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Outliers: Why Some People Succeed and Some Don’t – Malcolm Gladwell

https://youtu.be/EcMKLwVlpJk

Microsoft Research

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Outliers is a book about success. It starts with a very simple question: what is the difference between those who do something special with their lives and everyone else? In Outliers we are going to visit a genius who lives on a horse farm in Northern Missouri. We’re going to examine the bizarre histories of professional hockey players and look into the peculiar childhood of Bill Gates and spend time in a Chinese rice paddy. We will investigate the world’s greatest law firm and wonder about what distinguishes pilots who crash planes from those who don’t. And in examining the lives of the remarkable among us the brilliant, the exceptional and the unusual we will learn that the way we think about success is all wrong.

00:00

each year Microsoft Research hosts

00:03

hundreds of influential speakers from

00:04

around the world including leading

00:06

scientists renowned experts in

00:08

technology book authors and leading

00:10

academics and makes videos of these

00:12

lectures freely available

00:21

okay so mr. Gladwell is here today to

00:25

discuss his new book outliers outliers

00:28

is a book about success it starts with a

00:30

very simple question what is the

00:32

difference between those who do

00:34

something special with their lives and

00:36

everyone else the book explores this

00:39

question by examining the lives of the

00:41

remarkable among us the brilliant the

00:43

exceptional and the unusual through his

00:46

book we learned that the way we think

00:47

about success is all wrong

00:49

Malcolm Gladwell is a staff writer for

00:52

The New Yorker and the author of two

00:53

best-selling books the tipping point and

00:56

blink please join me in welcoming

00:57

Malcolm Gladwell to Microsoft

01:07

so no pleasure to be here you know I

01:11

don’t work in a office I work at home

01:13

and I

01:13

I forget what offices are like and I was

01:15

around the corner and I I saw this big

01:20

open refrigerator with all kinds of

01:23

subjects I was like how cool is that

01:26

I am I so I’m done with my new book

01:31

which you know there are many things in

01:33

it and I can say all kinds of things

01:35

about it but I I thought I would talk

01:37

about an idea that is actually not in

01:39

the book but that I’ve been thinking

01:41

about a lot since writing it and which

01:45

Encapsulates a lot of what the book is

01:46

about and it’s um it’s this idea that’s

01:50

called a capitalization and it is a

01:53

concept that a very brilliant

01:56

psychologist named James Flynn has

01:58

written a lot about those of you who

01:59

know something about IQ research will

02:02

have heard of the Flynn effect that’s

02:03

James Flynn’s idea and he’s written a

02:06

lot about this content of

capitalization

02:08

which is what is the rate at which a

02:11

society capitalizes on its potential and

02:15

it was what percentage of people who are

02:17

capable of doing something actually end

02:20

up doing that thing right how

02:22

efficiently do we make use of the

02:25

talents within a given group of people

02:26

so let me give an example um you know

02:29

how many of you read Michael Lewis’s

02:31

book The Blind Side which is this

02:33

extraordinary book about a young man in

02:36

East Memphis a teenager who’s six foot

02:39

six and 350 pounds and he’s discovered

02:42

by and adopted by a wealthy white family

02:45

and they realized that he’s an

02:47

extraordinary athlete and they they work

02:50

with him until he becomes one of the

02:52

finest offensive lineman in the country

02:56

and in fact he’s about to be drafted

02:58

into the NFL’s as many years later and

02:59

make a kajillion dollars and they it’s

03:04

this extraordinary story but the part of

03:05

it that always stayed with me when I

03:07

read it was it right at the very end the

03:10

kid whose name is Michael Oh her says

03:12

he’s from the slums of Memphis he’s

03:14

Memphis and he says if everyone

03:17

who I grew up with who was who was into

03:20

football who had real ability in

03:21

football actually ended up playing

03:23

football they’d need to have two

03:25

National Football League’s and what he

03:28

was saying was that that East Memphis

03:30

did not do a very good job of

03:32

capitalizing on its athletic ability

03:35

right and so Lewis actually follows up

03:37

on this and he he does this he talked to

03:40

some people in the he spent the school

03:42

system and he asked them what percentage

03:44

of kids in East Memphis who get a

03:46

college athletic scholarship actually

03:50

end up going to college and the answer

03:53

was one in six which absolutely floored

03:57

me because I would have thought that

03:58

when it comes if there was one thing in

03:59

America that we were really good at

04:01

doing it would be exploiting the

04:04

athletic ability of our youth in

04:06

particular of our of our

04:08

african-american youth I would have

04:09

thought that in an inner-city area the

04:11

capitalization rate for sports would

04:15

have been 90% but in fact what we learn

04:18

in East Memphis is that the

04:19

capitalization rate is one in six it’s

04:23

16 percent right so now think about it

04:25

if in something that we care about as

04:28

much as sports right something we

04:31

there’s possibly nothing in American

04:33

society that we devote more time and

04:35

attention intellectual resources to then

04:37

the maximization of the professional

04:39

sporting experience in something that we

04:41

cared that much about our cap rate is 16

04:44

percent so how high must it be in things

04:47

that we don’t care that much about right

04:50

that’s a very sobering notion and it

04:52

says that as a society we have an awful

04:54

lot long way to go towards properly

04:57

maximizing the human potential of our

05:00

members and so I realized when I thought

05:03

about that book that outliers is really

05:05

about that question it’s about

05:07

identifying sources of constraints on

05:10

capitalization rates and figuring out

05:12

how how to remove them so what I thought

05:15

I do is just to talk about a variety of

05:17

these constraints what are the kinds of

05:18

things that lower cap rates in any

05:21

number of different areas of human

05:23

endeavor so one obvious one is poverty

05:29

when that kid Michael

05:31

her who grows up in East Memphis talks

05:33

about what a tiny fraction of the kids

05:36

he grew up with who had athletic ability

05:38

actually end up going to college what

05:40

he’s talking about his poverty East

05:41

Memphis is one of the poorest

05:43

neighborhoods in the United States and

05:44

we know that that that kind of poverty

05:49

makes it very very difficult for those

05:52

who have an ability to do something to

05:54

actually end up doing that very thing

05:56

and that’s of an obvious constraint on

06:00

capitalization but one of the things I

06:02

think is is true of poverty is that we

06:07

tend even as we acknowledge its

06:09

importance in constraining

06:10

capitalization we underestimate just

06:13

what a powerful constraint it is and let

06:16

me give an example in the book I talk

06:17

about the famous German study that was

06:20

done in California and this is a study

06:21

done in the 20s began in the 20s in

06:23

California and Turman who is a

06:26

psychologist at Stanford in fact

06:28

determine who was the first Dean of

06:33

engineering at Stanford in fact isn’t

06:35

there a hall called terman hall at

06:36

Stanford how many would Stanford that’s

06:38

this guy’s son anyway the side fact for

06:41

those of you into Stanford he does this

06:44

thing where he he gives an IQ test to

06:47

250,000 California schoolchildren and he

06:50

basically identifies the top 120 points

06:53

Oh kids with IQs of 140 plus genius

06:58

level essentially and he tracks those

07:00

kids for the rest of their lives for 50

07:03

years and he’s trying to figure out what

07:06

happens to them and it’s his notion

07:08

starting out that he said yet he thinks

07:10

because he’s so invested in the notion

07:11

that IQ is the single most determinant

07:14

of life success he thinks what he’s done

07:16

is identified the cohort who will turn

07:19

out to be the leaders in academia in

07:21

academia in industry in the people who

07:24

will end up you know running all the

07:25

organizations and being the top

07:27

politicians and the top intellectuals

07:29

right so he follows them and follows

07:30

them for over the course of 20 and 30

07:32

years and 20 and 30 years in he realizes

07:34

actually it’s not true at all and that

07:36

these kids turn out as when they turn

07:39

out to be adults they have a variety of

07:41

strikingly different fates there

07:44

a small group that does very well the

07:47

top 15% do actually occupy positions of

07:51

real prominence in society then there’s

07:53

a big group in the middle who have

07:55

pretty average lives and remember these

07:57

are kids with adults with genius-level

08:00

IQ and the majority of them do they’re

08:02

kind of like have moderately successful

08:04

professional lives and then there is a

08:06

chunk at the bottom who have who are by

08:10

any measure failures who have whose

08:14

lives turn out by by any kind of

08:17

occupational yardstick to be massively

08:21

disappointing who make dude who dot do

08:24

not seem to make use of their

08:25

extraordinary human potential at all and

08:27

the question that Turman has to wrestle

08:29

with is why did that group fail what’s

08:32

the difference between this group who

08:33

did beautifully well on this group who

08:35

did so poorly at the bottom and he runs

