June 20, 2024 • 42 mins
This week on Risky Business, Nate and Maria discuss the reasoning behind Macron’s decision to hold early elections in France, how heat waves could help communicate the reality of climate change, and what we can learn from the impending sriracha shortage. The theme that ties it all together: How to think about long-term risk.
Further Reading:
“The stakes are high in Macron’s gamble” from the Financial Times
“What A Sriracha Shortage Teaches Us About Supply Chains” from Forbes
For more from Nate and Maria, subscribe to their newsletters:
“The Leap” from Maria Konnikova
“Silver Bulletin” from Nate Silver
See omnystudio.com/listener for privacy information.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:15):
Pushkin. Welcome back to Risky Business, a show about making
better decisions. I'm Maria Kuanakova.
Speaker 2 (00:28):
And I'm Nate Silver.
Speaker 1 (00:30):
Today on the show, we'll be starting off by talking
about Emmanuel Macrond, the President of France, calling snap elections
and what that means for how leaders think about risk assessments,
especially when they are huge gambles as in this case.
Speaker 2 (00:43):
And we'll talk about the heat wave that's been predicted
to hit the eastern United States this week, kind of
as an excuse to talk about climate change, an issue
I hope we can address on the show once in
a while, and communication versus reality on long term risks.
Speaker 1 (00:57):
And finally, we're going to be talking about one of
the single most important effects of climate change, which is
the potential shortage of one of my favorite condiments, siracha
hot sauce.
Speaker 2 (01:09):
Even a hot sauce is a hot sauce.
Speaker 1 (01:13):
Okay, Okay, we get we'll have we'll have this debate
after the break to come. Okay, So, Nate, as as
you've heard, Emmanuel Macron just did something that is completely
I mean, it's not completely unprecedented, but it's incredibly risky.
(01:34):
So we had EU elections right, and it turns out
that his party did not do that well. National Rally,
which is the Party of Marine Lapenn got thirty one
point four percent, and this is the far far right
party in France, and the New Popular Front, which is
(01:55):
the left wing alliance, got a total of about twenty
six percent, and his party got fourteen point six percent.
So he's the president right ruling party not not doing
that well. And instead of saying, you know, we need
to kind of rethink this stuff, we need to do something,
he decided to call snap elections three years ahead of schedule.
(02:16):
So on June thirtieth and July seventh, France is going
to go through two rounds of elections. And this is
a decision that as far as we can tell, Macron
did not consult with his government on. The Prime Minister
was absolutely shocked and it could have huge repercussions for France,
for Europe, for kind of the rise of right wing
(02:37):
nationalist movements in Europe. And the reason why I thought
it was really interesting for us to talk about this
is because there are some echoes of the types of
high risk maneuvers that we've been talking about that might
be an option in the United States, but of course
it's a huge, huge gamble.
Speaker 2 (02:55):
I already have a couple of points of pushback here, Maria, Yeah,
please push back night. One point I pushedback is I
think labeling everything right wing is not very revealing sometimes
because it neglects differences, including why in France and other
(03:16):
places that the you know, right wing conservative movements have
become more popular and more effective. You know, Marine le
Penn has been trying to soften her party's image.
Speaker 1 (03:29):
But let me, I'm just going to interrupt you right there.
But we know what the Front Nscionale is, right, and
we know that it was founded by her father, Jean
Marie Leapenn, who was just a rampant anti summit. Like this,
this is not a good party. This is a party
that's anti immigration, anti Semitic, anti all minorities, racist like this,
this is like as bad as it gets.
Speaker 2 (03:50):
But you're thinking like an elite. I am a man
of the masses. I think it's important to understand the
and democracy. We want to understand why more right wing,
veiled ideas might sometimes become popular in some cases because
they're paired with economic liberalism or maybe should say economic
or left wing policies where you have a welfare state,
(04:13):
you're not too concerned about budget deficits. You might even
tax the rich to some degree. Look, if I go
to my hedge fund poker game or whatever, people there describe.
Speaker 1 (04:23):
Themselves of the.
Speaker 2 (04:27):
People describe themselves as socially liberal but fiscally conservative or
moderate right. Those are not typical people. What these parties
have figured out is that if you're going to have
right wing populism, you don't necessarily need right wing conservative
economics to go along with that. Well, they will. They
(04:49):
will claim to want to protect the welfare state. They
are not very concerned about things like budget deficits, which
are seen as the province of centrists. Even Trump, to
some degree, he's not Paul Ryan in terms of talking
(05:10):
about like performing entitlement programs. Is willing to balloon the
deficit to cut taxes without necessarily cutting spending. They did
try to kill Obamacare in Trump's first term in office.
They've talked less about that this time. Maybe Democrats should
talk more about it. But, like you know, cultural grievances
(05:31):
that are often based in senophobia or racism, paired with
the welfare state, which is a very popular program sometimes
kind of left leaning economics is part of the reason
these parties around the world have been more have been
more effective now.
Speaker 1 (05:47):
And I think that that actually is a very important point. So, yes,
you know everything that I that I said, I think
stance about this party and why Marine the pen is
actually incredibly dangerous. However, I think it's important to note
that in these elections that just happened, the party one
ninety three percent of communes, which are the local districts,
(06:08):
came in first, right out, out of all of the
parties in ninety three percent of the communes in France,
which is huge because it means that they are finally
making inroads into places where historically they never have before.
And so I think that you're making a very valid
point that even though we might see, okay, this is
what the real agenda here is. And it's really scary
(06:30):
for voters who are looking to okay, you know, how
do we make our daily life better. We don't like Macron,
we don't like that he raised the retirement age. He's
making us work right, Macron is not popular. We're going
to vote for this for this other party, So kind
of I think one of the bigger there are two
big things here. One is the one that you just
pointed out that they are making inroads and they have
(06:52):
figured out a way to kind of connect to the masses,
and I think that that's something we're seeing in the
United States too. But I think the other thing is,
you know, how risky then is it to try to
call a snap election right now and say, well, fine,
you really want these guys, Let's see what happens. Because
I think that this is actually potentially there are two
(07:14):
things that he could be thinking, at least in my mind.
Number One, we're going to win, right like Number one,
when push comes to shove, I'll be able to assert
that people actually want more moderate politics, that they don't
really want this far right. Number Two, we're going to lose.
And that's okay because the presidential elections aren't for several years,
(07:35):
and people are actually going to get a taste of
what it means to have this far right force kind
of controlling a lot of the political agenda. They're not
going to like it. And then come election time, Marine
Leapen will not win the presidency and our party will
be in a much stronger position. Both of these things
are incredibly risky ways of thinking to my mind.
Speaker 2 (07:56):
Yeah, there are a couple things here. I mean, first
of all, thank you for the clarification on how this
is not a presidential election, which is not scheduled until
twenty twenty seven. For people's context, in the previous election,
which is twenty two, they're five years apart. In France,
Macron defeated the Pen by quite a bit, fifty nine
percent to forty one percent in the second round runoff. Right,
(08:20):
there are a whole bunch of different parties in France.
There actually are like kind of a viable left, center
and right plus weird i don't know, Gallic, Celtic whatever
parties here and there. But in that final two, in
that head to head match against matchup against the Pen,
despite being unpopular himself, he won by a pretty healthy margin.
(08:42):
I mean, you know, frances is still one of the
most liberal and kind of many senses of that term
countries in Europe. The prime minister is uh, this young
gay guy for example, Right, I mean, it's a country
that like has always kind of had like a proud
tradition of of political diversity, but including being you know,
(09:03):
proudly left wing in certain ways. So part of way
when I talk about this summary with you is when
people say the term risky. There are a couple of
ways in which that can be abused, I think right
one is that sometimes risky is just a euphemism for stupid,
Like it may have been really fucking stupid for McCrone
(09:26):
to call this election at this time. Right, it's a
bad time not just for incumbent parties in France but everywhere.
In the UK election set for July fourth, Conservatives are
set to get destroyed to the point where the Tories
may not even be the second largest party anymore. Now.
In the US election, Joe Biden is currently losing we've
(09:48):
talked about on the show by a little bit in
the polls to Donald Trump. In India, Mody just saw
a big demotion in the number of seats that his
alliance had, so the timing like couldn't be much worse.
And if you look at polls, then his group, which
is called Ensemble, there's some fancy or French name. I'm
(10:08):
not gonna try renaissance.
Speaker 1 (10:10):
Yeah, you're talking about Macron's party, Crown's Party.
Speaker 2 (10:15):
His party is in third place behind the right wing
coalition in the lift wing coalition and has only declined
in the one or two polls since the announcement was made.
And listen, it's a different system where the campaign takes
place much more quickly than in the US. That means
the polls can move more quickly. But like, but this
(10:38):
is not a good time to be an incumbent centrist technocrat.
It's not happy times for that for that type of politician.
