This article was taken from the December 2012 issue of Wired magazine. Be the first to read Wired's articles in print before they're posted online, and get your hands on loads of additional content by <span class="s1">subscribing online.
There are times when uncertainty is unbearable: waiting to hear about a school or job acceptance; or pacing outside an operating theatre, worrying about a loved one. But at other times we're a lot happier being in the dark -- or at least partially shaded.
Many of us have spent time beside a pool. And you have probably wondered: what are the odds that no children (or adults, for that matter) have peed in the water? When pressed, we'd have to admit that the odds that the pool is pee-free are close to zero, but the lack of absolute certainty allows us to relax and swim anyway. We may comfort ourselves with some fuzzy thought about chlorine, or the immense volume of the pool relative to a few bladders, and our concerns slip away.
Now, compare this with watching a kid stand by the pool and pee into it. Throw in some swimming trunks around his knees and a frantic, embarrassed parent scooping him up, alas, too late. Now you're no longer able to hold on to the slight possibility that the pool is free of urine. The relative volume of the water in the pool is now little comfort when you just saw a kid pee in it. Could you still take a quick dip?
When things are very close to being certain, but we are still able to pretend otherwise, we are experts at using this window, small though it may be, and expanding it. For example, lots of people don't wash their hands after visiting the lavatory. We all know this, but we can happily imagine that everyone who cooks and serves in a restaurant we patronise does. At least until we see a server leave the stall, straighten their shirt in the mirror, and walk out without so much as a rinse. Dinner is served ruined! It's only when we face direct evidence that we can no longer put our heads in the sand.
This also happens on a broader scale when we hold something or someone in high esteem -- and then something happens that's undesirable. Consider the five-second rule for food -- your snack has hit the floor, but five seconds is just enough time that we can pretend that nothing has sullied it. Or think about people who "go vegetarian" after reading books such as Eating Animals, and their friends who choose not to read it (as with pool-goers who look the other way in order not to see the kid in action). We could also consider all the people on both sides of the political spectrum who don't listen (with any degree of earnestness) to the opinions and facts presented by the other side. Ignorance may be bliss, but it only takes a speck of reality to ruin it.
The recent massive trading losses suffered by JP Morgan Chase offer parallel lessons. It seemed likely that JP Morgan Chase, like other banking companies, probably had some skeletons in the closet, but we didn't know for sure, and so they continued on with their relatively good reputation. In the race to the bottom of the banks, JP Morgan Chase's CEO Jamie Dimon got the best title a banker these days can get: "the least-hated banker in America". Now we have about $3 billion (£1.8bn) to prove the contrary.
Although for a company that size, that's a relatively small amount to lose (and surely their accountants could have hidden it).
The problem is that now we have direct evidence that they're not perfect. Once we are forced to see reality, we can no longer avoid the knowledge that the pool is polluted -- even if the damage was done by the least-hated character. And I suspect that, for many, the events at JP Morgan Chase further polluted not only their opinion about that company, but also about banking generally.
Dan Ariely is James B Duke professor of psychology and behavioural economics at Duke University, North Carolina, and author of The Honest Truth About Dishonesty
(HarperCollins)
This article was originally published by WIRED UK
