We’ve been hearing a lot about the colorful con artist George Santos, who was recently elected to the U.S. Congress. One news story asks:
Why, people keep asking, did it take so long for his lies to be revealed? Why did no one think to poke deeper? Why did the people who did know something fishy was going on not speak up?
In part because he just looked so darn convincing.
This reminds me of some examples from incompetence or fraud in business or science where the evidence was sitting in plain sight but where the perpetrators remained able, Wiley E. Coyote-style, to remain suspended in the air for years:
Theranos: They faked a test in 2006, causing one of its chief executives to leave—but it wasn’t until nearly ten years later that this all caught up to them
Wansink: The main discoveries of misconduct occurred in 2016 and 2017, but the Cornell Food and Brand Lab had a track record of scientific misconduct dating back at least to 2012. Didn’t stop NPR and the Nudgelords from treating him like a hero.
Musk: We were mocking that L.A. tunnel plan back in 2018, and I’m not even particularly up on these things. But only recently has this all seemed to catch up with the auto investor.
Ariely: Apparently the problems with his work were well known, years before shreddergate came out.
But, yeah, all these people dressed the part.
And here’s another one, where the ethical problems of a biology professor were first flagged in 2010, this dude continued doing suspicious things for over a decade, and only last year did it come out. The dean of his college did a bit to quash dissent, and the story also featured legal threats from Herbalife. And, yeah, it seems that they’re still around too.
Sean offered a relevant comment on all this:
The two fundamental governing principles are 1) that its much easier to establish that a business, a person, or an argument waves red flags than to communicate that to and convince the public, and 2) that there is much more money and fame in bunking than debunking, and a heavy cost to debunking (because the hucker or hucksters and many of their victims are motivated to push back). The wise (or at least *homines economici*) see that, investigate claims which seem to be too good to be true, quietly warn friends about what they find, and move on.
I have been thinking about this stuff more and more lately. Also in relation to things going on in society at large or politics or things like that.
In the case of incompetence or fraud in science I have thought about this a bit and could think of three possible ways in which producing bad science by bad scientists might be facilitated and/or encouraged:
1) the role of money, power, and status (e.g. universities might care more about the grants scientists get than their competence and/or integrity)
2) a closed environment of insiders (e.g. the colleagues who should be critical might actually be accomplices. Or they might have their own version of incompetent or fraudulent science they produce)
3) difficulty in determining who or what is right or wrong or good or bad (e.g. certain, or perhaps many, things in science are difficult to judge for outsiders, or staff members, or junior scientists. This is why someone who looks and acts convincing might wreak havoc)
Re: 2 – this is definitely a big part of it. To keep it vague, there’s an area I have done some work in, where, over time, I have come to believe we were/are all mostly just mining noise. I am out of academia, I don’t really need my pubs anymore. But I don’t want to write the takedown I could write, because I probably should retract my own work if I did that, and I don’t want to do that. And the people who DO still need their pubs clearly aren’t going to do it. Granted, I’ve seen some recent work in this area that is more methodologically sound, which is good. But most of what is out there is pretty bad, and… here we are.
Quote from above: “I am out of academia, I don’t really need my pubs anymore. But I don’t want to write the takedown I could write, because I probably should retract my own work if I did that, and I don’t want to do that.”
I am out of academia as well, though as was never really in academia.
I went on a walk earlier today and thought about a possible critical paper I could attempt to write, but I seem to not be able to stomach reading certain papers anymore which I would have to do to write the paper.
So be it.
Perhaps it’s better this way.
Nah, it’d be great for someone to fund people to push back against it all. But you’d have to worry about that organization being captured to push climate denial or that Tobacco is good for you or whatever else. It’d take some really serious commitment to truth. Hard to find that.
NIH funded the spinal cord injury replication project then it looks like a fund called Arnold Ventures funded the cancer reproducibility project. Both showed only 10-25% of what gets published could be replicated. And that is the easy part of science, the hard part is interpreting the results. No one cares. The same people keep getting paid to do the same things. It won’t stop until people stop paying for it.
Quote from above: “Nah, it’d be great for someone to fund people to push back against it all.”
I don’t need money to write the paper. I think I am commited to attempting to find the truth as well. It’s just that I really really don’t like reading about certain stuff anymore and/or I really really don’t like reading stuff by certain people anymore. I would have to do that to begin to write the paper and see if something can be made from the ideas in my head concerning this all.