And and Macron is like swimming upstream into that. So
risky may just mean stupid. There's also a bias, I
think toward assuming that the status quo is safe and
(11:05):
any change is risky. Right, Like I've argued in the
US that maybe and it saysn't maybe people take mistake
me as saying no, Joe Biden definitely should have make
sure why But like, you know, in some ways, if
hypothetically Biden were to improve Democrats' chances of defeating Trump
by stepping aside for somebody else at the convention, is
(11:28):
that risky? I mean, I mean, in some ways it
makes the risk of Trump less. If I don't know
that's true, I'm just saying it's like within the realm
of possibility, right, you know here, I mean, so here
he did make a surprising change that is a deviation
from the status quo, but like sometimes pursuing the status quo,
like in climate change, as we'll talk about. Right, if
we were to be just like, oh, we're not gonna
(11:48):
bother with any of these greenhouse gas reductions, right, I mean,
that would be the status quo. It's riskier than probably
switching to alternative energy, no.
Speaker 1 (11:58):
For sure, for sure, And I think that it's really
important to qualify what we mean by risky here. And
I think that some people, so Sarkazi actually came out
very vehemently against this and said that he probably thinks
that it's risky in the first sense of the word,
as in stupid, that this was a really really dumb call,
and he was very vocal about that. And I think
(12:20):
he called it playing Russian Roulette with the French government,
which is an interesting way of looking at it. But
if we look if we just look at precedent, right
when these types of gambles have happened over the last
few years, like Brexit didn't go so well, David Cameron
didn't do so well, like when you when you when
(12:41):
you do these sorts of like okay, well, find let's
throw it to the people. I think your second point
that this is just not a great time for throwing
it to the people in this particular way, at this
particular moment. If you're someone like Macro, to me, that resonates,
and so I wish you know, I wonder we obviously
don't know what's going on behind the scenes. You would
(13:02):
think that with such a consequential decision that you would
consult people. Right, with decision making, it's usually good to
consult other people who might have a point of view.
But it was very clear that like the Prime Minister
was not consulted, that very key people were not consulted.
And so to me, that's a very strange way of
making a risk assessment that has potentially very long reaching
(13:24):
consequences for your country.
Speaker 2 (13:26):
Well, what if mccron, like most politicians, is an ego
fucking maniac and is doing the thing you were talking
about earlier, Maria, which is to set himself up for
twenty twenty seven right that if you empower the right
wing more right and make la Penn who he beat
by whatever it was, seventeen points last time, he may
figure that you'll see the right wing getting power and
(13:48):
you know, in most of the world, certainly the United States,
which I know the best. Obviously, there is a phenomenon
known as thermostatic public opinion, which means that you tend
to turn the temperature in the opposite direction of where
the environment is. Right, if it's too hot in the room,
you turn the thermostat down. If it's too cold, you
turn the thermostat up. So a dose of right wingism
(14:10):
coupled with dysfunction, right, I mean, I don't think anyone's
saying anyone's gonna have a particularly compelling majority in France
is weird. Technically Macron appoints the prime minister, but subject
to like a recall vote basically from the legislature. So
you could have like it an you know, ugly two
headed step child McCrone governing with some conservative and so
(14:32):
dysfunctional mess and maybe he figures, Okay, that's going to
elevate La Penn and then and then I win the
runoff against her the second round against her again in
twenty twenty seven. So maybe that's maybe that's why you
don't consult other people or like, look at Joe Biden.
You know, if you could be persuaded that it's in
Joe Biden or in Democratic Party's best interest to have
(14:52):
another Candy or maybe better. I mean, I think clearly
a year ago, if he had an open primary, that
would have been better off. It may not be in
Biden's best interest though, right, and the average politician, even
the nice liberals, Maria, even the people you're inclined to
think are the good guys, are fucking egomaniacs. I can't
imagine that he thought that. I don't know, I don't
(15:16):
know them.
Speaker 3 (15:17):
Yeah no, but yeah, go ahead, good, No, you say,
we just got our ass kicked in these EU elections,
Let's have another election in a few weeks Like that
seems fucking stupid, unless you're playing some type of long
selfish I guess i'd say long game for twenty twenty seven.
Speaker 1 (15:35):
Yeah no, And that was the very cynical part of
my mind that kind of crafted that as the potential
motivation behind what he's doing. But I think that it
might actually be the more accurate reason. And so and
so I do think that that you're right, I mean,
to get to the pinnacle of politics like you do,
have to be How did you call them fucking egomaniacs? Yeah,
(15:56):
I think that that's a good that that's a good
way of thinking about it. And so it might at
the end of the day be an ego play, but
you know you are, you are playing with the fate
of Europe. So I think that as we kind of
as we think about this, as we look at the
next few weeks, it will be really interesting to see
how this plays out in Europe, and Nate, let's let's
(16:18):
revisit this after those elections to see if it in
any way affects your thinking about Biden's resignation potentially and
how like a high risk gamble like that might look
in the United States.
Speaker 2 (16:32):
We will definitely chick in Maria. These all these fucking
European elections are interfering with my plans to focus only
on poker during the main event. But but in between
my time reaching day six again, I'll check in on
how mcgrone's doing. We'll be back in a minute.
Speaker 1 (16:57):
Nate prepared to die. Let's hear heart. I've you know,
I was talking with my parents the other day and
my parents are in Boston and I'm in Las Vegas
right now, and they were complaining. They're like, oh my god,
it's about to be one hundred degrees and like one
hundred percent humidity, and it's already very hard to breathe.
And I was like, oh, it's ninety degrees and zero
percent humidity in Las Vegas. We have completely reversed. And
(17:22):
I think this is the beginning of a week where
that is true because a heat wave is hitting most
of the country but not Nevada.
Speaker 2 (17:29):
Yeah, New York is protected to get up to the
mid low to mid nineties later this week. Places like
Pittsburgh maybe up to ninety nine one hundred degrees. This
is not that that that that hot, except for the
time of year. That is, we're still in mid to
late June. It's technically still spring. By the way, Maria, Yeah,
(17:49):
we got four more days or two more when you're yeah,
we haven't.
Speaker 1 (17:51):
We haven't gotten to the summer solstice yet.
Speaker 2 (17:54):
Correct. But but these are potentially record breaking temperatures for
for the time of year that they're in. This is
not a meteorology podcast, but I did kind of want
to use a segment as an excuse to talk about
climate change and risk communication around climate change. It's early
(18:15):
in the Lifeless Show. It's not an issue we've talked about.
Yet I think one problem with climate change is that
like it's something happening slowly and kind of constantly over time.
By the way, if you look at data from the
Met Office Hadley Center in the UK, and I'm aware
I used to be more of a climate change nerd.
I'm aware there are debates over these different measurements, but
(18:38):
from this measurement, which is pretty consistent with what I
see elsewhere, twenty twenty three was the hottest year in
modern recorded history, with the mean global temperature anomaly one
point one degree celsius. By the way, Celsius fucking sucks
Fahrenheit so much better. Zero one hundred zero was cold.
Hundred is hot, the best fucking scale on Earth. And
you're trying to use celsius anyway, though this is denominated
(19:00):
in celsius.
Speaker 1 (19:00):
Zia, the zero is actually the freezing in celsius. That's
why that kind of makes sense. But I would much
rather know when it's fucking hot, because that's what we're
talking about climate change. That's what matters when we're talking
about these kinds of things. So one degree shift in
celsius is equal to more than two degrees shift in fahrenheit.
So you have these jumps, you're like, oh my god,
(19:22):
you know it's one degree hotter today. Now I want
to know that it's five degrees hotter, that it's ten
degrees hotter. And so I think that when you're communicating
as a psychologist, when we're talking about climate change, when
we're talking about risk, when we're talking about heat, fahrenheit
is absolutely the way to go, because that shit is
way more impressive than celsius.
Speaker 2 (19:39):
Yeah, you can take your kilometers in your centigrade temperature
scale and shove it metric system, give it to a
cat or something. We're Americans. We have fahrenheit. Anyway, though,
the table that I'm reading from claims credibly that global
tempatures were one point one degree centigrade celsius higher in
(20:03):
twenty twenty three than they have been over the long
term pre global warming period. So far in twenty twenty four,
they're one point two to three degrees celsiu is higher
than the long term trend you'd remembered for now these
you know, this does fluctuate up and downward. These may
prove to be particularly bad years. The long term trend
is pretty unmistakable and we're already nearing the one point
(20:26):
five degrees sort of best optimistic maybe now at this point, frankly,
not the very realistic case that's been the target target
warming rise of climate activists for years. So we're already
kind of we're already kind of seeing the evidence of this,
not that you need too much of a microscope to
(20:47):
find it. The other thing too, is that, like I
think our readers can imagine, like what a bell curve
looks like a normal distribution, you can imagine that if
you kind of shift that bell curve over to the right,
because now the average temperature and yes there's tons of
fluctuation over the course of the year, but if the
average temperature is two or three degrees fahrenheit hotter, you
(21:11):
can imagine that, like right tail the graph that crosses
past like ninety nine degrees or one hundred that actually
occurs a lot more often, And like the number of
heat waves has roughly doubled in the US since the
nineteen sixties, for example, according to the National Weather Service.
