All I wanted was a lousy little definition (so we would know we are talking about the same thing) and all I got is a shitty T-shirt. Bottomline is, if you can't explain it in 1-2 sentence what we are talking about, chances are it doesn't exist.
You want me to condense an entire career specialty into a bumper sticker??? It takes considerable study to work in this field, there is a mountain of published information about it, and somewhere in America right now people are probably arriving and registering for a risk management conference that will start tomorrow (Monday) morning. One of the reasons it requires study and apprenticeship is that
it is not intuitive. Common sense is only moderately useful in analyzing risks and choosing strategies for managing them. Instinct and emotion are much worse, and often lead people in exactly the wrong direction, as in the example I posted previously of America destroying its own economy and those of several other countries in a quixotic attempt to eradicate terrorism--a threat of almost negligible consequence--while blithely tolerating the
almost two-orders-of-magnitude greater death toll from drunk driving, which could be eradicated cheaply and without turning the country into a police state.
I have written many plans, letters, templates, presentations, course materials and other documents to introduce Americans to the principles of risk analysis and management. After all that practice, I still could not possibly condense a summary into two sentences.
You are a textbook example of why America is so bad at dealing with risks. You expect it to be easy, and
it just ain't!
I have a theory about criminals: they are uniformly bad problem solvers. They all choose ways to solve their immediate problems that ultimately prove disastrous for them. Not very smart, if you ask me.
It revolves around the discounted value of a future cost, compared to the full value of an immediate benefit. Any reasonably intelligent member of a modern economy who is not extremely wealthy would, without hesitation, accept an offer of $10,000 payable immediately, over a promise of $11,000 to be paid in twenty years. Even ignoring interest rate fluctuations, he has to weigh the possiblity that he might die before the payoff date, that inflation may make the money worth far less than it would be today, that the person or organization making the offer may go bankrupt and not have the money any more, etc. But moreover, most of us value current comfort and pleasure more highly than future comfort and pleasure, although we don't all use the same ratio.
Using the identical "emotional algebra," we all would agree to promising a "negative payoff," e.g., paying a bill, suffering punishment, etc., in the future in order to avoid making an
immediate payoff of considerably smaller size or value, and for the same reason. We might be dead, the other guy might be dead, civilization might collapse, etc. But by the same token as the above line of reasoning,
we simply regard current discomfort or displeasure as more onerous than future discomfort or displeasure.
We live in the present and discount the future.
But the
discount rate varies dramatically from one person to another. And that's the secret to analyzing the problem-solving skills of criminals that at first glance appear "bad, disastrous," and "not very smart" to you. These are simply people with a
very high discount rate.
- They live high-risk lives. To them, the probability of not being alive by the time the cops catch up with them for their crimes is not just an interesting exercise, it is a realistic expectation.
- They tend to be in extreme emotional pain, so having a van full of somebody else's tchotchkes to play with until they get tired of them (or break them or let somebody else steal them) will give them a few days of comfort and pleasure.
- They have an inflated self-image. (And no, I'm not referring to people who always think they're overweight ) They are convinced that they're smarter than we are, stronger than we are, braver than we are and luckier than we are, so to them the probability of being apprehended appears much lower than it really is.
- If you look at the statistics of solved crimes, it suggests that we upright citizens estimate the probability of being apprehended as greater than it really is. Does that make us also "bad problem solvers? Are we fools for not committing crimes that we'd probably get away with? The criminals certainly think so!
So, working within the logic, priorities and assumptions that inform the world view of criminals, they are really not such bad problem solvers. They are willing to accept the probability of being punished for a crime as the cost of the pleasure, money or other benefit that accrues from committing it. They are simply less patient than we are, and less certain of a long life.
This is a very unrealistic scenario.
This is a pretty big planet. Are you really sure that no woman anywhere has ever done that? This scenario is not
unrealistic so much as
extremely rare. That is a huge difference, at least in the discipline of
risk analysis and management.
We deal with extremely rare risk realizations all the time. Every risk is assessed a cost of realization and a probability of realization. If the probability is extremely low (say an earthquake), but the cost is extremely high (say losing all of the company's account information and going bankrupt), we still have to develop a contingency plan for addressing it (maintaining an off-site backup a thousand miles away will usually take care of this one).
But
unrealistic risks? No, we don't deal with that. We send you back to do a better job of analyzing it and to come back with a more realistic description and analysis.