Also, it’s not easy being critical sometimes. Especially when it feels like you are the only one critical of something. It might feel like you are the one who’s mistaken or even crazy, and others see things correctly. Even though it might be the other way around. I can also largely solve this possible problem I think, but that requires me to read even more to check and double check things. However, I don’t want to read certain stuff anymore.
I find it hard to decide when enough is enough as well. I have written a few critical essays which were based on stuff I read several years ago while I was still following matters more closely, and could handle reading certain things better. Those essays feel to me to be sort of the maximum I could make out of a lot of the things I read and thought over the years and were somehow still in my mind. Maybe that’s a sign that enough is enough and that I did the best I could. It feels like that sometimes at least.
I have a piece of paper above my desk with some quotes printed on it. One of them reads: “The sage acts by doing nothing”. Another one reads: “The way is ever without action, yet nothing is left undone”. I read those quotes a lot when thinking about whether I should write or do something or not. Perhaps one can do too much. Perhaps doing something halfway, gives someone else the opportunity to finish it. Perhaps that someone might do it better or at a more appropriate time than I would have done.
Anonymous, you might not need the money, but it sounds like you need the motivation. This is a familiar feeling. But a person/organization willing to pay you to address this science problem would be not just money, but also intrinsic motivation: “someone wants to know the truth here, wants it enough to pay for it, and has a timeline for when they want it” etc.
Quote from above: “Anonymous, you might not need the money, but it sounds like you need the motivation.”
I don’t think that’s it. I have plenty motivation to attempt to do something useful. The biggest issue I have is that I simply can’t stomach to read certain stuff by certain people anymore at this point in time. And I would have to do that to begin to write stuff.
I see that as a sign that I may have done all I could and/or should do.
I think it’s pretty simple really, but I am bored or my mind thinks about stuff or I want to do someting useful or I wonder if perhaps maybe I should try and write something more, etc., which might make things complicated.
I have tried to solve this issue recently by writing some song-lyrics, but it’s pretty hard to get some feedback on those or get some musician to take a look at them to see whether they can make a great song out of it. With a paper I could post it somewhere and that sort of completes things in my mind. With lyrics, I have no way to complete things in a similar fashion, which doesn’t feel optimal for my mind in some way.
So be it.
Perhaps it’s better this way.
Dan Davies also noticed that major fraudsters have usually been caught committing fraud before. Sarah Emily Howe who arguably invented the Ponzi scheme tried it three times (that we know of, she often used false names and front people). Davies’ theory is that modern economies require a habit of trusting certain kinds of people, so once con artists learn to look like one of those types, they have power. His book on the subject is kind of journalistic and associative but its a quick read.
It is interesting these early ponzi schemes all collapse after a year or two, but Madoff was able to keep his running for decades. You’d think it would be more difficult due to more regulations, but maybe he was just that much better at it.
Madoff’s genius seems to have been (1) acting as an anti-salesman, reluctant to bring in new investors, and (2) providing decent (too consistent to be real) but not outrageous returns.
#2 seems too obvious at first. But I can see it being a rare combination to have enough self control and willingness to run the scam.
Don’t forget Binance. It was operating as an illegal securities exchange for many years, but it only caught up with them in the last week or so!
What is the fraud there? Someone could, say, operate a food truck without a license with happy customers who don’t care. Maybe they even prefer it because its cheaper than the licensed truck down the street. It may be illegal but its not fraud.
Actually, the funniest thing I’ve seen in crypto is people openly running and participating in ponzi schemes. They all just like the game of trying to get out near the top. Is it still fraud if everyone knows it is a ponzi?
Anoneuoid: another thing Dan Davies noticed is that the crooks making money from one fraud are often paying out into someone else’s fraud. In some cases, its the same type of fraud (eg. “pay me to introduce you to people with a secret investment opportunity”)! This is something that glamorous pop-culture depictions of fraudsters leave out.
I saw a presentation about spam at defcon years ago that claimed the same. It was essentially that spammers make money by selling their data and tools to the next generation of spammers. The spam itself is rarely profitable.
In the Santos case, a local paper on Long Island had discovered and published many of the questionable actions and claims of Santos *before* the election. Its coverage, however, generated no ‘traction’, either in the media or with the public. It was when the New York Times investigated him, after the election, that everyone sat up and took notice.
Part of the lesson here is the decline of the influence and resources of local traditional media relative to other media and national traditional media. This might not be generalizable to the corporate and scientific instances.