So in some ways, heat waves are the best and
(21:33):
most reliable signal of global warming. And I think if
you are talking about climate change, I mean, first of all,
I'm actually the minority that says that, Like, I think
climate change is kind of a weird euphemism. I think
global warming is more descriptive in some ways. And if
you're gonna have global warming, you're gonna have not just
warmer on average, but you're gonna have more warm extremes,
(21:56):
and so like heat waves happening to this degree in
June are a clear consequence of that, And so I
think there's like an appropriate excuse to talk about this issue.
Speaker 1 (22:07):
Yeah, absolutely, and I think that it raises a lot
of questions about, you know, how we think about global warming.
I'm actually going to use that term as well, because
I completely agree with you. I studied briefly when I
was getting my PhD how to communicate risk around climate change,
and global warming really is much more descriptive, and unfortunately
(22:29):
that term became very politicized and is not popular anymore.
But it is exactly what we're talking about. So I
think it's good communication, which is one of the things
I think that is an important question here, right, how
do we communicate the risks and tell people like, look,
this is important, we need to make changes. And I
don't care you know what your politics are. This is
something that affects all of humanity.
Speaker 2 (22:51):
It's one of those funny issues. And actually, like relative
to other things, views on global warming have gotten a
little bit less polarized of all things in the US.
I mean, we're like kind of out of the al
Gore polar bears era and things like that. You know, Look,
what are the challenges in riscommunication is that in some sense,
(23:12):
the more seriously people take climate change slash global warming,
the less of a chance that will cause big scary problems. Right.
If you look at CO two emissions, this is also
data from our world and data they have leveled off
to some degree. Now they actually fell a little bit
(23:33):
during the pandemic years when economic output was depressed. They
have since rebounded, but they've kind of rebounded to like
roughly where they were a few years ago. If you
look at more detail, you see that the West, meaning
the wealthy countries in Europe and the EU, actually have
seen declines in their carbon output, whereas China's have increased
(23:55):
a lot. Other parts of developing world have increased quite
a bit. So this is kind of like a little
bit of a political problem too. I mean, I think
that the rest of the world is entitled to the
sort of prosperity that we have in the US. I
haven't seen kind of projections of like, you know, we're
now having decceleration and population growth. Maybe that affects things
in the long term as well, But it is a diffical
(24:19):
problem because you actually are kind of getting and kind
of telling people like, yeah, I mean you know that
China might have to pay for a mess that kind
of you know, the West originally caused a little bit,
but the West has actually cut its emissions in meaningful ways.
So one question is, like, just from a peer I mean,
from purely like empirical standpoint, how well do like scare
(24:40):
tactics work, Because there are some liberals who think that,
like the ocean is going to be boiling in like
seven years, and that's just complete misinformation. That's like believing
in like horse tranquilizers or something to cure disease.
Speaker 1 (24:54):
Wait, I do think that there are there are actually
some good data that scare tactics are not great, and
that that's not the way that you want to be
communicating if you want people to change behavior on this
type of thing. Scare tactics are great. It comes to
very palpable immediate risks. But even then, like think about like,
(25:14):
let's just go back to like childhood, right if you
have a kid, and neither one of us has kids,
but if you have a kid and you want them
not to do something, and you're trying to kind of
scare them, right and say, oh, if you do this,
blah blah blah blah blah, you know, the Boogeyman's going
to come and you're gonna be carried off and all
this bad stuff's going to happen. The scarier it is, like,
maybe it'll work up until age like two or three,
(25:36):
and then when they some critical thinking abilities kick in,
they'll be like, Okay, this does not make sense. This
ain't actually going to happen. I'm going to do this
and see what the actual consequences are for myself. And
I think that that's actually a pretty good, pretty good
illustration of the kind of the degree of scare tactics
at work. Right. It does need to be grounded in reality.
(25:59):
You can't start like telling people that the Boogeyman's going
to come and boil all of the oceans and eat
all of your trees and that the sky's going to
turn black, you know that that's not going to work.
But the unfortunate the unfortunate thing is, though there are
no good data on what actually works well, it turns
out that a lot of different tactics don't work particularly well,
(26:21):
and that this is an incredibly, incredibly difficult issue to communicate.
And one of the fundamental reasons is something that you've
already alluded to, which is that it's not immediate. It's
not something that I experience right now. It's something where
I can experience a lot of things that kind of
seem to disconfirm it. And people are really really bad
(26:41):
at probabilistic thinking, as we've talked about, and we're really
bad at long term planning, right We're really bad at
kind of thinking like ten years ahead, one year ahead.
Now let's talk about fifty years ahead, one hundred years ahead.
And you know, our thinking really does break down, Our
planning breaks down, our risky decision making breaks down. So
it's a really difficult subject. And I wish that, you know,
(27:04):
wouldn't it be amazing if at the end of the
segment we had a golden bullet. I don't think that's
going to happen, but it's a really, it's a thorny question.
Speaker 2 (27:13):
Yeah. Look, and you get in the fact that, like,
if I send some pollution up into the atmosphere, it
spreads around the globe. Right, So I don't realize that
cost necessarily directly myself. Right. There are even some countries,
you know, the colder countries, I mean, Canada, Russia might
benefit from global warming. That's just a fact right now. Look,
(27:35):
I think more and more people feel like a responsibility
to do something about kind of the shared humanity that
we all have. But yeah, it's a notoriously tricky issue.
And I think, as you're getting at before, like people
are playing a long game here. I think too often
elites again criticizing elites, of which I'm a fucking elite, right,
(27:57):
I'm criticizing my tribe.
Speaker 1 (27:58):
Now, you're a man of the people who plays in
high stakes hedge fund posts.
Speaker 2 (28:03):
I think my tribe often treats the masses contemptuously, not
just treat some has contempt for the masses, and therefore
they think these people are fools, right, And we can
kind of tell like a little white line of them,
and they won't figure it out, and it doesn't work, right.
You know, there were efforts, for example, to repress maybe
(28:27):
censor is slightly too strong a term, but like to
repress discussion of like the theory that COVID originated in
a lab, right, which is now considered by you know,
roughly a fifty to fifty shot by like several major
US agencies that have investigated, you know, that didn't actually
work people the whole time if you ask polls, and no,
science is not done by poll but people said, yeah,
(28:47):
actually I would lean lab like if you asked me myself, right,
you know, I think you know, there are efforts, for example,
for Biden to tell people don't worry about the fact
that I'm eighty one years old and Trump is fucking
seventy eight years old, just turned seventy eight last week,
by the way, right, it doesn't work. Not every fucking
person cares about the tone of how the New York
(29:07):
Times explained something that kind of verify information based on
their instinct about whether you're honest and truthful and how
kind of the evidence kind of checks out with their
own experience in the world. That's one thing that I
guess global warming has going for it is that people
do correctly into it that you have things like these
heat waves coming more often. That's definitely happening more often, right,
(29:29):
that's unambiguous, whereas things like hurricanes it's more complicated the
physics of the atmosphere and things like that, and those
are rareer events. But like it, being really abnormally hot
probably is more persuasive to people to do something about
global warming than some rhetorical trick.
Speaker 1 (29:51):
Will be right back, Nate, we were just talking about
something really serious, you know, climate change, global warming, heat waves.
But to me, there's something that's really close to my
(30:12):
heart that this issue is getting at, which is that
we might be facing another shortage of everyone's, well not everyone's,
but my favorite hot sauce that I like to add
to everything, which is Huifong's Siracha sauce, you know, with
its little green cap and it's little rooster. And there
(30:34):
was a shortage of it a few years ago, and
now there might be a second one, and I'm freaking
out and thinking about all sorts of irrational things like
should I stock Pilot while it's still available and create
a shortage by my own irrational behavior? But anyway, I
think that this is something that's very interesting to talk
about By the way, did you know that it was
pronounced si racha, not sri racha, which is the way
(30:56):
I've been saying it my entire life. I watched some
videos where Vietnamese individuals corrected pronunciation and I was blown away.
Speaker 2 (31:07):
Just get rid of that extra r doing anything, Just
get rid of it. I'm just going to confuse people.
But now it's just siracha. You can ignore the first R.
Speaker 1 (31:17):
Yes, exactly exactly. But in all seriousness, I think that
there's a really interesting aspect of risk assessment here from
the corporate standpoint, not just the individual standpoint. So there
are two reasons why we might be seeing a shortage.
But one of them is because so the company that
produces sir Rochessauceuifong, they broke off their relationship with their supplier,
(31:40):
their long term supplier and their only supply supplier, Underwood Ranches.