08:38

through I mean this question obviously

08:39

obsesses him and he runs through every

08:40

conceivable explanation for that

08:42

difference and he says that their

08:44

personalities it’s not he says is it

08:46

there is it there their habits is it

08:50

there and it goes on and on down the

08:51

list and he realizes in the end that the

08:53

answer is really really simple and that

08:56

is that the kids who did best these

08:57

genius kids who ended up succeeding in

09:00

the world were the ones who came from

09:01

wealthy households and that the

09:03

genius-level kids who ended up utter

09:05

failures in life were the ones who were

09:07

born into poor families right born into

09:10

families where parents hadn’t gone to

09:12

college where they weren’t books in the

09:13

home where there wasn’t the kind of

09:14

cultural and institutional support for a

09:17

habit of learning and a habit of

09:20

intellectual activity what he was saying

09:23

in other words that even if you endow a

09:25

child with a brain that is a

09:29

one-in-a-billion brain that is not

09:32

sufficient to ensure the success of that

09:34

child that poverty is such a powerful

09:37

constraint on capitalisation that it can

09:40

reduce that genius child to a lifetime

09:43

of worse than mediocrity a lifetime of

09:46

really profound on disappointment so

09:49

that’s the that’s the first constraint

09:51

like I say it’s the obvious constraint

09:52

but I think it’s important to impress on

09:55

on for all of us to understand

09:57

that poverty is probably a bigger

09:59

constraint than we think particularly

10:01

those of us who are not intimately

10:03

connected with it we may tend to

10:05

underestimate what an extraordinary

10:07

impact that has on on limiting people’s

10:10

ability to do well

10:11

so let’s look with some other

10:13

constraints that are maybe less obvious

10:14

I got really interested in this book in

10:17

looking at the composition of elite

10:19

sports teams and and if you do that you

10:23

find all cut find out all kinds of

10:24

strange things so at one point I looked

10:27

at the roster of the 2007 junior Czech

10:31

hockey team now I did not pick that team

10:33

for any I picked that team at random I

10:35

just was interested in the that’s an

10:37

elite team it was the second or third

10:39

best junior hockey team in the world

10:40

after of course the Canadiens I’m

10:42

Canadian and so it’s a it’s a really

10:45

elite team these are the kind of kids

10:46

who go on to play in the NHL or in the

10:48

illegal adult leagues in in in Europe so

10:53

I’m going to read to you the birth dates

10:55

of the members of that national Czech

10:58

team 2007 January 3rd January 3rd

11:03

January 12th February 8th February 10th

11:06

February 17th February 20th February

11:08

24th March 5th March 10th March 26th

11:12

April 22nd May 5th June 6th July 2nd

11:16

July 19th July 20th August 15th August

11:19

25th August 31st November 29th and

11:22

December 31st now what’s strange about

11:26

that list

11:26

did you notice 11 of the 20 names are

11:30

born in January February and March it is

11:33

a massively skewed distribution of birth

11:36

dates towards the first three months of

11:38

the year now that is not something

11:40

idiosyncratic to the 19 to 2007 Chuck

11:43

junior hockey team in fact if you look

11:44

at any elite hockey team anywhere in the

11:48

world and for that matter any elite

11:50

soccer team anywhere in the world you

11:53

will see the same skewed distribution

11:54

you will see that an overwhelming number

11:57

of the members of those teams are born

11:59

in January February and March now why is

12:01

that

12:05

the answer is that the eligibility

12:09

cut-offs for age class hockey and soccer

12:11

throughout the world is January 1st and

12:14

in both those sports we very very

12:16

aggressively recruit the best and the

12:18

brightest kids at a very early age so we

12:20

go and we look at a had a a group of 10

12:23

year olds we watch them play hockey or

12:24

soccer and we picked the best right and

12:26

we select them out we put them in

12:28

all-star teams and we give them a

12:29

special coaching and extra practice time

12:31

and more games and encourage them and

12:32

encourage them right thinking that is

12:34

the best way to capitalize on the talent

12:38

pool in that particular sport but think

12:41

about it when you’re 10 years old

12:43

who’s going to be the best at a

12:44

particular activity physical activity

12:46

the oldest kids right the kid who is

12:50

born in January has ten months of

12:51

maturity on the kid born in October and

12:53

when you’re ten years old ten months is

12:56

an extraordinary long period of time it

12:57

can be that it can be three or four

12:59

inches in height it can be a difference

13:01

between between being clumsy and being

13:03

massively coordinated so we think we are

13:05

picking the best and we’re not we’re

13:07

picking the oldest right and then we

13:10

take the oldest and we give them special

13:12

coaching and all kinds of extra

13:14

opportunities and all kinds of extra

13:15

games and lo and behold ten years later

13:18

they really are the best right but it’s

13:20

a self-fulfilling prophecy

13:22

we created the conditions that made them

13:25

the best and foolishly thought we were

13:26

actually identifying real talent now you

13:31

only have to look at that and realize

13:33

what an extraordinary constraint on

13:36

capitalisation that is right logic would

13:39

tell us that the distribution of hockey

13:41

ability or soccer ability should be even

13:44

throughout the year there by rights

13:45

should be as many great soccer players

13:48

or hockey fairies born in December as

13:50

January but when we look at these teams

13:52

that we see they’re overwhelmingly

13:53

weighted for the first three months of

13:55

the year that suggests that we are that

13:58

the capitalization rate for hockey it’s

14:00

must be less than 50% right we are

14:03

leaving

14:04

all the talent born in the second half

14:06

of the year on the table now there’s

14:09

clearly a very easy solution to that

14:11

problem and that is that when we put

14:13

together leagues of four soccer soccer

14:17

and hockey and

14:18

at her support in the h-class arena we

14:22

should have different streams for kids

14:24

born in different months we should have

14:26

three parallel leagues one for kids born

14:28

in the first four months of the year one

14:29

for kids born in the middle for months

14:31

and one for kids born in the last four

14:32

months right and have them develop

14:34

independently until they’re in their

14:36

mid-teens and then select it’s a really

14:38

simple way and if we did that we would

14:40

double or triple our capitalization of

14:43

talent in that particular realm now why

14:45

don’t we do that right because we refuse

14:48

to admit that our own rules arbitrary

14:51

rules constrain capitalization and we

14:53

cling to a naive belief that these

14:56

meritocracies that we have constructed

14:59

in this particular realm are entirely

15:02

rational and efficient and fair so this

15:05

is a second constraint on capitalization

15:08

it’s the stupidity constraint right

15:10

there’s our inability to understand that

15:13

there is something deeply arbitrary and

15:15

unfair in the way we have written the

15:17

rules on which a meritocracy exists now

15:22

for those of you who think that that is

15:24

a minor issue and that so what if those

15:27

kids can’t play hockey you know why

15:29

can’t they just play another sport let

15:31

me remind you that this is true of many

15:33

sports I’m gonna I’m gonna give you the

15:36

the birth dates of the 2007 check junior

15:39

soccer team ready January 1st January

15:42

3rd January 5th January 12th January

15:44

26th January 27th February 1st February

15:47

14th February 20th February 1st February

15:52

9th April 16th May 20th May 26th June

15:56

22nd June 24th August 18th and September

16:00

26th but if that’s not a contest ability

16:05

constraint on capitalization on football

16:07

ability on soccer ability in a country

16:10

by the way that cares more about

16:11

football than you know perhaps anything

16:14

I don’t know what is that’s a and I you

16:16

know we need to take in other words very

16:18

seriously the question of how we choose

16:21

to structure systems of America

16:25

meritocratic systems and this also you

16:28

can apply this exact same logic to

16:31

educational opportunities

16:32

if you look at how well kids do in

16:36

school based purely on their birth dates

16:39

on whether they fall into the youngest

16:42

oldest or middle age cohort in their

16:45

class you see exactly the same patterns

16:49

in fact there’s a beautiful study done

16:51

recently that tracked thousands and

16:53

thousands of kids across the West and

16:55

tracked them all the way through to

16:57

their university level and found that

16:59

kids born in the relatively youngest

17:03

cohort of their age class were 11

17:06

percent less likely to go to college

17:08

than kids born in the relatively oldest

17:11

cohort of their of their age class 11

17:14

percent is a huge difference and it says

17:18

that we are that is 11 percent of kids

17:20

whose opportunity is being whose whose

17:23

whose human potential is being

17:25

squandered right completely foreclosed

17:29

why because we are so stupid as to

17:32

organize our elementary school education

17:34

without reference to the obvious fact of

17:38

biological maturity right it is another

17:41

it is a glaring example of how stupidity

17:45

constraints dramatically limit the

17:49

capitalization of human potential

17:52

so third constraint and I can go on

17:56

