On a fine morning 100 summers ago in Sarajevo, an automobile driver ferrying the Austro-Hungarian Archduke Franz Ferdinand made a wrong turn off the main street into a narrow passageway and came to a stop directly in front of a teenaged activist member of the Serbian terrorist organization Black Hand. Gavrilo Princip drew his pistol and fired twice. The archduke and his wife fell dead. Within hours, World War I was well on its way to seeming inevitable (or at least necessary), all because of a wrong turn. And the idea that history is rational and sheds light on an intelligible story, much less a story of inevitable and inexorable advance, was also shot dead, as dead as the archduke himself.
Austria invaded Serbia in response to the assassination soon thereafter. Russia had guaranteed protection for the Serbs via treaty and duly responded. Germany, also by treaty, was committed to support Austria when Russia intervened. France was bound to Russia by treaty, causing Germany to invade neutral Belgium in order to reach Paris by the shortest possible route. Great Britain then entered the fray so as to support Belgium and, to a lesser extent, France. From there, the entire situation went completely to hell.
Alleged experts on both sides expected a quick outcome. “Over by Christmas” was the consensus view, even though the expected prevailing parties remained in dispute. Forecasters then were no better than today’s iteration, obviously. The “absolute neutrality” of the United States lasted until the spring of 1917 when Germany’s unrestricted submarine warfare policy caused too much damage to U.S. interests to be ignored.
By 1919, after the war’s end, 10 million had died in addition to the archduke and his wife even as the seeds of Nazism and the Second World War were sown. Western civilization, previously so full of optimism and fairly broad prosperity, had drawn itself into a very tight circle and begun blasting away from very close range for no very good reason.
The lead-up to World War I demonstrates the planning fallacy (outlined by Nobel laureate Daniel Kahneman in his terrific book, “Thinking, Fast and Slow”) writ large. In the same way that the narrative fallacy constructs stories to create a make-believe history of grand designs and chess-master-like wisdom (since winners tend to write the accepted accounts), the planning fallacy projects those same fanciful renderings forward with the idea that the future can somehow be managed—and perhaps controlled—despite the lack of any actual historical support for the notion.
As Adam Gopnik sagely points out in a recent edition of The New Yorker, “[w]hat history actually shows is that nothing works out as planned, and that everything has unintentional consequences.” Indeed, “the best argument for reading history is not that it will show us the right thing to do in one case or the other, but rather that it will show us why even doing the right thing rarely works out.”
The planning fallacy is related to optimism bias (think Lake Wobegon—where all the children are above average) and self-serving bias (where the good stuff is deemed to be my doing while the bad stuff is always someone else’s fault). We routinely overrate our own capacities and exaggerate our abilities to shape the future.
Thus the planning fallacy is our tendency to underestimate the time, costs and risks of future actions and at the same time to overestimate the benefits thereof. It’s at least partly why we underestimate the likelihood of bad results. It’s why we think it won’t take us as long to accomplish something as it does. It’s why projects tend to cost more than we expect. It’s why the results we achieve aren’t nearly as good as we expect and why they are so often disastrous.