and you have to kind
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of walk people through that and that's
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going to be a much more effective way of
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of of
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getting people to prepare now do you
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know of examples of agencies or
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governments or companies that are that
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are doing things like this that have
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developed policies like this or do we do
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they all need to get a copy of the book
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they got to get a copy of the book they
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definitely have to get but I'll give one
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example and and related to what I said a
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few moments ago the Federal Emergency
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Management agency is very concerned with
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communicating risk and they have
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actually changed the way they're
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presenting information on the flood
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Hazard they used to talk about a one in
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a 100e flood or return period they're
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now telling people think about the next
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30 years when you and what could happen
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to you and you should be considering
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buying insurance for next year even
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though uh you are thinking about the
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fact that it's low probability it could
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be greater than such and such for one
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and four for a disaster to occur so they
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are actually trying to take that
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seriously we don't but they have to do
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this in such a way that they communicate
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so people at least read that which of
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course is a challenge and of itself I
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mean because I would think with that
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it's like they're taking it from 100 to
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30 actually takes it back within the
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realm of their lifetime so they're doing
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it for them not for the people who are
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going to live there in the future that's
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exactly right they want to get a
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reasonable time period but if they said
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and and they and and when they do that
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they of course stretch the probability
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and make it a lot higher than it would
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occur next year now could a family or an
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individual use this Behavior risk AIT to
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help themselves prepare for disasters or
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is it more for policy makers ERS or
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companies no I think it's absolutely can
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be used for for individual households
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because I think that often it's the case
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that that often it's the case the
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companies themselves at a very very high
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level are actually fairly good at
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thinking through all the details and
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having very well-developed um you know
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risk avoidance plans or something like
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that for example a a a utility compan
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has actually tend to be very good at
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this sort of thing on the other hand a
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lot of the kind what with this book I
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think is a little bit more targeted at
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is uh organizations which aren't
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necessarily all that experts in terms of
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R risk preparation and so for any given
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family uh you need to sit down and think
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through well well how is it that we as a
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family are thinking about risk and these
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biases actually even more so apply there
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um and Howard was given the example of
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start that started out the book about uh
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the Glend deore family where a woman um
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uh hastily put her children into a van
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and then took them down and uh in front
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of the and they she lost the children
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and in a Hy in a Hast evacuation I that
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you know we would like to think that
