Interesting that this quote was initially about stock options at tech companies. It turned out that stock options did become nearly universal in tech compensation, and companies that granted them outcompeted companies that did not. So the management that was ostensibly “doing a massive blag at the expense of shareholders” wasn’t really, time vindicated their practices and things like option backdating and not treating them as an expense weren’t even really necessary, but it took a few years. It wasn’t obvious in 2002 that this is how it would play out.
And relevant to the title quote: maybe it should be amended to “good ideas do not need a lot of lies to gain public acceptance eventually”. The dynamic here is that a significant part of public opinion is simply “well, this is how things work now, and it seems to be working”, and any new and innovative idea by definition is not going to be how things work now. The lies are needed to spur action and disturb the equilibrium of today. But if you’re still telling lies a few years in, you’ve failed and it’s a bad idea to begin with.
> Interesting that this quote was initially about stock options at tech companies. It turned out that stock options did become nearly universal in tech compensation, and companies that granted them outcompeted companies that did not. So the management that was ostensibly “doing a massive blag at the expense of shareholders” wasn’t really, time vindicated their practices and things like option backdating and not treating them as an expense weren’t even really necessary, but it took a few years. It wasn’t obvious in 2002 that this is how it would play out.
I happen to have read probably everything that Warren Buffet wrote on this subject, and in my opinion your take is confused at best.
First, you say that “stock options did become nearly universal“. No, they were already nearly universal at the time that this conversation was happening. I remember that Warren Buffet was quoting, going by memory, something like all but 3 out of 500 S&P DONT companies do it, or nasdaq or whatever index he was talking about. The fact that almost all companies do it doesnt mean its the right thing to do and if almost no company did it, Buffet wouldnt be complaining about it.
Second, you say “companies that granted them outcompeted companies that did not“. I literally have no idea how you came to this conclusion since, like I said, at the time this conversation was going on almost all company did it. Not because the companies that didnt do it died out, but because companies that didnt do it switching into doing it.
Third, and most important, I believe you misunderstand what the conversation is about. Expensing stock options is not a competitive advantage. Granting stock options might be, the rationale that paying management and staff more attracts the best people is an argument worth having. But the conversation isnt about whether its a good idea to grant stock options, the conversation is about which entry you should put your stock options when preparing financial statements. The author says clearly that this is about accounting, but you missed that. Theres no competitive advantage in doing one way or the other. The reason why Buffet complains about them is that A) it makes harder to discern from financial statements how much staff is costing the shareholders, not that its a competitive advangage or disadvantage, and B) if theres a cost that you need to pay in order to run the business, thats called an expense, and by your own argument you need stock options to run the business, therefore those are expenses and thats how they should be labeled in the income statement. The argument of companies doing it is that “earnings“ is bigger if there are things which are expenses but you dont call them that. Its literally saying that pnl = P - L but you know what, its bigger if I just report the P and hide the L.
> My reasoning was that Powell, Bush, Straw, etc, were clearly making false claims and therefore ought to be discounted completely, and that there were actually very few people who knew a bit about Iraq but were not fatally compromised in this manner who were making the WMD claim
At the risk of missing the point, I have to say that knowing what we know now, this is a very poor heuristic. Predicting a lack of WMD was not only correct by mere coincidence, but also irrelevant to the decisions made about the war in Iraq.
What is this blog post even saying? When you can't distinguish a lie, trust the room vibes? Seeking comfort won't give you any answers or get you closer to the truth.
Not enough people ask "why". They instead argue about effectiveness or correctness. At some point you have to determine whether you're chasing the truth to make a decision or just for its own sake. In the vast majority of cases what you want is a decision that will produce the desired results. That's the real reason why lies happen and why merely knowing the truth doesn't get you anywhere and often nobody cares.
EDIT: for the sanity of any late replies. My bad. I replaced the part about AI with something I thought was more interesting.
How was predicting a lack of WMD correct by mere coincidence? He ignored the blatant liars, believed people with a good record on the subject, and got it right as a result. That's not coincidence, that's an excellent heuristic.
It is a bit of a weird article, though. Correctly predicting Iraq isn't some amazing feat. All it required was being paying some vague attention to the available facts. The question is not, how did some people get it right. The question is, how did so many people not?
Having worked in public advocacy advertising, I’d frame it like this:
“Good ideas don’t need lies” is a compelling ideal but in practice, public acceptance isn’t a reliable signal of truth or societal benefit. It depends on incentives, narratives, and how information is presented.
History shows that even harmful or suboptimal ideas (like coal power) can gain widespread support if presented persuasively, while genuinely beneficial ideas can struggle if they’re complex or unintuitive.
A useful heuristic is: if an idea relies on misleading claims to survive scrutiny, that’s a warning sign. But public acceptance itself is not proof of goodness or correctness.
