• Julian Talbot

Existential Risk as a Process

In Ernest Hemingway’s novel The Sun Also Rises, a passage in which a character named Mike is asked how he went bankrupt. “Two ways,” he answers. “Gradually, then suddenly.


Geostrategic and technological change happens much the same way. Small changes accumulate, and suddenly the world is a different place.


Life on earth is, by any metric, somewhat improbable. Infinitely improbable, according to many physicists. The continued existence of homo sapiens, or any species, is uncertain. And unlikely. We know that roughly 500 million years from now, our sun will start to die, and if we are to overcome that little problem, we must first become an interstellar species.


Well before then, however, we must learn to manage cyber wars, climate change, massive meteorite strikes, nuclear war, artificial intelligence, and solar flares, to name a few risks. Granted, the likelihood of any single event wiping out life on earth, or even the human species, is low.


That, however, is only true if we view them as independent events. Climate change, as it increases, will stress many populations. Combine that with a solar flare that takes out satellites and electricity grids. An opportunistic nation might seize the opportunity to unleash its nuclear weapons and AI against countries it perceives as vulnerable.



Many believe that our risk management strategies and geopolitical understanding have matured to the point where such calamities can be anticipated and prevented. Recent actions of Chinese President Xi Jinping and Russian leader Vladimir Putin suggest that the seventy years following World War Two may be an anomaly, a mere blip in history.


Discussing the risk of nuclear war, Thomas Schelling, recipient of the Nobel Prize in Economics and professor of foreign policy, national security, nuclear strategy, and arms control, argued that analysts were mistaken to talk of the brink of nuclear war. He argued that war is not the "sharp edge of a cliff where one can stand firmly, look down, and decide whether or not to plunge."


Schelling asserted that a better description was a "curved slope." A leader might edge their country out onto this slope, but "the slope and the risk of slipping are rather irregular; neither the person standing there nor the onlookers can be quite sure quite how great the risk is, or how much it increases when one takes a few steps downward."


This concept can be applied equally to any existential risk. Describing risk as a curved slope might seem like sophistry. But most risk management is predicated on thinking about what might happen and assessing the likelihood and consequences. Baked into this approach is the assumption that risk is binary. It will happen, or it won't happen. After the fact, we can say whether the risk did or did not occur.


A binary approach is probably acceptable for slips, trips, falls, and business-as-usual risks. But it is a dangerous assumption for global catastrophic risks or existential threats. A better model might involve changing our thinking from 'risk might happen' to 'risk is happening.' That involves thinking about risk as a process rather than an event. Such an approach significantly changes our current thinking, including the ISO31000 model.


Geostrategic and financial analysts are perhaps more in tune with this concept of risk as a living process. But arguably, even those skilled individuals unconsciously measure risks as events, not processes.


If a risk is an uneven slope rather than a binary event, neither the participants nor observers can be entirely sure which part of the slope they are on. Or when they reach the point of no return.


Thanks to Malcolm Gladwell's book, most of us are familiar with the concept of a tipping point. It's a valuable concept, but it doesn't serve us as in risk management if the tipping point is only visible in hindsight. Thinking of risk in terms of a tipping process may be more accurate.


Events and consequences can become inevitable long before we realize it. However, they might be preventable or recoverable if we understand that we are in the process and actively involved as participants.


In such a process, we might even have the opportunity to intervene with additional resources. In practical terms, we need an approach that sees the journey, not just the possible destinations, for global existential threats.


In the words of Benjamin Graham, one of the greatest investors of all time, "The purpose of the margin of safety is to render the forecast unnecessary."



 

If you're looking for ideas on what we can do to think about risk as a process, some of these might help.

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