Kennon-Green & Co. Fiduciary Financial Advisor, Wealth Management, Global Value Investing

Several of the mail bag questions I’ve been getting ask for specific examples of how to look at the world, including the news, through a rational mental model approach.  A perfect illustration fell into my lap today so I’m going to group these responses, write this post, and then reply to all of those who were looking for a walk-through of how the perception of someone who was approaching things rationally might differ from that of someone who based their response solely on unexamined reactions.

[mainbodyad]To amplify the impact, making it easier to see the way your brain can be influenced, I chose a case study that hits two powerful emotions on both sides: Guns in the United States, and another phenomenon that is often referred to as Privilege.

How Selective Media Coverage Influences Behavior and Perceptions

Earlier this week, a mother with two twin boys was working at home when a man began repeatedly ringing the doorbell.  She went to a crawlspace and grabbed a gun, hiding as her husband, on the other line, called 911.  When the home invader broke in and found them, she shot him five or six times, causing him to flee and giving the police enough time to show up.  She very likely saved her life and the lives of her two young sons.

The story got very little coverage.  It doesn’t sell papers or generate page views.  A quick write up by an ABC news source and that was it.

Yesterday morning, a high school student walked into class and shot two people.  A few key trigger words (“student” “school” “shooting”) are going to remind people of Sandy Hook and Columbine so this story, which is, on the national stage, a non-event, is now the front page headline on one of the world’s most popular landing pages for hundreds of millions of people to see.

Example of Mental Model In News

Example of Mental Model In News

This creates an entire cycle of mental models.  

  • Confirmation Bias Mental Model:  If you have a negative view of guns, this online bubble of personalized news stories and media coverage habits is going to cause your subconscious mind to go, “See!  That’s what I thought.” 
  • Spotlight Fallacy Mental Model:  The spotlight fallacy leads one to assume that all members of a given class (in this case, people who carry a gun) are like those who are most often profiled in the media or seen first hand in real life.
  • Mere Association Mental Model: If you live in an area without a lot of gun exposure, the constant reinforcement of certain terms and visual images (grieving parents, police sirens, murdered innocents) is going to eventually cause you to feel, on a deep subconscious level, those things when you hear or see objects or words that your brain has associated as being connected.  This works the opposite way, too.  Someone living in Wyoming sees a gun and likely thinks of protection for family, food from hunting, recreation with friends, etc. 
  • Action Bias: The human brain is wired to attempt to “do something” following negative feedback.  This has been known in behavioral finance for some time and often leads to investors selling assets when they should be holding, or acquiring more.  In the case of an issue like gun control, a high profile story can cause people to feel as if they have done something to prevent it from happening again, regardless of the effectiveness or overall desirability of their actions.  A perfect example is Vice President Joe Biden meeting with video game companies to discuss gun violence as a result of Sandy Hook shooting.
  • Deprival Super Reaction Tendency: To borrow this one from Charlie Munger, when mammals are deprived of things that they have come to see as a right, or they take for granted, the response is often extreme and irrational.  Attempting to limit any guns, for example, would likely trigger this response from the gun-right advocates.

This bizarre gun coverage is now captivating the public imagination despite the fact that murder rates have dropped like a stone over the past 30 years.  In 1980, the homicide rate peaked at 10.2 murders per 100,000 people.  Less than three months ago, the Department of Justice bragged about the fact that U.S. Homicide rate has fallen to the lowest rate in 40 years at 4.2 murders per 100,000, a decrease of nearly 60%.

The only difference is the ubiquity of media and the fact that this is “the story” now because people keep rewarding publishers who focus on it.  There were more per capita murders 40 years ago.  This idea that there is suddenly a murder epidemic is patently false.  There is a media coverage problem.

Based on the preliminary data for 2011, the Centers for Disease Control and Prevention estimates 2,437,163 people in the United States died last year.  Of those, 11,493 were murdered with a gun.  That is 0.47% of all deaths.  With a population base of 311,800,000 people, that is 0.0037% of the nation.

The Real Victims of Gun Violence in the United States

Of those 11,493 gun murders, a significant percentage (somewhere between 1/3 and 1/2) involved inner-city gang fights that disproportionately hurt poor, black, males.  In fact, the CDC found that 92 to 96 out of every 100 gang murders involved a gun.  What’s worse, these homicide victims are significantly younger than non-gang homicide victims.  It is basically black kids killing other black kids, but no one will talk about or acknowledge the issue except civil rights activist C.L. Bryant, former leader of the NAACP, who was so moved by the problem, he created a new film called, “Runaway Slave” that addresses the issue.

To paraphrase Bryant’s argument – and he’s got a very good point if you examine media coverage – no one in the United States seems to care when an innocent 6 year old black girl is killed by crossfire from gangs when sitting on the steps of her apartment building.  Yet, one rich teenager shoots another and suddenly you get three days of coverage on CNN.

It may be unpopular to admit it out loud around the cashmere sweater-wearing, latte-sipping, college-educated crowd of which I, myself, am a member, but the only reason guns are now being discussed is because affluent people were killed in the suburbs.  

To give you an idea of how disproportionate the pain of these crimes are in cold numbers, the U.S. Census Bureau Statistical Abstract shows that in 2008, the last year figures were available (the new report for 2011 should be published soon since it is triennial), African Americans make up 49% of murder victims despite being only 13% of the population.  Other than a few high profile shootings – Aurora, Columbine, and Sandy Hook – a vast majority of the nation’s gun violence hurts poor, young, black, males.  And, to our shame, nobody cares.  It will never lead the evening telecast.  It doesn’t sell newspapers.

[mainbodyad]By studying the data, whenever I hear someone complain about guns in the United States given how small the problem is as a percentage of deaths, all I think is, 1.) No, it’s really not given that murders are at the lowest level they have been in 40 years, and 2.) Even if it were, you only think it’s only a problem because your class – the comfortable folks living in the suburbs – are now being affected by the violence.

This entire gun debate is a media fiction.  It doesn’t exist.  Anyone who thinks there is even the smallest chance that the United States will ever enact comprehensive gun legislation, and it will be upheld by the courts for any extended period of time, is living in a fantasy world with no understanding of the broader cultural, social, and constitutional traditions of the nation.  The United States has more guns per capita than any other nation on the planet.  For every 100 people, there are nearly 89 guns.  In a ground invasion, you wouldn’t even require a military build up – the existing stockpiles are so large you can arm nearly every man, woman, and child instantly, creating an army of nearly 275 million people.  The nation was born after throwing off an oppressive government that trampled on individual rights.  To think that the very fabric that makes up that history could be changed is bordering on delusional.  There are too many self-reinforcing mental models at work.  I would wager a significant amount of money that should such action be attempted, you would see a civil war on scale with the 1860’s.  I don’t mean that hyperbolically.  I think you’d actually see a significant portion of the Midwest and South begin a violent succession movement.

I’m always baffled by some of my contemporary’s failure to grasp situational awareness, existing inside a privileged bubble.  You need to be cold and impartial when examining these things, not influenced by your own prejudices or values.  This entire debate is a waste of our time as a country.  There are more important things to be focusing on, such as the state of education (which correlates with violence), and the ability of lower and middle class families to earn a decent living.  We also need to address the state of mental health resources in this country.  Stories like the ones already mentioned are less about guns and more about society not knowing what to do with people who are born with faulty wiring.  A decent amount of the time, the perpetrators are not evil people who made a bad choice; they are mentally sick and were still out living among society with no safety net.