about constraints but I’ll stop with the

17:57

third one this is in many ways the most

18:00

fun one and the most controversial one

18:03

but but I think it’s it’s worth digging

18:05

into and it’s it’s what I what I would

18:08

say as an attitudinal constraint on

18:10

capitalization so one of the I have a

18:13

whole chapter in my book which is about

18:15

this question of why it is that Asian

18:17

kids do so much better at math than

18:19

their Western counterparts now the

18:21

numbers here are irrefutable and they’re

18:24

extraordinary the differences in

18:26

mathematics performance between kids in

18:30

Singapore Hong Kong South Korea Japan

18:32

and kids in America Germany England or

18:37

what have you

18:38

though fact we just got of results from

18:42

these international math test

18:43

comparisons I think a couple weeks ago

18:45

and

18:45

we’re talking about the difference is

18:46

not this the difference is is that and

18:51

if you look closely at trying to figure

18:54

out why it seems to be the case that the

18:56

difference the reason for that

18:57

difference has to do with attitudes it

19:01

has to do with what is the attitude with

19:03

which the child in those two sets of

19:06

cultures approaches a math problem and

19:10

it seems to be the case that when Asian

19:12

kids sit down and face a high school

19:14

math problem they have a different

19:16

expectation of what solving that problem

19:18

entails they have an expectation that if

19:21

they apply effort to the problem the

19:22

problem is solvable whereas when we look

19:25

very closely at the attitudes of Western

19:27

children they seem to have the attitude

19:29

that their ability to solve that math

19:31

problem is a function of their ability

19:34

of their innate ability something they

19:36

either have or they don’t and that

19:38

attitudinal difference seems to make a

19:41

profit have a profound effect on the

19:45

ability of kids to do well at math

19:47

because as it turns out the Asian

19:49

approach to mathematics is the correct

19:51

one when I say correct let me give an

19:53

example so these international math

19:55

tests that we give to kids around the

19:58

world they’re called Tim’s we give the

20:00

Tim’s every four years it’s the same

20:01

test two kids all over the world and and

20:04

that’s how we come up with these

20:05

rankings of how countries do well when

20:07

we give the Tim’s to kids at the same

20:10

time as we get them to math test we give

20:12

them a questionnaire and the

20:13

questionnaire is really long it’s 120

20:16

questions long and it asked them all

20:18

kinds of questions about that it will be

20:19

useful to researchers so how many hours

20:22

do you study

20:22

do your parents encourage you do you

20:25

like man you know all those kinds of

20:26

things but it’s really really long and

20:27

it’s so long in fact that most kids

20:29

don’t finish the questionnaire it’s just

20:31

too too long right so a couple years ago

20:34

this really brilliant guy called rolling

20:36

ball at Penn I decided he would rank the

20:40

countries of the world by what

20:42

percentage of questions on the

20:44

questionnaire their kids finished right

20:47

now you know what he found when he did

20:49

that ranking and compared it to the

20:51

ranking of countries on the world by

20:53

what percentage of questions on the math

20:55

test their kids got right the two

20:57

rankings were exactly the same

20:59

and when I say exactly the same I mean

21:01

there was a correlation of point nine

21:02

point nine in the history of social

21:05

science there has never been a

21:06

correlation of point nine between two

21:09

it’s the same thing when we if you want

21:11

to know how good a country doesn’t

21:13

mathematics in other words you don’t

21:15

have to ask that those countries kids

21:17

any math questions you just have to make

21:21

them do a task that requires them to sit

21:24

down at a seat for an extended period of

21:26

time and focus on a task wait and if

21:29

they can do it they’re good at math

21:32

really really fascinating in other words

21:34

what we’re saying is when we look at

21:38

Asian cultures what we are seeing is

21:41

this this difference in mathematical

21:43

ability what we’re seeing is not some

21:45

underlying difference in talent or

21:47

aptitude for mathematics but a

21:49

difference in capitalization that Asian

21:52

the Asian cultural attitude about work

21:54

has the result of being a far more

21:56

efficient way of capitalizing on math

21:59

ability than Western attitudes towards

22:02

work and that tells us where the deficit

22:06

in our mathematical education in the

22:10

Western world lies it’s not in our

22:12

curriculum it’s not in the quality of

22:14

our teachers it’s not in the size of our

22:16

classrooms it’s not in the amount of

22:18

money we spend on schools it is the

22:20

attitude in the head of the child as he

22:23

or she sits down in 11th grade and does

22:26

algebra or calculus right and by the way

22:30

nor is it a problem in our genes as some

22:32

people would like to say of there’s a

22:34

whole bizarre argument that Westerners

22:37

have I’m an inferior set of genes when

22:39

it comes to mathematics then Easterners

22:42

you know a totally ludicrous and

22:45

unnecessary step in this argument

22:47

no it’s about culture it’s about a

22:49

difference in attitude and about their

22:51

ability to far more efficiently

22:53

capitalize on the abilities of their

22:56

kids now why now why does this the case

23:01

I mean this is a I’ll just address for a

23:03

moment a really really interesting

23:05

question is okay if Asian cultures have

23:08

profoundly different attitudes towards

23:10

effort when it comes to mathematics why

23:13

right why does that come from and nobody

23:15

knows but in my book I venture what I

23:17

think is a plausible explanation and

23:20

that is that I think it has to do with

23:23

patterns of effort laid down in in

23:27

historical agricultural practices that

23:31

when you look what what is the thing

23:33

that Hong Kong South China South Korea

23:36

and Japan all have in common and that is

23:39

they are historically rice-growing

23:40

cultures right and what is distinctive

23:43

about rice growing it is the most

23:45

labor-intensive and cognitively complex

23:48

form of Agriculture known to men we know

23:51

so my my my father’s European ancestors

23:55

in the Middle Ages in northern England

23:58

probably worked a thousand hours a year

24:01

as peasant farmers so that meant was

24:04

they worked from from dawn to noon five

24:08

days a week on the weekends they drank

24:11

themselves silly and during the winter

24:14

they slept basically and they got lots

24:17

of I don’t feel this but a peasant in

24:18

medieval England got lots and lots and

24:20

lots of holidays that peasants

24:23

counterpart in South China or Japan in

24:27

the same period would not have worked

24:28

1,000 hours a year they would have

24:30

worked 3,000 hours a year for the simple

24:33

reason that rice farming is just a whole

24:35

it is not not a difference not a that’s

24:38

not just a difference in degree from

24:40

wheat farming is a difference in kind

24:42

it’s a whole different way of working it

24:44

demands that you wake up at dawn and

24:47

work all the way until dusk and demands

24:49

that you work on the weekend in fact

24:51

there’s a wonderful Chinese proverb that

24:56

I quote in the book which is a man who

25:01

works dawn to dusk 360 days a year will

25:05

not go hungry right which is encapsulate

25:08

the difference between eastern and

25:10

western agricultural practices no my

25:14

peasant ancestors in northern England it

25:16

would be inconceivable they could call

25:18

that a proverb they would have said the

25:20

man who works a hundred and seventy five

25:24

days a year

25:26

dawn to Allah

25:27

and may or may not be hungry well my

25:32

argument is if your culture does that if

25:34

that’s what you guys what you do for a

25:36

thousand years that attitude is a deeply

25:39

rooted part of your makeup and win your

25:43

kids even if they didn’t themselves work

25:45

in a rice paddy when they sit down and

25:47

face a calculus or an algebra problem

25:50

that legacy that attitude towards effort

25:54

and persistence translates beautifully

25:56

to that most modern of tasks and that

26:00

and means that your culture will do a

26:02

far better job of of capitalizing on on

26:06

on its innate ability now is that the

26:09

whole story I don’t know probably not

26:10

they’re probably all kinds of other

26:11

explanations as well and I get into some

26:13

of them but I think it is important that

26:16

when we look at things from this

26:17

perspective to try and add to try and

26:20

answer questions using history and

26:23

culture as our guide when you think

26:26

about problems in other words from the

26:28

perspective of capitalization I think

26:30

you look for answers in different places

26:32

then when you have a far more simple or

26:35

more reductive approach to these kinds

26:38

of things now why is this capitalization

26:40

discussion of capitalization so

26:41

important because I think when we look

26:45

at why certain people or groups succeed

26:49

in the world

26:51

our default explanation is always of

26:53

those differences in success reflect

26:56

underlying differences in ability and we

27:00

forget about how much poverty stupidity

27:04

and attitudes are far more important

27:06

constraints on on capitalization you

27:09

know remember I’m a I’m up happy I’m a

27:11

runner and I observed like most runners

27:15

have over the last 25 or 30 years how

27:18

utterly dominant the Kenyans and the

27:20

Ethiopians have been in long-distance

