Reader,

I used to think that Elon Musk was a bit crazy, but very smart. Now I’m sure about the crazy stuff and not so sure about him being smart. Maybe his ketamine use is stirring the mix.

Smart people pay attention to consequences

The late Peter Drucker was a great business thinker and a hero to many of us because he analyzed the picture of big decisions across time. His comments about the need to consider the “futurity” of your decisions triggered reflection to look at consequences, both intended and unintended.

His proverbial bottom line is that we spend a lot of time thinking about the intended consequences of strategies and decisions and insufficient time considering “the other stuff” we get from these decisions.

A few examples

I went to ChatGPT and posted a query about the unintended consequences of government decisions. It gave me twenty within seconds. Here are four for your amusement and consideration.

The 18th Century British Window Tax

• Intended Consequence: Raise government revenue through a property tax based on the number of windows.
• Unintended Consequences:
  • Many homeowners bricked up windows to avoid taxation, reducing natural light and ventilation.
  • This led to poorer health conditions due to lack of fresh air, contributing to disease.

Prohibition in the United States (1920-1933)

• Intended Consequence: Reduce alcohol consumption and associated social problems.
• Unintended Consequences:
  • Growth of organized crime (e.g., Al Capone) as bootlegging became highly profitable.
  • Increased unsafe, homemade alcohol consumption leading to poisoning and death.
  • Loss of government tax revenue from legal alcohol sales, contributing to economic downturns.

The Great Leap Forward in China (1958-1962)

• Intended Consequence: Rapid industrialization and increased agricultural production.
• Unintended Consequences:
  • Overemphasis on “back yard” steel production resulted in both poor-quality goods and neglect of farming.
  • Famine due to failed agricultural policies and misreported grain yields, resulted in the deaths of an estimated 30-45 million people.

The 2008 Housing Crisis (Government Encouragement of Homeownership)

• Intended Consequence: Increase homeownership, especially among low-income families.
• Unintended Consequences:
  • Relaxed mortgage lending standards led to a housing bubble.
  • When the bubble burst, it triggered a global financial crisis, leading to widespread foreclosures and job losses.

A framework to consider

Mr. Musk had fun swinging a chainsaw at a political rally and the actions of DOGE are certainly dramatic. However, I contend that the damage to our science infrastructure will go on much longer than the immediate loss of jobs for thousands of government and affiliated researchers and workers.

Here’s a framework for all of us to spend time pondering before we make major decisions.

1: Define the Decision & Its Intentions

• Objective:
• Intended Benefits:
• Key Assumptions:

2: Consider the Immediate and Ripple Effects

• Immediate Effects:
• Second-Order Effects (1-3 years):
• Third-Order Effects (5+ years):
• Unexpected Consequences:

3. Build three scenarios

• Best-Case Scenario:
• Middle-Ground Scenario:
• Worst-Case Scenario:
• Early Warning Signs to Monitor:

4: Monitor Real-World Outcomes & Adjust

• Key Metrics to Track:
• Early Warning Signs That Indicate Policy Failure:
• Potential Policy Adjustments Based on Data:

Conclusion & Final Assessment

• Is the policy sustainable?
• Are unintended consequences manageable?
• What adjustments should be made?

What are we seeing today?

Musk has taken his chainsaw to a wide variety of government departments and agencies, including the National Institutes of Health, National Oceanic and Atmospheric Administration, and various university research programs.

Regarding the sciences, France and China have already expressed invitations for research scientists to visit them to continue their work. If the U.S. continues to cut costs with a chainsaw, I’m worried that we will lose our lead in the sciences.

I know that government can become more efficient, but blindly cutting headcount is not the way to science greatness. Musk wants "efficiency" but we will experience more than cost reduction. Think about it.

Thinking Skills

You already know that I’m updating my 2006 book, The Prepared Mind of a Leader, to focus on foresight. However, the skills described in the earlier book still apply. These skills are explained, along with potential barriers and application tools in the Prepared Mind Checklist. Grab the ​​Prepared Mind Checklist.pdf​ here.

Cheers,

Bill