So that relationship broke off in twenty sixteen. So then
they looked for producers in Mexico. And originally kind of
the fallout of this was there was a shortage. Now
there's going to be another shortage because in Mexico we
have a heat wave and a drought, and so this
is happening right now, and I think that you know,
(32:02):
there are two different issues. Obviously the climate change that
we've just talked about, but also like, I'm sorry when
I was reading this story and this whole saga of
Underwood and Quifong in that partnership and how it came
to be and how it broke up, like this was
just a list of like what you do not do
when it comes to risk assessment in business, what you
(32:22):
do not do when it comes to diversification of your
supply chain, et cetera, et cetera, et cetera, And so
it seemed like a lot of bad business decisions that
might end with me not being able to get the
sauce I want when I want it.
Speaker 2 (32:37):
Look, I think there are certain types of products that
are kind of correctly risk averse because they lean very
heavily on brand loyalty. Right, So first of all, let's
have a couple. You want to have an honest conversation
about siracha sauce, Siracha hot sauce. So, first of all,
it tricks you by having that extra R that you're
(32:58):
not supposed to pronounce. The brand is also it is
a great sauce. It's important brand who because some people
think that, like some people think that siracha is just
this what's puce you're call It's like who Quong Quifong? Right?
They actually think that siracha is some like registered trademark
of Quifong, and it's not. It's just the best known
brand of it.
Speaker 1 (33:19):
Yeah.
Speaker 2 (33:20):
An article friend from Mackenzie Filson, who is a writer
for The Kitchen, a subvertical of Yahoo Life. Mackenzie tested
did a blind taste test of one, two, three, four, five,
six seven siracha sauces. Do you want to guess where
the famous rooster bottle of Quifong ended up on that
(33:42):
blind taste test?
Speaker 1 (33:43):
First? First, No, I'm assuming it's not first, because otherwise
you would not be asking me. So what was first night?
Speaker 2 (33:52):
First is Ox brand siracha sauce, and then Ninja Squirrel
Siracha hot sauce was right second.
Speaker 1 (34:00):
Okay, I have to say, that's a really nice name.
I like Ninja Squirrel. But at the end of the day,
people are incredibly loyal and they want this sauce. But
when they can't get that sauce, that's a big, big problem.
And so it does lead to things that seem to
be irrational, but to me on an individual level, seem
completely rational. Like I really want to go after we
(34:20):
finished taping, I have to go play poker, but I
would rather go to the store and actually just like
get five bottles of siracha and just have them just
in case something happens. Is that a good thing for
me to do? Or is that a bad thing for
me to do?
Speaker 2 (34:32):
I mean, it might be selfish what the effective altruists
say about your hoarding siracha sauce. And it does keep
by the way, was doing research, it does preserve in
your fridge for like literally two or fevers, which I'm
not sure that's the best advertisement for it necessarily, But no,
what you were saying, I mean, you know, the most
(34:52):
famous mistake all those some people think it was kind
of a long game to trick people when Coca Cola
switched its recipe was kind of the most famous mistake
in the history of like marketing. When you have an
iconic brand that is actually a push come to shove.
If you were to do a blind taste test, I
doubt that risky business listeners would necessarily be able to
(35:14):
tell Sirachia and or prefer it. But they have an
iconic brand and you don't want to fuck with that, right,
You don't want to say, yeah, it's going to taste
a little bit different. You thinks actually better. You want
to preserve that iconicness, and that means I think kind
of correctly being risk averse when it comes to things
that would affect affect your product quality.
Speaker 1 (35:31):
Yeah, I think that's right. And you know, going so
going back to that original dispute, I think that you know,
there were a lot of mistakes there, given that you
want to protect the taste and kind of the original
recipe on the quality. Because first of all, they only
had one single supplier, so we Fong and Underwood just
(35:52):
work together. And Underwood's only client was we Fong, So
they ended up just dedicating hundreds of thousands of acres
of land too, you know, doing just growing these chili
so that they could supply this one company. And it
was a part partnership of the minds of the two
Potter familiases, right, the two heads of the family. And
(36:14):
they were all handshake deals, like they didn't have contracts.
It was all just like okay, this year, we're going
to give you this much and you're going to pay
us this much. And I was just reading this and
I was thinking, holy shit, Like, isn't someone at this
point like maybe that worked like thirty years ago before
this became a big deal. Now that we're talking about
this huge business, isn't someone going to tell them this?
(36:34):
Say't a good idea? Like as a poker player, I
know that everything needs to be in writing, right, Like
if you and I, like we have swaps and events,
we have those in text messages, right, so we actually
have the exact thing that like, this is the percentage
that we've swapped. This is how the swap works, so
that we have a record. How can you be making
these deals with just one supplier? You know, no no backup,
(36:57):
no redundancy, nothing, and it's all a handshake deal. Like
to me, this is this is just a really weird
way of thinking about risk as a business owner. So
obviously to me this is more interesting as consumer because
it causes these sorts of problems. But as a business owner,
I think that you want to be thinking about risk
and more in a way that includes diversification, includes redundancies,
(37:20):
includes kind of these protections so that shit like this
doesn't happen, especially when you have things like climate change
which are already threats to your supply.
Speaker 2 (37:29):
Okay, Maria, we've had fun with our hot Sauce segment.
What is like the actual investigative takeaway that people can
apply in their everyday lives here? What do we learn
from today's episode?
Speaker 1 (37:43):
Well, I think that on an individual basis, we learned
that it's good for me to stockpile, but nobody else
should stockpile because that's a rational behavior. However, we did
learn that long term planning is incredibly important on every
single level, and that starts at the corporate level, right
and on an individual level, you know, also planning ahead
is good. That does not necessarily mean stockpiling, but it
(38:05):
might involve diversifying your tastes so that you do, you know,
look at the other competitors so that if there is
a shortage, you can get what's that squirrel called ninja squirrel?
You can music fryd ninja squirrel and see if it
stocks up. So so I think that those are those
are all kind of things that we need to think about.
(38:26):
And all of these things, like everything we've talked about
today is kind of centered on our lack of ability
to think through risk over the long term, right as
opposed to immediately and to have that sort of long
term planning mentality.
Speaker 2 (38:43):
Look, if you're this Saratch company, you don't want people
to realize is that this is actually not a hot sauce.
It's a medium sauce, a delicious medium sauce. But like
if people get hooked on like the Abanniro stuff and
like the Ghost Pepper stuff, you're screwed, right, So you
better you better shape up and have some inventory ready
in Q three. I'll take you that much.
Speaker 1 (39:04):
Absolutely. Please do not make me switch brands. I don't
want to. I want to remain more to you help
me do that. Thank you, And now, Nate, I'm going
to be off to play my next event of the
World series, which is still not going nearly as well
as yours. I've had one men cash, Nate one min
cash in the last.
Speaker 2 (39:25):
Week, Maria. It often tends to turn around. It's kind
of literally random to some large degree. What's what's the
event today?
Speaker 1 (39:33):
The event today is a two thousand dollars freeze out event.
So I'm actually, yeah, I'm excited. I appreciate that. I
really like freeze out events. So freeze out events for
non poker players means you can only enter one time,
and in some ways that's the truest form of poker,
right If you bust your app, you're done. And I
(39:53):
love that, and so I'm I'm excited for the freeze outs.
The main event is a freeze out, So I hope
Nate that today is a Marie event because so far,
you know, I've had two cases this whole series. I mean,
I've only played for two weeks, so it's one a week.
But still it feels like I'm not I'm not doing
that well and it's time to turn things around.
Speaker 2 (40:12):
Do you feel like you're still playing your A game
or or is it getting to be a grind?
Speaker 1 (40:18):
No? No, I think I think that it was really nice.
You know, I took that week off and so I'm
actually pretty fresh still. And then I took two days off.
I didn't play Friday or Saturday, which I think is
important to take these breaks so I actually practice what
I preach right in my tips for the World Series,
I said you need to kind of take brain breaks,
and I did do exactly that. I went hiking on Saturday.
(40:40):
I ran into a mountain lion, so it wasn't as
relaxing as I would have wanted it to be. Yes,
but here I am to tell the tale. But that
was not the most relaxing hike in the world. PSA.
There are lots of mountain lions in the Spring Mountains.
Normally you never see them, but when they start growling
at you, it means that you have inadvertently impinged on
(41:01):
their territory, and it's probably a good idea to back
away and get the fuck out of there, which is
why I did.
Speaker 2 (41:07):
I didn't intuitively know that we're lion in Las Vegas.
Speaker 1 (41:10):
Oh, there are tons of mountain lions, so the Spring
Mountains have a lot of them. Red Rock even has some.
But yes, you are talking to someone who escaped from
a mountain lion relatively unscathed. I have a I have
a little uh. Yeah, I have a little cut cut
up from a fall, as I had as I tried
to get away. But otherwise I'm good.
Speaker 2 (41:30):
Do lions like siracha? Could it be like?
Speaker 1 (41:35):
Excellent? Excellent idea? I will I will try that next time.
Speaker 2 (41:38):
Join us next time and we will experiment with mountain
lions and sches sauce A.
Speaker 1 (41:49):
Risky Business is hosted by me Maria Kanakova and me
Mate Silver. The show is a co production of Pushkin
Industries and iHeartMedia. This episode was produced by Isabelle Carter.