27:22

running and this has prompted all kinds

27:26

of people to say that this must

27:27

represent some fundamental difference in

27:30

underlying levels of ability that there

27:32

must be something peculiar about the

27:34

genetic makeup of East Africans that

27:36

makes them better runners than the rest

27:39

of us that’s

27:40

and explanation right but a far more

27:42

elegant and persuasive and simpler

27:44

explanation for them is that they have a

27:47

higher level of capitalization than we

27:49

do Alberto Salazar who’s the great

27:51

American marathoner he recently pointed

27:55

out that in Kenya there are probably a

27:58

million schoolboys between the age of 10

28:00

and 17 years of age who run but over ten

28:04

around 10 to 12 miles a day right a

28:07

million boys running 10 to 12 miles a

28:10

day between the age of 12 and 17 the

28:12

same number in the United States is

28:15

probably 5,000 if that right so our

28:19

capitalization rate when it comes to

28:21

distance running what is it is it it’s

28:23

surely less than 1% right it’s probably

28:26

point 0.5 percent how many kids who are

28:29

capable of being great long-distance

28:32

runners in the United States ever

28:33

discover whether they have that that

28:36

that ability they never do because I

28:38

never actually do the work necessary to

28:40

find it but in Kenya how many great

28:42

distance runners do they miss if they

28:44

have a million school boys running ten

28:46

miles a day almost none their

28:48

capitalization rate is probably 95%

28:50

that’s the difference right the

28:53

difference has to do with what does the

28:55

culture value and where does it spend

28:57

its time and attention and how good is

28:59

it at finding and make and exploiting

29:01

that kind of human potential they’re

29:03

really good at that when it comes to

29:04

distance running and we’re not and I

29:07

think when you think about things that

29:09

weigh it powerfully clarifies how you go

29:12

about improving our use of human

29:15

potential it means that you don’t give

29:17

up means that you don’t say look at a

29:19

group that’s not succeeding and say they

29:22

are incapable of success and say that

29:24

the problems that they face are too

29:26

powerful to an eight to ingrain for us

29:28

to do anything about the capitalization

29:30

argument I think enables us it empowers

29:34

us it tells us that we can actually make

29:36

a profound difference in how well people

29:39

turn out if we choose to pay attention

29:41

to the constraints imposed by poverty by

29:45

stupidity and by attitude so that’s a

29:49

little glimmer of the kinds of things

29:52

that I’m resting

29:53

in his book there’s many more but I

29:55

would be happy to answer any questions

29:57

then how many of you have I don’t know

30:13

if you mentioned people more over 40 or

30:15

50 can’t spin spin thousand I was doing

30:17

something will you suggest to us oh this

30:21

is that the question is in reference to

30:23

I talked about in the book at one point

30:26

about um how long does it take to be

30:28

good at something and the this

30:31

observation by many psychologists that

30:33

that to master a cognitively complex

30:36

task whether it’s playing chess at an

30:39

elite level or being a brain surgeon or

30:41

a Cosco music composer or a good

30:42

computer programmer requires seemingly

30:47

without exception 10,000 hours of

30:49

deliberate practice so 10,000 hours is

30:52

roughly four hours a day for ten years

30:55

so you need to put in that kind of time

30:57

before even the most talented of people

31:00

innately talented people can ever

31:01

achieve an elite status but I would

31:05

actually the and what I don’t think this

31:09

argument that observation suggests that

31:12

people who are older in life

31:14

this is closing doors to people who are

31:16

older life on the country I says it I

31:17

think it suggests the opposite that it

31:20

says that at any point in our lives if

31:22

we are in a position to apply ourselves

31:24

in a formal and rigorous and intensive

31:26

way to a problem we should be able to

31:29

see fruits of that it says in other

31:32

words that what is special about people

31:35

who do highly extraordinary or creative

31:37

acts is not that they are there’s

31:40

something special of something inherent

31:42

in their mind some particular genius or

31:45

that there is some magical property

31:47

associated with youth right on the

31:49

country it says that know what sets them

31:51

apart is that simply that what we are

31:52

seeing is the the the necessary and

31:56

predictable outcome of applying oneself

31:59

rigorously to a task something that can

32:02

that is available to anyone at any point

32:04

in their life if they choose to

32:06

apply themselves in that way so if I

32:08

think it’s a my liberating observation

32:28

so the question was about Little League

32:30

baseball literally baseball has a cutoff

32:32

in mid summer or early summer and in

32:34

fact if you look at the distribution of

32:36

birth dates of baseball players

32:39

professional baseball players in in

32:41

America you will see that they are

32:42

highly clustered in the late summer

32:44

months most baseball players are June

32:46

July August or July August September I

32:49

forgotten exactly where the so we see

32:51

the same effect very clearly with

32:53

baseball what does the kid who is born

32:55

on an April 27th do well in a certain

33:00

way nothing there’s nothing you can do

33:03

this is I mean this is some one of the

33:06

things that I would that I were in

33:07

writing this book was objecting to was

33:09

this strain and American thinking that

33:11

says that all obstacles are ultimately

33:15

overcome a ball by individuals if that

33:19

individuals simply chooses to be

33:22

determined enough I think that’s very

33:23

true and I’ll persistence determination

33:25

are incredibly important components of

33:28

success but we also have to understand

33:31

that when it comes to stupidity

33:34

constraints there is very little that

33:36

individuals can do that’s the reason

33:38

that’s why we call them stupidity

33:39

constraints because they have been

33:41

stupidly appo imposed on a collective

33:43

level and are powerful enough to

33:46

overcome even really really determined

33:49

individuals there are certain things

33:51

that can only be done at the society

33:53

level right and you know it is only our

33:57

naive like I said I only our naive faith

33:59

in the efficiency and fairness of

34:01

Metacritic systems that prevents us from

34:03

seeing this the only thing you can do

34:06

for the kid born April 27th who wants to

34:08

be a baseball player is do what I talked

34:09

about is create parallel leagues based

34:12

on on physical maturity that’s the way

34:14

you do it and it is that if you look

34:17

when I read that roster list for those

34:19

Czech teams

34:20

you know there are lots and lots and

34:22

lots of kids in check in in the Czech

34:25

Republic who want to be successful

34:28

soccer or hockey players but who

34:32

happened to be born at the end of the

34:34

year and you can see there’s the

34:35

evidence they’re not getting it they’re

34:36

not making it right it’s not enough to

34:39

ask the individual to I’m to try harder

34:42

sure so I was kind of wondering as I

34:47

read through the book if you know given

34:49

it it’s kind of about constraints placed

34:51

are someone arbitrarily and if you came

34:54

across any examples in your research of

34:56

sort of outliers of those theories in

34:58

other words people that managed to

35:00

succeed in certain things despite those

35:02

constraints yeah so yeah this is a very

35:05

interesting question so there’s

35:06

something I’ve thought about a lot

35:07

subsequent to this so the book

35:11

identifies I’m really interested in this

35:13

book in advantages that are advantages

35:17

meaning the kinds of opportunities and

35:20

advantages that end up putting you

35:22

further ahead than you would have been

35:23

otherwise right but that’s clearly only

35:26

one of four conditions there are also

35:28

advantages that are disadvantages so if

35:33

your father is worth a billion dollars

35:36

do you think that you would be as a kid

35:41

better off or worse off today right then

35:44

you then you would be if your father

35:46

made $100,000 I would rather have a dad

35:49

who made a hundred thousand than have

35:50

done a billion I think they’re having a

35:52

father with a billion dollars would

35:53

actually be quite crippling to your

35:55

motivation and so that’s an advantage

35:57

that’s actually a disadvantage right so

36:00

then there’s also disadvantages that are

36:03

disadvantages so that would be that’s

36:07

condition three and that would be to

36:09

grow up the child of a single mother

36:12

who’s addicted to drugs in you know in

36:17

East Memphis is a disadvantage that’s a

36:19

disadvantage you really you know almost

36:21

no one overcomes that right but what

36:24

you’re asking about is the fourth

36:26

condition which is are there

36:28

disadvantages that are advantages now

36:30

that is the most fascinating one of all

36:32

so

36:34

for example one of the most fascinating

36:39

observations that’s been made in recent

36:41

years is that someone did a study

36:44

recently that pointed out that 30% of

36:46

American entrepreneurs have been

36:49

diagnosed at some point in their life

36:51

with a profound learning disability and

36:53

you know you only have the list of

36:55

people who fall into this category

36:57

so the dyslexic you know Branson’s a

37:00

dyslexic Charles Schwab is a dyslexic

37:02

the guy who founded Kinkos is a dyslexic

37:06

I can go on I mean the list is like this

