PSYCHOLOGY, MEMORY, SELF-DELUSION, ECONOMICS AND FINDING WORK

A conversation between Brooke Allen (founder of NSoW) and Tom Heinzen who is a Professor of Psychology at William Paterson University in New Jersey, a practicing psychotherapist, and co-author of Statistics for the Behavioral Sciences, Many Things to Tell You: Natural Poetry by People Living in Nursing Homes, and Eighty Dots. We met recently over bagels.

Brooke: Thank you so much for taking the time to speak with me.

Tom: You are most welcome. I am very interested in the premise of No Shortage of Work; it could be of great help to my students.

Brooke: How so?

Tom: I try to show them, as you do, how they might benefit from alternative approaches to the job market.

Brooke: For example?

Tom: Economics has the concept of “opportunity cost”. If you buy something with money, the direct cost is what you pay. But there may be other costs in terms of what you have to give up. If you were invited to someone’s house for dinner, but instead you bought Yankees tickets, in addition to the price of the ballgame, you also incur the cost of not having dinner with friends.

Brooke: How does understanding that help you find a job?

Tom: Rather than concentrate on doggedly pursuing the end goal, say an interesting and high-paying job, you might concentrate on just doing better than you are currently doing. If you are doing nothing, the opportunity cost of doing anything else is zero, so you can do anything and be better off even if it pays zilch, and it might give you skills. Then, if something else comes along, giving up the thing you are doing now becomes your opportunity cost. For example, perhaps a high paying, but boring job comes along. The cost of taking it might be giving up unpaid work that was interesting.. Eventually, you may become an excellent candidate for a high-paying and interesting job that you would have had no hope of getting directly.

Brooke: That is a core idea at NSoW.

Tom: Another idea comes from statistics. For example, imagine Company A advertises a job – that is certain. Company B advertises no job. What is the probability you will get a job at A vs. B.

Brooke: You want me to say it is more likely at A – but there’s got to be a trick here, doesn’t there?

Tom: Right. It depends on, among other things, how many people are competing for the job at Company A. Imagine both companies have 100 managers. Company A has one manager offering one job that has received 500 applicants. Your chances of convincing that one manager to hire you may be very slim, no matter how good you are, just because of the competition. The chances of convincing one of the 100 managers at Company B to hire you might be so high, it isn’t even worth your time to apply at Company A.

Brooke: That’s another theme of ours. Why wait around for other people to identify their needs – do it for them. Did you learn that in school?

Tom: No, I learned that as a salesman. I worked as a salesman before going to college.

Brooke: Well, we have a problem of selling the idea that there is no shortage of work. For some people, it seems obvious, and when they embrace the idea they reap all the benefits of it being true. And others embrace the opposite belief, and they experience the world as there was no work anywhere.

Tom: Sometimes a little self-deception is a good thing.

Brooke: Huh?

Tom: There was this study of some 80-year-olds who had convinced themselves they were 65. They actually behaved like they were 65, even had the physiology of 65-year-olds. It was as if believing they were 65 made them so. But if they had believed they were 20 they might have gotten in trouble attempting the things 20-year-olds do.

Brooke: Like trying to pick up 18-year-olds?

Tom: No comment.

Brooke: My grandmother was fond of quoting Henry Ford who said, “Whether you believe you can do a thing or not, you are right.”

Tom: That is true; within limits. Believing you can fly by flapping your arms doesn’t make it so.

Brooke: Are you saying that we are wrong – there is a shortage of work?

Tom: No. It is a fact that there is no shortage of work, at least the way you define it. But I am saying that if you don’t believe it, you won’t act as if it were.

Brooke: So, if you don’t believe it is true, what do you do?

Tom: You might consider acting as if it were true even though you know it isn’t, just to see what happens.

Brooke: That is amazing. A very busy man gave me about 5 hours of his time last summer. I thanked him. He said, “No problem, there is plenty of time for everything.” I said that surely can’t be true, we might not know how much time we have on the planet, but it isn’t infinite. He said, “Just act as if it were infinite and see what happens.”

Tom: Does having infinite time mean you don’t have to do things now because you can put them off into the future?

Brooke: Funny, I wrote to him later and asked if he was talking about the afterlife – that everything didn’t have to be done in this life; it can wait. He wrote and said he saw no evidence for an afterlife.

Tom: Did you change your beliefs?

Brooke: Not really, but I have started to act as if time were infinite and something weird is happening. It feels as if I have more time and I’m getting more done because it feels like I have more time for things. It has cut into the time I spend watching TV, however.

Tom: Interesting.