Our associate producer is Gabriel Hunter Chang. Our executive producer
is Jacob Goldstein.
Speaker 2 (42:06):
And if you want to listen to and add three version,
sign up for pushkar Plus for six thirty nine a month.
You get access to adre listening. Thanks for tuning in.
Pushkin. Welcome back to Risky Business, a show about making
better decisions. I'm Maria Kuanakova.
Speaker 2 (00:28):
And I'm Nate Silver.
Speaker 1 (00:30):
Today on the show, we'll be starting off by talking
about Emmanuel Macrond, the President of France, calling snap elections
and what that means for how leaders think about risk assessments,
especially when they are huge gambles as in this case.
Speaker 2 (00:43):
And we'll talk about the heat wave that's been predicted
to hit the eastern United States this week, kind of
as an excuse to talk about climate change, an issue
I hope we can address on the show once in
a while, and communication versus reality on long term risks.
Speaker 1 (00:57):
And finally, we're going to be talking about one of
the single most important effects of climate change, which is
the potential shortage of one of my favorite condiments, siracha
hot sauce.
Speaker 2 (01:09):
Even a hot sauce is a hot sauce.
Speaker 1 (01:13):
Okay, Okay, we get we'll have we'll have this debate
after the break to come. Okay, So, Nate, as as
you've heard, Emmanuel Macron just did something that is completely
I mean, it's not completely unprecedented, but it's incredibly risky.
(01:34):
So we had EU elections right, and it turns out
that his party did not do that well. National Rally,
which is the Party of Marine Lapenn got thirty one
point four percent, and this is the far far right
party in France, and the New Popular Front, which is
(01:55):
the left wing alliance, got a total of about twenty
six percent, and his party got fourteen point six percent.
So he's the president right ruling party not not doing
that well. And instead of saying, you know, we need
to kind of rethink this stuff, we need to do something,
he decided to call snap elections three years ahead of schedule.
(02:16):
So on June thirtieth and July seventh, France is going
to go through two rounds of elections. And this is
a decision that as far as we can tell, Macron
did not consult with his government on. The Prime Minister
was absolutely shocked and it could have huge repercussions for France,
for Europe, for kind of the rise of right wing
(02:37):
nationalist movements in Europe. And the reason why I thought
it was really interesting for us to talk about this
is because there are some echoes of the types of
high risk maneuvers that we've been talking about that might
be an option in the United States, but of course
it's a huge, huge gamble.
Speaker 2 (02:55):
I already have a couple of points of pushback here, Maria, Yeah,
please push back night. One point I pushedback is I
think labeling everything right wing is not very revealing sometimes
because it neglects differences, including why in France and other
(03:16):
places that the you know, right wing conservative movements have
become more popular and more effective. You know, Marine le
Penn has been trying to soften her party's image.
Speaker 1 (03:29):
But let me, I'm just going to interrupt you right there.
But we know what the Front Nscionale is, right, and
we know that it was founded by her father, Jean
Marie Leapenn, who was just a rampant anti summit. Like this,
this is not a good party. This is a party
that's anti immigration, anti Semitic, anti all minorities, racist like this,
this is like as bad as it gets.
Speaker 2 (03:50):
But you're thinking like an elite. I am a man
of the masses. I think it's important to understand the
and democracy. We want to understand why more right wing,
veiled ideas might sometimes become popular in some cases because
they're paired with economic liberalism or maybe should say economic
or left wing policies where you have a welfare state,
(04:13):
you're not too concerned about budget deficits. You might even
tax the rich to some degree. Look, if I go
to my hedge fund poker game or whatever, people there describe.
Speaker 1 (04:23):
Themselves of the.
Speaker 2 (04:27):
People describe themselves as socially liberal but fiscally conservative or
moderate right. Those are not typical people. What these parties
have figured out is that if you're going to have
right wing populism, you don't necessarily need right wing conservative
economics to go along with that. Well, they will. They
(04:49):
will claim to want to protect the welfare state. They
are not very concerned about things like budget deficits, which
are seen as the province of centrists. Even Trump, to
some degree, he's not Paul Ryan in terms of talking
(05:10):
about like performing entitlement programs. Is willing to balloon the
deficit to cut taxes without necessarily cutting spending. They did
try to kill Obamacare in Trump's first term in office.
They've talked less about that this time. Maybe Democrats should
talk more about it. But, like you know, cultural grievances
(05:31):
that are often based in senophobia or racism, paired with
the welfare state, which is a very popular program sometimes
kind of left leaning economics is part of the reason
these parties around the world have been more have been
more effective now.
Speaker 1 (05:47):
And I think that that actually is a very important point. So, yes,
you know everything that I that I said, I think
stance about this party and why Marine the pen is
actually incredibly dangerous. However, I think it's important to note
that in these elections that just happened, the party one
ninety three percent of communes, which are the local districts,
(06:08):
came in first, right out, out of all of the
parties in ninety three percent of the communes in France,
which is huge because it means that they are finally
making inroads into places where historically they never have before.
And so I think that you're making a very valid
point that even though we might see, okay, this is
what the real agenda here is. And it's really scary
(06:30):
for voters who are looking to okay, you know, how
do we make our daily life better. We don't like Macron,
we don't like that he raised the retirement age. He's
making us work right, Macron is not popular. We're going
to vote for this for this other party, So kind
of I think one of the bigger there are two
big things here. One is the one that you just
pointed out that they are making inroads and they have
(06:52):
figured out a way to kind of connect to the masses,
and I think that that's something we're seeing in the
United States too. But I think the other thing is,
you know, how risky then is it to try to
call a snap election right now and say, well, fine,
you really want these guys, Let's see what happens. Because
I think that this is actually potentially there are two
(07:14):
things that he could be thinking, at least in my mind.
Number One, we're going to win, right like Number one,
when push comes to shove, I'll be able to assert
that people actually want more moderate politics, that they don't
really want this far right. Number Two, we're going to lose.
And that's okay because the presidential elections aren't for several years,
(07:35):
and people are actually going to get a taste of
what it means to have this far right force kind
of controlling a lot of the political agenda. They're not
going to like it. And then come election time, Marine
Leapen will not win the presidency and our party will
be in a much stronger position. Both of these things
are incredibly risky ways of thinking to my mind.
Speaker 2 (07:56):
Yeah, there are a couple things here. I mean, first
of all, thank you for the clarification on how this
is not a presidential election, which is not scheduled until
twenty twenty seven. For people's context, in the previous election,
which is twenty two, they're five years apart. In France,
Macron defeated the Pen by quite a bit, fifty nine
percent to forty one percent in the second round runoff. Right,
(08:20):
there are a whole bunch of different parties in France.
There actually are like kind of a viable left, center
and right plus weird i don't know, Gallic, Celtic whatever
parties here and there. But in that final two, in
that head to head match against matchup against the Pen,
despite being unpopular himself, he won by a pretty healthy margin.
(08:42):
I mean, you know, frances is still one of the
most liberal and kind of many senses of that term
countries in Europe. The prime minister is uh, this young
gay guy for example, Right, I mean, it's a country
that like has always kind of had like a proud
tradition of of political diversity, but including being you know,
(09:03):
proudly left wing in certain ways. So part of way
when I talk about this summary with you is when
people say the term risky. There are a couple of
ways in which that can be abused, I think right
one is that sometimes risky is just a euphemism for stupid,
Like it may have been really fucking stupid for McCrone
(09:26):
to call this election at this time. Right, it's a
bad time not just for incumbent parties in France but everywhere.
In the UK election set for July fourth, Conservatives are
set to get destroyed to the point where the Tories
may not even be the second largest party anymore. Now.
In the US election, Joe Biden is currently losing we've
(09:48):
talked about on the show by a little bit in
the polls to Donald Trump. In India, Mody just saw
a big demotion in the number of seats that his
alliance had, so the timing like couldn't be much worse.
And if you look at polls, then his group, which
is called Ensemble, there's some fancy or French name. I'm
(10:08):
not gonna try renaissance.
Speaker 1 (10:10):
Yeah, you're talking about Macron's party, Crown's Party.
Speaker 2 (10:15):
His party is in third place behind the right wing
coalition in the lift wing coalition and has only declined
in the one or two polls since the announcement was made.
And listen, it's a different system where the campaign takes
place much more quickly than in the US. That means
the polls can move more quickly. But like, but this
(10:38):
is not a good time to be an incumbent centrist technocrat.
It's not happy times for that for that type of politician.