In short: persuasion and truth are related—but far from identical.
Some good ideas might need a whole lot of marketing to catch on. Some bad ideas might need very little. The quote merely argues that if you must deceive people for an idea to catch on, the idea is not good. A corollary is that if you are tempted to lie in your advocacy, you should probably reexamine what you are advocating for.
This is what scares me the most about AI. You have a handful of really big companies trying to outdo each other as they race to implement it and deploy it as quickly as possible.
To try and justify their outrageous capital spending on data centers; they are incentivised to exaggerate its current capabilities and also what it will be capable of 'soon'.
There is no time to evaluate each step to make sure it is accurate and going in the right direction, before setting it loose on the public.
I guess a counterpoint might be Apple's "strategy". Scare quotes because I truly don't know if it was deliberate or just a happy accident. But somehow they've managed to not get so intensively exposed to the downside risk--if the wild claims about AI don't pan out they're not going to lose very much compared with the other megacorps.
When companies are spending that much capital, they almost can't help becoming unreliable narrators about what the technology can do right now versus what they hope it will do in two or three years
It is also a useful trick to keep in mind the opposite of critical thinking - following the herd. Just copying everyone around you is often a great strategy. So good that even if everyone around you are making mistakes it can still be the dominant strategy (there is a reason a lot of people who don't like war are cowed into silence when war fever descends). Most people are using it.
That implies that it is ridiculously easy to be right when everyone else is wrong. People aren't trying to be right. Any sort of principle-based analysis easily outperforms the herd. When leaders in society start lying that is indeed one of those situations. Pretty much any situation where everyone knows something and the hard statistics are telling a different story is.
The more pressing problem is how to go from a lovable Cassandra to someone who can preempt major events and convince the herd to not hurt itself in its confusion. Coincidentally that is how markets work, people who have a habit of being right are given full powers to overrule the mob and just do what they want. Markets don't care if everyone believes something. They care if people who got the calls right last time believe something.
In this case, the US hasn't seen a good outcome to a war since something like WWII and even there they waited until the war was mostly over and the major participants in the European theatres were exhausted before getting involved. The record is pretty bad. Iraq was an easy call to anyone who cares about making accurate predictions.
> That implies that it is ridiculously easy to be right when everyone else is wrong
I think this true but misleading — conditioned on other people going with the herd in the wrong direction, it is easy to be right. However, often the herd is going in a right (or at least acceptable) direction. The continual effort to check if the herd is going in the right direction _is not_ easy. If a magic eight ball could alert you “hey the herd is wrong right now, take a closer look”, that would be great! But we have no such magic eight ball.
> the US hasn't seen a good outcome to a war since something like WWII
Korean War, Panama, and Gulf War were rather successful, resulting in a (more) US-aligned and prosperous South Korea/Panama/Gulf. Without these wars, South Korea wouldn't exist, Panama would probably still be a dictatorship, Saddam Hussein would control Kuwait and the US would have significantly less influence among the GCC.
my opinion is that lies have no relevance to if the idea is good or bad. liars lie and honest people are honest. ideas are not people and do not care who it is that thought them up.
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I’m kind of conflicted and confused faced with this message on this site, especially with the content of the post. Can someone explain why I’m feeling annoyed?
The flip side is that good ideas with honest framing often lose to bad ideas with better marketing. Being right isn't enough if you can't communicate it and most people don't have the patience to evaluate the honest version.
Something interesting about my experience with the Iraq War was that, as a 9 year old living in DC at a wealthy, liberal private school, everyone knew from the beginning it was all a lie. I only learned fairly recently that a vast majority of the country thought invading Iraq was a good idea.
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[ 453 ms ] story [ 274 ms ] threadAnd relevant to the title quote: maybe it should be amended to “good ideas do not need a lot of lies to gain public acceptance eventually”. The dynamic here is that a significant part of public opinion is simply “well, this is how things work now, and it seems to be working”, and any new and innovative idea by definition is not going to be how things work now. The lies are needed to spur action and disturb the equilibrium of today. But if you’re still telling lies a few years in, you’ve failed and it’s a bad idea to begin with.
I happen to have read probably everything that Warren Buffet wrote on this subject, and in my opinion your take is confused at best.
First, you say that “stock options did become nearly universal“. No, they were already nearly universal at the time that this conversation was happening. I remember that Warren Buffet was quoting, going by memory, something like all but 3 out of 500 S&P DONT companies do it, or nasdaq or whatever index he was talking about. The fact that almost all companies do it doesnt mean its the right thing to do and if almost no company did it, Buffet wouldnt be complaining about it.
Second, you say “companies that granted them outcompeted companies that did not“. I literally have no idea how you came to this conclusion since, like I said, at the time this conversation was going on almost all company did it. Not because the companies that didnt do it died out, but because companies that didnt do it switching into doing it.
