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Betting against the house

January 30, 2009

“Prediction is very hard, especially about the future”
- Yogi Berra

With due respect to the esteemed philosopher, that just isn’t true.  Oh, it’s difficult to predict events, but ignoring probabilities is foolish.

Back in 2001 I went to Comdex in Las Vegas.  Because of 9/11 the convention was lightly attended, and I had extra time to visit casinos and other attractions.  For a non-gambler this mostly consists of partaking of delightful food at fire-sale prices, but it was interesting in other ways.  The moment of realization came when I walked through the MGM-Grand building.  It’s a gigantic pyramid with spotlights shining straight up into the night sky.

It’s difficult to describe the scale and opulence of the place.  The main gambling floor was so big that I wished I had a bicycle to get to the other side, where there were several restaurants nearly lost in the distant tobacco haze.  Off in one corner was a lion habitat.  There were actually lions in a pretty good-sized simulated savannah with an incongruous artificial cliff.  I wondered if they used the lions to punish welshers.

Another casino featured a simulated Roman market, complete with a lovely simulated sky that changed with the hour to become night.  It bore the same comparison to a suburban shopping mall as a Bentley does to a Yugo.  Yet another casino featured actual, full-scale pirate ship battles.  Nowhere was there any place to sit down that didn’t involve either food or gambling.

These are not charities.  No wealthy financier said; “Let us entertain the people out of the goodness of our hearts!”  No, these magnificent temples were the product of inexorable, well-studied (by the casinos) probability.  The casino’s reputation depended on the outcome of a single throw of the dice, a single turn of the roulette wheel, or a single pull of the slot machine lever being carefully random.  Their income depends on there being nothing random about the aggregate outcome.

It’s sort of a strange business model, when you think about it.  Most businesses try to make a known profit on each small transaction.  The idea that some random transaction could just up and cost them a million dollars would send their conservative actuaries running for the door.  But that uncertainty is what makes gambling work.  In a way, casinos are the most scientific of all businesses, because science is all about paying attention to the probabilities, as best they can be known.  Science validates itself through prediction.

As the old saying goes; “The battle does not always go the strong, nor the race to the swift, but that’s the way to bet.”  Yet casinos are full of people betting against the house.  Somehow it does not occur to them that the size and opulence of the casino is testament to the likely outcome.  The idea of prediction is held out of sight.

Holding prediction out of sight was faith-based strategy for the last eight years.  One of my favorite quotes from the Bush administration is; “Nobody could have predicted the failure of the levees.”

Riiiight.  Nobody except the Army Corps of Engineers, National Geographic, Scientific American, the New Orleans Times Picayune, and even Mister Bill.  But there’s no reason the Bush administration should have been able to see it coming.

The “nobody could have predicted” defense has a long, disastrous history. There is something in the human mind that makes us want to believe everything will turn out OK.  So people in authority don’t give adequate consideration to the possibility that it won’t.

Nobody could have predicted that the space shuttle Challenger would blow up if launched in weather that was colder than it was designed to be launched in.  (Except the engineers who designed the thing.) Nobody could have predicted 9/11 (Except the intelligence analysts who did, and were dismissed by Bush).  Nobody could have predicted that Iran would want nukes if a superpower invaded countries on two of its borders.  (Except pretty much everyone.)  And who would have guessed that massive deficit spending plus lower taxes would result in an economic meltdown?  And above all, nobody has any idea what will happen from global warming.  Nope, that’s in God’s hands, nothing we can do about it.

Well except for scientists who have been analyzing actual data.  And some of them have been saying; “We’re screwed. We waited too long.  It’s time to start thinking about geoengineering.”  In a strange way, this message is a comfort to wingers.  At last, says the winger, the environmentalists will throw up their hands and let the rest of the world get on with the important business of making sure future generations will be strengthened by the struggle to survive on a plundered and ruined planet.

Classy.  There’s an alternative message, for those not willing to give up the ghost just yet: it is not only still worth doing something about it, but more important than ever.

Christianists are fond of yawping about how prophets in Old Testament times were killed if they made any mistakes.  Yep, they had to have a perfect record.  Which they accomplished by being vague, as I certainly would if my ass were on the line.  But the prophets were neither scientists or actuaries, and their prophecies were not evidence-based.  That was excusable back in the days before we knew what we know now, but if you confuse events like weather with aggregate outcomes like climate, how is that responsible?  If you ignore clear warnings from qualified sources, how is that good governance?  Why should anyone take you seriously if you bet against the house?