Gregory:
This reminds me of my post from a few years ago, When does research have active opposition?, where I argued that some of these long-lasting errors or frauds were able to persist for so long in plain sight was that they had no active opposition.
That, and chutzpah, of course.
Yes, it does seem curious that *Democrats* didn’t harp on the Santos findings– they’re the obvious active opposition. Or at least they didn’t harp enough to interest the voting public or the media in general. Perhaps they were overconfident?
As a native Long Islander, I can also completely concur in your latter assessment– there’s plenty of chutzpah to go around on the Island!
I really think Santos didn’t mean to win. He meant to extract maximum donations, lose quietly, and then live off the campaign cash for as long as possible. Winning brought the kind of attention that he couldn’t sustain with bad results (though, I note, he’s still the sitting Congressperson, so so far so good?)
Kind of like The Producers– the musical’s success exposed the financial shenanigans. A flop would have been very personally profitable to Bialystock & Bloom!
“looked so darn convincing” – what? Grandmother a Holocaust victim, mother died in 9/11, managed employees who died in the pulse night club shooting, and saved 2500 cats and dogs through a charity? For God’s sake, it is so wildly improbable that these facts and events would all involve the same person. His story was like if you asked a small child to write a fictional story about their idea of the most appealing hero, and then play act as that hero in front of their peers. The desire for esteem and envy of those who have it drives much fraudulent activity like this IMO, far more than greed.
Anon:
Click through and take a look at the linked article. When they say he “looked” so darn convincing, they’re literally talking about his look: what he looked like, more specifically how he dressed.
Whaddya mean by things have caught up with Musk?
https://www.bbc.com/news/business-65781534
I read that “caught up” sentence as referring to The Boring Company. Boring is not a roaring success but it appears to still be operational. See https://gizmodo.com/boring-company-approved-las-vegas-tunnel-65-network-1850403119.
Of course, if you average over Musk’s ‘portfolio’ (Boring, SpaceX/Starlink, Tesla, Zip2) he’s incredibly successful. Tesla is, perhaps irrationally, the most valuable auto company in the world and SpaceX appears to have about a 50% share of the launch market. Tesla, SpaceX, and Starlink have had major impacts on their industries—lowering costs and expanding markets.
So, by the standards of the Musk portfolio, The Boring Company is dull but it is still alive.
Bob76
+1
Its very odd to put Musk in any list with Santos and Wasnick, the guy is the primary force in reigniting US success in space (SpaceX), and jump starting the current clean tech revolution with EVs (Tesla, Solar City).
Can’t help but think the recent demotion of Musk in Left-leaning circles has more to do with his outspokenness against censorship than any hard facts.
Eklavya:
I don’t know anything about the recent demotion of Musk. His L.A. tunnel plan was clearly ridiculous back in 2018. It’s an example of a silly idea that was in plain sight for years but it took awhile for much of the press to catch on. I’m not trying to evaluate all of Musk’s career, any more than I’m trying to evaluate everything that Santos or Wansink did; they just have this one thing in common, which is that the ridiculousness of their claims was out in the open for awhile before everyone twigged to them.
Eklavya –
> Can’t help but think the recent demotion of Musk in Left-leaning circles has more to do with his outspokenness against censorship than any hard facts.
I think it might be more accurate to describe it as having to do with his bloviation about censorship rather than his outspokenness against censorship.
His rhetoric on censorship is highly selective and ideologically focused, his “free speech absolutism” giddyup clearly has some hitches (i.e., https://theintercept.com/2023/03/28/twitter-modi-india-punjab-amritpal-singh/), and it’s connected to a larger ideological orientation.
Ron Chernow writes:
“In 1875, Henry E. Wrigley, the head of the Pennsylvania Geological Survey, issued a doomsday warning that the state – and hence the world – production of oil had peaked and would soon experience precipitous decline” (“Titan: The Life of John D. Rockefeller Sr.”, p197, intro to chapter 12)
Amazingly, after 150 years of failed doom (“precipitous decline”) prognostications, “experts” and “scientists” continue to flog the public relentlessly with claims of future doom. I agree with Andrew, there is no opposition to the relentless effort of scientists to promote future doom with the most frivolous claims. But its worse than that. Within the scientific and political communities, not only is there no opposition, there is very strong demand for doom fakes – just as there is, apparently, a strong demand for p-value junk science.