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this is a book which kind can help
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households like that um make sure that
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those events never occur and what it
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does is it says look you know when
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you're faced with disasters these are
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the kind of mistakes that you're likely
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to make and it's not because there's
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something wrong with you you're just
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human and these are these are hard grain
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hardwired biases that we have and once
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we understand what those are you can
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kind of anticipate the kind of mistakes
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you're going to make and so and then
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that's the first step in trying to avoid
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them here's what our hope is there are a
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series of stories that are graphic and
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people do react to graphic stories in a
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way that they don't react to just the
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facts or whatever and and our hope is
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that people will read these stories and
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recognize that it can happen to them in
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some way and it has happened to others
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and that they'll pay attention to the
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very last part of the book on here ways
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to improve and then we would like to use
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one of our biases that we hope makes
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this book more than just one person
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reading it and that's the her effect and
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we hope that there will be somehow a
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notion that people will see this and say
00:16:34
you know this is something I'd like to
00:16:36
talk to a few other people about and it
00:16:38
isn't just our situation it may be
00:16:40
others and I hope it becomes a topic
00:16:42
which generally is not a topic of
00:16:44
conversation of the fact that we have
00:16:46
these kinds of biases we have these
00:16:48
things and we all think of our own sets
00:16:51
of activities that might reflect that
00:16:53
and we have our own personal ones which
00:16:55
we can experience and that that becomes
00:16:57
really more of a social Norm that this
00:16:59
is something that people should
00:17:00
recognize they have and there's a
00:17:02
tendency with with the kinds of events
00:17:05
we're talking about for people not to
00:17:07
want to pay attention and our hope is
00:17:09
that the stories that we tell here will
00:17:11
resonate enough so that people will want
00:17:13
to actually think about them I mean it
00:17:15
seems like we don't you know we hear
00:17:16
about hurricanes when they're a day away
00:17:18
or two days away or maybe in the
00:17:20
immediate aftermath but then we don't
00:17:22
hear about them again until the next one
00:17:24
comes along and you talk a lot about
00:17:26
those types of events in the book but
00:17:27
you also talk about more long range
00:17:29
events specifically about about climate
00:17:31
change which is not something that the
00:17:33
be the worst part of it's not going to
00:17:35
happen tomorrow or next week next year
00:17:37
maybe even not in the next decade but
00:17:39
how does the behavior risk audit apply
00:17:41
to something like that where it's more
00:17:42
of a long-term broader risk well this is
00:17:45
a real Challenge and I think we
00:17:47
recognize it's a challenge that we're
00:17:49
facing right now because climate change
00:17:51
is not necessarily being discussed in a
00:17:53
way that I think we would like to see it
00:17:56
discussed it is a critical problem um
00:17:58
and Miami where Bob has lived there for
00:18:01
a while and can and can talk about that
00:18:02
directly is facing major problems with
00:18:05
sea level possible sea level rise and
00:18:07
people may not be paying attention right
00:18:09
now and I think what we would say I and
00:18:12
a way to say it is first of all
00:18:14
construct some scenarios that you begin
00:18:16
to see what might happen and think about
00:18:19
how you can take some steps now to avoid
00:18:22
those scenarios and also to think about
00:18:24
the fact that it isn't just yourselves
00:18:26
but there's future Generations at stake
00:18:28
and what is going to be what is this
00:18:29
going to do to my children and my great
00:18:31
grandchildren and how can we take some
00:18:33
steps and try to make the case to
00:18:36
recognize that there's a tendency to say
00:18:38
this is not going to happen and it won't
00:18:40
happen necessarily tomorrow but there
00:18:42
has to be planning and it isn't just for
00:18:44
the individuals it's for communities and
00:18:46
that's why I point out Miami being one
00:18:48
example of that uh yeah that as Howard
00:18:51
said I think long run risk is very
00:18:53
difficult uh and particularly if it's
00:18:55
the case of let's say if you're living
00:18:56
in in any Coastal area you're worried
00:18:58
about SE level rise and you say well
00:19:00
scientists are forecasting that in 60 to
00:19:02
70 years this area that you're living in
00:19:05
is going to be underwater uh well that's
00:19:08
I'm not going to be living there in 607
00:19:09
years so why should I particularly care
00:19:10
about that and you what how do I justify
00:19:13
that and this is particularly the case
00:19:14
for communities who are thinking about
00:19:16
doing things like raising taxes and bond
00:19:18
issues to put up Public Works projects
00:19:21
to prevent sea level rise when the
00:19:23
people who are voting for them are going
00:19:24
to have to pay these taxes aren't going
00:19:26
to be the ones that are actually going
00:19:27
to be benefiting from it and so I I
00:19:29
think that that people might understand
00:19:31
well maybe we need to take care of it