37:08

long right so why is that well the

37:12

argument is that it’s not a coincidence

37:13

is in fact it is a direct function there

37:17

entrepreneurialism is a direct function

37:19

of their disability so how do you

37:21

succeed if you cannot read or write from

37:23

the very earliest stages in your

37:25

elementary education you compensate for

37:27

that if you’re the ones who make it a

37:29

lot of kids don’t make it but those who

37:30

do composite how do they compensate well

37:31

from the very earliest age you learn how

37:34

to delegate so kids who make it through

37:37

school kids who make it to school who

37:42

can’t read or write you know how they do

37:43

it they do it by having others do their

37:45

reading reading and writing for them

37:47

right you learn you compensate by being

37:50

a really good oral communicator you

37:52

can’t write or read so you your talker

37:55

right you learn how to problem-solve

37:57

right because your life is one big

37:59

problem you’re in an institution asks

38:03

you to do two things and you can’t do

38:05

either of them right and you learn how

38:07

to be a leader you have to do all those

38:10

things problem solved delegate oral

38:13

communicate you learn how to lead in

38:15

fact there’s a beautiful saying that was

38:17

also done that said that pointed out

38:18

that of dyslexic entrepreneurs 80% of

38:21

them were a captain of a high school

38:23

sports team versus 30% of non dyslexic

38:26

entrepreneurs that’s the character type

38:28

right so when you go down to the real

38:30

world and what is a required of an

38:32

entrepreneur that they’d be a good

38:34

leader that they delegate that they’d be

38:36

a problem solver and that they’d be good

38:37

oral communicators these people have

38:39

been spending their whole life

38:40

practicing the very the four skills that

38:43

are at the cornerstone of

38:44

entrepreneurial success now

38:47

you talk to those people and you ask

38:48

John Chambers dyslexic but it’s

38:51

difficult reading his own email you

38:53

asked all those guys what did you know

38:56

what role did this Lexia play in your

38:59

success they would say it wasn’t an

39:01

obstacle that I had to overcome it was

39:03

in fact the reason I’m successful it is

39:06

a disadvantage that ended up being an

39:08

advantage now I am actually this

39:10

category to me is the most fascinating

39:12

one of all I’m saluting the other

39:14

example one of the most striking

39:18

findings in educational research is that

39:21

there’s almost no payoff that we can

39:23

find to reducing class size even though

39:27

all parents are obsessed with class size

39:28

right irrationally so if your kid is in

39:31

a class size of 25 and you hear that at

39:33

some other school it’s 19 until you pay

39:36

$25,000 a year to get your kid at the

39:38

school with the 19 kids instead of the

39:39

25 right in fact reams and reams and

39:43

reams of academic studies have failed to

39:45

show any advantage to smaller class

39:47

sizes except for really disadvantaged

39:51

kids in very very early grades for

39:53

everyone else it’s a total wash why is

39:55

it a wash because it makes no sense why

39:58

would you do just as well in a class

40:00

where the teachers not paying you enough

40:02

as much attention right shouldn’t

40:04

shouldn’t be a correlation between

40:05

teacher inputs and student performance I

40:09

yes but only if there are there is no

40:12

such thing as a disadvantage that can be

40:14

an advantage what if the disadvantage of

40:17

being all in a large classroom is

40:19

something that you compensate for what

40:22

if it’s like dyslexia what if if you’re

40:24

one of 30 kids you compensate and learn

40:27

self-reliance and that self-reliance in

40:30

the end is just an important a trait has

40:33

the thing that you would get from a

40:35

heavy amount of teacher feedback right

40:37

we are resolutely uninterested in the

40:40

category of benefits that fall into that

40:42

fourth category right we can’t even talk

40:44

about them no one wants to talk about

40:46

what are the things what are the kind of

40:48

customized disadvantages that we might

40:50

introduce into our school system that

40:52

might have a positive effect right and

40:55

we’re we’re all we operate under this

40:58

extraordinarily psychologically naive no

41:01

that the only thing that matters in

41:03

school are advantages that are

41:04

advantages right as if everything else

41:07

didn’t exist like I would love to see

41:10

for example and now ranting on and on

41:13

but it is not like I live in Manhattan

41:15

in Manhattan we had these super super

41:17

super fancy private schools the most

41:19

advantaged private schools in the world

41:22

right the cost 30 grand a year

41:24

high schools I’m not convinced that that

41:28

isn’t a that those schools don’t fall

41:30

into the category of advantages that are

41:31

disadvantages I would love to see I

41:33

would love to know on a kind of see a

41:35

systematic analysis of whether you’re

41:38

helped why is it the case that you’re

41:39

better off going to that school then

41:41

learning how to cope in a far more

41:44

heterogeneous rough-and-tumble

41:47

public school environment I don’t it’s

41:50

not obvious to me why that’s in fact

41:52

most of the successful people who send

41:54

their kids to those schools went to

41:57

rough-and-tumble heterogeneous public

41:59

schools so it is this massive act of

42:02

cognitive dissonance that you turn on

42:04

the very thing that clearly made you

42:06

successful and deny it to your child

42:08

right in the name of what right the same

42:13

grandfather who says that he walked

42:15

seven miles to school every morning

42:16

barefoot drives his kid his grandchild

42:19

in the SUV two blocks to school because

42:22

it’s raining out if it worked for you

42:24

grandpa

42:25

what isn’t it work for me

42:31

possible cultural explanations for

42:33

success like you prepared an Asian to

42:35

Western but even within my fingers off

42:37

I’ve read a lot of studies that try to

42:39

explain for example if its genetic or

42:41

cultural it now there are more Nobel

42:43

Prizes about Jews or any Western

42:44

European Jew each turn your few Jews

42:46

yeah is there any way to debunk that

42:48

yeah so um a lot of advantages Jewish

42:55

advantages are shared by other ethnic

42:58

groups who have are in a similar

43:00

sociological position so the parsees in

43:04

India the Lebanese throughout the world

43:07

the ethnic Chinese in Southeast Asia in

43:11

Malaysia and Vietnam and I mean I could

43:15

go on but there’s a whole series of

43:17

groups that if you look closely at their

43:19

the roles they have played and the

43:21

success they have achieved right so

43:24

they’re all they’re all doing the same

43:25

thing so Jews are not an anomalous

43:28

they’re not anomalous at all they are

43:29

part of a pattern of accomplishment that

43:32

is common to this these discrete ethnic

43:36

minorities within larger countries and a

43:38

lot of that has to do with the kind of

43:41

extraordinary set of there are series of

43:44

disadvantages that come with being in

43:45

that position but there are also a set

43:47

of advantages

43:48

so outsider status being this kind of

43:51

minority outside our group is incredibly

43:54

useful if you would like to play any

43:56

sort of middle man role right which what

43:59

all those groups do lebanese Parsi

44:02

ethnic Chinese and-and-and Jews always

44:06

play in very end up playing this

44:08

entrepreneurial middle man role which is

44:10

something that is uniquely available to

44:12

the outsider because the outsider as an

44:16

outsider is allowed to do things that

44:18

you can’t do if you’re a member of

44:19

majority you can be tough you can say no

44:22

you’re gonna be a banker right where

44:25

you’re where you’re I mean this does not

44:27

apply to the bankers on Wall Street and

44:30

over the last 10 years but historically

44:32

if you were a banker your success

44:34

depended on your ability to say no right

44:36

and to be mean to say to someone who is

44:39

not paying you got to pay

44:41

right it’s really hard to do that if you

44:43

are a member of the majority culture

44:45

because you risk your social standing

44:48

when you stand up to someone and put

44:50

your foot down but if you’re a member of

44:52

a minority group that’s outside the

44:54

general culture you can be tough you can

44:56

say no right so that’s why you see

44:58

banking as always dominated by those

45:00

four groups throughout the you know my

45:02

mother grew up in Jamaica the Jamaican

45:05

it’s funny actually Jamaica is a perfect

45:07

sample this the entrepreneurial

45:09

commercial class of Jamaica is ethnic

45:11

Chinese Jewish and Lebanese an exact

45:18

indication of this very thing so we

45:21

could play with that idea and and I and

45:25

come to an understanding of all kinds of

45:27

of patterns of accomplishment in those

45:30

groups because all those groups also

45:31

have disproportionate professional

45:33

success and disproportionate

45:35

intellectual to some extent into a

45:36

business portion of intellectual success

45:38

as well I feel like I’m discriminating

45:41

against the back of the room referring

45:44

to them yeah what is it

45:50

to be successful in today’s time trading

45:52

where we’re at right now

45:54

as opposed to

46:02

well that’s an interesting question I

46:04

mean the I think it’s easier in the

46:07

sense that there are just so many other

46:09

there are so many such an array of

46:13

things to be good at now right success

46:18

was narrowly defined in the 30s as being

46:20

a doctor or a lawyer today we have you

46:24