Brooke: You teach psychology, and you are a therapist. Another thing I run into is the concept of fairness. People say, “How do I know if I work to benefit someone else without being paid now that I will eventually be rewarded?”

Tom: You don’t know. How can you? It is kind of like raising a child.

Brooke: How so?

Tom: All you can do when bringing up your kid is to try to load the dice in their favor. The more lottery tickets you buy, the greater the chances of winning.

Brooke: But, lottery tickets are a sucker’s bet.

Tom: True, but free lottery tickets are not. If you are not giving anything up to do something of value to others, it is like getting a free ticket; no guarantees, but worth more than nothing.

Brooke: One NSoW idea is that time is a wasting asset, use it or lose it.

Tom: This really comes home when I do the eighty dots with my students.

(Eighty Dots is the name of a book by Tom. In it he describes a technique he uses with his students – he draws eighty dots on the board to represent 80 years of life expectancy.)

When I cross off the first twenty dots, it really drives home the point that their life is already one quarter over. Then I begin crossing off years for school, work, family, and so on. Eventually the question arrives, “Hey, when is any of this for me?”

Brooke: How old were you when you wrote it?

Tom: Early fifties?

Brooke: The teacher in the book is called Professor Midlif. What is that all about?

Tom: Isn’t it obvious?

Brooke: Many friends have told me that periods of unemployment have been the turning points in their lives when they change direction and get more control.

Tom: As a therapist, I can tell you that making changes like that can be a lot of work…

Brooke: On the other hand, I know people who spend 20 years complaining about their job, get laid off, and then spend years trying to get exactly that same job back. I try to suggest that the reason they got laid off, and the reason they aren’t landing a new job, is because nobody needs that sort of work done any longer.

Tom: That happens a lot.

Brooke: I know unemployed people that spend their days playing on-line games instead of working, or even looking for work. They also have kids sitting at home who don’t lift a finger to find a job. How can they tell their kids to go get a job if they don’t set a good example?

Tom: My wife and I were late bloomers. So, when our children were in grammar school, we were in college. We didn’t have time to watch TV, help them with their homework, or even spend time yelling at them for not doing theirs. We were too busy studying, so that is what they saw us do. On the other hand, your kids can be motivated to not be like you. Psychologists refer to the “possible self” – all the people you might become. Your child may see someone they want to become, or someone they don’t want to become.

Brooke: Funny. I don’t smoke and my sister does. We both have the same reason, “What do you expect; dad smoked four packs a day.” My dad was a sculptor, and all I can tell you was that when I was a kid I didn’t want to be one.

Tom: I bet you don’t actually know much about what you thought of your dad being a sculptor as a kid. You remember things, but there is a good chance you remember things that never were. There was an interesting study about how young women, who are not virgins, lose all memory of having lost their virginity after signing vows of celibacy, and women who have rescinded on those vows, lose the memory of having signed. (citation/link needed) Rewriting a memory can be a good thing, as when a couple fondly recalls their time spent on a vacation that would have invoked horror if remembered accurately. Or it can be bad, as when a young girl leaves an STD untreated because she remembers herself as a virgin.

Brooke: Barbara Ehrenrich takes aim at the whole “positive psychology” movement in her book, Bright-sided: How the Relentless Promotion of Positive Thinking Has Undermined America. Have you read it?

Tom: Yes. She has a point. Even though I was helped by my training as a salesman when I was younger, which has many of the elements of positive psychology, I do think you can go overboard and slip into wishful thinking.

Brooke: I took a one-day class on selling once. It was mostly about staying optimistic in the face of rejection. What else did you learn in selling?

Tom: I learned to think of my job as being of help to my clients.

Brooke: You mean, being a false friend?

Tom: No, I mean being a business consultant.

Brooke: I met this fellow whose daughter had been diagnosed with autism. He believed that she was destined for an unhappy future. He was trying to hit it big on Wall Street so as to make enough money to give his daughter the best therapy money could buy. I introduced him to my friend, Rob, who has an autistic son. Rob told me once that, while he feels lucky to have made so much money, having an autistic child was a gift. Helping that child, and advancing the understanding of autism, has given meaning to his life in a way that making rich people richer does not. His advice to the father of the daughter was that he develops more positive expectations for his daughter.

Tom: That is very interesting.

Brooke: But some friends who are critics of “positive thinking” would be skeptical. Rob founded a school for autistic children, and has done original work to advance the understanding of the condition. He takes personal responsibility for helping his son, and the results are dramatic. I can’t imagine he could have been so successful while maintaining a sense of hopelessness. Was his success a result of the kind of self-deception we talked about earlier?