Third, and most important, I believe you misunderstand what the conversation is about. Expensing stock options is not a competitive advantage. Granting stock options might be, the rationale that paying management and staff more attracts the best people is an argument worth having. But the conversation isnt about whether its a good idea to grant stock options, the conversation is about which entry you should put your stock options when preparing financial statements. The author says clearly that this is about accounting, but you missed that. Theres no competitive advantage in doing one way or the other. The reason why Buffet complains about them is that A) it makes harder to discern from financial statements how much staff is costing the shareholders, not that its a competitive advangage or disadvantage, and B) if theres a cost that you need to pay in order to run the business, thats called an expense, and by your own argument you need stock options to run the business, therefore those are expenses and thats how they should be labeled in the income statement. The argument of companies doing it is that “earnings“ is bigger if there are things which are expenses but you dont call them that. Its literally saying that pnl = P - L but you know what, its bigger if I just report the P and hide the L.
What are you basing this claim on?
At the risk of missing the point, I have to say that knowing what we know now, this is a very poor heuristic. Predicting a lack of WMD was not only correct by mere coincidence, but also irrelevant to the decisions made about the war in Iraq.
What is this blog post even saying? When you can't distinguish a lie, trust the room vibes? Seeking comfort won't give you any answers or get you closer to the truth.
Not enough people ask "why". They instead argue about effectiveness or correctness. At some point you have to determine whether you're chasing the truth to make a decision or just for its own sake. In the vast majority of cases what you want is a decision that will produce the desired results. That's the real reason why lies happen and why merely knowing the truth doesn't get you anywhere and often nobody cares.
EDIT: for the sanity of any late replies. My bad. I replaced the part about AI with something I thought was more interesting.
It is a bit of a weird article, though. Correctly predicting Iraq isn't some amazing feat. All it required was being paying some vague attention to the available facts. The question is not, how did some people get it right. The question is, how did so many people not?
History shows that even harmful or suboptimal ideas (like coal power) can gain widespread support if presented persuasively, while genuinely beneficial ideas can struggle if they’re complex or unintuitive.
A useful heuristic is: if an idea relies on misleading claims to survive scrutiny, that’s a warning sign. But public acceptance itself is not proof of goodness or correctness.
In short: persuasion and truth are related—but far from identical.
Some good ideas might need a whole lot of marketing to catch on. Some bad ideas might need very little. The quote merely argues that if you must deceive people for an idea to catch on, the idea is not good. A corollary is that if you are tempted to lie in your advocacy, you should probably reexamine what you are advocating for.
"Don’t worry about people stealing your ideas. If your ideas are any good, you’ll have to ram them down people’s throats." -- Howard Aiken
...to mean that, usually, the good ideas are the crazy sounding ones...
To try and justify their outrageous capital spending on data centers; they are incentivised to exaggerate its current capabilities and also what it will be capable of 'soon'.
There is no time to evaluate each step to make sure it is accurate and going in the right direction, before setting it loose on the public.
That implies that it is ridiculously easy to be right when everyone else is wrong. People aren't trying to be right. Any sort of principle-based analysis easily outperforms the herd. When leaders in society start lying that is indeed one of those situations. Pretty much any situation where everyone knows something and the hard statistics are telling a different story is.
The more pressing problem is how to go from a lovable Cassandra to someone who can preempt major events and convince the herd to not hurt itself in its confusion. Coincidentally that is how markets work, people who have a habit of being right are given full powers to overrule the mob and just do what they want. Markets don't care if everyone believes something. They care if people who got the calls right last time believe something.
In this case, the US hasn't seen a good outcome to a war since something like WWII and even there they waited until the war was mostly over and the major participants in the European theatres were exhausted before getting involved. The record is pretty bad. Iraq was an easy call to anyone who cares about making accurate predictions.
I think this true but misleading — conditioned on other people going with the herd in the wrong direction, it is easy to be right. However, often the herd is going in a right (or at least acceptable) direction. The continual effort to check if the herd is going in the right direction _is not_ easy. If a magic eight ball could alert you “hey the herd is wrong right now, take a closer look”, that would be great! But we have no such magic eight ball.
Korean War, Panama, and Gulf War were rather successful, resulting in a (more) US-aligned and prosperous South Korea/Panama/Gulf. Without these wars, South Korea wouldn't exist, Panama would probably still be a dictatorship, Saddam Hussein would control Kuwait and the US would have significantly less influence among the GCC.
I’m kind of conflicted and confused faced with this message on this site, especially with the content of the post. Can someone explain why I’m feeling annoyed?
I bought an EV last year and it's definitely been a "good idea" for me. Luxurious ride, fuel costs a tenth, doesn't stink.
Seems such an obvious upgrade it slightly confuses me take-up hasn't been quicker among people who like me can charge at home.