know 25 different things that we would

46:27

give a cord that same status to or at

46:30

least after the meltdown on Wall Street

46:33

24 sorry mr. Foster Diggs so in that

46:40

sense you know if you think about the

46:44

kinds of things that are available to

46:45

those who are willing to put ten

46:47

thousand about hours of practice in the

46:49

list is just longer now and so in that

46:51

sense I would say that where I’m at an

46:53

advantage you know how Bill Gates works

46:57

is achievement

46:58

and you know three and six and you dub

47:00

programming and that seeing that success

47:03

before it actually became what we’re all

47:05

here tonight now oh I see well it’s

47:10

always gonna be yeah well we’re in this

47:12

is you know that kind of question is

47:14

unanswerable because it requires us to

47:16

know what the next you think about

47:18

people that Bill Gates’s generation was

47:21

that they were getting their 10,000

47:23

hours in in a discipline before the rest

47:25

of the world realized that that was the

47:27

discipline that mattered right by

47:30

definition we do not know what that

47:31

discipline is today only the 15 year old

47:34

equivalent of Bill Gates does so those

47:36

of you with 15 year old children should

47:38

ask them but you know I’m not gonna know

47:43

sure

47:50

yeah so I have a in the culture section

47:52

of the book

47:53

I am I talk about I try to Kondo I talk

47:58

about um I try to so it’s a I’m trying

48:01

to set up the discussion of Asians in

48:04

math because the hard thing to

48:05

understand about the kind of cultural

48:08

explanation I give for Asian mathematics

48:11

superiority is this notion that the kids

48:14

who are doing well in math today in

48:18

South Korea or Singapore or where have

48:20

you

48:20

an are not themselves rice farmers

48:23

nor are their parents nor in some cases

48:25

are their grandparents right so why how

48:27

is it possible that rice farming could

48:30

be the explanation for the way they are

48:31

well in order to buy that you have to

48:33

buy the idea that cultural models and

48:37

codes and rules persists then long after

48:40

the circumstances that created them have

48:42

gone away those things are still in the

48:44

air they don’t they don’t they don’t

48:46

peter out or vanish they’re actually

48:49

they stick around

48:49

and so I I describe I give an account at

48:53

an explanation for why Appalachia in

48:55

America has always been the most violent

48:59

part of the United States and the

49:02

explanation for that is not in the

49:05

particular immediate conditions of

49:07

Appalachian life it has to do with where

49:09

the ancestors of those living in

49:11

Appalachia come from and they all they

49:14

many of them they that that Appalachia

49:16

was settled by people by the

49:18

scotch-irish people from the borderlands

49:20

of the united kingdom who had developed

49:23

in their time there are hundreds of

49:25

years there in that most kind of lawless

49:28

and dangerous and barren existence had

49:37

developed this thing called a culture of

49:38

Honor which was a culture where your

49:40

where your honor was everything and

49:42

where you would do anything to defend it

49:44

and that is precisely the kind of

49:46

culture that leads to lots and lots and

49:48

lots of violence but it was a that whole

49:51

section of the book is is preparing us

49:54

for the notion for the seeming the

49:56

counter intuitive notion that what your

49:58

great-great great-great grandparents did

50:00

for a living could make a difference in

50:02

how you see the world

50:04

which is not an obvious it’s a difficult

50:05

point I think for many people to grasp

50:08

sure well you made a great case for the

50:12

10,000 hours of work it takes to become

50:14

exceptionally good and it’s something

50:17

and then also poor people are basically

50:20

a disadvantage but I’m wondering what

50:22

were you temps with the loss to society

50:23

we only have so many slots so for

50:26

instance if you have a better pathway

50:28

from the Czech team so the people were

50:31

fully distributed would they have a

50:32

better team yeah I think it stands to

50:36

reason that the Czechs so suppose the

50:39

Czechs have what the Canadians use the

50:40

Canadians inside Canadian suppose the

50:44

Canadians did had three parallel leagues

50:49

then their denominator of kids that

50:51

they’re choosing from I think if you

50:53

look at the distribution now you can

50:55

make a a reasonable inference that they

50:57

are the cap rate is 40 percent right if

51:01

we can raise the capitalization rate to

51:02

80 percent we have doubled the number

51:05

the available pool of kids that were

51:08

choosing from for the most elite level

51:09

so it doesn’t change the same number of

51:12

people are is only a limited number of

51:17

slots in the National Hockey League but

51:19

it stands to reason if the pool that

51:21

you’re pulling from is twice as big the

51:24

average level of talent should be higher

51:29

that you should in other words be able

51:31

to to raise the median level of talent

51:34

in the league if you’ve increased your

51:36

if you’ve increased your you pull your

51:41

fishing

51:45

I know I’m about to get like totally

51:47

smoked but go ahead you would expect

51:51

that the people that were born later in

51:53

the year on the Czech team of all these

51:54

seniors with possibly better than the

51:57

ones are born over yeah that’s yes

52:00

here’s how it starts to get really

52:01

really interesting you might so they

52:03

have overcome well there are several

52:04

things there remember though they may

52:07

simply be maturational anomalies that is

52:10

to say not all if you look at a group of

52:13

seven year-olds they don’t all mature at

52:17

the same rate it is mostly the case that

52:22

the kids born in January are going to be

52:23

bigger and stronger than the kids born

52:25

in December but some of the December

52:26

borns at the age of 10 or 11 are going

52:29

to be as mature as those born in January

52:31

I think what you’re seeing is that those

52:34

are the kids who end up making the in

52:36

each other just ones whose whose growth

52:38

curve was a little bit accelerated I

52:40

think that’s the I don’t know it’s a

52:43

very good question

52:43

you’ll be worth looking into but I did

52:45

look at the list of like the greatest

52:46

hockey players ever and you know they’re

52:49

almost all January February March – the

52:54

ability to cap rate the ability to take

52:57

advantage of like here talking about

52:58

being he’s that kid runners the million

53:01

that have their but their system is not

53:03

able to do anything with that

53:06

so yes the quality of the the ones who

53:10

make it through it’s a great

53:11

conversation that’s happening here

53:13

aggressive Microsoft around innovation

53:14

and part where the ideas is you know how

53:17

do we dig in and find innovation where

53:19

it is it’s it’s not always just coming

53:21

out of MSR there might be we’re bad it

53:24

finding ideas great innovation at other

53:27

parts of the company somebody that’s in

53:29

operations or support that’s a great

53:31

idea but if there’s not the mechanisms

53:33

to pull that out and do something with

53:35

that and so we’re there’s this downward

53:37

pressure on the stupidity factor

53:41

not allowing us to find those ideas yeah

53:44

as well as the upward push yeah sure

53:47

those yes well this is a good point so

53:50

to go back to your point as well so one

53:53

way imagine you know it as a thought

53:56

experiment let’s just use hockey for

53:58

example suppose we wanted to increase

53:59

the cap rate in hockey in the in Canada

54:04

one way to do it is to talk about what

54:06

I’m talking about which is not to

54:07

increase the number of slots in the

54:08

National Hockey League but simply to

54:10

increase the number of developmental

54:12

leaks to have this kind of but another

54:15

way is to is to increase the slots

54:16

suppose as a thought experiment we

54:18

double the size of the National Hockey

54:21

League and we say we’re not going to

54:23

have 30 teams right would that be would

54:27

the would the expansion of that end have

54:30

the effect of forcing a higher if

54:33

greater efficiency in the capitalization

54:34

of hockey teams in of hockey in the

54:39

developmental leagues in other words can

54:41

we are there two ways to do this can you

54:42

do this bottom-up or can you do this

54:44

top-down the only I would be curious I’m

54:48

curious about the top-down version

54:50

because we have a version of it in this

54:52

country right now right where you have

54:55

companies like Microsoft which whole

54:59

tier of high technology companies which

55:01

are in perpetual have a perpetual

55:03

shortage of very very talented people

55:05

right they’re always complaining we

55:06

can’t we can’t find enough people who to

55:08

fill these kinds of slots we got to go

55:10

overseas without always kind of and so

55:13

in this case it has not had the this

55:17

this perpetual shortage of very talented

55:19

people has not really had the effect I

55:21

think of dramatically raising our

55:23

capitalization rates when it comes to

55:25

math and science in fact over the course

55:27

of the last 25 or 30 years the relative

55:29

performance of the United States in math

55:31

and science seems to if I if I have my

55:33

numbers correctly seems to have if

55:35

anything eroded so that suggests that

55:38

maybe top down that’s up that that

55:42

supply side up or demand side approaches

55:45

how does get the mixed up one of them

55:47

you know I’m talking about increase the

55:48

number of slots at the top may not be

55:50

the best way to do it I mean but it’s