00:19:32
but maybe we should just do this next
00:19:34
year okay that uh this to put off yeah
00:19:37
it's it's easy to put off because
00:19:38
nothing's going to change that much and
00:19:40
so so of course what happens is you keep
00:19:42
putting it off till the next year and it
00:19:43
never never gets done so some of the
00:19:45
things we we were kind of thinking about
00:19:46
within the book are what are ways in
00:19:48
which you can kind of get people to take
00:19:50
uh safe actions or have a culture of
00:19:52
safety in a situation where they don't
00:19:54
have to they're not the uncertainty is
00:19:57
actually not is on taking risk rather
00:20:00
than than not taking risk so for example
00:20:03
um normally it's the case of you have
00:20:05
your your city budget and one of the
00:20:07
light items should be should we put
00:20:09
multi-million dollars into a pumping
00:20:11
system okay and that's an add-on and
00:20:13
then you have to think through is this a
00:20:15
good use of the money now well what if
00:20:17
it was the case that every year just is
00:20:19
a standard starting point in the in the
00:20:21
in the community budget that there's
00:20:23
money set aside for infrastructure
00:20:25
improvements but then that can be
00:20:27
removed so all of a sudden then the
00:20:29
discussion is uh do we want to not take
00:20:31
a safe action this year or not and then
00:20:34
that might be just enough to basically
00:20:35
keep some of those items still on the
00:20:37
budget which they might have might have
00:20:39
otherwise been removed and the hope is
00:20:40
through those little sorts of steps that
00:20:42
might we get a little bit closer at
00:20:44
dealing with some of these these
00:20:45
extremely difficult Long Run problems
00:20:47
and you could couple just what Bob is
00:20:49
saying with the notion of let's not make
00:20:52
make sure we don't have the cost
00:20:54
immediately on top of us having a
00:20:56
long-term loan so that you do spread it
00:20:59
over a number of years will make it more
00:21:01
attractive and then if you can show that
00:21:03
there are benefits that are going to
00:21:05
occur even in the short run that maybe
00:21:07
property vales will go up maybe people
00:21:09
will want to move into the area and you
00:21:11
can sell your home a little more easily
00:21:13
by the fact that one recognizes the
00:21:16
community is taking steps now to avoid
00:21:18
this problem that might be really
00:21:20
serious 20 or 30 years from now and now
00:21:22
would be a lot less serious and I think
00:21:24
those are problems facing coastal cities
00:21:26
again bringing up Miami that really has
00:21:28
to be concerned about what is going to
00:21:30
happen to the property values of their
00:21:31
homes all of a sudden when people say
00:21:33
we're not really taking the steps and
00:21:35
now we are seeing that this is going to
00:21:36
be a major problem so I think if we can
00:21:39
combine these things with economic
00:21:41
incentives with the default option that
00:21:43
Bob mentioned and which is one of our
00:21:45
Notions is if you don't do this the fact
00:21:48
is you have to say I'm not going to do
00:21:50
this rather than I'm going to do this
00:21:52
and also to recognize one of the
00:21:54
challenges and Bob brought it up very
00:21:56
directly on the political process we
00:21:57
have a little acronym that we
00:21:59
occasionally use and I'll use it right
00:22:01
now uh
00:22:03
Nim not in my term of office if we can
00:22:07
avoid that avoid the notion of having
00:22:09
expended and recognize that there are
00:22:11
benefits of being doing this in my term
00:22:13
of office rather than saying it's not in
00:22:16
my term of office then I think we have a
00:22:18
chance of at least getting people to pay
00:22:20
attention now what about different kinds
00:22:22
of risk like political risks I some of
00:22:24
the things that I read in the book
00:22:25
really reminded me a little bit of some
00:22:27
of the things that you know you heard
00:22:28
heard people in the UK say around the
00:22:30
time of brexit that oh this won't happen
00:22:33
it won't pass or even around the time of
00:22:34
the election that I feel like there was
00:22:36
maybe some myopia or or optimism at play
00:22:40
a little bit there do I mean do you
00:22:41
think that the principles in the book
00:22:43
can apply to different types of risk
00:22:44
other than natural disasters or
00:22:46
environmental risk well uh I mean we
00:22:49
haven't thought explicitly about brexit
00:22:53
uh in terms of that or and use an
00:22:54
example but I think there is a a notion
00:22:57
here that the of a feeling that people
00:23:00
may not really necessarily appreciate
00:23:03
all the elements of a particular problem
00:23:05
I think that's what I would want to use
00:23:07
and I think we can say about brexit and
00:23:09
I think we can say about the election
00:23:10
that occurred that there was a degree of
00:23:13
optimism by people who felt that they
00:23:15
really didn't have to be concerned about
00:23:17
necessarily voting in a particular way
00:23:19
on the basis of feeling that this was a
00:23:21
foregone conclusion that things were
00:23:23
going to work out that way and so in
00:23:24
that sense we come back to the optimism
00:23:26
bias in terms of what one hopes will
00:23:28
happen but may not actually happen yeah
00:23:31
and I I certainly you can go through
00:23:33
those biases and they can provide kind
00:23:34
of an explanation for why maybe a lot of
00:23:37
people were very surprised by the uh uh
00:23:40
the the uh the last election or
00:23:42
alternative looking at half you know
00:23:43
half the country was not at all
00:23:45
surprised and the other half was
00:23:46
extremely surprised and and I think that
00:23:48
the part that was extremely surprised
00:23:50
was influenced by things like herd think
00:23:52
uh they went around and the people that
00:23:54
they talked to were people had their
00:23:55
same values that they did and they
00:23:56
became under the belief that this is the
00:23:58
way the world is and uh and and and so
00:24:01
on and so on and you know simplification
00:24:03
there's a tendency to to not look
00:24:05
broadly and looking for evidence that
00:24:07
maybe there are people out there who
00:24:08
don't think like you do and and when you
00:24:10
take all these things together all of a
00:24:12
sudden there's this group think which in
00:24:14
many cases may have led for a lot of
00:24:16
people who were for example Clinton
00:24:17
supporters to feel they didn't need to
00:24:19
vote on and so forth and it's such a
00:24:21
foregone conclusion so Howard and Robert
00:24:24
thanks for being with us good to be here
00:24:26
yeah glad to be here thanks
00:24:34
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