And and Macron is like swimming upstream into that. So
risky may just mean stupid. There's also a bias, I
think toward assuming that the status quo is safe and
(11:05):
any change is risky. Right, Like I've argued in the
US that maybe and it saysn't maybe people take mistake
me as saying no, Joe Biden definitely should have make
sure why But like, you know, in some ways, if
hypothetically Biden were to improve Democrats' chances of defeating Trump
by stepping aside for somebody else at the convention, is
(11:28):
that risky? I mean, I mean, in some ways it
makes the risk of Trump less. If I don't know
that's true, I'm just saying it's like within the realm
of possibility, right, you know here, I mean, so here
he did make a surprising change that is a deviation
from the status quo, but like sometimes pursuing the status quo,
like in climate change, as we'll talk about. Right, if
we were to be just like, oh, we're not gonna
(11:48):
bother with any of these greenhouse gas reductions, right, I mean,
that would be the status quo. It's riskier than probably
switching to alternative energy, no.
Speaker 1 (11:58):
For sure, for sure, And I think that it's really
important to qualify what we mean by risky here. And
I think that some people, so Sarkazi actually came out
very vehemently against this and said that he probably thinks
that it's risky in the first sense of the word,
as in stupid, that this was a really really dumb call,
and he was very vocal about that. And I think
(12:20):
he called it playing Russian Roulette with the French government,
which is an interesting way of looking at it. But
if we look if we just look at precedent, right
when these types of gambles have happened over the last
few years, like Brexit didn't go so well, David Cameron
didn't do so well, like when you when you when
(12:41):
you do these sorts of like okay, well, find let's
throw it to the people. I think your second point
that this is just not a great time for throwing
it to the people in this particular way, at this
particular moment. If you're someone like Macro, to me, that resonates,
and so I wish you know, I wonder we obviously
don't know what's going on behind the scenes. You would
(13:02):
think that with such a consequential decision that you would
consult people. Right, with decision making, it's usually good to
consult other people who might have a point of view.
But it was very clear that like the Prime Minister
was not consulted, that very key people were not consulted.
And so to me, that's a very strange way of
making a risk assessment that has potentially very long reaching
(13:24):
consequences for your country.
Speaker 2 (13:26):
Well, what if mccron, like most politicians, is an ego
fucking maniac and is doing the thing you were talking
about earlier, Maria, which is to set himself up for
twenty twenty seven right that if you empower the right
wing more right and make la Penn who he beat
by whatever it was, seventeen points last time, he may
figure that you'll see the right wing getting power and
(13:48):
you know, in most of the world, certainly the United States,
which I know the best. Obviously, there is a phenomenon
known as thermostatic public opinion, which means that you tend
to turn the temperature in the opposite direction of where
the environment is. Right, if it's too hot in the room,
you turn the thermostat down. If it's too cold, you
turn the thermostat up. So a dose of right wingism
(14:10):
coupled with dysfunction, right, I mean, I don't think anyone's
saying anyone's gonna have a particularly compelling majority in France
is weird. Technically Macron appoints the prime minister, but subject
to like a recall vote basically from the legislature. So
you could have like it an you know, ugly two
headed step child McCrone governing with some conservative and so
(14:32):
dysfunctional mess and maybe he figures, Okay, that's going to
elevate La Penn and then and then I win the
runoff against her the second round against her again in
twenty twenty seven. So maybe that's maybe that's why you
don't consult other people or like, look at Joe Biden.
You know, if you could be persuaded that it's in
Joe Biden or in Democratic Party's best interest to have
(14:52):
another Candy or maybe better. I mean, I think clearly
a year ago, if he had an open primary, that
would have been better off. It may not be in
Biden's best interest though, right, and the average politician, even
the nice liberals, Maria, even the people you're inclined to
think are the good guys, are fucking egomaniacs. I can't
imagine that he thought that. I don't know, I don't
(15:16):
know them.
Speaker 3 (15:17):
Yeah no, but yeah, go ahead, good, No, you say,
we just got our ass kicked in these EU elections,
Let's have another election in a few weeks Like that
seems fucking stupid, unless you're playing some type of long
selfish I guess i'd say long game for twenty twenty seven.
Speaker 1 (15:35):
Yeah no, And that was the very cynical part of
my mind that kind of crafted that as the potential
motivation behind what he's doing. But I think that it
might actually be the more accurate reason. And so and
so I do think that that you're right, I mean,
to get to the pinnacle of politics like you do,
have to be How did you call them fucking egomaniacs? Yeah,
(15:56):
I think that that's a good that that's a good
way of thinking about it. And so it might at
the end of the day be an ego play, but
you know you are, you are playing with the fate
of Europe. So I think that as we kind of
as we think about this, as we look at the
next few weeks, it will be really interesting to see
how this plays out in Europe, and Nate, let's let's
(16:18):
revisit this after those elections to see if it in
any way affects your thinking about Biden's resignation potentially and
how like a high risk gamble like that might look
in the United States.
Speaker 2 (16:32):
We will definitely chick in Maria. These all these fucking
European elections are interfering with my plans to focus only
on poker during the main event. But but in between
my time reaching day six again, I'll check in on
how mcgrone's doing. We'll be back in a minute.
Speaker 1 (16:57):
Nate prepared to die. Let's hear heart. I've you know,
I was talking with my parents the other day and
my parents are in Boston and I'm in Las Vegas
right now, and they were complaining. They're like, oh my god,
it's about to be one hundred degrees and like one
hundred percent humidity, and it's already very hard to breathe.
And I was like, oh, it's ninety degrees and zero
percent humidity in Las Vegas. We have completely reversed. And
(17:22):
I think this is the beginning of a week where
that is true because a heat wave is hitting most
of the country but not Nevada.
Speaker 2 (17:29):
Yeah, New York is protected to get up to the
mid low to mid nineties later this week. Places like
Pittsburgh maybe up to ninety nine one hundred degrees. This
is not that that that that hot, except for the
time of year. That is, we're still in mid to
late June. It's technically still spring. By the way, Maria, Yeah,
(17:49):
we got four more days or two more when you're yeah,
we haven't.
Speaker 1 (17:51):
We haven't gotten to the summer solstice yet.
Speaker 2 (17:54):
Correct. But but these are potentially record breaking temperatures for
for the time of year that they're in. This is
not a meteorology podcast, but I did kind of want
to use a segment as an excuse to talk about
climate change and risk communication around climate change. It's early
(18:15):
in the Lifeless Show. It's not an issue we've talked about.
Yet I think one problem with climate change is that
like it's something happening slowly and kind of constantly over time.
By the way, if you look at data from the
Met Office Hadley Center in the UK, and I'm aware
I used to be more of a climate change nerd.
I'm aware there are debates over these different measurements, but
(18:38):
from this measurement, which is pretty consistent with what I
see elsewhere, twenty twenty three was the hottest year in
modern recorded history, with the mean global temperature anomaly one
point one degree celsius. By the way, Celsius fucking sucks
Fahrenheit so much better. Zero one hundred zero was cold.
Hundred is hot, the best fucking scale on Earth. And
you're trying to use celsius anyway, though this is denominated
(19:00):
in celsius.
Speaker 1 (19:00):
Zia, the zero is actually the freezing in celsius. That's
why that kind of makes sense. But I would much
rather know when it's fucking hot, because that's what we're
talking about climate change. That's what matters when we're talking
about these kinds of things. So one degree shift in
celsius is equal to more than two degrees shift in fahrenheit.
So you have these jumps, you're like, oh my god,
(19:22):
you know it's one degree hotter today. Now I want
to know that it's five degrees hotter, that it's ten
degrees hotter. And so I think that when you're communicating
as a psychologist, when we're talking about climate change, when
we're talking about risk, when we're talking about heat, fahrenheit
is absolutely the way to go, because that shit is
way more impressive than celsius.
Speaker 2 (19:39):
Yeah, you can take your kilometers in your centigrade temperature
scale and shove it metric system, give it to a
cat or something. We're Americans. We have fahrenheit. Anyway, though,
the table that I'm reading from claims credibly that global
tempatures were one point one degree centigrade celsius higher in
(20:03):
twenty twenty three than they have been over the long
term pre global warming period. So far in twenty twenty four,
they're one point two to three degrees celsiu is higher
than the long term trend you'd remembered for now these
you know, this does fluctuate up and downward. These may
prove to be particularly bad years. The long term trend
is pretty unmistakable and we're already nearing the one point
(20:26):
five degrees sort of best optimistic maybe now at this point, frankly,
not the very realistic case that's been the target target
warming rise of climate activists for years. So we're already
kind of we're already kind of seeing the evidence of this,
not that you need too much of a microscope to
(20:47):
find it. The other thing too, is that, like I
think our readers can imagine, like what a bell curve
looks like a normal distribution, you can imagine that if
you kind of shift that bell curve over to the right,
because now the average temperature and yes there's tons of
fluctuation over the course of the year, but if the
average temperature is two or three degrees fahrenheit hotter, you
(21:11):
can imagine that, like right tail the graph that crosses
past like ninety nine degrees or one hundred that actually
occurs a lot more often, And like the number of
heat waves has roughly doubled in the US since the
nineteen sixties, for example, according to the National Weather Service.