55:53

open to it’s it’s worth

55:55

you know thinking about all these

55:56

various common scenarios sure math

56:02

programs and all this that a lot of that

56:04

efforts gonna be wasted because to

56:05

societal underpinnings are yeah yeah you

56:10

need to have a kind of I mean there has

56:12

to be like to go back to the the the

56:15

Kenyan runners for example so they do

56:17

have there’s an awful lot of it’s

56:20

actually incredibly wasteful to have a

56:22

ninety percent capitalization rate for

56:23

distance running you don’t actually want

56:25

a million of your twelve year olds

56:28

running ten miles a day because you only

56:31

have four spots on the Olympic team or

56:33

whatever three spots and metric team you

56:35

want them to be doing something that has

56:36

some kind of ultimate payoff so

56:37

especially that’s actually not a it’s

56:39

not a model we want to emulate probably

56:40

a good thing that we have a one-percent

56:41

capitalization rate but we just

56:43

shouldn’t whine about our performance in

56:45

upon this is running but as a result but

56:47

um but there are a whole series of like

56:52

here’s that this is a totally wacky idea

56:54

that I’ve been talking about with some

56:56

people which is I suppose you rewarded

57:03

in suppose you set up a system that

57:05

allowed individuals or groups or

57:07

nonprofits to profit from raising cap

57:11

rates so I go into suppose like go into

57:14

the sector to South Central LA and I

57:17

have a class of us a first grade class

57:20

right now I know actually speaking

57:23

looking at the those kids in their

57:24

socio-economic background that the

57:26

amount of federal tax those kids will

57:28

pay like actually twenty thirty years

57:33

hence is probably close to zero right

57:35

you have to join you to really be a

57:37

member of the middle class to to pay

57:39

taxes these days and the the number of

57:42

kids in a the worst part of South

57:45

Central who end up in the middle class

57:46

is very very small so suppose I said to

57:48

so the cap rate if we define

57:50

capitalization as joining the middle

57:52

class and paying federal taxes the

57:54

capitalization rate in a bad

57:57

neighborhood in South Central is pretty

58:00

much a zero okay so what if we said to

58:03

anyone that if you can raise the

58:07

capitalization rate in

58:08

that group I’ll give you a cut of their

58:11

federal taxes so what if you said just

58:13

like you it’s like a you could you could

58:15

venture capital groups of kids right now

58:19

obviously this is a as a kind of as a

58:21

kind of thought experiment so we know

58:23

we’re getting so why do you because

58:25

we’re getting zero federal tax dollars

58:26

now what would be so wrong to say if you

58:29

Joe Smith want to invest in this class

58:32

of kids for the next 25 years I’ll give

58:35

you a fifty percent of the tax revenue

58:36

in perpetuity and if you so in other

58:38

ways if you can get you know three

58:40

computer programmers and two doctors out

58:42

of this class of thirty kids you’re

58:43

gonna be a very very rich man and by the

58:45

way society will be way better and the

58:47

kids will be happier because they will

58:48

have what they don’t have now which is

58:50

someone who is actively interested in

58:53

and capable of of increasing their

58:57

capitalization right of getting the rate

58:58

from zero to whatever it is ten fifteen

59:00

twenty thirty five percent I seen I have

59:03

no I dissolve people you know when you

59:05

tell other people late very often people

59:07

think oh that it’s just sound so blue

59:09

you know what it’s whatever problems are

59:11

oh that idea it’s a lot better than what

59:13

we have now which is no one caring for

59:15

the kids right but the point is that

59:17

capitalization strategies change the

59:22

discussion they move us away from this I

59:25

am so sick of this relentless absurd

59:29

exhausting focus on ability which is

59:33

just beside the point and and they moves

59:37

away from that and move us towards on

59:39

this focus on the exploitation of the

59:43

ability that’s already there and that’s

59:45

just a far more rational place to start

59:47

if we had if we did everything in our

59:50

power to exploit ability and we still

59:53

saw differences in outcomes then we can

59:55

talk talent right if we had if in

59:57

America we had twenty five million high

60:01

school kids running twelve miles a day

60:03

and we still were getting you know

60:05

smoked at the Olympics in the ten

60:06

thousand meters

60:07

I will entertain every genetic argument

60:09

you want about difference in us in East

60:11

Africans but until we do that it’s a

60:13

pointless argument right that’s what I

60:15

so that’s why I think we need to be much

60:17

more inventive in our in our thinking

60:19

about capitalization

60:21

what if that runners playing soccer

60:23

hockey lacrosse football baseball

60:26

basketball right like we spread our many

60:30

more sports then indeed yes yeah yes was

60:35

my point that it’s apples and that

60:37

because of those very very differences

60:38

great differences in the way in which

60:39

talent athletic talent is capitalized in

60:41

these two cultures you can’t draw any

60:44

conclusions about innate ability comment

60:56

that he’s gonna have to leave the

60:57

building cuz he has to go do a talk at

60:59

the Gates Foundation where I think he’s

61:00

gonna be convincing them to make that

61:02

investment in those kids so I know

61:11

everybody you know what’s the book and I

61:13

did have a Malkin those pre signed tons

61:15

of copies the books so my question to

61:17

you is we can have Malcolm answer

61:18

questions for all of us for the next 15

61:20

minutes and then get in the car and get

61:22

over the bridge or he can sign and

61:24

personalize books for a very few of you

61:28

so I’m thinking we’re moving toward the

61:30

questions yeah

61:46

this is a disproportionate amount of

61:47

sprinkles do you think that fall to do

61:52

the same thing even though they have a

61:53

small people were available yeah well

61:56

has some as you know I’m half Jamaican

61:58

so I’m powerfully disposed to answer

62:00

this question in the way that reflects

62:02

most flatteringly on Jamaica from

62:06

Jamaica is it’s a beautiful example of

62:09

this right so in this long-running

62:13

debate about nurture versus nature in

62:16

running in sprinting especially you know

62:19

that the quote unquote gene pool of

62:21

Jamaica isn’t any different than any

62:24

number of other countries around the

62:25

world and yet Jamaica utterly dominates

62:27

sprinting this is a clear case where cap

62:30

rates for sprinting in Jamaica are must

62:33

be very very close to 90% and I I have

62:38

no real evidence for this other than

62:39

anecdotally I was just in Jamaica for

62:40

Christmas who’s me my cousins and I am a

62:43

runner so I go was I would go running

62:44

around you know in the little Hills

62:45

around my aunts house and it was this

62:49

hilarious things never have to be

62:50

anywhere else that the sight of someone

62:53

running in Jamaica is just ignite some

62:56

kind of thing in all passers-by so here

62:59

I am you know running along down the

63:01

road and like people like slow down wave

63:03

and think some guy will be trudging

63:05

along back from work and he would say he

63:07

would like you go run run run oh ok run

63:10

after me

63:10

I like run with me for like it was just

63:13

like this and I realize like this is

63:15

it’s an obsession right it’s a complete

63:17

obsession and there is so much status

63:20

associated with the act of running that

63:22

if you have any you know even remote

63:24

ability in this area you exploit it

63:26

right and you know Usain Bolt at this

63:28

point is if he is a you know not since

63:32

Bob Marley has has there been someone

63:34

who has ignited this degree of so I

63:36

think it’s a beautiful illustration of

63:38

of what I’m talking about

63:42

this is all based on pepper society

63:45

values

63:47

yes how long it would take a societal

63:50

value change to impact the

63:52

capitalization of the other folks

63:54

artists and we’re going to enter a new

63:56

phase of political life here I think a

63:58

lot of us are hoping this new value yeah

64:02

yeah yeah so I I’m a real optimist in I

64:08

believe these kinds of shifts can happen

64:09

really quickly and let’s let’s stick

64:10

with sports Ramona because Sports is a

64:12

just a an elegant way of if you think

64:16

about what happened after title 9 is a

64:19

timeline so I was just with I saw a

64:22

friend of mine the day who has 12 year

64:27

old daughter so she’s 40-something and

64:29

she was talking about the difference

64:31

that is between her upbringing and her

64:34

daughters and my friend is a he’s an

64:37

athletic person in the sense that she’s

64:39

you know has no there’s no but she did

64:42

not play any sports at all as a kid so

64:46

she grew up in an upper middle-class

64:47

family in Providence Rhode Island not

64:50

some you know sticky play like you know

64:52

eastern seaboard it never even occurred

64:54

to her to do sports none and in her

64:56

daughter’s life sports is everything I

64:59

mean not everything they they do the

65:00

same amount of schoolwork she did but

65:01

they play so many organized sports she

65:04

can’t keep track of it that is a

65:06

capitalization or capitalization rate

65:08

for women and soccer or basketball 20

65:12

only 25 or 30 years ago was what 5

65:15

percent 2 percent 3 percent today it’s

65:18

50 60 70 percent that’s one generation

65:21

it’s an incredible shift in what we

65:23

think of in our kind of priorities in

65:25

that particular area that makes me

