Applying Black Swan concept in sustainability: Via negativa, barbell theory, and soul in the game

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As an amateur reader, I have never read books that are so addictive as the ones from Nassim Taleb. His writing always gave me both dopamine hits and brain exhaustion.

I started by reading the Black Swan (his best selling book about unlikely events i.e. the 2008 crisis) a couple of years ago, hearing that Jeff Bezos required all Amazon executives to read this book. So there I was, flippering the first 50 pages that gave me a headache. Honestly, I didn't understand the first time I read it. Only after a second time of slow reading, and a third time revisiting the book, I kind of understand the ideas.

It was not easy. But like playing tough video games, it kept me wanting more and ended up reading all 5 of his books.

The goal in life is not to read as many books as we can, but to reread the best books. Nassim Taleb's book is one that will be reread for thousands of years.

- Naval Ravikant

This article is based on Taleb's thought provoking concepts applied to environmental sustainability.

Via negativa: Improving by removing

Via negativa was mentioned in the book Antifragile. It means that by removing, we make things more robust. Most of the time It is easier to avoid or remove problems than to add new solutions to fix a problem.  

To mitigate climate change, we are used to the question of how to reduce carbon emissions. But the reduction has limits. There are more important questions to tackle, how to remove carbon emissions.

Carbon removal is a concept of removing carbon emission from the atmosphere by storing it on earth (e.g mangrove), converting it into other things (e.g cements), or even avoiding it to go into the atmosphere in the 1st place (e.g capture plant in manufacturing plant).

Barbell theory: aim for low and high, never medium

Barbell theory in Finance means that in order to maximize return, we should not invest in medium assets, because it could go up a bit but can also go down to zero. Rather, we should distribute between high risk bets (e.g crypto) and low risk safety nets (e.g bonds). Taleb concluded that these approaches can be applied to anything in life.

Barbell theory could work for the environment too, we can do a lot of actions that have smaller impacts (e.g riding bicycles, turning off the plug at night), while allocating enough resources to support moonshot projects that could have a high impact.

For example, Bill Gates has invested a lot of time and money in Terrapower, a nuclear technology company that aims to provide clean energy on a large scale. When I was in high school, I was taught that nuclear power is bad, because it's dangerous. 

However, some (including Gates) might argue that because there have been accidents in the past, does not mean we should stop innovating. Imagine if we stop building airplanes after the first 10 accidents since the Wright Brothers’ invention, we will never have created the modern airplane.

Innovation sustains civilization, we need to keep innovating for a cleaner way of life.

Source: link

Soul in the game: Have passion

Skin in the game means taking the risk of the downside to  enjoy the upside (e.g., opening up a business, owning shares). From the book skin in the game, I also learned the concept of soul in the game. To have passion for something bigger, more important than our self existence.

Source: Enjoy the weather

I see lots of soul in the game within the Web3 community, especially in the regenerative finance movement. For example, the folks at Regen network are building the financial infrastructure as the base layer to support environmental focused projects.

It uses distributed ledger and remote sensing technology to measure quantifiable output and tokenize it. Tokenizing carbon emission has been done successfully by other projects (read my previous article on carbon tokens), but Regen is looking beyond that.

Regen is creating new incentives based on a regenerative practice (input), even though the output would not be seen after 10-20 years. For example, a chocolate farmer can claim a token if its practice can be verified of having positive environmental impact.

We can incentivize economic activity that benefits the local ecosystem. WAGRET (We gonna regenerate earth together).

- Gregory Launda, founder of Regen Network

Regen is developing a framework so the community in the network can self verify openly and transparently on the chain. This could help to reduce the hassle of having 3rd party verifiers and cutting the middlemen (e.g. only 20% of conventional carbon credit profit goes to the landowner, 80% are distributed to different players). 

Conclusion: Black swan

Absence of evidence does not mean evidence of absence, as explained very well in the Black Swan book. We don't know what we don't know, there is always a probability of catastrophe. 

In our environment, we have seen various evidence of destruction, from rising sea water that floods lowland areas, to extreme heat that burns forested areas. However, it does not mean that we have it all figured out. 

Let’s be paranoid about the worst unlikely events from climate change, and channel our energy to create new solutions.

Thanks for reading this article. Life is beautiful. Enjoy the weather.