So in some ways, heat waves are the best and
(21:33):
most reliable signal of global warming. And I think if
you are talking about climate change, I mean, first of all,
I'm actually the minority that says that, Like, I think
climate change is kind of a weird euphemism. I think
global warming is more descriptive in some ways. And if
you're gonna have global warming, you're gonna have not just
warmer on average, but you're gonna have more warm extremes,
(21:56):
and so like heat waves happening to this degree in
June are a clear consequence of that, And so I
think there's like an appropriate excuse to talk about this issue.
Speaker 1 (22:07):
Yeah, absolutely, and I think that it raises a lot
of questions about, you know, how we think about global warming.
I'm actually going to use that term as well, because
I completely agree with you. I studied briefly when I
was getting my PhD how to communicate risk around climate change,
and global warming really is much more descriptive, and unfortunately
(22:29):
that term became very politicized and is not popular anymore.
But it is exactly what we're talking about. So I
think it's good communication, which is one of the things
I think that is an important question here, right, how
do we communicate the risks and tell people like, look,
this is important, we need to make changes. And I
don't care you know what your politics are. This is
something that affects all of humanity.
Speaker 2 (22:51):
It's one of those funny issues. And actually, like relative
to other things, views on global warming have gotten a
little bit less polarized of all things in the US.
I mean, we're like kind of out of the al
Gore polar bears era and things like that. You know, Look,
what are the challenges in riscommunication is that in some sense,
(23:12):
the more seriously people take climate change slash global warming,
the less of a chance that will cause big scary problems. Right.
If you look at CO two emissions, this is also
data from our world and data they have leveled off
to some degree. Now they actually fell a little bit
(23:33):
during the pandemic years when economic output was depressed. They
have since rebounded, but they've kind of rebounded to like
roughly where they were a few years ago. If you
look at more detail, you see that the West, meaning
the wealthy countries in Europe and the EU, actually have
seen declines in their carbon output, whereas China's have increased
(23:55):
a lot. Other parts of developing world have increased quite
a bit. So this is kind of like a little
bit of a political problem too. I mean, I think
that the rest of the world is entitled to the
sort of prosperity that we have in the US. I
haven't seen kind of projections of like, you know, we're
now having decceleration and population growth. Maybe that affects things
in the long term as well, But it is a diffical
(24:19):
problem because you actually are kind of getting and kind
of telling people like, yeah, I mean you know that
China might have to pay for a mess that kind
of you know, the West originally caused a little bit,
but the West has actually cut its emissions in meaningful ways.
So one question is, like, just from a peer I mean,
from purely like empirical standpoint, how well do like scare
(24:40):
tactics work, Because there are some liberals who think that,
like the ocean is going to be boiling in like
seven years, and that's just complete misinformation. That's like believing
in like horse tranquilizers or something to cure disease.
Speaker 1 (24:54):
Wait, I do think that there are there are actually
some good data that scare tactics are not great, and
that that's not the way that you want to be
communicating if you want people to change behavior on this
type of thing. Scare tactics are great. It comes to
very palpable immediate risks. But even then, like think about like,
(25:14):
let's just go back to like childhood, right if you
have a kid, and neither one of us has kids,
but if you have a kid and you want them
not to do something, and you're trying to kind of
scare them, right and say, oh, if you do this,
blah blah blah blah blah, you know, the Boogeyman's going
to come and you're gonna be carried off and all
this bad stuff's going to happen. The scarier it is, like,
maybe it'll work up until age like two or three,
(25:36):
and then when they some critical thinking abilities kick in,
they'll be like, Okay, this does not make sense. This
ain't actually going to happen. I'm going to do this
and see what the actual consequences are for myself. And
I think that that's actually a pretty good, pretty good
illustration of the kind of the degree of scare tactics
at work. Right. It does need to be grounded in reality.
(25:59):
You can't start like telling people that the Boogeyman's going
to come and boil all of the oceans and eat
all of your trees and that the sky's going to
turn black, you know that that's not going to work.
But the unfortunate the unfortunate thing is, though there are
no good data on what actually works well, it turns
out that a lot of different tactics don't work particularly well,
(26:21):
and that this is an incredibly, incredibly difficult issue to communicate.
And one of the fundamental reasons is something that you've
already alluded to, which is that it's not immediate. It's
not something that I experience right now. It's something where
I can experience a lot of things that kind of
seem to disconfirm it. And people are really really bad
(26:41):
at probabilistic thinking, as we've talked about, and we're really
bad at long term planning, right We're really bad at
kind of thinking like ten years ahead, one year ahead.
Now let's talk about fifty years ahead, one hundred years ahead.
And you know, our thinking really does break down, Our
planning breaks down, our risky decision making breaks down. So
it's a really difficult subject. And I wish that, you know,
(27:04):
wouldn't it be amazing if at the end of the
segment we had a golden bullet. I don't think that's
going to happen, but it's a really, it's a thorny question.
Speaker 2 (27:13):
Yeah. Look, and you get in the fact that, like,
if I send some pollution up into the atmosphere, it
spreads around the globe. Right, So I don't realize that
cost necessarily directly myself. Right. There are even some countries,
you know, the colder countries, I mean, Canada, Russia might
benefit from global warming. That's just a fact right now. Look,
(27:35):
I think more and more people feel like a responsibility
to do something about kind of the shared humanity that
we all have. But yeah, it's a notoriously tricky issue.
And I think, as you're getting at before, like people
are playing a long game here. I think too often
elites again criticizing elites, of which I'm a fucking elite, right,
(27:57):
I'm criticizing my tribe.
Speaker 1 (27:58):
Now, you're a man of the people who plays in
high stakes hedge fund posts.
Speaker 2 (28:03):
I think my tribe often treats the masses contemptuously, not
just treat some has contempt for the masses, and therefore
they think these people are fools, right, And we can
kind of tell like a little white line of them,
and they won't figure it out, and it doesn't work, right.
You know, there were efforts, for example, to repress maybe
(28:27):
censor is slightly too strong a term, but like to
repress discussion of like the theory that COVID originated in
a lab, right, which is now considered by you know,
roughly a fifty to fifty shot by like several major
US agencies that have investigated, you know, that didn't actually
work people the whole time if you ask polls, and no,
science is not done by poll but people said, yeah,
(28:47):
actually I would lean lab like if you asked me myself, right,
you know, I think you know, there are efforts, for example,
for Biden to tell people don't worry about the fact
that I'm eighty one years old and Trump is fucking
seventy eight years old, just turned seventy eight last week,
by the way, right, it doesn't work. Not every fucking
person cares about the tone of how the New York
(29:07):
Times explained something that kind of verify information based on
their instinct about whether you're honest and truthful and how
kind of the evidence kind of checks out with their
own experience in the world. That's one thing that I
guess global warming has going for it is that people
do correctly into it that you have things like these
heat waves coming more often. That's definitely happening more often, right,
(29:29):
that's unambiguous, whereas things like hurricanes it's more complicated the
physics of the atmosphere and things like that, and those
are rareer events. But like it, being really abnormally hot
probably is more persuasive to people to do something about
global warming than some rhetorical trick.
Speaker 1 (29:51):
Will be right back, Nate, we were just talking about
something really serious, you know, climate change, global warming, heat waves.
But to me, there's something that's really close to my
(30:12):
heart that this issue is getting at, which is that
we might be facing another shortage of everyone's, well not everyone's,
but my favorite hot sauce that I like to add
to everything, which is Huifong's Siracha sauce, you know, with
its little green cap and it's little rooster. And there
(30:34):
was a shortage of it a few years ago, and
now there might be a second one, and I'm freaking
out and thinking about all sorts of irrational things like
should I stock Pilot while it's still available and create
a shortage by my own irrational behavior? But anyway, I
think that this is something that's very interesting to talk
about By the way, did you know that it was
pronounced si racha, not sri racha, which is the way
(30:56):
I've been saying it my entire life. I watched some
videos where Vietnamese individuals corrected pronunciation and I was blown away.
Speaker 2 (31:07):
Just get rid of that extra r doing anything, Just
get rid of it. I'm just going to confuse people.
But now it's just siracha. You can ignore the first R.
Speaker 1 (31:17):
Yes, exactly exactly. But in all seriousness, I think that
there's a really interesting aspect of risk assessment here from
the corporate standpoint, not just the individual standpoint. So there
are two reasons why we might be seeing a shortage.
But one of them is because so the company that
produces sir Rochessauceuifong, they broke off their relationship with their supplier,
(31:40):
their long term supplier and their only supply supplier, Underwood Ranches.
So that relationship broke off in twenty sixteen. So then
they looked for producers in Mexico. And originally kind of
the fallout of this was there was a shortage. Now
there's going to be another shortage because in Mexico we
have a heat wave and a drought, and so this
is happening right now, and I think that you know,
(32:02):
there are two different issues. Obviously the climate change that
we've just talked about, but also like, I'm sorry when
I was reading this story and this whole saga of
Underwood and Quifong in that partnership and how it came
to be and how it broke up, like this was
just a list of like what you do not do
when it comes to risk assessment in business, what you
(32:22):
do not do when it comes to diversification of your
supply chain, et cetera, et cetera, et cetera, And so
it seemed like a lot of bad business decisions that
might end with me not being able to get the
sauce I want when I want it.