65:27

profoundly optimistic about our ability

65:29

to shift our capitalization the the

65:35

focus of our interest in other more

65:36

consequential areas because let’s face

65:38

it that’s not a very consequential area

65:39

but if we can do it with you know with

65:42

soccer I feel like we can do it with all

65:43

kinds of other things

66:07

the culture

66:17

mistake slavery for example is for the

66:20

longest impact of slavery and what are

66:23

you talking about outliers that

66:26

community black

66:30

in fact with me

66:32

how long yeah so the question was about

66:36

on the opposite side thinking about how

66:39

things like the legacy of slavery have

66:40

impacted opportunity and so I in the

66:45

last chapter of my book is a personal

66:47

chapter and it’s about my it’s the story

66:49

of my mother’s family and it attempts to

66:52

answer this very question so my mother

66:55

is a brown skinned Jamaican and one of

66:58

the points and I she has had this what

67:01

what I what anyone would consider a

67:04

successful life she grew up in a little

67:05

tiny cottage in the middle of the Hills

67:07

of Jamaica and ended up a upper-middle

67:10

class professional in Canada right and I

67:12

tried to tell her story using the ideas

67:14

of the book and focus not on her own

67:16

pluck and intelligence but on the what

67:19

are the kinds of opportunities that

67:20

allowed her to do that and one of the

67:22

things that I got into was the

67:24

peculiarities of being a brown skinned

67:28

Jamaican and I traced my mother’s family

67:31

history back to in the 1700s as a

67:37

plantation owner from Ireland comes to

67:39

Jamaica and takes as his concubine

67:41

basically I’m sure just bought and raped

67:43

an African slave and that’s the

67:46

beginning of my that their son a guy

67:48

named John Ford was the the beginning of

67:51

my mother’s line right so in Jamaica the

67:55

offspring the mulatto offspring of a

67:57

mixed-race Union in the 1700s was not

68:01

put back into slavery the way that that

68:04

child would have been in the in the

68:07

American South on the contrary the Brits

68:09

did this very very different thing which

68:10

was if you were mixed race you got

68:12

welcomed into the ruling class so John

68:15

Ford one generation removed from a slave

68:17

ship was a preacher he was a literate

68:20

educated man who was a free was a free

68:23

man in 1790 whatever it was and whose

68:25

kids were free and on and on and if you

68:27

traced my mother’s family history down

68:29

along with the history of all these

68:31

other parallel brown skinned Jamaicans

68:34

you see a legacy of privilege that goes

68:36

back generations upon generations upon

68:38

generations you see people who are

68:40

members of the entrepreneurial and

68:42

commercial and professional classes

68:43

going back to the earliest earliest

68:46

days of the 19th century right now that

68:48

has given them a status and a set of

68:52

opportunities that are denied to people

68:54

who who were pushed back into slavery

68:57

their equivalents in America who weren’t

68:59

plucked out in 1790 and allowed to get

69:02

an education but were pushed back in and

69:04

enslaved for another three generations

69:05

there is a world of difference between

69:07

starting from where my mother started

69:10

from and starting from where she would

69:12

have started from if her ancestors have

69:14

been in Georgia or Alabama you know

69:17

interestingly as well along those same

69:19

lines skip gates the professor of

69:22

african-american studies at Harvard did

69:23

this really fascinating set of

69:25

genealogical studies of prominent and

69:28

successful African Americans and

69:29

discovered that almost without fail if

69:33

you look back several generations into

69:36

the families of these success stories

69:38

what you find is either someone who was

69:41

who was a freed slave so freed before

69:44

emancipation or a freed slave who

69:48

managed in the first generation after

69:49

emancipation to own land in other words

69:52

you see the same thing that success in

69:55

the present day is a function of an

69:57

opportunity that was created two three

69:59

four or five generations previously

70:01

right and that is that when we’re

70:03

talking about this flipside it reminds

70:05

us that of how the shadow of slavery

70:10

those who were denied that kind of of

70:13

get-out-of-jail-free card on that my mom

70:16

got or that you know these other people

70:18

that skip gates looked at card to be

70:20

denied for your ancestor to be denied

70:22

that get out of jail free card matters

70:24

even today so now you asked about Obama

70:27

what is the success of Obama tell us

70:30

about the continuing significance of

70:32

that legacy nothing right nothing listen

70:36

I mean I love him as much as anyone I

70:38

could not be more thrilled about what’s

70:40

gonna happen on Tuesday right I mean a

70:42

relief of cataclysmic I might even

70:44

become an American citizen now but

70:48

but let’s be let’s be clear his victory

70:53

does not mean that this issue is over

70:55

right it it you know and if that is how

70:58

we interpret it then yeah well that’s

71:33

the you know I wish I could give you a

71:36

kind of complete and satisfying answer

71:39

to that and I don’t know I mean in my

71:42

book I talked a little bit about just on

71:44

this narrow question of how can you

71:46

teach math to inner-city kids

71:48

and can you can you get an inner-city

71:52

kid to think like an Asian when it comes

71:55

to math and the answer is we think the

71:56

answer is yes we’ve seen extraordinary

71:58

results with with teaching math by

72:02

changing attitudes about work and that

72:05

makes me think that we have all kinds of

72:07

opportunities in other areas but what

72:08

that effort looks like I don’t know it’s

72:11

sort of it’s the kind of thing that I

72:13

hope others will I’m sure others already

72:15

pursuing but that I think we need to

72:17

know more about as a as a society I will

72:29

have I have many many ideas one um one

72:32

I’ll give you a little preview of my

72:33

next New Yorker article which is uh

72:35

whether it’s to in works one is an

72:37

attack on to kill a mockingbird because

72:42

it turns out if you read no one has read

72:45

this book since you were like 12 years

72:46

old right so what do you know when

72:50

you’re 12

72:50

nothing reread it so I’ll tell you and

72:54

you discovered Atticus Finch monster

72:57

and they’re coming soon and another the

73:02

other one which is will be even more

73:03

near and dear to your hearts and I can’t

73:05

give you details but I’ll give you the

73:06

outline and by the way this is such a

73:09

cool story I have never won this cool a

73:11

long time I met this guy from your world

73:16

software entrepreneur whatever and you

73:21

know the type he’s like came from Mumbai

73:23

went to Caltech or MIT you know three

73:26

dollars in his pocket makes a name for

73:29

himself in Silicon Valley here’s a

73:31

daughter and his daughter wants to play

73:35

she’s 12 years old she wants to play

73:36

basketball right now he isn’t doing

73:38

about basketball he’s a software

73:40

programmer from Mumbai but he decides I

73:42

want to coach my daughter’s basketball

73:43

team so he goes to a basketball game and

73:46

he observes it right as an outsider

73:48

would right we’re talking about

73:49

outsiders he’s an outsider you know he

73:52

observes it and he comes away shaking

73:53

his head thinking why do they play this

73:55

game in such a mindless fashion and so

73:58

he decides to to teach his daughter and

74:02

her teammates to play the game his way

74:04

right and what happens now keep in mind

74:07

this team is a team of girls taken

74:10

they’re all from like Mountain View and

74:12

their fathers are all people like this

74:14

guy they’re the children of software

74:16

programmers they are not big huge

74:17

hulking mesomorphs with bulging muscles

74:20

they’re like little skinny girls with

74:22

pigtails right what happens they almost

74:24

win the state championship they don’t

74:27

win the state Senate because they

74:28

actually they get cheated in this

74:29

outrageous way which is one of the great

74:31

parts the story but the whole point of

74:33

this it’s just so on every level genius

74:36

it all has to do with what happens when

74:39

a really really smart guy from Mumbai

74:42

des sized to coach basketball and the

74:45

answer is nothing that you’ve ever seen

74:47

on a basketball court before now only

74:50

through his last little factoid which is

74:54

during the games when he’s doing this

74:56

thing that he does and is these little

74:58

girls with big tail but only they’re not

75:00

good basketball players PS they’re not

75:03

gonna go and play like division one cut

75:05

they’re like little skinny girls who

75:07

spend who are gonna they’re all gonna

75:08

take physics at Caltech they don’t even

75:10

in

75:11

faster than sports that much but they’re

75:13

like under the tutelage of this masked

75:15

genius mad genius during the games as

75:18

they’re coaching the other the opposing

75:20

coaches who are the ones steeped in the

75:23

older paradigm of basketball get so

75:27

enraged by what’s happening that they

75:30

start by like you know just kind of

75:32

sitting there and it’s done silence then

75:34

they start screaming at their own girl

75:36

these 12 people screaming at their own

75:38

players as if it’s their fault right and

75:40

then like invariably they challenge this

75:44

guy to a fight in the parking lot after

75:45

the game anyway so look for that one –

75:51

thank you all

English (auto-generated)

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