What claims of future doom? I guess you mean the climate change thing. That isn’t doom, it is like minor fluctuations. Doom would be predicting entire states being wiped out by floods like this: https://en.wikipedia.org/wiki/Missoula_floods
I mean, the Sahara was grasslands 5k years ago. Climate change on that scale is bound to happen again, and humanity should prepare for it as best we can.
You’ve never heard of the “Population Bomb”? Seriously? We were all supposed to starve by 1980.
Peak oil? (three or four different iterations?) Y2K? Genetic engineering? There was briefly a claim of the exhaustion of phosphorous for fertilizer during the last peak oil freak out and there have been relentless other claims of “resource exhaustion” doom. There was also a big freakout about nitrogen for fertilizer when the original sources of guano in the south pacific were tapped out. And of course Sagan’s “nuclear winter,” which even Sagan later admitted was highly unlikely.
In all of these cases humanity survived by making incremental changes to actual problems, not by trying to predict problems that might occur 100 years in the future.
If you’re not familiar with the population bomb you should familiarize yourself with it. It’s been a key concept behind the environmental movement since the outset.
I was reading Edward O. Thorp’s autobiography A Man For All Markets, and it’s much like that. Thorp is always boasting about how he (sometimes, his wife) is detecting frauds and warning his (often very rich) friends off from them, demonstrating his high personal ethics and critical acumen.
For example, he boasts that he looked into Madoff in 1991 or something like that at the request of an investor in it, and deduced that Madoff must have been running a massive multi-decade Ponzi scheme, because the investor had given him Madoff receipts of the exotic trades supposedly being done, but the public records showed that so few of these trades were done that on some of the days Madoff was supposedly doing them, this investor’s individual share was larger than the actual total number executed – a smoking gun proof that Madoff was fabricating extensively and could only have been a Ponzi. Thorp especially notes that this was before the Madoff Ponzi scheme supposedly, officially, began, according to the Madoffs, and that most of the people involved clearly knew and got away with it.
As we all know, it would take another almost 2 decades for the Madoff Ponzi to finally collapse with >$60b in losses – that is, almost all of the losses occurred after Thorp says he found a smoking-gun proving Madoff was a complete fraud. So, was Thorp’s whistleblowing to the SEC crushed by insiders bribed with payoffs or something equally sordid? Oh, no. Thorp just didn’t tell anyone but his friends. So his investor-friend withdrew his investment (including, of course, his net-winnings), and here we are.
Say what you will about Thorp, but the autobiography certainly leaves little doubt about his membership in the tribe of ‘homines economici’…
It’s interesting that he went to the trouble of verifying the trades. I guess he needed hard proof. But if an investment “opportunity” is in a secret club – i.e., not a common stock or bond traded openly on a public exchange – and produces outrageous returns, that should be enough on it’s own to indicate a scam. It’s funny that rich people are such easy marks for this crap, I guess because they’re so greedy they’ll believe anything.
He noted the same thing: the size and regularity of the returns *should* have proven that something was wrong, if not necessarily a Ponzi. Of course, high returns didn’t prove there was a fraud (Thorp having had high returns of his own in his then-recently-shuttered hedge fund, after all), but the regularity did (even Thorp’s hedge fund, with its mania for hedging, sometimes had big drops to ~0% annual return).
However, a lot of people didn’t appreciate the statistical facts of quasi-efficient markets like a hardnosed ex-chemist/physicist like Thorp did and thought that was possible (especially in earlier eras when markets were so much less efficient), or seem to have assumed that Madoff might be front-running or doing tax fraud or something other than a ponzi. Showing that the trades didn’t even exist in the first place was hard proof because it disproved most of those – aside from proving he was fabricating records (which was evidence for a Ponzi, rather than the other things), he can’t be frontrunning brokerage customers if he isn’t executing any trades which would front run, or doing tax fraud to evade capital gains tax (which eats up returns from trading like crazy) if he isn’t doing any trades at all, and definitely not magically beating the market without doing trades.
Plus, I think Thorp had time on his hands, what with his hedge fund having closed. Aside from poking into Madoff, he describes how he was doing a lot of wacky trades on his own account at that point (like setting up memberships in credit unions just in case decades later they converted to regular corporations & having an account meant you got preferences in the IPO, so every time he traveled somewhere his staff would look for places he could set up an account). So, maybe he went further than he really needed to in order to dissuade his friend. I’m no stranger to that sort of rabbit-holing myself.