On building leak-proof systemsSun, 19th Aug '07, 6:35 am::

I am an ardent follower of world news. Be it politics, science, business, or pop culture, I am keen to hear and understand the situation regardless of the scale or my distance from the incident. I could be reading the tactics of the Recording Industry Association of America, the hostility of environmental groups towards nuclear power stations, or the Chinese threats to liquidate their US currency holdings, I have noticed certain human elements at play in every locale. To name a few, (1) greed, (2) ignorance, (3) inflexibility, and (4) irrationality are commonly at play in the prime issues of local and global conflicts.

As residents of a civilized society that is at most a single crisis away from savagery and barbarism, we have constructed innumerable social systems to keep all of us functional and urbane. As we have a justice system in place to ensure murder and theft is discouraged, we have banking systems to regulate the institutions that promote growth by enabling mass savings and investments, namely banks. Then we have school systems that dictate what a student of age nine should read and which math problems the student should be able to solve by age twelve. Add to that the laws on aviation, the rules of alpine skiing, the regulations on equipment sterilization for medical purposes, the age of consent laws that are different in every geographic region, and the code of ethics for international journalists in war zones, and we come to a very complex world to legally function in. While all of us break a few rules, most of us follow most of the rules. We stick to the rules quite well indeed. After all, who wants to be hauled away to prison, get fired from the job, be disqualified from the race, or be banned from the Saturday morning gardening club? That's the stuff news is made out of.

News is but a glorified portrayal of the leaks in the system. From stories about school shootings in suburban communities to suicide bombings in the Middle East, from stock market crashes in Europe to polar bear habitat loss in the Arctic, the purpose of news is to highlight the cracks in the long-standing systems we have in place, thereby making all of us think "somebody needs to fix this!" Your local station will cover the story of the bottling plant near your house that is dumping industrial waste into your scenic lake. Similarly, the national news networks will break the story of accidents happening across the country as long as a hole in the system can be pinpointed. Story of a bridge collapse is about the breakdown of construction regulation, infrastructure budgeting, and political earmarks. News of a molested child is to decry the deviation from moral conduct, social decency, and parental expectations. Watching the news is like watching a beautiful painting being ripped to shreds, one knife-slash at a time.

The keen observers of news notice that when the news isn't broadcasting the leaks in the system, that in itself is a sign of the larger leak in the system, whereby the fourth estate is found to be in bed with the governing bodies. It doesn't take long before the traditionally free, uncensored media becomes an extension of the ruling party and helps dictate the edicts of the rulers by publicizing propaganda as facts. Regardless of when the common man realizes the system is breaking down, every system we have designed thus far will eventually break down; an overbearing side-effect of the human element at play.

Without getting into personal characteristics of specific individuals, we know that humans are morally sound and unsound, sharing and selfish, considerate and rude, amicable and violent. Depending on the situation, these characteristics could be found in the same individual or entire organizations and even countries. We also know that most people would do whatever is necessary to benefit themselves and their groups. However, doing so often inconveniences other groups and breaks the rules of the system. Keep in mind, the system could be foreign exchange markets or the restaurant tip jar where some people are bound to twist the rules to help themselves while others are compelled to help others by giving up some of their own share.

The study of Game theory discusses possible outcomes of conflicts that occur between different agents. "In strategic games, agents choose strategies which will maximize their return, given the strategies the other agents choose." While each situation needs a specific application of game theory to work well and give appropriate results, there are more underlying assumptions in real-life than the simple "maximize personal return" hypothesis that traditional game theory considers.

If our goal is to design a leak-proof system, we have to know the foundation on which it will be built. Considering that a leak-proof solution to a specific system involving humans could be reduced to any other system involving humans and thus have the ability to eliminate world hunger, poverty, environmental disasters, territorial wars, road rage, and long lines at the grocery store, I presume that the desire to come up with such a solution is global and intimately human. Once we have a list of the human flaws, our eventual goal should be to recreate everything such that the most amount of good comes out, despite everything bad that will certainly happen. In other words, we wish to devise a solution to every problem in the guaranteed presence of Murphy's Law.