Speaker 2 (32:37):
Look, I think there are certain types of products that
are kind of correctly risk averse because they lean very
heavily on brand loyalty. Right, So first of all, let's
have a couple. You want to have an honest conversation
about siracha sauce, Siracha hot sauce. So, first of all,
it tricks you by having that extra R that you're
(32:58):
not supposed to pronounce. The brand is also it is
a great sauce. It's important brand who because some people
think that, like some people think that siracha is just
this what's puce you're call It's like who Quong Quifong? Right?
They actually think that siracha is some like registered trademark
of Quifong, and it's not. It's just the best known
brand of it.
Speaker 1 (33:19):
Yeah.
Speaker 2 (33:20):
An article friend from Mackenzie Filson, who is a writer
for The Kitchen, a subvertical of Yahoo Life. Mackenzie tested
did a blind taste test of one, two, three, four, five,
six seven siracha sauces. Do you want to guess where
the famous rooster bottle of Quifong ended up on that
(33:42):
blind taste test?
Speaker 1 (33:43):
First? First, No, I'm assuming it's not first, because otherwise
you would not be asking me. So what was first night?
Speaker 2 (33:52):
First is Ox brand siracha sauce, and then Ninja Squirrel
Siracha hot sauce was right second.
Speaker 1 (34:00):
Okay, I have to say, that's a really nice name.
I like Ninja Squirrel. But at the end of the day,
people are incredibly loyal and they want this sauce. But
when they can't get that sauce, that's a big, big problem.
And so it does lead to things that seem to
be irrational, but to me on an individual level, seem
completely rational. Like I really want to go after we
(34:20):
finished taping, I have to go play poker, but I
would rather go to the store and actually just like
get five bottles of siracha and just have them just
in case something happens. Is that a good thing for
me to do? Or is that a bad thing for
me to do?
Speaker 2 (34:32):
I mean, it might be selfish what the effective altruists
say about your hoarding siracha sauce. And it does keep
by the way, was doing research, it does preserve in
your fridge for like literally two or fevers, which I'm
not sure that's the best advertisement for it necessarily, But no,
what you were saying, I mean, you know, the most
(34:52):
famous mistake all those some people think it was kind
of a long game to trick people when Coca Cola
switched its recipe was kind of the most famous mistake
in the history of like marketing. When you have an
iconic brand that is actually a push come to shove.
If you were to do a blind taste test, I
doubt that risky business listeners would necessarily be able to
(35:14):
tell Sirachia and or prefer it. But they have an
iconic brand and you don't want to fuck with that, right,
You don't want to say, yeah, it's going to taste
a little bit different. You thinks actually better. You want
to preserve that iconicness, and that means I think kind
of correctly being risk averse when it comes to things
that would affect affect your product quality.
Speaker 1 (35:31):
Yeah, I think that's right. And you know, going so
going back to that original dispute, I think that you know,
there were a lot of mistakes there, given that you
want to protect the taste and kind of the original
recipe on the quality. Because first of all, they only
had one single supplier, so we Fong and Underwood just
(35:52):
work together. And Underwood's only client was we Fong, So
they ended up just dedicating hundreds of thousands of acres
of land too, you know, doing just growing these chili
so that they could supply this one company. And it
was a part partnership of the minds of the two
Potter familiases, right, the two heads of the family. And
(36:14):
they were all handshake deals, like they didn't have contracts.
It was all just like okay, this year, we're going
to give you this much and you're going to pay
us this much. And I was just reading this and
I was thinking, holy shit, Like, isn't someone at this
point like maybe that worked like thirty years ago before
this became a big deal. Now that we're talking about
this huge business, isn't someone going to tell them this?
(36:34):
Say't a good idea? Like as a poker player, I
know that everything needs to be in writing, right, Like
if you and I, like we have swaps and events,
we have those in text messages, right, so we actually
have the exact thing that like, this is the percentage
that we've swapped. This is how the swap works, so
that we have a record. How can you be making
these deals with just one supplier? You know, no no backup,
(36:57):
no redundancy, nothing, and it's all a handshake deal. Like
to me, this is this is just a really weird
way of thinking about risk as a business owner. So
obviously to me this is more interesting as consumer because
it causes these sorts of problems. But as a business owner,
I think that you want to be thinking about risk
and more in a way that includes diversification, includes redundancies,
(37:20):
includes kind of these protections so that shit like this
doesn't happen, especially when you have things like climate change
which are already threats to your supply.
Speaker 2 (37:29):
Okay, Maria, we've had fun with our hot Sauce segment.
What is like the actual investigative takeaway that people can
apply in their everyday lives here? What do we learn
from today's episode?
Speaker 1 (37:43):
Well, I think that on an individual basis, we learned
that it's good for me to stockpile, but nobody else
should stockpile because that's a rational behavior. However, we did
learn that long term planning is incredibly important on every
single level, and that starts at the corporate level, right
and on an individual level, you know, also planning ahead
is good. That does not necessarily mean stockpiling, but it
(38:05):
might involve diversifying your tastes so that you do, you know,
look at the other competitors so that if there is
a shortage, you can get what's that squirrel called ninja squirrel?
You can music fryd ninja squirrel and see if it
stocks up. So so I think that those are those
are all kind of things that we need to think about.
(38:26):
And all of these things, like everything we've talked about
today is kind of centered on our lack of ability
to think through risk over the long term, right as
opposed to immediately and to have that sort of long
term planning mentality.
Speaker 2 (38:43):
Look, if you're this Saratch company, you don't want people
to realize is that this is actually not a hot sauce.
It's a medium sauce, a delicious medium sauce. But like
if people get hooked on like the Abanniro stuff and
like the Ghost Pepper stuff, you're screwed, right, So you
better you better shape up and have some inventory ready
in Q three. I'll take you that much.
Speaker 1 (39:04):
Absolutely. Please do not make me switch brands. I don't
want to. I want to remain more to you help
me do that. Thank you, And now, Nate, I'm going
to be off to play my next event of the
World series, which is still not going nearly as well
as yours. I've had one men cash, Nate one min
cash in the last.
Speaker 2 (39:25):
Week, Maria. It often tends to turn around. It's kind
of literally random to some large degree. What's what's the
event today?
Speaker 1 (39:33):
The event today is a two thousand dollars freeze out event.
So I'm actually, yeah, I'm excited. I appreciate that. I
really like freeze out events. So freeze out events for
non poker players means you can only enter one time,
and in some ways that's the truest form of poker,
right If you bust your app, you're done. And I
(39:53):
love that, and so I'm I'm excited for the freeze outs.
The main event is a freeze out, So I hope
Nate that today is a Marie event because so far,
you know, I've had two cases this whole series. I mean,
I've only played for two weeks, so it's one a week.
But still it feels like I'm not I'm not doing
that well and it's time to turn things around.
Speaker 2 (40:12):
Do you feel like you're still playing your A game
or or is it getting to be a grind?
Speaker 1 (40:18):
No? No, I think I think that it was really nice.
You know, I took that week off and so I'm
actually pretty fresh still. And then I took two days off.
I didn't play Friday or Saturday, which I think is
important to take these breaks so I actually practice what
I preach right in my tips for the World Series,
I said you need to kind of take brain breaks,
and I did do exactly that. I went hiking on Saturday.
(40:40):
I ran into a mountain lion, so it wasn't as
relaxing as I would have wanted it to be. Yes,
but here I am to tell the tale. But that
was not the most relaxing hike in the world. PSA.
There are lots of mountain lions in the Spring Mountains.
Normally you never see them, but when they start growling
at you, it means that you have inadvertently impinged on
(41:01):
their territory, and it's probably a good idea to back
away and get the fuck out of there, which is
why I did.
Speaker 2 (41:07):
I didn't intuitively know that we're lion in Las Vegas.
Speaker 1 (41:10):
Oh, there are tons of mountain lions, so the Spring
Mountains have a lot of them. Red Rock even has some.
But yes, you are talking to someone who escaped from
a mountain lion relatively unscathed. I have a I have
a little uh. Yeah, I have a little cut cut
up from a fall, as I had as I tried
to get away. But otherwise I'm good.
Speaker 2 (41:30):
Do lions like siracha? Could it be like?
Speaker 1 (41:35):
Excellent? Excellent idea? I will I will try that next time.
Speaker 2 (41:38):
Join us next time and we will experiment with mountain
lions and sches sauce A.
Speaker 1 (41:49):
Risky Business is hosted by me Maria Kanakova and me
Mate Silver. The show is a co production of Pushkin
Industries and iHeartMedia. This episode was produced by Isabelle Carter.
Our associate producer is Gabriel Hunter Chang. Our executive producer
is Jacob Goldstein.
Speaker 2 (42:06):
And if you want to listen to and add three version,
sign up for pushkar Plus for six thirty nine a month.
You get access to adre listening. Thanks for tuning in.
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