17 January 2017

Cognitive Dissonance (2014) #nlpoli

People like things in life to fit together.

When things don’t fit together, people get upset.  They get fidgety.  They try to make things fit together.

It’s an idea regular readers know from other posts.  Take this bit from a post from 2012 as a good example of how some people react when faced with a situation where what is happening doesn’t fit with their preconceived notions. The context was a decision by then-Premier Kathy Dunderdale to refuse to meet with the parents of a boy who had  died tragically.
Our friend the open line caller did exactly what people tend to do when confronted with this cognitive dissonance.  He made up a completely fictitious set of claims.  Kathy Dunderdale was the victim of a plot.  Some unspecified crowd called “they” had set a trap for her with this meeting.  When they tried to spring it, Kathy foiled their nefarious plot. 
The media have been pounding away at this  because they just love misery.
And the root of it all was the end of the sectarian school system almost 20 years ago.  Since the evil Liberals did away with sectarian schools, we have been set on just this course.  Politics in this province is gone down to the lowest level with this sort of mean-spirited attacks on good people, besmirching the good name of lovely people like Kathy who are only trying to do good for the world.
Anyone listening to the province’s major open line show this past week heard a couple of really good examples of how people react when the world as it is doesn’t fit with their preconceptions.  The common factor was Muskrat Falls.

The backdrop to the to interviews is the skyrocketing cost of the project.  While Nalcor hasn’t been willing to release any revised cost estimates,  we know with a fair degree of certainty that the costs in late 2013 were at least a billion dollars above what they were 12 months beforehand.  People are easily talking about a project that will be double the original cost estimate of $5.0 billion by the time it is done. 

At the very least,  Nalcor officials admitted recently that the project will almost certainly run behind schedule as the company works to keep rising costs under control.  Then there’s the question of power.  Hydro-Quebec has a a law suit in the Quebec courts that could demolish the claims about how much the project will produce.

What Premier Tom Marshall has taken to doing lately is to talk about all the wonderful things that Muskrat Falls will do.  Billions of dollars of cash every year, he claimed at one point in the House of Assembly in early April. He corrected himself the next day but the confusion Marshall experienced is remarkable because he’s been at the centre of this project since it started.

Marshall returned to the same grandiose claims this week when talking to VOCM’s Paddy Daly about the idea that maybe the project might get too costly to finish. Nalcor as a whole will produce billions in revenues.  We will have money to pay off all the debt, cash for an investment fund and just about everything else Marshall has rejected in the past. 

As the cost of Muskrat Falls grows far beyond what its backers claimed and the value of it looks less and less certain,  Tom Marshall’s claims of what the project will do have grown in proportion.  No one would be surprised if Marshall started claiming that Nalcor would cure cancer some day using money from Muskrat falls, undoubtedly.

What Marshall is doing is a form of cognitive dissonance.  it’s like a psychological experiment in which a group of people get an obviously impossible task.  As they fail,  they try harder,  grow more grandiose in their boasts about success, and do all sorts of things to compensate for the gap between what happened and what they expected.

One of the other things some of the group will do is reaffirm the correctness of their basic methods.  They’ve been failing, the story would go,  because they haven’t been managing the project properly. 

You’ll see a variation of that in comments former Nalcor board member and chair Cathy Bennett made in a conversation with Daly the day after Marshall was on Open Line. The problem with Muskrat Falls, according to Bennett, is that the Conservatives are not managing it properly.  They are using the wrong method.  Bennett’s answer is to redouble the efforts to get it right.  She does not believe in doing the same things.  Bennett wants to do more of the same things.

Bennett’s starting point was that the government cannot stop the project at all, ever,  as Marshall suggested at one point.  Muskrat Falls must go ahead, regardless.  As costs go up,  the provincial government must double its efforts to find ways to cut costs.  She didn’t have any specific suggestions but you can imagine someone who thinks that more management will fix things might suggest cutting the cost of supplies  - buying cheaper concrete maybe – or using half as many light bulbs in the stairwells.  Maybe cheaper screws.  That kind of thing.

Both of these arguments, that is the grandiose claims or the critique of past methods reflect not only cognitive dissonance but also the sort of fundamentally flawed thinking that drives megaprojects like this.  We’ve seen lots of the same sorts of things early.  Kathy Dunderdale, for example, used to argue that only the folks at Nalcor were smart enough to understand this project and to carry it forward. That’s a common fallacy that drive megaprojects.

Another cabinet minister – Derek Dalley – used the same claim recently when he talked about getting an outside expert to look over Nalcor’s shoulder.  Can’t be done, says Dalley.  Nalcor has already done all that and found all the experts.  The smart people all back Muskrat Falls.

There’s a reason why people call this sort of thing a fallacy.  It’s an unsound argument, a mistaken belief.  Nalcor has huge problems with its management practices  and there are experts who are ready to find the problems and point out how to fix them.  The public utilities board found one such expert.  Their interim report on the blackouts in January are an indictment of Nalcor’s management practices

The only thing Nalcor supporters like Dalley can point to, incidentally, are reports done by contractors hired by Nalcor or the provincial government and set to work under conditions set by Nalcor.  Genuinely independent reviews have been highly critical of the company’s arguments for the megaproject.

The fundamental problem with Muskrat Falls is that it was entirely a political project justified by arguments about its performance that were, as it fairly quickly became apparent, completely unfounded.  In other words, Muskrat Falls never made sense. It could never do what its backers claimed, whether we are talking about the money it would make,  the power it would generate, or even the cost of the whole thing. 

That’s the fundamental contradiction that the project’s supporters are grappling with:  it’s the impossible task from the psychological experiment.  By the time people like Marshall and Bennett break through their delusions and admit the whole thing will never work, we will be so far along with construction that shutting the whole thing down won’t even be possible.

People who study psychology and decision-making will be shifting through the Muskrat Falls projects for decades to come in an effort to figure out how such an obviously ridiculous idea captured the minds of so many reasonable people. 

Taxpayers, meanwhile, will be stuck with the bill.