Saturday, June 18, 2011


What do pensions and nuclear power have in common? Both require managers empowered to make prudent, long-term safety decisions. In the case of pensions the basic principles are well-known; this isn't "nuclear science". But in both cases public pressure for short-term pain aversion make safe operation impossible, independent of the selflessness of management. And incompetent, corrupt, or untrustworthy management makes it much worse.

The list of other systems and institutions incompatible with the current environment is probably quite long...

1 comment:

Gemfinder said...

As I have mentioned previously, a sizable chunk of the population appears to be boundedly rational, the limitation being that they discount the future to zero, beyond a window of 90 days or so.

No matter how well organized an enterprise, if something important ends up in the hands of such a person, the eventual but inevitable result is to go kablooie. This is very hard to design around.

My favorite example is not nuclear plants, but the build-your-own-virus labs at major universities. Keep that hazmat suit handy.