The strongest of human characteristics is greed or the desire to maximize personal benefit. We all want good things to happen to us. Be it money, praise, passion, or enlightenment, we want more of what we feel is good. Some of us, very rarely all of us, will break the rules to help ourselves at the expense of others. The harm caused to others, be it publicly visible or remain anonymous, some percentage of the population will abuse the trust put upon their shoulders. A system that expects every person to be completely faithful and trustworthy will thus certainly fail. This is why billions of dollars in monetary aid go missing as soon as they hit African governments' bank accounts. Our entire concept of charity expects the kind, altruistic people to trust strangers in power to help strangers in need. The amount of charity that reaches the ones in need is thus inversely proportional to the amount of human greed. We cannot easily reduce the amount of greed so what we should do, is minimize our reliance on honesty for a system to work.

How would one change a system to reduce dishonesty? Take the example of construction contract bids, i.e. tenders. If a local government wants a bridge built and wants to maximize public benefit, it can appear to do so by asking for anonymous bids from construction companies and selecting the bid with the lowest cost. However, that will not maximize public benefit as a construction company can drastically undercut their asking price by using inferior material that can cause the entire bridge to fail in years. So a better solution is to stipulate that the contract will be awarded to the second lowest bid. Now the company cannot quote a price so low that they will assuredly win, thus encouraging all the bidders to give more realistic cost estimates. There is certainly a loophole in this system too, as a company can simply put in a very low bid as before and have another sister company bid even lower. Thus they can ensure the lowest bid and the second lowest bid. The real-life solution to this has been mired in volumes of government regulations preventing this exact scenario, along with millions of possible underhanded tricks. Nevertheless, this entire system is built upon the citizens entrusting the local government to trust a construction company, and thus is subject to every single bit of greed faced by the aforementioned charity donations by altruistic individuals to African nations. The true solution is to minimize the reliance on greed. For the local government, it might be in the best public interest, even though more expensive, to award the contract to the median bidder as that value is much more difficult to game. To help the developing nations, developed nations can make larger contributions in the form of education, access to better healthcare, enabling free trade, and building infrastructure instead of simply wiring billions to unmonitored bank accounts.

This brings us to another powerful human lacking, inadequate knowledge. Call it ignorance, lack of education, or just plain stupidity, a system will succumb to idiocy without relent. Thus any system that expects all parties to be educated and fully understand the consequences of their actions, will be prone to failure. Information Economics deals with information asymmetry where one party has more information than the other and tries to devise "fair" solutions to such problems. However, there are numerous problems where having more information is not always as large of a benefit as one might assume. Take driving on the highways for instance. If people would just stop driving like idiots, there would be far fewer fatalities. In spite of the many experienced drivers, the few poor drivers can ruin it for every single driver on the road in a matter of seconds. To minimize fatalities, we have numerous laws in place to minimize idiocy - from limits on alcohol content within the blood stream to minimum age rules for various driving privileges. Note that while all attempts are made to discourage bad drivers from driving, the system still relies on people being good drivers and hence prone to accidents. A futuristic solution to this problem could be automated driving where you would punch in your destination and the car would drive itself. What amazes me is that such a system, which can cost a lot initially but completely eliminate accidents by inebriated or inexperienced drivers, is possible to put into place in the near future yet very few care about it. Though the automated driving software itself would never be perfect, it would improve with time, as most automated systems do. Put in a backup system with fail-safe mechanism and personal transportation can be a thousand-fold safer. So why is it not in place yet? That's the third deep-seated human defect, aversion to change or inflexibility.

Most working systems are designed with the foresight that they are not immune to abuse and hence expect timely changes to be incorporated to ensure consistent functioning. A good example is the US Constitution that was adopted over two hundred years ago and has had twenty-seven amendments to date. Even though constitutional amendments seek to maximize public benefit and limit abuse of power, nearly every amendment was met with vehement opposition, be it the 13th amendment that abolished slavery or the 19th amendment that gave equal voting rights to women - people just don't want things to change, even if it is for the greater good. While such an important set of rules supported by a strong central government can indeed work, it is nevertheless difficult to bring about changes because various segments of population have vested interests in maintaining the status quo. The ones in power strive to remain in power. Any system that requires new rules to be created in order to prevent abuse will fail when the new rules have to be approved and enforced by the same bodies that are abusing the system or benefiting from the underlying asymmetries. The US Constitution thus defined three branches, Legislative, Executive, and Judicial, each of which had specific and limited powers. The system would work as long as all the branches worked independently of each other and maintained a system of checks and balances to ensure no single branch abused its powers. The entire system will be prone to failure if the executive branch manages to incapacitate the judicial branch by planting personnel in key positions who refuse to prosecute members of the executive branch under any circumstances, especially if at least half the legislative branch is under the influence of executive branch. Alas, I can offer no instantaneous solution to such a dilemma, primarily because of the tremendously powerful vested interests that are averse to any changes away from the status quo.