Tom: There is another concept we call “framing” which refers to how we view the problems in our life, and the orientation we take regarding their solutions. If Rob sees his son as a gift that gives him a focus to his efforts, and if the other person views his daughter as a burden, that makes it necessary that he make a lot of money, then of course their attitudes will differ.

Brooke: You know, it is funny how money works. Thirty years ago, I was taking flying lessons but I had to drop out because I couldn’t afford it. I noticed that at the airport there were a bunch of high-school kids who would hang out all weekend, doing odd jobs for free, and when instructors had time, they would teach them how to fly. They were becoming pilots and I was not. One of the richest people in the world has an autistic son, and he has sponsored a great many efforts in the area. My bet is that if the man I met dedicates himself to helping his daughter directly, and if money becomes a missing ingredient, it will show up. I cannot base this statement on anything other than faith. However, I can tell you with certainty that you can dedicate your life to making piles of money, and fail miserably.

Tom: It sounds like the direct cost of learning how to fly was high for you. Those high-school kids were learning how to fly because the opportunity cost of their time was zero. Helping out at the airport gave them the chance to fly. Why didn’t you just go out to the airport and do what those kids were doing?

Brooke: Uhm, this is embarrassing… I hadn’t thought of it. One of those high-school kids might be an unemployed 50-year-old today. My goal is to teach him a lesson from his own past; one that you point out I hadn’t learned. He might not be working because he can’t find a job that will pay him the $100,000 he used to make, not because there is anything wrong with him, but because the jobs don’t exist. I want to teach him that, because his opportunity cost is not $100,000, but zero, he is now free to do anything that doesn’t cost him something. He could start hanging out at the airport again.

Tom: I bet that if you were to teach him that lesson from his past, his memory of his past will change.

Brooke: Interesting. There is a man I met who left a high paying job to spend a year sailing around the Pacific. Did he buy a boat? No. He cooked for a wealthy family on their obscenely big yacht and they taught him to sail. That was how he spent one of his dots. Before he left, he told me he didn’t want to go sailing some day; he wanted to do it now. Even though the direct cost of sailing was zero, the opportunity cost of taking that year away from work was huge. If he were unemployed, his direct cost and his opportunity cost would both have been zero, making a year in the Pacific an even more compelling option.

Tom: That is how I would like my students to frame their circumstances. Instead of “I can’t do anything because I can’t find a job?” I’d like them to think, “Because my opportunity cost is zero, I can do anything.” Of course they may not be able to do things that require other people to give them money, but there are still plenty of things they can do.

Brooke: You once told me that you believed the only two things you should borrow money to buy are a house and an education. Now that home prices have collapsed, do you still believe that?

Tom: Um… yes.

Brooke: I’d like to challenge you on that. As a trader, one thing I have learned is that no matter how good something is in terms of intrinsic value, the price can be too high. If it makes sense to borrow money to buy a house for $100,000, then does it make sense at $200,000, $500,000, $1,000,000? At some point the price is too high.

Tom: OK.

Brooke: Now, let’s talk about the opportunity cost of a graduating student with $50,000 in debt. Can they really do anything? If they choose to sail around the Pacific instead of taking a paying job, they might default on their loan. So, isn’t the cost a bad credit rating or possibly worse?

Tom: That’s true.

Brooke: But, if they turned down the chance to sail for a year, and instead spent their time looking for work and not finding it, they might still default. And if that happens, they would have been better off had they gone sailing.

Tom: But, if they spent the year looking for work, it would be like buying lottery tickets… there was a chance they would land a job, but if they sail around the Pacific it might make it certain that they will default.

Brooke: That’s right. They probably should keep looking and not go sailing. My only point is that, while education might open opportunity, incurring debt reduces your options.

Tom: It’s all a tradeoff.

Brooke: That’s right, but at some point, the price can be too high. I recently met a man who graduated with an MBA in Finance, and $250,000 in debt. He can’t find a job that pays enough to give him any hope of honoring his debts. He was very upset.

Tom: I can imagine.

Brooke: Now, I have an MBA in Finance which is all about assets, liabilities, probabilities, and prices. I paid cash for my education, so I could chalk it up as a sunk cost if it was worthless, as it eventually proved to be. But, at no time, in any of my classes, did anyone teach us how to evaluate our education as an investment. I think this is almost criminal, and in the investment world, it would be.

Tom: I think education needs to be reformed.

Brooke: I agree, although I don’t have the fortitude to tackle it. But, may we meet again to discuss education? My thesis at NSoW is that an education is one of the least expensive things you can get, often free, and I’m not talking about winning a scholarship, I’m talking about what you can do to learn without incurring cost.

Tom: Of course. Let’s talk again.