[Cass R Sunstein] Must-reads of 2018: Poker, politics and, yes, Bob Dylan

Most lists of the year’s best books reflect the personal tastes of those who produce them. This list is different. It’s entirely objective. What unites these five books is that nothing is rote or by-the-numbers about them. Each of them crackles with a kind of demonic energy.

“A Crisis of Beliefs: Investor Psychology and Financial Fragility,” by Nicola Gennaioli and Andrei Shleifer.

What caused the financial crisis of 2008? What’s likely to cause future crises? Gennaioli and Shleifer offer an original, compelling and intriguing answer: investor psychology.

The authors argue that investors greatly underestimated the risk of a crisis because they relied on what psychologists call “the representativeness heuristic.” When people use that heuristic, they exaggerate the probability of outcomes that are similar to those that have been observed recently -- and they neglect outcomes that are radically different.

In periods defined by good economic news (involving, for example, housing prices or technology stocks), investors overlook the risk that things will start to go sour. But when a downturn begins, investors overreact, again because of the representativeness heuristic. They start to sell assets, thus turning the increased risk that they suddenly perceive into a reality.

Gennaioli and Shleifer offer a parsimonious account of boom-bust cycles -- one that relies mostly on what goes on in people’s minds.

“Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts,” by Annie Duke.

When you go to a restaurant, get married, take a job, move to a new city or choose a vacation, you’re making a kind of bet. A winner of the World Series of Poker, Duke has a psychology background. Integrating her fascinating gambling experiences with academic findings, she shows that if we think of our choices as bets about an uncertain future, we will be able to avoid an assortment of errors and cognitive traps.

To be sure, the quality of our decisions matters -- but so does luck. People often fail to distinguish between the two.

Duke’s discussion is full of wisdom and also of fun, warmth, humor and humanity. Her sharp, data-driven analysis comes with a large lesson, which is that losers should be willing to forgive themselves: Sometimes the right play just doesn’t work.

“Fire Sermon,” by Jamie Quatro.

Quatro is interested in routine, religion, sin, romance, longing, the illicit, love in multiple forms and (most interestingly, I think) the experience of time. Some moments and days, she shows, are part of life’s furniture. They blend into each other. They are precious, in their way, but nothing stands out.

Other moments (and perhaps days) are in Technicolor. The world bursts into song. Such moments seem to last forever. They define lives.

Quatro has been compared to the great Flannery O’Connor; the comparison is fair, because both take big risks, and have unmediated access to some of the hidden recesses of the human heart.

“Network Propaganda: Manipulation, Disinformation and Radicalization in American Politics,” by Yochai Benkler, Robert Faris and Hal Roberts.

There are a lot of books on networks, social media, propaganda, polarization and American politics. This is the best.

Packed with data, it is organized by a clean, simple story, which is that it’s the right vs. the rest, not the right vs. the left. The authors identify a right-wing ecosystem, led by Fox News and Breitbart, and it amounts to its own political universe. What happens on Twitter, Facebook and elsewhere is in significant part a result of an ideological feedback loop, self-consciously manipulated by the right.

In the process of documenting all this, the authors raise serious questions about some widespread understandings. It’s too simple, and in important respects wrong, to say that social media are driving political polarization. The role of the Russians in the 2016 election turns out to be more complicated, and more subtle, than people think.

It’s not right to say that the right and the left have their own echo chambers; the left doesn’t, at least not in anything like the same sense. The authors also have a host of ideas about how to make democracy work better.

“How to Stop Time,” by Matt Haig.

Has there ever been a novel like this one? It’s a romance, a thriller, science fiction and a comedy -- and its topic is what is precious. While its hero lives for hundreds of years, he discovers that any of us can find ways to stop time. The book is a ton of fun, but Haig is interested in a lot more than that.

“Dylan on Dylan: Interviews and Encounters,” edited by Jeff Burger.

In the mid-1960s, Dylan “went electric,” abandoning folk music and the protest songs that had made him famous. Many of his fans were puzzled and angry.

Things came to a head in his Royal Albert Hall concert in 1966, where much of the British audience jeered. Dylan responded, “These are all protest songs. This is not British music, it’s American music.”

These interviews sing, and they offer plenty of American music.

Consider this: “Museums are cemeteries. Paintings should be on the walls of restaurants, in dime stores, in gas stations, in men’s rooms.” Or this: “The word ‘protest,’ I think, was made up for people undergoing surgery. It’s an amusement-park word.”

But there’s also humility, even sweetness: “I don’t know how I got to write those songs.”

Dylan once sang, “To live outside the law, you must be honest.” Even when they’re not exactly truthful, these interviews are honest.

To put all of these books in context, consider what William Blake wrote about John Milton, the greatest religious poet in the English language: “The reason Milton wrote in fetters when he wrote of Angels & God, and at liberty when of Devils & Hell, is because he was a true Poet and of the Devils party without knowing it.”

The authors of the best books of 2018 aren’t of the Devil’s party. But in their different ways, they’re true poets. They’re unfettered.


Cass R Sunstein
Cass R. Sunstein is a Bloomberg Opinion columnist. He is the author of “The Cost-Benefit Revolution” and co-author of “Nudge: Improving Decisions About Health, Wealth and Happiness.” -- Ed.

(Bloomberg)