In addition to greed, lack of information, and aversion to change, in almost all clashes, there are ingrained human emotions at play, often irrational at face-value and based more on belief and less on logic. How do you create a better healthcare system if religious beliefs dictate surgery is immoral and therefore to be avoided? While this may seem like a minor, inconsequential blemish in the human psyche, a system that requires everyone to make rational decisions will indeed fail when a considerable percentage of the population does not make the rational decision. The fundamental basis of microeconomics, political science, as well as sociology is rational choice theory, which assumes that "individuals choose the best action according to stable preference functions and constraints facing them," that is, people will weigh the different options and pick the ones that they can afford to derive the most benefit from. While "proponents of rational choice models do not claim that a model's assumptions are a full description of reality," when trying to construct and deploy actual systems in real life, we need the assumption to be true, otherwise the system that relies on rational choices, will fail. In theory, rational choice is easier to describe. If I get a less strenuous job with more pay and higher level of job satisfaction, it would be a rational choice for me to switch, unless I had other reasons to stay in my current position, like better scope of advancement in the future. Irrationality can also be rationalized in this sense by noting that if the new job was in Colorado and I love all states that begin with the letter C and end with the letter O, I can derive a higher level of satisfaction by moving there. Realistically speaking, that's a pretty irrational reason to move, but it can still be supported by a loose application of rational choice theory. In practice though, the very definition of rational is subject to debate. What is rational and obvious to one set of people may seem irrational and delirious to another. Who are we to legislate whether someone's belief in surgery being immoral is rational or not, they certainly think it's rational.

Think of any problem in your life, family, company, community, society, country, or even the entire world. Our solution to solve problems has always been to put carefully crafted systems in place. Remember that all systems will be met with (1) human greed, (2) ignorance, (3) inflexibility, and (4) irrationality. Now try to solve your problem WITHOUT requiring any of these four human conditions to be solved first. The perfect solution would be one that bypasses these limitations i.e. does not rely on solving any of them first. The scale of the problem is inconsequential for I believe that if you can solve the problem of neighbors with loud, booming speakers without giving them anything in exchange, without educating them on the virtues of silence, without providing them with headphones, or without making them truly understand how their careless behavior is affecting your emotional well-being, I can expand your solution to bring about world peace. Calling the cops on them won't be a good solution as they are already aware of their loudness and ignore it, thereby proving they are selfish and ignorant of others' concerns. It is possible to bring about world peace by enriching the needy, educating the masses, encouraging development growth and change, and eliminating aspects of fundamentalism and irrationality from the human personality. We can reduce and minimize pollution the same way, by discouraging corporate greed that favors cheaper dumping methods instead of costlier waste-management, explaining the long-term ill-effects of pollution, replacing fossil-fuels by renewable sources of energy, and minimizing the spread of extravagantly polluting devices like oversized vehicles for personal use.

The bright side to this dismal discourse is that not every problem requires all four aspects of human condition to be solved. Bringing about gender and racial equality required changes to social norms and eradication of irrational intolerance but barely had anything to do with human greed. Consequently, even if we can't eliminate human greed or educate every person, we can still solve a lot of problems. Education in itself is a problem, and the education system can be improved by social changes that promote intellectualism instead of wealth or power. Problems in education cannot be fixed by trying to provide more rigorous education or making promises of monetary or political grandeur.

If you see a problem, identify which of the four human deficiencies you are up against and try to tackle each of them individually, instead of calling for a patchwork of remedies that is akin to putting a bandage on an organ failure. If you ever feel ambitious and philosophical enough, go ahead and try to come up with a leak-proof system for resolving human struggles that does not rely on any of the four human shortcomings to be solved first. A Nobel peace prize would be the least you would deserve.

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