When Theories Fail

In all the reminiscing and analysis that's emerged following Supreme Court Justice John Paul Stevens' retirement announcement last Friday, the piece that's intrigued me the most is the explanation of how Stevens came to change his views on the death penalty over the course of his tenure on the court.

Linda Greenhouse, a former Supreme Court correspondent for The New York Times noted that Stevens had renounced his support for the death penalty two years ago "in an opinion based not in abstract principle but in years of sorrowful observation of how the death penalty was actually being administered." Stevens, she said, had come to the conclusion that "the premise that the justices had assumed in 1976, that the death penalty could be rational and fair, had gone unfulfilled," and it was now time to reconsider "the justification for the death penalty itself."

The justices had been operating on a theory that, at least in Justice Stevens' opinion, the messy reality of life had not matched. And so he came to change his opinion about the theory.

That is, of course, what all good scientists are supposed to do. We develop theories, and then we test them, or see how they play out in real life. If reality doesn't behave the way the theory predicted, we're supposed to use that information to modify and improve our theories and opinions. What makes that anecdote about Stevens notable is how few public figures -- or even private individuals, for that matter -- manage that kind of measured re-evaluation of their beliefs or positions, despite how often our theories about business, economics, foreign policy or human behavior prove themselves less perfect in practice than they sounded on paper.

Take, for example, the grand theories about free access and content on the Internet. In a recent issue of Newsweek, Andrew Zoll, an early advocate of free content on the Internet,   acknowledged that the approach he'd espoused was, in retrospect, a phenomenally bad idea. The oft-repeated mantra that "information wants to be free," he says, was actually a shortened, zippy piece of a much longer and more nuanced thought by Stewart Brand explaining the tension between information wanting to be expensive, because it's so valuable, and wanting to be free because the barriers to publishing were becoming lower.

"Selling 'free' made us seem like visionaries," Zoll said. "Unfortunately ... the idea that we Internet visionaries sold was a load of crap." He went on to apologize for his role in promoting the flawed theory, and argued that we all really should pay for the content we get on the Web -- although he acknowledged that it may take new platforms like the Kindle and iPad to change the "free" paradigm that's now accepted practice.

As someone who never thought the "free content" movement was all that terrific an idea, or made economic sense for any creative person (or entity) whose product was content, I wasn't all that mollified by Zoll's "oops ... sorry" after the fact. But I have to give him credit. At least he re-examined his beliefs -- and began advocating a new approach -- when reality didn't pan out the way his theory predicted. He also took responsibility for his role in advocating the flawed theory.

Contrast that with the performance, this past week, of Alan Greenspan and Robert Rubin at the Financial Crisis Inquiry Commission. They had both advocated a "less is more" theory of financial regulation -- both in general, and in the case of the notorious derivatives market that caused so much damage. Most people now view those theories as, at the very least, seriously flawed. When the crisis broke a year and a half ago, Greenspan himself acknowledged, almost in disbelief, that his belief in the power of markets to self-regulate was evidently misplaced.

But while Justice Stevens reversed his position on the death penalty when he realized that reality hadn't panned out the way his initial theory had imagined it would, and Zoll has now begun arguing that information shouldn't be free, after all...there was no sign of any similar conversion on Greenspan or Rubin's part at the hearing. For that matter, there wasn't even a sense that they were willing to take all that much responsibility for their roles in advocating a theory that had led the nation's economy to the brink of disaster.

Three of the hardest words for anyone to utter are "I was wrong." But they're also a necessary first step in coming up with a better theory, approach, or solution. It can be wrenching for a scientist to realize that his or her prized theory, which he or she has spent years gaining status and benefits from pursuing and advocating, is flawed, wrong, or doesn't really work in real life conditions. And scientists don't generally have to face, in the course of acknowledging the flaws of their theories, irreparable damage done -- innocent men executed, an industry grievously damaged, or millions of people left without jobs, houses, or retirement savings.

But as Stevens, Zoll and others have demonstrated, it can be done. In fact must be done, if truth, justice, sustainable solutions, or long-term success are ever to be achieved. Of course, perhaps Rubin, Greenspan and some of the others on Wall Street arguing that they weren't really responsible and nothing needs to change truly believe their words, and still believe in their theories. More likely, I suspect that they just still want to believe in them. They like those theories. Those theories worked well for them.

And perhaps, given some more time, they'll come around. Justice Stevens, after all, had over 30 years to re-evaluate his initial positions, assumptions, and theories. But if Stevens seems to stand a bit taller than the Wall Street wizards do at the moment, it's not the black robe or title. It's his ability to say "I was wrong. My assumptions did not play out in real life the way I thought they would. And so I am now advocating a different approach." The titans of Wall Street -- and, indeed, all of us -- would do well to take a few notes.