Or we could just keep believing, and keep pulling the lever.  God’s watching over us.

Categories: Uncategorized
  1. Still Me
    January 30, 2009 at 12:14 | #1

    I have a friend who works with a very religious Christian, of what denomination I do not know.  Apparently this Christian’s sentiment about the environment is, do what you want now and don’t worry about the future of the earth; don’t worry if we all die, because we’ll just end up getting to heaven and to God’s Glory that much sooner.

    Twisted logic.

    Hee hee…your word verification for me on this comment is “believe”. Maybe … nawwww.

  2. Still Me
    January 30, 2009 at 15:27 | #2

    By the way, Ernest Callenbach was on public radio yesterday morning with a rather upbeat and hopeful discussion about his book Ecotopia, from the 70’s.  It’s being reprinted.  If you want to listen to the web archive let me know and I’ll give you more info. This might help lift your own spirits about the environment if that’s the sort of thing you are thinking.  He is a good presenter.

  3. February 3, 2009 at 08:01 | #3

    Hmm.  I wonder if anyone’s ever done a study comparing the magical thinking of gamblers, religious freaks, and the Bush Regime?  I’d imagine there are some striking correlations there.

    This was a fantastic reminder of who really gets played when you play the odds.  Thanks muchly!

  4. Tbird
    February 12, 2009 at 20:01 | #4

    Actually, Christianity is becoming increasingly green these days. But that’s not the part that interests me so much. Scientific consensus concerning global warming (climate change) is not so monolithic as you assert. And those who do not buy into the alarmist scenario generally know the difference between ‘weather’ and ‘climate’. Further, though I’m not sure you really meant it this way – it’s a bit simplistic to think of weather as strictly an input mechanism into the larger aggregate of climate. Even taking that at face value – weather is so big and complex that we haven’t done too well yet predicting it. It’s apparently pretty hard to predict the frequency, magnitude, and path of hurricanes, much less the likely locale for future floods, droughts, etc. Computer models do considerably less well than the Farmer’s Almanac. Vulcanism and many other variables for the ‘aggregate outcome of climate’ are equally hard to predict. In other words, there may be reason for not putting sufficient trust in elements of the present scientific establishment to warrant putting our entire social, financial, and political futures into their hands. This becomes more a problem given the ill advised marriage of science and government where the climate issue is concerned. That’s a bad idea regardless of the issue or the ‘wing’ of one’s politics. Thanks all.

  5. February 12, 2009 at 21:27 | #5

    Wow, Tbird… I hope we can develop technology for turning BS into fuel; your comment would solve all our problems.

    “Ill-advised marriage of science and government”?  On what basis do you suggest government make decisions?  Oh right… the Farmer’s Almanac.  Or maybe the Bible.

  6. Tbird
    February 13, 2009 at 13:16 | #6

    Actually, no I do not recommend that the government make decisions based on either the Farmers Almanac or the Bible. My reference to the Almanac had to do with the accuracy of weather predictions made by computer models. I don’t recall mentioning the Bible at all. And yes – the ‘ill advised marriage of government and science.’ But you read that the wrong way. The problem is not with government making scientifically based decisions but with science making politically based decisions. Right wing or left, it doesn’t matter. When science is driven by a political – or religious – agenda the results can only be bad. A small for instance – when governors with an agenda control the disbursement of grant monies for scientific research with an eye toward advancing that agenda, pressure is put on science to arrive at conclusions suiting the agenda. This is bad for those who depend on science arriving at the actual truth instead. Such political pressure is brought to bear on science in numerous ways. Hope the clarification helps. By the way, I once visited a farm in Iowa that featured a pretty nifty mechanism for converting BS into fuel. The bovine waste produced methane which, converted to electricity, ran the whole dairy including a cheese factory and a small museum the farmer had built, with enough juice left to sell some back to the public utilities. It was pretty cool.

    Thanks again.

  7. March 1, 2009 at 00:13 | #7

    Vegas is proof that psychics and and prayer could not possibly work.  The probabilities in gambling are so well-tuned and understood that any deviations due to psychic power or prayer, however slight, would, over time, become obvious and measurable. No such deviations have ever been observed. 

    The only workaround is that for every prayer god sees fit in Vegas to answer, he must also cause someone else who would not have otherwise lost to lose.

    God cost me $400.

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